Owens v. Lead Stories, LLC ( 2021 )

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE
CANDACE OWENS, in her individual )
capacity, and CANDACE OWENS, LLC, )
a Delaware limited liability company, )
)
Plaintiffs, )
) C.A. No. S20C-10–016 CAK
- against - )
)
LEAD STORIES, LLC, a Colorado )
limited liability company, and GANNETT )
SATELLITE INFORMATION )
NETWORK, LLC d/b/a USA TODAY, a )
Delaware limited liability company, )
)
Defendants. )
Submitted: June 11, 2021
Decided: July 20, 2021
Defendant Lead Stories, LLC’s Motion to Dismiss for Lack of Personal
Jurisdiction under Delaware Superior Court Civil Rule 12(b)(2)
Defendants’ Motions to Dismiss for Failure to State a Claim under Delaware
Superior Court Civil Rule 12(b)(6)
MEMORANDUM OPINION AND ORDER
Sean J. Bellew, Esquire, Bellew LLC, 2961 Centerville Road, Suite 302,
Wilmington, DE 19808, Attorney for Plaintiffs.
Todd V. McMurtry, Esquire and Jeffrey A. Standen, Esquire, Hemmer DeFrank
Wessels, PLLC, 250 Grandview Drive, Suite 500, Fort Mitchell, KY 41017,
Attorneys for Plaintiffs (Pro Hac Vice).
John P. Coale, Esquire, 2901 Fessenden Street, NW Washington, DC 20008,
Attorney for Plaintiffs (Pro Hac Vice).
Garvan McDaniel, Esquire, Hogan McDaniel, 1311 Delaware Avenue,
Wilmington, DE 19806, Attorney for Defendant Lead Stories, LLC.
Craig Weiner, Esquire and Reena Jain, Esquire, Akerman LLP, 1251 Avenue of
the Americas, 37th Floor, New York, NY 10020, Attorneys for Defendant Lead
Stories, LLC (Pro Hac Vice).
Steven T. Margolin, Esquire, Lisa Zwally Brown, Esquire and Samuel L. Moultrie,
Esquire; Greenberg Traurig, LLP, The Nemours Building, 1007 North Orange
Street, Suite 1200, Wilmington, DE 19801, Attorneys for Defendant Gannett
Satellite Information Network, LLC.
Michael J. Grygiel, Esquire and Cynthia Neidl, Esquire, Greenberg Traurig, LLP,
54 State Street, 6th Floor, Albany, NY 12207, Attorneys for Defendant Gannett
Satellite Information Network, LLC (Pro Hac Vice).
Michael Pusateri, Esquire, Greenberg Traurig, LLP, 2101 L Street, NW, Suite
1000, Washington, DC 20037, Attorney for Defendant Gannett Satellite
Information Network, LLC (Pro Hac Vice).
KARSNITZ, J.
INTRODUCTION
Today’s world of technological wizardry presents endless opportunities for
conflict and battle like Kilkenny cats. Social influencers can sway opinions of
millions of people controlling politics and money. Those with substantial control
over social media like Facebook struggle to control fact from fiction. The case
before me presents one battle in the social media wars. It also presents a real-life
struggle affecting reputations, the ability to earn substantial income, and the ability
to fact-check.
The political aspects of this case are manifest but must be ignored in favor of
application of the law. The law and courts in general are often slow to react to
changing times. By way of example, the jurisdictional principles I struggle with in
this Opinion were not originally designed for the digital world but are evolving and
adapting.
Elements of free speech also pervade this case. While many have argued that
those private actors who control aspects of the internet should have their control
limited, as the law currently exists, private actors are not constrained by First
Amendment constitutional principles. I leave to further debate the question of
whether these private actors should be otherwise restricted in their control of content.
One final preliminary note. I have no doubt the parties to this suit have
divergent views on many things. I also have no doubt they have acted in good faith
3
in their efforts to promote their views as shown by their conduct which forms the
factual basis for this lawsuit.
PERSONAL JURISDICTION OVER LEAD STORIES, LLC
Today I am asked to determine the constitutionally permissible reach of the
Delaware long-arm statute1 through cyberspace. This case stands at the intersection
of the traditional law of personal jurisdiction, particularly with respect to interstate
commerce in tangible goods and services, and the modern use of websites on the
Internet to publish, disseminate and sell information. As this Court has stated:
The pending motions [to dismiss] require this Court to probe questions
of personal jurisdiction at perhaps their most theoretical. Courts across
the country increasingly are confronted with cases challenging online
conduct and must determine issues of personal jurisdiction over actors
engaged in such conduct. These cases highlight the reality that the
Internet, which increasingly forms an important part of our day-to-day
interactions, exists outside of the state boundaries that define
considerations of jurisdiction.2
However, in my view, the fact that the product allegedly causing the tortious
injury in this case is modern – digital information disseminated through the Internet
– does not necessarily require a departure from the more traditional jurisprudence of
personal jurisdiction, or a unique or even different jurisdictional analysis. I am not
deciding this case using, as the determinative factor, the fact that the product
1
10 Del. C. § 3104(c).
2
Rotblut v. Terrapinn, Inc., 2016 WL 5539884, at *1 (Del. Super. Sept. 30, 2016).
4
allegedly causing tortious injury is electronic media, as opposed to any other form
of media or a tangible physical object. An entity’s reaching beyond its state’s
borders, allegedly causing tortious injury in Delaware by an act committed in
Delaware, should not be treated differently for personal jurisdiction purposes merely
because the act is committed over the Internet.
BACKGROUND
Defendant Lead Stories, LLC, a Colorado limited liability company (“Lead
Stories”) has a contract with Facebook, Inc., a Delaware corporation (“Facebook”)
to regularly transmit fact-checking stories over the Internet to Facebook. Facebook
may in turn use those stories to place covers over its users’ Facebook webpages,
warning about the veracity of the users’ posts on those webpages. Some of these
stories have been about Candace Owens, in her individual capacity, and Candace
Owens, LLC, a Delaware limited liability company (collectively, “Plaintiffs”), and
warning covers have been placed over their Facebook webpages. Such warning
covers appear on Facebook webpages worldwide, including those seen in Delaware.
Plaintiffs assert a variety of tort claims, addressed later in this Opinion, against Lead
Stories for injury allegedly arising out of these facts.
On October 18, 2020, Plaintiffs filed a Complaint against, inter alia,
Defendant Lead Stories. On December 18, 2020, Lead Stories filed a Motion to
Dismiss the Complaint as against Lead Stories under Delaware Superior Court Civil
5
Rule 12(b)(2) for lack of personal jurisdiction over Lead Stories. On February 24,
2021, I heard oral argument on this Motion. This is my decision on that Motion.
SUMMARY
Plaintiffs, on the one hand, tell me that the foregoing facts are sufficient in
and of themselves to give me jurisdiction over Lead Stories. Lead Stories, on the
other hand, essentially argues that Plaintiffs’ argument cannot withstand the
constitutional rigors of personal jurisdiction analysis. Lead Stories tells me that it
has no presence in Delaware for purposes of general (or “all purpose”) jurisdiction,
and that strict “but for” causation by Lead Stories of Plaintiffs’ alleged injury within
Delaware is required to confer specific (or “case limited”) jurisdiction. In my view,
there is a more nuanced, middle ground between these two approaches. In that
middle ground, questions of personal jurisdiction are best resolved by a common
sense, fact-driven analysis.
Although the development of the law, including Delaware law, regarding the
permissible reach of personal jurisdiction based on the use of the Internet is in its
infancy, the standard I adopt is well articulated as follows:
[T]he likelihood that personal jurisdiction can be constitutionally
exercised is directly proportionate to the nature and quality of
commercial activity that an entity conducts over the Internet.3
3
This standard was articulated by the Court in Zippo Manufacturing Co. v. Zippo Dot Com, Inc.,
952 F. Supp. 1119, 1124 (W.D. Pa. 1997) (citations omitted); see discussion, post.
6
Using this standard, I have examined the level of interactivity and the
commercial nature of the exchange of information that occurred on the Facebook
website, using the Lead Stories information, to determine the exercise of personal
jurisdiction. I have determined that the nature and quality of this commercial activity
warrants that I can constitutionally exercise personal jurisdiction over Lead Stories.
In addition to this standard, the lodestar for me in the exercise of personal
jurisdiction is whether two values are upheld: treating Lead Stories fairly, and
protecting “interstate federalism;” i.e., preventing a State with little legitimate
interest in a case from encroaching on a State more affected by the controversy.4 In
my view, Lead Stories had, or should have had, fair warning that its fact-checking
stories, as used by Facebook, might subject it to jurisdiction in Delaware. 5
Moreover, in my view, Delaware has a greater interest than Colorado in the outcome
of this case.6 A denial of jurisdiction would lead to an unfair and inefficient result,
because it would require Plaintiffs to pursue multiple causes of actions in different
jurisdictions, with the possibility of inconsistent results and the certainty of increased
costs.
Finally, Delaware courts have consistently held that our long-arm statute is to
4
World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297-298 (1980).
5
See Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985).
6
See Bristol-Myers Squibb Co. v. Superior Court of Cal., San Francisco Cty., 137 S. Ct. 1773(2017).
7
be construed broadly to confer personal jurisdiction to the maximum extent possible
under the due process clause.7
ANALYSIS
Standard of Review
Pursuant to Delaware Superior Court Civil Rule 12(b)(2), Plaintiffs bear the
burden of establishing that I have personal jurisdiction over Lead Stories.8 Personal
jurisdiction over a nonresident defendant is proper where: (1) Delaware’s long-arm
statute applies; and (2) the Court’s exercise of jurisdiction does not violate
constitutional due process.9 Plaintiffs must make a specific showing that Delaware
maintains jurisdiction under its long-arm statute.10
Pursuant to Delaware’s long-arm statute, I may exercise general or specific
personal jurisdiction over a non-resident defendant when the party maintains the
requisite minimum contacts with Delaware enumerated in the statute.11 General
jurisdiction requires a plaintiff to show that the “defendant regularly and
continuously conducted business within Delaware.” 12 For specific jurisdiction,
7
Daily Underwriters of America v. Maryland Auto. Ins. Fund, 2008 WL 3485807, at *3 (Del.
Super. July 31, 2008); Hercules Inc. v. Leu Trust & Banking Ltd., 611 A.2d 476, 480 (Del. 1992)
(citing LaNuova D & B, S.p.A. v. Bowe Co., Inc., 513 A.2d 764, 768 (Del. 1986) (“[S]ection
3104(c) has been broadly construed to confer jurisdiction to the maximum extent possible under
the due process clause.”)).
8
Schweitzer v. LCR Capital Partners, LLC, 2020 WL 1131716, at *5 (Del. Super. Mar. 9, 2020).
9
LaNuova D & B, S.p.A. v. Bowe Co., Inc., 513 A.2d 764, 768 (Del. 1986).
10
Greenly v. Davis, 486 A.2d 669, 670 (Del. 1984).
11
Clayton v. Farb, 1998 WL 283468, at *1 (Del. Super. Apr. 23, 1998).
12
Tell v. Roman Catholic Bishops of Diocese, 2010 WL 1691199, at *8 (Del. Super. Apr. 26, 2010).
8
plaintiff is required to make “a showing that the cause of action arises from conduct
occurring within the state.”13
If there is a statutory basis to exercise jurisdiction, this Court must then
consider whether such an exercise is consistent with the requirements of due process.14
To satisfy due process, Plaintiffs must show “minimum contacts” exist between Lead
Stories and Delaware such that the exercise of jurisdiction is consistent with
“traditional notions of fair play and substantial justice.”15 These “minimum contacts”
must be rooted in an “act by which the defendant purposefully avails itself of the
privilege of conducting activities within the forum State, thus invoking the benefits
and protections of its laws.” 16 Thus, a defendant must purposefully establish
minimum contacts with the forum state such that the defendant could reasonably
“anticipate being haled into court” there.17
GENERAL PERSONAL JURISDICTION
General (or all purpose) jurisdiction is based on a nonresident defendant’s
persistent, continuous, and substantial course of conduct through which the
13
Id.; Rotblut, 2016 WL 5539884, at *5.
14
Rotblut, 2016 WL 5539884, at *4.
15
World-Wide Volkswagen Corp., 444 U.S. at 292 (citing Int’l Shoe Co. v. Washington, 326 U.S.
310, 316 (1945)); Ciabattoni v. Teamsters Local 326, 2016 WL 4442277, at *4 (Del. Super. Aug.
22, 2016).
16
Asahi Metal Indus. Co., Ltd. v. Super. Ct. of California, Solano Cty., 480 U.S. 102, 109 (1987)
(quoting Burger King Corp., 471 U.S. at 475).
17
Burger King Corp., 471 U.S. at 474.
9
nonresident creates a general presence in Delaware.18 To subject Lead Stories to
general jurisdiction pursuant to 10 Del. C. §3104(c)(4), Plaintiffs must allege at
least one of three things: (1) Lead Stories regularly conducts or solicits business in
Delaware; (2) Lead Stories engages in any other persistent course of conduct in
Delaware; or (3) Lead Stories derives substantial revenues from its services used in
Delaware.19 It is Plaintiffs’ burden to show Lead Stories’ conduct falls within the
reach of 10 Del. C. §3104(c)(4).20
Regularly Conduct or Solicit Business in Delaware
Plaintiffs argue that “Lead Stories regularly contracts to supply fact-checking
services to Facebook, which operates extensively in [Delaware].”21 However, that
allegation goes to the contacts of Facebook with Delaware, not the contacts of Lead
Stories with Delaware. Lead Stories’ employees, office and other contacts are all in
Colorado. This Court has held that mere maintenance of a website or webpage over
the Internet accessible to anyone, including Delawareans, whether by Facebook or
Lead Stories, is insufficient to confer general jurisdiction.22 Thus, Lead Stories is
not subject to general jurisdiction under this prong of 10 Del. C. §3104(c)(4).
Engage in Any Other Persistent Course of Conduct in Delaware
18
Herman v. BRP, Inc., 2015 WL 1733805, at *4 (Del. Super. Apr. 13, 2015).
19
See 10 Del. C. § 3104(c)(4); LaNuova D&B, S.p.A., 513 A.2d at 767–68.
20
Schweitzer, 2020 WL 1131716, at *5.
21
Compl. ¶ 44; Plaintiffs’ First Amended Complaint (Transaction ID 6657138) ¶ 46 [hereinafter
Pls. Am. Compl.].
22
Rotblut, 2016 WL 5539884, at *6.
10
Plaintiffs argue that because “Lead Stories regularly contracts to supply fact-
checking services to Facebook which operates extensively in [Delaware]” that “Lead
Stories regularly engages in a persistent course of conduct in Delaware.” 23 This
argument fails for two reasons. First, the conduct alleged is that of Facebook, not
Lead Stories. Plaintiffs suggest that because Lead Stories contracts with Facebook
to supply fact-checking services to Facebook, Lead Stories itself therefore engages
in a persistent course of conduct in Delaware. But, as discussed above, mere
maintenance of a website or webpage over the Internet accessible to anyone,
including Delawareans, whether by Facebook or Lead Stories, is insufficient to
confer general jurisdiction. 24 Second, setting aside Lead Stories’ contractual
relationship with Facebook, Plaintiffs fail to identify any other persistent course of
conduct by Lead Stories in Delaware.
Moreover, Lead Stories is not registered, licensed, or otherwise authorized to
do business in Delaware.25 Nor does Lead Stories maintain an office, interests, real
property, or assets in Delaware.26 Lead Stories has never paid any taxes to the State
of Delaware, and it does not maintain any ongoing material contractual relationships
with entities or individuals in Delaware.27
23
Compl. ¶ 44; Pls. Am. Compl. ¶ 46.
24
Rotblut, 2016 WL 5539884, at *6.
25
Duke Decl. ¶ 10.
26
Id. at ¶¶ 11–12. Plaintiffs make no allegations to support jurisdiction under §§ 3104 (c)(5) or
(c)(6).
27
Id. at ¶ 12.
11
Thus, Lead Stories is not subject to general jurisdiction under this prong of 10
Del. C. §3104(c)(4).
Derive Substantial Revenue for Its Services Used in Delaware
Plaintiffs allege that Lead Stories “derives substantial revenue from Delaware
by providing fact-checking services to Delaware through its website and through
Facebook.”28 This Court has rejected the argument that an “employee’s receipt of a
salary based on services rendered to a company that allegedly derives substantial
revenue from its activities in Delaware is a sufficient contact under §3104(c)(4) to
confer personal jurisdiction over [the employee].”29 Moreover, receipt of a salary,
“part of which might reflect time spent working to generate fees related to services
an employer provided in Delaware, would [not] satisfy the Due Process Clause’s
minimum contacts requirement.” 30 Even if Lead Stories receives substantial
revenue from its agreement with Facebook, Plaintiffs fail to allege that Lead Stories
derived substantial revenue from activities in Delaware.
Thus, Lead Stories is not subject to general jurisdiction under this prong of 10
Del. C. §3104(c)(4).
To summarize the elements of general personal jurisdiction: Plaintiffs do not
28
Compl. ¶ 44; Pls. Am. Compl. ¶ 46.
29
Rotblut, 2016 WL 5539884, at *7.
30
Hartsel v. Vanguard Grp., Inc., 2011 WL 2421003, at *7 (Del. Ch. June 15, 2011), aff’d, 38
A.3d 1254 (Del. 2012).
12
sufficiently allege that Lead Stories (1) regularly conducts or solicits business in
Delaware, (2) engages in any other persistent course of conduct in Delaware, or (3)
derives substantial revenue from services or things used or consumed in Delaware.31
Accordingly, Plaintiffs are unable to persuade me that I may properly exercise
general personal jurisdiction over Lead Stories.32
SPECIFIC PERSONAL JURISDICTION
To subject Lead Stories to specific (or case-limited) personal jurisdiction
under the Delaware long-arm statute, Plaintiffs must allege that Lead Stories (1)
transacts business or performs work or services in Delaware 33 ; (2) contracts to
provide “services or things” in Delaware34; or (3) causes tortious injury in Delaware
by an act or omission in Delaware.35 Although Plaintiffs and Lead Stories present
arguments for and against the proposition that Lead Stories transacts business or
performs work or services in Delaware, and contracts to provide “services or things”
in Delaware, under 10 Del. C. §3104(c)(1) and 10 Del. C. §3104(c)(2), respectively,
I need not address those arguments. The Delaware long-arm statute is in the
disjunctive, so any one of the three bases for specific personal jurisdiction will
31
Duke Decl. ¶ 11.
32
See Aeroglobal Capital Management, LLC v. Cirrus Industries, Inc., 871 A. 2d 428, 438 (Del.
2005).
33
10 Del. C. §3104(c)(1).
34
10 Del. C. §3104(c)(2).
35
10 Del. C. §3104(c)(3); Tell, 2010 WL 1691199, at *8 (noting that the cause of action must arise
from conduct within Delaware).
13
suffice for jurisdiction to attach. I also decide cases on the narrowest possible
grounds. I find that Plaintiffs sufficiently allege that Lead Stories caused tortious
injury in Delaware by acts or omissions in Delaware under 10 Del. C. §3104(c)(3),
which in and of itself provides a sufficient basis for personal jurisdiction.
Personal Jurisdiction Under 10 Del. C. §3104(c)(3)
10 Del. C. §3104(c)(3) requires Plaintiffs to allege that Lead Stories caused a
tortious injury in Delaware resulting from an act or omission by Lead Stories in
Delaware.36 A naked allegation that a tortious injury occurred in Delaware, without
more, does not satisfy 10 Del. C. §3104(c)(3). 37 Delaware law further requires
Plaintiffs to allege that the injury was caused by an act or omission which was
committed in Delaware.38 “The dual reference to ‘within the state’ indicates that the
draftsmen intended that there be two separate events, each within the State.” 39
“[P]laintiff cannot be the only link between the defendant and the forum. Rather,
it is the defendant’s conduct that must form the necessary connection with the forum
State that is the basis for its jurisdiction over him.”40
When considering whether a defendant acted within Delaware, this Court has
required “something more” than “the knowledge that [a] website could be viewed or
36
See Hartsel, 2011 WL 2421003, at *14.
37
Rotblut, 2016 WL 5539884, at *6.
38
Id.; Tell, 2010 WL 1691199, at *14 (declining to exercise personal jurisdiction under § 3104(c)(3)
where plaintiff alleged no act or omission of the defendants occurred in Delaware).
39
Ramada Inns, Inc. v. Drinkhall, 1984 WL 247023, at *2 (Del. Super. May 17, 1984).
40
Milliken v. Meyer, 311 U.S. 457, 463 (1940).
14
that their product could be used in [Delaware].”41 In Rotblut, an individual author
who resided in Illinois, and subsequently Washington, D.C., wrote a blog which a
Delaware subsidiary corporation posted on a website owned and hosted by its parent
holding company, which was incorporated under the laws of the United Kingdom
with a principal place of business in London, England. Plaintiffs sued the author,
the subsidiary, and the holding company for defamation. The Court recognized that
it had jurisdiction over the Delaware subsidiary, but held that it had no specific
personal jurisdiction over the author or the parent holding company under 10 Del. C.
§3104(c)(3) and granted their motions to dismiss. Assuming arguendo that there
was a tortious injury in Delaware, the Court found that the mere fact that the parent
holding company owned the website, on which it hosted postings by its subsidiary,
was not enough under 10 Del. C. §3104(c)(3), and thus considered whether the parent
holding company “committed an act or omission” in Delaware. The Court found
that the parent holding company’s awareness that its website might be viewed in
Delaware or viewed by Delaware residents is not “an act or omission” in Delaware
under 10 Del. C. §3104(c)(3). Similarly, the Court held that, since the individual
author had not been in Delaware, or had any other presence in or contact with
Delaware when the story was written, he had not committed “an act or omission” in
Delaware under 10 Del. C. §3104(c)(3).
41
Rotblut, 2016 WL 5539884, at *5.
15
This case is distinguishable from Rotblut. Lead Stories contracted with
Facebook, a Delaware corporation, to provide fact-checking services and stories to
Facebook. Using those services and stories, Facebook placed warnings on the
Facebook page of Plaintiffs, one of whom is a Delaware limited liability company,
including the page as it appeared to Delaware customers and which, as alleged in the
Complaint, drove Plaintiffs’ customers away from their Facebook page, negatively
affected the business they generated from their Facebook page, and diverted their
customers away from their Facebook page to the website of Lead Stories – a
competitor – and its advertisers. The contract with which Lead Stories allegedly
tortiously interfered is between a Delaware corporation (Facebook) and a Delaware
limited liability company (Candace Owens, LLC). Plaintiffs allege that, because of
Lead Stories’ information, Facebook determined that Plaintiffs were in breach of their
contractual obligations to Facebook, thus triggering Facebook’s adverse actions
against Plaintiffs, including restricting their ability to advertise, suspending their
account, and demonetizing their relationship.
Lead Stories, although its fact-checking stories about Plaintiffs may have been
written in Colorado, had a contract with Facebook, in the regular course of business,
to use those stories as warnings to cover Plaintiffs’ Facebook account. Lead Stories
knew or should have known that its stories could be used, among other places, on
the Facebook page of a Delaware LLC as it appeared in Delaware.
16
The federal courts in the Third Circuit have taken an expansive view of the
Delaware and Pennsylvania long-arm statutes, in the context of the Internet, that
favors specific personal jurisdiction. In Zippo Manufacturing Co. v. Zippo Dot Com,
Inc.,42 the manufacturer of “Zippo” tobacco lighters brought federal and state law
claims against a computer news website which used domain names using the word
“zippo.” The Court held that, by zippo offering its website news service to
Pennsylvanians, (1) zippo purposefully availed itself of doing business in
Pennsylvania and was subject to personal jurisdiction there, (2) Zippo’s claims arose
out of zippo’s Pennsylvania-related conduct, and (3) the exercise of personal
jurisdiction over zippo in Pennsylvania was reasonable. The Court stated:
[T]he likelihood that personal jurisdiction can be constitutionally
exercised is directly proportionate to the nature and quality of
commercial activity that an entity conducts over the Internet. This
sliding scale is consistent with well developed personal jurisdiction
principles. At one end of the spectrum are situations where a defendant
clearly does business over the Internet. If the defendant enters into
contracts with residents of a foreign jurisdiction that involve the
knowing and repeated transmission of computer files over the Internet,
personal jurisdiction is proper. At the opposite end are situations where
a defendant has simply posted information on an Internet Web site
which is accessible to users in foreign jurisdictions. A passive Web site
that does little more than make information available to those who are
interested in it is not grounds for the exercise [sic] personal jurisdiction.
The middle ground is occupied by interactive Web sites where a user
can exchange information with the host computer. In these cases, the
exercise of jurisdiction is determined by examining the level of
interactivity and commercial nature of the exchange of information that
42
952 F. Supp. 1119 (W.D. Pa. 1997).
17
occurs on the Web site.43
This case is not at either extreme, but in the middle. Lead Stories did not enter
into discrete contracts with Delawareans for its fact-checking services and stories.
Nor did it simply post its fact-checking services and stories on a passive website that
was available only to those who were interested in them. Rather, Lead Stories’ fact-
checking services and stories were posted on Facebook, an interactive website where
users could take any number of actions adverse to Plaintiffs, including leaving
Plaintiffs’ Facebook page, switching to the website of Lead Stories – a competitor –
and its advertisers, and not spending money on Plaintiffs’ website. In addition,
Facebook itself could take actions adverse to Plaintiffs, including restricting their
ability to advertise, suspending their account, and demonetizing their relationship.
In such a case, when I examine the “level of interactivity and commercial nature of
the exchange of information that occurs on the website,” I am persuaded that the
exercise of specific personal jurisdiction is appropriate.
In Kloth v. Southern Christian University,44 a Delaware student sued a private
Alabama university’s “distance learning” program (i.e., on-line school) for breach
of an implied contract to provide her with a complete education and discrimination
against her because she was not a Christian. Only two Delaware students (including
43
Id., at 1124 (citations omitted).
44
494 F. Supp. 2d 273 (D. Del. 2007), aff’d, 320 F. App’x 113 (3d Cir. 2008).
18
plaintiff) used the program. The Court found no basis for general personal
jurisdiction over the university under 10 Del. C. §3104(c)(4) but stated that
specific personal jurisdiction would be proper when “a defendant’s website is
specifically designed to commercially interact with the residents of [Delaware].”45
Finding that the university’s passive website was not so designed, the Court declined
to exercise personal jurisdiction and granted the defendant’s motion to dismiss.
However, in this case, Lead Stories’ website, as used by Facebook, was very much
designed to interact with Delaware residents, among others, although their number
cannot be precisely ascertained.
CONSTITUTIONAL DUE PROCESS
The Fourteenth Amendment's Due Process Clause limits my power to exercise
jurisdiction over Lead Stories. The seminal decision in this area remains
International Shoe Co. v. Washington.46 There, the United States Supreme Court
held that a tribunal's authority depends on the defendant's having such “contacts”
with the forum State that “the maintenance of the suit” is “reasonable” and “does not
offend traditional notions of fair play and substantial justice.” 47 In applying that
formulation, the United States Supreme Court has long focused on the nature and
45
Id., at 279.
46
326 U.S. 310, 316 (1945).
47
Id., at 316–317.
19
extent of “the defendant's relationship to the forum State.”48 That focus led to the
recognition of the two types of personal jurisdiction: general and specific
jurisdiction. A state court may exercise general jurisdiction only when a defendant
is “essentially at home” in the State.49 Specific jurisdiction covers defendants less
intimately connected with a State, but only as to a narrower class of claims. To be
subject to that kind of jurisdiction, the defendant must take “some act by which [it]
purposefully avails itself of the privilege of conducting activities within the forum
State.”50 And the plaintiff's claims “must arise out of or relate to the defendant's
contacts” with the forum state.51
Enter Ford Motor Company v. Montana Eighth Judicial District Court 52
(“Ford Motor”). In that case, Ford, a nonresident of the forum state, had
manufactured and sold automobiles in states other than the forum states, but the
current owners of the automobiles sued Ford for death and injuries sustained when
the automobiles malfunctioned in the forum states. Ford heavily advertised, and
conducted sales and service of, other automobiles in the forum states. Ford appealed
dismissal of its motion to dismiss for lack of personal jurisdiction in the lower state
courts. The Supreme Court affirmed the lower courts and upheld specific personal
48
Bristol-Myers Squibb Co. v. Superior Court of Cal., San Francisco Cty., 137 S.Ct. 1773, 1779
(2017).
49
Goodyear Dunlop Tires Operations, S. A v. Brown, 564 U.S 915, 919 (2011).
50
Hanson v. Denckla, 357 U.S. 235, 253 (1958).
51
Bristol-Myers, 137 S.Ct., at 1786.
52
141 S. Ct. 1017 (2021).
20
jurisdiction.
Ford did not contest that it does business in the forum states and that it actively
seeks to serve the market for automobiles and related products in those states. Or to
put that concession in more doctrinal terms, Ford agreed that it “purposefully
avail[ed] itself of the privilege of conducting activities” in those states. 53 Ford
claimed instead that those activities did not sufficiently connect to the suits, even
though the resident plaintiffs alleged that Ford automobiles malfunctioned in the
forum states. In Ford's view, the needed link must be causal in nature: jurisdiction
attaches “only if the defendant's forum conduct gave rise to the plaintiff ’s claims.”
Writing for a majority of five, Justice Kagan, who in 2017 wrote a vigorous
dissent in Bristol-Meyers Squibb Co. accusing the majority in that case of unduly
curbing the exercise of specific jurisdiction, expanded the scope of specific
jurisdiction. She concluded that the Bristol-Meyers Squibb Co. test that the
plaintiff’s claims must “arise out of or relate to the defendant's contacts” with the
forum state (emphasis supplied), since it is disjunctive, creates two individual bases
for specific personal jurisdiction – a claim which “arises out of” or a claim which
“relates to” – defendant’s contacts with the forum state, and either will suffice to
exercise specific personal jurisdiction. The Court found that the plaintiffs’ claims
both arose out of, and related to, Ford’s extensive contacts with the forum states, and
53
Hanson, 357 U.S. 235, 253 (1958).
21
upheld the lower courts’ exercise of specific personal jurisdiction, notwithstanding
the fact that the automobiles had been neither manufactured nor sold in the forum
states.
Justice Alito, concurring in the result, decried the majority’s creation of two
tests, and asserts that there is only one: the classic “minimum contacts’ test of
International Shoe.
Justices Gorsuch and Thomas, also concurring in the result, went one step
further, and called for a return to the law of personal jurisdiction as it existed before
International Shoe.
Ford Motor, unlike this case, does not involve defendants’ contacts on the
Internet. However, I am an aficionado of duck decoys, so I note with particular
interest the discussion by Justice Gorsuch of a hypothetical that was asked at oral
argument54 and mentioned by the majority in a footnote:
The majority imagines a retiree in Maine who starts a one-man
business, carving and selling wooden duck decoys. In time, the man
sells a defective decoy over the Internet to a purchaser in another State
who is injured. We aren't told how. (Was the decoy coated in lead
paint?) But put that aside. The majority says this hypothetical supplies
a useful study in contrast with our cases. On the majority's telling,
Ford's “continuous” contacts with Montana and Minnesota are enough
to establish an “affiliation” with those States; by comparison, the decoy
seller's contacts may be too “isolated” and “sporadic” to entitle an
injured buyer to sue in his home State. But if this comparison highlights
anything, it is only the litigation sure to follow. For between the poles
of “continuous” and “isolated” contacts lie a virtually infinite number
54
Tr. of Oral Arg. 39.
22
of “affiliations” waiting to be explored. And when it comes to that vast
terrain, the majority supplies no meaningful guidance about what kind
or how much of an “affiliation” will suffice. Nor, once more, does the
majority tell us whether its new affiliation test supplants or merely
supplements the old causation inquiry.
But, today, even an individual retiree carving wooden decoys in
Maine can “purposefully avail” himself of the chance to do business
across the continent after drawing online orders to his e-Bay “store”
thanks to Internet advertising with global reach. A test once aimed at
keeping corporations honest about their out-of-state operations now
seemingly risks hauling individuals to jurisdictions where they have
never set foot.
Perhaps this is the real reason why the majority introduces us to
the hypothetical decoy salesman. Yes, he arguably availed himself of a
new market. Yes, the plaintiff ’s injuries arguably arose from (or were
caused by) the product he sold there. Yes, International Shoe’s old
causation test would seemingly allow for personal jurisdiction. But
maybe the majority resists that conclusion because the old test no longer
seems as reliable a proxy for determining corporate presence as it once
did. Maybe that's the intuition lying behind the majority's introduction
of its new “affiliation” rule and its comparison of the Maine retiree's
“sporadic” and “isolated” sales in the plaintiff ’s State and Ford's deep
“relationships” and “connections” with Montana and Minnesota.
Putting Justice Gorsuch’s jurisprudential concerns aside, in this case Plaintiffs”
claims clearly “relate to” Lead Stories’ contacts with Delaware via Facebook on
Plaintiffs’ webpage. These contacts were neither isolated nor sporadic, but
continuous. In my view, Ford Motor mitigates in favor of specific personal
jurisdiction over Lead Stories. The requirements of the Due Process Clause of the
Fourteenth Amendment to the United States Constitution are satisfied.
23
CONCLUSION
Plaintiffs have not provided me with a sufficient basis on which I may exercise
general personal jurisdiction over Lead Stories under Delaware law. Plaintiffs have,
however, provided me with a sufficient basis on which I may exercise specific
personal jurisdiction over Lead Stories under Delaware law. The nature and quality
of the commercial activity that Lead Stories conducted over the Internet mitigate in
favor of specific personal jurisdiction. Although Lead Stories did not directly
transact business or perform work or services in Delaware, or contract to provide
“services or things” in Delaware, it contracted with Facebook to supply fact-
checking services and stories which were disseminated by Facebook in
Delaware in such a manner as to allegedly cause tortious injury in Delaware, which
could reasonably have been foreseen by Lead Stories. Moreover, I find that the
exercise of specific personal jurisdiction over Lead Stories comports with
constitutional due process requirements under Ford Motor Company. Accordingly,
I exercise specific personal jurisdiction over Lead Stories.
For the reasons stated above, I DENY Defendant Lead Stories’ Motion to
Dismiss for Lack of Personal Jurisdiction under Delaware Civil Rule 12(b)(2).
IT IS SO ORDERED.
I turn now to both Defendants’ Motions to Dismiss for failure to plead
cognizable claims.
24
FAILURE TO STATE A CLAIM
A bedrock principle of our law is that the United States Constitution protects
freedom of speech.55 As Justice Brett Kavanaugh noted, while sitting as a D.C.
Circuit Court judge, the United States Supreme Court has guided courts to
“expeditiously weed out unmeritorious defamation suits” because they can threaten
freedom of speech. 56 Early dismissal of defamation lawsuits for failure of the
complaint to state a claim on which relief can be granted “not only protects against
the costs of meritless litigation, but provides assurance to those exercising their First
Amendment rights that doing so will not needlessly become prohibitively
expensive.”57 The same logic should apply to other tort lawsuits whose complaints
are based on defendants’ injurious false statements, where First Amendment
limitations apply.58
BACKGROUND
As discussed earlier in this Opinion, this suit arises out of Facebook’s third-
party partners’ fact-checking articles regarding Plaintiffs’ Facebook posts. 59
55
U.S. Const. amend. I.
56
Kahl v. Bureau of Nat'l Affairs, Inc., 856 F.3d 106, 109 (D.C. Cir. 2017) (citing Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); New York Times Co.
v. Sullivan, 376 U.S. 254, 84 S.Ct. 710, 11 L.Ed.2d 686 (1964)).
57
Fairbanks v. Roller, 314 F. Supp. 3d 85, 89 (D.D.C. 2018) (citation omitted).
58
Blatty v. New York Times Co., 728 P.2d 1177, 1184 (Cal. 1986) (en banc) (explaining why the
First Amendment should apply to any claim whose gravamen is an injurious falsehood
statement).
59
Pls. Am. Comp. ¶¶ 1–2.
25
Defendant Lead Stories and Defendant Gannett Satellite Information Network, LLC,
a Delaware limited liability company d/b/a USA TODAY (“Gannett” or “USA
TODAY”) (Gannett and USA TODAY, collectively, “Defendants”) have
contractual relationships with Facebook, which pays its third-party fact-checking
partners, including Defendants, to publish “fact-check” articles examining whether
certain Facebook posts contain untruthful information.60
On October 18, 2020, Plaintiffs filed a Complaint against both Defendants.
On May 4, 2021, Plaintiffs filed a Motion for Leave to File and Serve the First
Amended Complaint (the “Amended Complaint”), and, on June 21, 2021 I granted
Plaintiffs’ Motion. In the Amended Complaint, Plaintiffs assert three tort claims
against both Defendants: (1) intentional interference with contractual relations, (2)
tortious interference with prospective business relations, and (3) unfair competition
at common law. 61 Plaintiffs assert two additional tort claims solely against
Defendant Lead Stories: (4) defamation with actual malice, and (5) defamation with
common law malice.62
On December 18, 2020, both Defendants filed a Motion to Dismiss the
Complaint under Delaware Superior Court Civil Rule 12(b)(6) for failure to state a
60
Id. ¶¶ 33, 34, 40, 41.
61
Pls. Am. Compl., ¶¶ 141–64.
62
Pls. Am. Compl., ¶¶ 165–89.
26
claim. On April 28, 2021, I heard oral argument on these Motions. This is my
decision on those Motions.
Plaintiff Candace Owens is a conservative political commentator and an
active user of Facebook and other social media, including Twitter.63 She is a public
figure.64 Plaintiff Candace Owens, LLC is a Delaware limited liability company
primarily controlled by Candace Owens to, among other things, maintain Candace
Owens’ Facebook page.65 Candace Owens writes the content that she posts on her
social media pages operated by Candace Owens, LLC.66
On March 29, 2020, Candace Owens published a post on her Facebook page
claiming that the methods U.S. governmental officials used for counting COVID-19
deaths overstated the peril and the scope of the COVID-19 pandemic (the “First
Facebook Post”).67 To support her claim, she linked and referenced Dr. John Lee’s
article in the First Facebook Post.68 Dr. Lee is a consultant pathologist with the
United Kingdom’s National Health Service and wrote an article showing his concern
related to the U.K. methods of counting the COVID-19 death toll.69
63
Id. ¶¶ 5–13.
64
See id. ¶¶ 6, 13 (describing Candace Owens as a “popular” commentator and “a prominent
social media star”).
65
Id. ¶¶ 21–22.
66
Id. ¶ 25.
67
Id. ¶ 55.
68
Id. ¶ 57.
69
Id. ¶ 58.
27
On April 1, 2020, Lead Stories published an article fact-checking Owens’
First Facebook Post (the “Lead Stories Article”). 70 The Lead Stories Article
determined that Owens’ First Facebook Post was false and labeled Owens’ First
Facebook Post with the terms “Hoax Alert” and “False.”71 Lead Stories publication
of its article caused Facebook to place a false information warning label on the First
Facebook Post.72
On April 28, 2020, Candace Owens published a post on her Facebook page
questioning the relationship between the counting of COVID-19 deaths and flu
deaths in early 2020 (the “Second Facebook Post”).73 In the Second Facebook Post,
she cited CDC reports and argued in a sarcastic manner that the number of flu deaths
had decreased drastically in early 2020.74
On April 30, 2020, USA TODAY published a fact-check article analyzing
data from the CDC and concluding that Owens’ Second Facebook Post carried false
information (the “USA TODAY Article”).75 As a result of that article, Facebook
displayed a false information warning label on the Second Facebook Post.
70
Id. ¶ 72.
71
Id. ¶ 77.
72
Id. ¶ 83.
73
Id. ¶ 63.
74
Id. ¶¶ 63–64.
75
Id. ¶ 79, Ex. E.
28
Plaintiffs attached as exhibits to their Amended Complaint the First Facebook
Post, the Second Facebook Post, Dr. Lee’s article, the Lead Stories Article, and the
USA TODAY Article.76
During relevant times, Plaintiffs and Facebook had an advertising contract.77
Under this contract, Plaintiffs paid Facebook, and, in return, Plaintiffs were entitled
to run advertisements on their Facebook page.78 On June 24, 2020, Facebook sent
an email to Plaintiffs, writing that “because [Plaintiffs’ Facebook page] ha[d]
continually shared content rated false by third-party fact-checkers,” Facebook
decided to suspend Plaintiffs from running advertisements on Facebook.79
Plaintiffs assert in the Amended Complaint that the Lead Stories Article
contains several false and defamatory statements that were made with actual malice,
constituting the tort of defamation.80
Plaintiffs further assert in the Amended Complaint that USA TODAY
maliciously decided to publish the USA TODAY Article which purported to fact-
check Candace Owens’ sarcastic hyperbole in the Second Facebook Post, even
though sarcastic hyperbole cannot be fact-checked because it does not deliver any
statement of fact.81 Plaintiffs contend that both Defendants knew that, by improperly
76
Id. Ex. A–E.
77
Id. ¶¶ 100–01.
78
Id.
79
Id. ¶ 108.
80
Id. ¶¶ 125–40, 165–89.
81
Id. ¶¶ 64–70.
29
and wrongfully publishing their articles about Plaintiffs’ Facebook posts, Facebook
would place warning labels on the posts and would use them to justify banning
Candace Owens, LLC from deriving advertising revenue from the Facebook
platform. 82 Plaintiffs claim that, as a result, this conduct by both Defendants
constitutes tortious interference with contractual relations.83
Plaintiffs further assert in the Amended Complaint that Plaintiffs had
recurring, prospective business opportunities with Facebook, where Plaintiffs would
pay Facebook to run advertisements on Owens’ Facebook page.84 Also, Plaintiffs
had prospective business opportunities with Facebook users who could buy Owens’
book “Blackout.”85 Plaintiffs argue that Plaintiffs lost these opportunities because
of Defendants’ wrongful, improper publication of their articles about Plaintiffs’
Facebook posts, which led Facebook to place warning labels on the posts and to
suspend Plaintiffs from running advertisements, including advertisements about her
book “Blackout,” on Plaintiffs’ Facebook page.86 Plaintiffs claim that Defendants’
conduct constitutes tortious interference with prospective business relations.87
Lastly, Plaintiffs contend that, by wrongfully publishing the articles,
Defendants interfered with Plaintiffs’ reasonable expectation to enter into and
82
Id. ¶¶ 141–49.
83
Id.
84
Id. ¶ 157.
85
Id. ¶ 150–56.
86
Id.
87
Id. ¶ 150–57.
30
continue a valid business relationship with Facebook, which Plaintiffs claim
establishes unfair competition at common law.88
ANALYSIS
Standard of Review
On a Motion to Dismiss for failure to state a claim upon which relief can be
granted under Delaware Superior Court Civil Rule 12(b)(6),89 the pleading standard
is “reasonable conceivability.”90 Under the reasonable conceivability standard, all
well-pleaded allegations in the complaint must be accepted as true. 91 Even vague
allegations are considered well pleaded if they give the opposing party notice of a
claim.92 The court must draw all reasonable inferences in favor of the non moving
party.93
However, “[a] claim may be dismissed if allegations in the complaint or in the
exhibits incorporated into the complaint effectively negate the claim as a matter of
law.”94 Moreover, the court will not “accept conclusory allegations unsupported by
88
Id. ¶ 158–64.
89
Super. Ct. Civ. R. 12(b)(6).
90
K.C. Co., Inc. v. WRK Constr., Inc., 2019 WL 338671, at *2 (Del. Super. Ct. Jan. 24, 2019).
(citing Central Mortg. Co. v. Morgan Stanley Mortg. Capital Holdings, LLC, 27 A.3d 531, 537
(Del. 2011)).
91
Spence v. Funk, 396 A.2d 967, 968 (Del. 1978).
92
In re Gen. Motors (Hughes) S’holder Litig., 897 A.2d 162, 168 (Del. 2006) (quoting Savor,
Inc. v. FMR Corp., 812 A.2d 894, 896–97 (Del. 2002)).
93
Id.94
Tigani v. C.I.P. Associates, LLC, 228 A.3d 409 (Del. 2020) (quoting Malpiede v. Townson,
780 A.2d 1075, 1082 (Del. 2001)).
31
specific facts,” nor will it “draw unreasonable inferences in favor of the non-moving
party.”95 Dismissal is not appropriate unless the “plaintiff would not be entitled to
recover under any reasonably conceivable set of circumstances susceptible of
proof.”96 The reasonable conceivability standard asks whether there is a possibility
of recovery.97
Defamation with Actual Malice and Defamation with Common Law Malice
(Defendant Lead Stories Only)
Under Delaware law, to state a claim for defamation, a public figure plaintiff
must plead that: (1) the defendant made a defamatory statement; (2) concerning the
plaintiff; (3) the statement was published; and (4) a third party would understand the
character of the communication as defamatory. 98 In addition, the public-figure
plaintiff must plead that (5) the statement is false and (6) that the defendant made
the statement with actual malice—“that is, with knowledge that it was false or with
reckless disregard of whether it was false or not.” 99 There is no liability for
defamation when a statement is determined to be true or substantially true.100 In the
95
Price v. E.I. DuPont de Nemours & Co., 26 A.3d 162, 166 (Del. 2011) (citation omitted).
96
Windsor I, LLC v. CWCapital Asset Mgmt. LLC, 238 A.3d 863, 871–72 (Del. 2020) (quoting
In re Gen. Motors, 897 A.2d at 168).
97
Cent. Mortg. Co. v. Morgan Stanley Mortg. Capital Hldgs, LLC, 27 A.3d 531, 537 (Del.
2011).
98
Agar v. Judy, 151 A.3d 456, 470 (Del. Ch. 2017) (citing Doe v. Cahill, 884 A.2d 451, 463
(Del. 2005) (en banc)).
99
Id. (citing New York Times v. Sullivan, 376 U.S. 254, 280 (1964)).
100
Preston Hollow Capital LLC v. Nuveen LLC, 216 A.3d 1, 9 (Del. Ch. 2019) (citing Riley v.
Moyed, 529 A.2d 248, 253 (Del. 1987)).
32
context of a motion to dismiss a libel suit,101 it is for the court to determine as a
matter of law whether the allegedly defamatory statements are protected expressions
of opinion, and whether statements of fact are susceptible of a defamatory
meaning.102
Plaintiffs allege in the Amended Complaint that the following three
statements made in the Lead Stories Article are defamatory and false and were made
with actual malice:
(1) The [false] claims [about the COVID-19 death counting method]
originated in a post . . . published on Facebook by Candace Owens
on March 29, 2020.
(2) [The First Facebook Post] is being shared to suggest that medical
officials are – in Owens’ words – “trying desperately to get the
numbers to justify this pandemic response.” This comment is an
attempt to downplay the severity of a global infectious disease that
has killed more than 42,000 people as of March 31, 2020.
(3) There are several inaccuracies in [the First Facebook Post].103
I find no facts alleged in the Amended Complaint supporting Plaintiffs’ claim
that statement (1) is defamatory or false. As Lead Stories correctly points out in its
brief, Plaintiffs altered the statement and omitted relevant context.104 The statement
in the original Lead Stories Article, attached to the Amended Complaint as Exhibit
101
Spence v. Funk, 396 A.2d 967, 970 (Del. 1978) (“libel is written defamation.”).
102
Ramunno v. Cawley, 705 A.2d 1029, 1035 (Del. 1998) (en banc) (citing Riley v. Moyed, 529
A.2d 248, 253 (Del. 1987)).
103
Pls. Am. Compl., ¶ 78 (alteration in original).
104
Memorandum of Law in Support of Defendant Lead Stories, LLC’s Motion to Dismiss, at 24
[hereinafter Lead Stories’ Br.].
33
A, merely reads that “[t]he claims originated in a post (archived here) published on
Facebook by Candace Owens on March 29, 2020.”105 In their Amended Complaint,
Plaintiffs admit that Owens is the author of the claims published on Owens’ First
Facebook Post. 106 This statement does not convey any facts that are untrue or
capable of defamatory meaning as it does not injure Owens’ reputation in any
sense.107
I further find no facts alleged in the Amended Complaint supporting
Plaintiffs’ claim that statements (2) and (3) are false under the reasonable
conceivability standard. Although Plaintiffs allege that statements (2) and (3) are
false, these allegations are negated by the Exhibits A, B and C to the Amended
Complaint. 108 Plaintiffs’ claim that statements (2) and (3) are false is based on
Plaintiffs’ assertion that the First Facebook Post is truthful. 109 To support this
assertion, Plaintiffs allege that, in the First Facebook Post, Owens linked and
referenced an article by renowned U.K. pathologist Dr. John Lee that confirms the
105
Pls. Am. Compl., Ex. A.
106
Pls. Am. Compl., ¶ 55.
107
See Images Hair Sols. Med. Ctr. v. Fox News Network, LLC, 2013 WL 6917138, at *3 (Del.
Super. Ct. Dec. 20, 2013) (citing Spence v. Funk, 396 A.2d 967, 967 (Del.1978)) (noting that a
statement is capable of defamatory meaning if the statement tends to “injure the reputation in the
popular sense”).
108
Pls. Am. Compl., ¶ 55, Ex. A, Ex. B, Ex. D; see Tigani v. C.I.P. Associates, LLC, 228 A.3d
409 (Del. 2020) (quoting Malpiede v. Townson, 780 A.2d 1075, 1082 (Del. 2001)) (“[a] claim
may be dismissed if allegations in the complaint or in the exhibits incorporated into the
complaint effectively negate the claim as a matter of law.”).
109
Id. ¶ 56.
34
accuracy of her First Facebook Post’s claim that COVID-19 deaths in the United
States are being overstated.110 Specifically, Plaintiffs state that Dr. Lee explains
“precisely why COVID-19 would be potentially overstated as the cause of death.”111
While acknowledging that Dr. Lee’s article was referencing the United Kingdom’s
method for counting deaths (and not the United States), Plaintiffs assert, without
support, that “the reporting criteria for cause of death are international: thus, the
standards to be followed in the U.K. mirror those in the U.S.”112
However, Dr. Lee’s article, Exhibit B to the Amended Complaint, does not
support these assertions. 113 In his article, Dr. Lee stated that because countries
calculate cause of death differently, “the data on COVID-19 [deaths] differs wildly
from country to country.”114 In fact, Dr. Lee presented that the death rate of COVID-
19 in the United States (1.3 percent) is much lower than the rate in the United
Kingdom (5 percent) because both countries use different methods when calculating
COVID-19 as cause of death.115 Thus, merely because Dr. Lee argued in his article
that the U.K. COVID-19 death recording method may exaggerate COVID-19
deaths,116 it does not mean that he argued that the U.S. method overstates COVID-
110
Id. ¶ 57–58.
111
Id. ¶ 58.
112
Id.
113
Id. Ex. B.
114
Id.
115
Id.
116
Id.
35
19 deaths. If anything, Dr. Lee’s article suggests that reporting criteria for cause of
death are not consistent among countries.117
Plaintiffs also quote statements from two U.S. health officials, Dr. Deborah
Birx and Dr. Ngozi Ezike, in the Amended Complaint to support Plaintiffs’ assertion
that the First Facebook Post is factually accurate.118 However, the statement from
Dr. Birx only shows that (1) countries have different recording methods regarding
COVID-19 deaths, and (2) when a person who has a preexisting condition and
COVID-19 dies, medical authorities in the United States count it as a COVID-19
death.119 Dr. Ezike, another U.S. health official whom Plaintiffs cite in the Amended
Complaint, made a point similar to Dr. Birx’s statement.120
Dr. Birx’s statement does not support Owens’ statements in the First
Facebook Post. In the First Facebook Post, Owens said that “I spent all day today
trying to look up daily death rates for any other diseases. You can’t get it anywhere.
They are reporting ONLY on coronavirus deaths.”121 The quoted statements from
Dr. Birx and Dr. Ezike in the Amended Complaint did not say that medical
authorities in the United States only count COVID-19 deaths and stop counting other
117
Id.
118
Id. ¶¶ 59–60.
119
Id. ¶ 59.
120
See id. ¶ 60 (explaining that when a person with a preexisting condition and COVID-19 dies,
the death will be listed as a COVID-19 death).
121
Id. ¶ 55.
36
causes of deaths.122 Nor did the statements from Dr. Birx and Dr. Ezike say that
when a person with a preexisting condition who is also positive for COVID-19 dies,
only COVID-19 would be listed as the single cause of death on her death
certificate.123
The Lead Stories Article is not inconsistent with either Dr. Birx’ or Dr.
Ezike’s statements.124 Lead Stories did not deny that COVID-19 would be listed on
the death certificate if a person who has a preexisting condition and carries COVID-
19 dies. 125 Instead, Lead Stories pointed out in its article that typically the
preexisting condition will also be listed as a contributory cause on the death
certificate if a person who is positive for COVID-19 dies. 126 The Lead Stories
Article quoted Dr. Sally Aiken’s statement that “if [decedents] are positive for
COVID-19 and have symptoms, COVID-19 is typically being listed on the death
certificate as the cause of death, with their other diseases listed as contributory.”127
Moreover, the Lead Stories Article revealed inaccuracies in Owens’ First
Facebook Post.128 It pointed out a factual contradiction between what Owens wrote
on the First Facebook Post and on her own Tweet that was incorporated into the First
122
See id. ¶¶ 59–60.
123
See id.
124
See id. Ex. D.
125
See id.
126
Id.
127
Id.
128
See id.
37
Facebook Post regarding the number one cause of deaths in the United States.129 On
the First Facebook Post, Owens wrote “[o]besity is the number 1 killer in
America.”130 In her Tweet, which is incorporated into the same Facebook post, she
wrote “[t]he number one killer in America is [h]eart disease.”131 Then, Lead Stories
stated in its article that, according to NBC News (provided with a link to NBC
News), CDC does not list obesity as a cause of death and concluded that Owens’
claim in the First Facebook Post that obesity is the number one cause of death is not
factually accurate.132
Thus, Plaintiffs’ assertion that Dr. Lee’s article supports the truthfulness of
Owens’ statements in the First Facebook Post are rebutted by the exhibits to the
Amended Complaint. Nor do the statements by Dr. Birx and Dr. Ezike support
Owens’ statements in the First Facebook Post. Moreover, in its article attached to
the Amended Complaint as Exhibit D, Lead Stories points out factual inaccuracies
in Owens First Facebook Post. Thus, Plaintiffs fail to show that statements (2) and
(3) are false under the reasonable conceivability standard.
Plaintiffs also claim in their Amended Complaint that Lead Stories made false
statements when it used the terms “Hoax Alert” and “False” in the Lead Stories
129
Id.
130
Id. Ex. A.
131
Id.
132
Id. Ex. D.
38
Article.133 The phrase “Hoax Alert” was stated right above the heading of the Lead
Stories Article as a notice concerning Owens’ Facebook Post, and the word “False”
was written in a rectangle image partly overlapping the Owens’ Facebook post
image.134 For the following reasons, I do not think that Plaintiff’s claim that “Hoax
Alert” and “False” constitute false statements is well pled under Delaware Superior
Court Civil Rule 12(b)(6).
First, Plaintiffs do not demonstrate that the word “False” is an untrue
statement under the reasonable conceivability standard. Plaintiffs argue that because
the First Facebook Post relied on an opinion from its own expert, Dr. Lee, and Lead
Stories relied on an opinion from its own expert, Dr. Ailen, Lead Stories was not
able to fact-check the First Facebook Post.135 This is not accurate. Opinions may
carry underlying assertions of facts. 136 Dr. Lee and Dr. Ailen may well have
different opinions on whether COVID-19 should be counted as cause of death.
However, as discussed above, their underlying factual assertions are not
inconsistent. More importantly, in contrast to Plaintiffs’ allegations, Dr. Lee’s
article does not support, much less confirm, the accuracy of Owens’ First Facebook
Post. Therefore, Plaintiffs fail to demonstrate under the reasonable conceivability
133
Id. ¶ 77.
134
Id. ¶ 78, Ex. D.
135
Id. ¶ 132.
136
Milkovich v. Lorain Journal Co., 497 U.S. 1, 18 (1990) (“expressions of ‘opinion’ may often
imply an assertion of objective fact”).
39
standard that Lead Stories made a false statement when it superimposed the word
“False” over Owens’ Facebook Post image.
Second, in Plaintiffs’ Answering Brief in Opposition to Lead Stories’ Motion
to Dismiss, Plaintiffs provide the Merriam-Webster dictionary’s definition of “hoax”
and argue that, by using the words “Hoax Alert,” Lead Stories suggested that
Plaintiffs were not just mistaken but were purposely lying, and, thus, it is
defamatory.137
However, in my opinion the term “Hoax Alert” as used in the Lead Stories
Article is much like the term “blackmail” as used in newspaper articles in Greenbelt
Cooperative Publishing Association, Inc. v. Bresler, where the developer plaintiff
sued for libel.138 In Bresler, the local newspaper defendant published several articles
stating that some people had described the developer’s negotiating position in his
negotiations with a city as “blackmail.”139 The word appeared several times and was
used once as a subheading within a news story.140 The United States Supreme Court
rejected the plaintiff’s contention that liability could be premised on the notion that
137
Plaintiffs’ Answering Brief in Opposition to Defendant Lead Stories, LLC’s Motion to
Dismiss, at 23–24 [hereinafter Pls. Answering Br. in Opposition to Lead Stories].
138
Greenbelt Co-op. Pub. Ass'n v. Bresler, 398 U.S. 6 (1970).
139
Id. at 7.
140
Id. at 7–8.
40
the word “blackmail” implied the plaintiff had committed the actual crime of
blackmail.141 The Court noted that:
“[i]t is simply impossible to believe that a reader who reached the word
‘blackmail’ in either article would not have understood exactly what
was meant: it was Bresler’s public and wholly legal negotiating
proposals that were being criticized. No reader could have thought that
either the speakers at the meetings or the newspaper articles reporting
their words were charging Bresler with the commission of a criminal
offense. On the contrary, even the most careless reader must have
perceived that the word was no more than a rhetorical hyperbole, a
vigorous epithet used by those who considered Bresler’s negotiating
position extremely unreasonable.”142
Moreover, in Montgomery v. Risen, the United States Court of Appeals for the
D.C. Circuit found that the book-author defendant’s description of the plaintiff’s
software as an “elaborate and dangerous hoax” in his book was merely “loose,
figurative, or hyperbolic,” and that such language could not serve as a basis for
liability in a defamation action.143 Similarly, the term “Hoax Alert” in the Lead
141
Id. at 14–15.
142
Id. at 14.
143
Montgomery v. Risen, 875 F.3d 709, 711 (D.C. Cir. 2017); see also Phantom Touring, Inc. v.
Affiliated Publ'ns, 953 F.2d 724, 728 (1st Cir. 1992) (finding description of plaintiff's musical
comedy as “a rip-off, a fraud, a scandal, a snake-oil job” to be merely “figurative and
hyperbolic” and thus protected by the First Amendment); McCabe v. Rattiner, 814 F.2d 839, 842
(1st Cir. 1987) (ruling that the word “scam,” used in an article regarding a timeshare sales
program, is incapable of being proven true or false); Ayyadurai v. Floor 64, Inc., 270 F.Supp.3d
343, 361–62 (D. Mass. 2017) (explaining that “charlatan” used in a loose figurative manner
cannot be defamatory); Metcalf v. KFOR-TV, Inc., 828 F. Supp. 1515, 1530 (W.D. Okla. 1992)
(noting that statement that a medical organization was a “sham” perpetrated by “greedy doctors”
is a matter of opinion); NBC Subsidiary (KCNC-TV), Inc. v. Living Will Ctr., 879 P.2d 6, 11
(Colo. 1994) (en banc) (explaining that statement that a product is a “scam” as a statement of its
value is not a defamatory statement).
41
Stories Article was used as loose, figurative, or hyperbolic language.144 It is not
reasonably conceivable that readers who read the Lead Stories’ Article would have
understood “Hoax Alert” to mean that Plaintiffs were intentionally spreading a lie.
Instead, the readers would have understood “Hoax Alert” as a rhetorical hyperbole
implying that the Owens’ Post carries inaccurate information and that the readers
should proceed cautiously when reading the post.
Since Candace Owens is a public figure, Plaintiffs’ defamation claims can
only survive a motion to dismiss if allegations in the Amended Complaint support
reasonably conceivable inferences that (1) one or more statements in Lead Stories
Article are false, and (2) Lead Stories made the statements with actual malice.
Plaintiffs fail to show that the statements in Lead Stories Article were false under
Delaware’s reasonable conceivability standard. Therefore, Plaintiffs fail to state
defamation claims against Lead Stories.
Intentional Interference with Contractual Relations
The contract between Plaintiffs and Facebook is a contract with which tortious
interference may occur. Defendants, relying upon Illominate Media Inc. v. CAIR
Florida, Inc., 145 argue that no contract actually existed between Facebook and
144
See Pls. Am. Compl., Ex. D (not indicating that Plaintiffs lied in the First Facebook Post).
145
841 Fed. Appx. 132 (11th Cir. 2020) (per curiam).
42
Plaintiffs. 146 Facebook’s Terms of Service are, not surprisingly, onerous for its
users.147 They do not change the fact, however, that a contract did exist between
Plaintiffs and Facebook.148 Offer, acceptance, and consideration, the sine qua non
of a contract, are all elements of the relationship.149
Delaware courts have adopted the Restatement (Second) of Torts in the
context of tortious interference with contractual relations,150 §766 of which states
that:
[o]ne who intentionally and improperly interferes with the performance
of a contract (except a contract to marry) between another and a third
person by inducing or otherwise causing the third person not to perform
the contract, is subject to liability to the other for the pecuniary loss
resulting to the other from the failure of the third person to perform the
contract.151
Defendants argue that §766 requires a breach of contract in order to state a claim of
tortious interference with a contractual relationship, and Facebook did not breach its
146
Id. at 136–38; see Reply Brief in Further Support of Gannett Satellite Information Network,
LLC’s Motion to Dismiss the Complaint, 7–15 [hereinafter Gannett’s Reply Br.]; Transcript of
Oral Argument held on February 24, 2021 (BL-88); Defendant Gannett’s Supplemental Letter
(Transaction ID: 66376164) [hereinafter Gannett’s Letter].
147
Pls. Am. Compl. Ex. I.
148
Id.
149
Trexler v. Billingsley, 166 A.3d 101 (Table) (Del. 2017) (“A valid contract requires an offer,
acceptance, and consideration, and the parties must have intended that the contract would bind
them.”).
150
ASDI, Inc. v. Beard Research, Inc., 11 A.3d 749, 751 (Del. 2010) (“In this context, Delaware
courts have consistently followed the Restatement (Second) of Torts, which recognizes a claim for
tortious interference with contractual relations where the defendant utilizes ‘wrongful means’ to
induce a third party to terminate a contract.”).
151
Restatement (Second) of Torts § 766 (1979).
43
contract with Plaintiffs since the contract is an “at-will” contract.152 Defendants also
assert that I should follow Illominate, in which the Eleventh Circuit affirmed the
district court’s dismissal of the plaintiffs’ claim that the defendants tortiously
interfered with the plaintiffs’ relationship with Twitter and Twitter followers.153 In
Illominate, the Eleventh Circuit found under Florida law that neither relationship is
protected.154 The court reasoned that, under Twitter’s Terms of Service, Twitter can
terminate its business relationship with the plaintiffs at any time for any reason. 155
Because the plaintiffs had no legal or contractual rights to the continued use of
Twitter, the court found that their contractual rights were not protected.156
I disagree with Defendants. First, I do not find any language in §766 that
requires breach of contract, as opposed to interference with the performance of a
contract. 157 Moreover, Comment (c) to §766 provides that “[t]he liability for
inducing breach of contract is now regarded as but one instance, rather than the
exclusive limit, of protection against improper interference in business relations.”158
Comment (g) to §766 provides that “[u]ntil he has so terminated [a contract at will],
152
Gannett’s Reply Br., 7–15; Transcript of Oral Argument held on February 24, 2021 (BL-88);
Gannett’s Letter.
153
Illominate Media, Inc., 841 Fed. Appx. 132 at 136–38 (11th Cir. Dec.29, 2020); see Gannett’s
Reply Br., 7–15; Transcript of Oral Argument held on February 24, 2021 (BL-88); Gannett’s
Letter.
154
Illominate Media, Inc., 841 Fed. Appx. at 136–38.
155
Id. at 137.
156
Id.
157
See Restatement (Second) of Torts § 766 (1979).
158
Id. cmt. (c).
44
the contract is valid and subsisting, and the defendant may not improperly interfere
with it.”159
Second, in ASDI, Inc. v. Beard Research, Inc.,160 the Delaware Supreme Court
found that the defendants tortiously interfered with the plaintiffs’ contract with the
third party, where the third party could terminate the contract at will.161 Even though
ASDI was an “at will” employment contract case, the Delaware Supreme Court
clearly explained that “[c]onduct amounting to tortious interference has been found
actionable even where the third party is lawfully entitled to terminate a contract at
will.” 162 The Court did not say that its reasoning applies only to “at will”
employment contract cases. Instead, the Supreme Court provided examples of sister
state courts’ decisions finding actionable tortious conduct that had induced
“termination of at will . . . commercial contracts, such as an attorney-client
relationship, a marketing contract, and a sawdust supply contract.”163
In Travel Syndication Technology, LLC v. Fuzebox, LLC,164 the United State
District Court for Delaware also found that tortious interference with contractual
159
Id. cmt. (g).
160
11 A.3d 749 (Del. 2010).
161
Id. at 751–52.
162
Id. at 751.
163
Id. at 751–52 (citing SliceX, Inc. v. Aeroflex Colo. Springs, Inc., 2006 WL 1699694, at *2–3
(D. Utah June 15, 2006); Lurie v. New Amsterdam Cas. Co., 270 N.Y. 379, 1 N.E.2d 472, 473
(1936); Marks v. Struble, 347 F.Supp.2d 136, 144 (D.N.J. 2004); Pure Milk Prod. Co-op. v. Nat'l
Farmers Org., 64 Wis.2d 241, 219 N.W.2d 564, 574–75 (1974); Silva v. Bonafide Mills, Inc., 82
N.Y.S.2d 155, 156–57 (N.Y.S. 1948)).
164
2012 WL 1931238 (D. Del. May 25, 2012).
45
relations can occur in at will contracts under Delaware law.165 One of the claims the
plaintiff made in Travel Syndication Technology was that the defendant wrongfully
terminated an at-will service agreement between the plaintiff and the third party.166
The District Court explained that the defendant failed to understand that whether a
termination was legally justified is not the focus of a tortious interference with
contractual relations claim; instead, the focus of the claim is whether a wrongful
inducement of the termination exists.167
However, although Plaintiffs’ contract with Facebook is a contract with which
interference may occur, Plaintiffs fail to plead that Defendants “improperly” or
“wrongfully” interfered with the performance of the contract between Plaintiffs and
Facebook under §766 of the Restatement (Second) of Torts, which requires improper
interference as an essential element. A tortious interference claim cannot survive if
the claim is premised solely on statements that are protected by the First Amendment
because the exercise of constitutionally protected speech cannot be an “improper”
or “wrongful” action. 168 Because Candace Owens is a public figure, the First
165
Id. at *6.
166
Id. at *7.
167
Id.
168
See TMJ Implants, Inc. v. Aetna, Inc., 498 F.3d 1175, 1201 (10th Cir.2007) (concluding that
as the statements that allegedly caused the tortious interference claim is protected by the First
Amendment, the tortious interference claim is not actionable); Redco Corp. v. CBS, Inc., 758
F.2d 970, 973 (3d Cir.1985) (holding that because the statements that allegedly caused the
intentional interference claim are protected by the First Amendment, “the intentional interference
with contractual relations count is not actionable because there is no basis for finding that their
actions were improper”).
46
Amendment protects Defendants’ statements unless Plaintiffs’ Amended Complaint
supports reasonably conceivable inferences that (1) Defendants’ articles contain
false statements, and (2) Defendants made the statements with actual malice. 169
Defendants’ articles are protected by the First Amendment because Plaintiffs fail to
state that both Defendants’ articles contain false statements of fact made with actual
malice under the reasonable conceivability standard.
In the United States Supreme Court’s landmark case, N.A.A.C.P. v. Claiborne
Hardware Co.,170 the plaintiffs filed claims, among which was “the tort of malicious
interference with respondents’ businesses.” 171 The plaintiffs alleged that their
businesses had been damaged because of civil rights boycotts by the defendants. 172
The Supreme Court found that the defendants were not liable in damages for the
results of their nonviolent activity protected by the First Amendment.173 The Court
explained that “[w]hile the State legitimately may impose damages for the
consequences of violent conduct, it may not award compensation for the
consequences of nonviolent, protected activity [by the First Amendment]; only those
losses proximately caused by the unlawful conduct may be recovered.”174
169
See New York Times Co. v. Sullivan, 376 U.S. 254, 280 (1964); Blatty v. New York Times Co.,
728 P.2d 1177, 1182–84 (Cal. 1986) (en banc).
170
458 U.S. 886 (1982).
171
Id. at 889–91.
172
Id. at 888–90.
173
Id. at 915.
174
Id. at 913.
47
Delaware courts have not addressed the issue of whether tortious interference
with contractual relations and prospective business relations are subject to First
Amendment limitations. However, courts in other jurisdictions have ruled on this
precise matter.175 For example, in Blatty v. New York Times Co., the Supreme Court
of California found in an en banc decision that the plaintiff’s intentional interference
claims failed to overcome First Amendment protections and agreed with the
defendant that the plaintiff’s intentional interference claims failed to state a claim on
which relief could be granted.176 The court explained that:
Not only does logic compel the conclusion that First Amendment
limitations are applicable to all claims, of whatever label, whose
gravamen is the alleged injurious falsehood of a statement, but so too
does a very pragmatic concern. If these limitations applied only to
actions denominated “defamation,” they would furnish little if any
protection to free-speech and free-press values: plaintiffs suing press
defendants might simply affix a label other than “defamation” to their
injurious-falsehood claims—a task that appears easy to accomplish as
a general matter . . . and thereby avoid the operation of the limitations
and frustrate their underlying purpose.177
The Tenth Circuit also has ruled that speech protected by the First Amendment
does not constitute “improper” interference under Colorado law, which, like
Delaware, follows the Restatement (Second) of Torts in context of tortious
175
See, e.g., Blatty v. New York Times Co., 728 P.2d 1177 (Cal. 1986) (en banc); Jefferson Cty.
Sch. Dist. No. R-1 v. Moody's Investor's Servs., Inc., 175 F.3d 848 (10th Cir. 1999); Unelko
Corp. v. Rooney, 912 F.2d 1049 (9th Cir. 1990).
176
Blatty, 728 P.2d at 1181.
177
Id. at 1184.
48
interference claims. 178 In Jefferson County School District No. R-1 v. Moody’s
Investor’s Service, Inc., the Tenth Circuit affirmed the district court’s dismissal of
the plaintiff’s tortious interference claim based on failure to state a claim upon which
relief could be granted.179 The plaintiff contended that even if the defendant’s article
constitutes a statement protected by the First Amendment, the First Amendment is
not applicable because the plaintiff’s intentional interference with business relations
and prospective business relations claims are based on the defendant’s “conduct”—
publication of the article in a newspaper—rather than its speech. 180 The court
rejected the plaintiff’s contention that a decision to publish constitutionally protected
speech can be regulated by state tort actions for interference with contractual
relations noting that the plaintiff’s argument is not consistent with the First
Amendment principles.181 The court found that, first, the defendant’s article did not
imply false assertion of fact about the plaintiff, which was protected by the First
Amendment;182 and, second, lawful conduct or speech that is protected by the First
Amendment is “insufficient to establish the required element of improper conduct”
for a tortious interference claim.183
178
Jefferson Cty. Sch. Dist. No. R-1, 175 F.3d at 856–58.
179
Id. at 857–61.
180
Id. at 851.
181
Id. at 857 (noting that the U.S. Supreme Court concluded that “allow[ing] a plaintiff to
establish a tort claim by proving merely that a particular motive accompanied protected
speech . . . might well inhibit the robust debate that the First Amendment seeks to protect.”)
182
Id. at 857–58.
183
Id.49
The Ninth Circuit also explained in Unelko Corp. v. Rooney184 that a tortious
interference with business relationships claim is subject to the same first amendment
requirements that govern actions for defamation.185
In the instant case, Plaintiffs claim that USA TODAY improperly used its
“false” fact-check article to place a “false” information warning label on Plaintiffs’
Second Facebook Post in order to redirect traffic from Plaintiffs’ Facebook page to
its own website. To support this claim, Plaintiffs allege that USA TODAY, under
its contract with Facebook, maliciously and falsely fact-checked Plaintiffs’ opinion
or obviously hyperbolic, rhetorical, sarcastic statement, when in fact such statements
are not capable of being fact-checked.186 Plaintiffs argue in their Answering Brief
that the tortious interference claim against Gannett is not based on USA TODAY’s
speech but USA TODAY’s wrongful conduct.187
I reject Plaintiffs’ argument. Even though Owens’ statement “nobody is dying
of the flu anymore” may be an opinion or a hyperbolic statement as Plaintiffs argue
in Amended Complaint,188 this statement was presented with statistical facts that are
objectively verifiable. In the Second Facebook Post, incorporated as Exhibit C,
184
912 F.2d 1049 (9th Cir. 1990).
185
Id.186
Pls. Am. Compl., ¶ 68
187
Plaintiffs’ Answering Brief in Opposition to Defendant Gannett Satellite Information
Network, LLC’s Motion to Dismiss, at 1–2 [hereinafter Pls. Answering Br. in Opposition to
Gannett].
188
Pls. Am. Compl., ¶¶ 63–65.
50
Owens stated, “[a]ccording to CDC reports – 2020 is working out to be the lowest
flu death season of the decade. 20,000 flu deaths took place before COVID-19 in
January, and then only 4,000 deaths thereafter. To give you context; 80,000
Americans died of the flu in the 2019.” 189 The USA TODAY Article, which is
incorporated into the Amended Complaint as Exhibit E, acknowledges that the
statement, “nobody is dying of the flu anymore,” is sarcasm.190 USA TODAY did
not fact-check this sarcastic statement in its article.191 Instead, the USA TODAY
Article fact-checked whether the statistical data that Owens used in the Second
Facebook Post were true and found that “[a]ccording to CDC data, none of Owens’
statistics is correct.”192
In the Amended Complaint, Plaintiffs fail to allege that any of USA TODAY’s
statements are factually false.193 Instead, they merely contend that USA TODAY
falsely fact-checked an obvious hyperbole, which is improper interference. 194
Again, I disagree. Owens provided factual statistics in her Second Facebook Post
along with her sarcastic comment, and USA TODAY fact-checked the statistics
Owens offered in the Second Facebook Post.195 As the Blatty court noted, lawful
189
Pls. Am. Compl., Ex. C.
190
Pls. Am. Compl., Ex. E (noting that some Facebook and Twitter users “read between the lines
of her sarcasm to comment on what she may be implying.”).
191
See id.192
Id.193
See Pls. Am. Compl.
194
Id. ¶ 69.
195
Id. Ex. C, Ex. E.
51
conduct or speech protected by the First Amendment is not enough to constitute an
essential element of improper interference.196 As Plaintiffs do not claim that USA
TODAY’s article is factually false, Plaintiffs fail to plead that the alleged
interference is improper as USA TODAY’s article is protected by the First
Amendment. Plaintiffs fail to plead a claim for tortious interference with contractual
relations against Gannett.
Plaintiffs also fail to plead “improper” interference for tortious interference
with contractual relations against Lead Stories because, as discussed previously,
their allegations against Lead Stories do not show that Lead Stories’ article contains
any false statements under the reasonable conceivability standard. Therefore,
Plaintiffs’ claim for tortious interference with contractual relations against Lead
Stories must be dismissed under Delaware Superior Court Civil Rule 12(b)(6).
Tortious Interference with Prospective Business Relations
To plead a claim of tortious interference with prospective business relations,
it is necessary for Plaintiffs to plead that the alleged interference was improper.197
In addition to pleading that the alleged interference was improper, Plaintiffs must
plead that “(a) the reasonable probability of a business opportunity, (b) the
196
Jefferson Cty. Sch. Dist. No. R-1 v. Moody's Investor's Servs., Inc., 175 F.3d 848, 856–58
(10th Cir. 1999).
197
DeBonaventura v. Nationwide Mut. Ins. Co., 428 A.2d 1151, 1153 (Del. 1981).
52
intentional interference by defendant with that opportunity, (c) proximate causation,
and (d) damages.”198
Plaintiffs allege in the Amended Complaint that, not only did they have a
contract with Facebook, but they also had other prospective business opportunities
with Facebook.199 Plaintiffs explain that they had opportunities to prospectively
enter into new contracts with Facebook for each new advertisement that Plaintiffs
produce and pay Facebook to manage.200 Moreover, Plaintiffs allege that they had
future business opportunities with potential purchasers of Owens’ book “Blackout,”
which was advertised on her Facebook page.201 Plaintiffs claim that, by publishing
the articles which led Facebook to place false information warning labels,
Defendants intentionally interfered with Plaintiffs’ prospective business
opportunities.202
However, Plaintiffs fail to plead that Defendants’ alleged interference was
improper, because the alleged interference was protected by the First Amendment,
as discussed above. Therefore, Plaintiffs’ claim for tortious interference with
prospective business relations against both Defendants must be dismissed based
under Delaware Superior Court Civil Rule 12(b)(6).
198
Id.199
Pls. Am. Compl., ¶ 157.
200
Id.201
Id. ¶¶ 151–56.
202
Id.53
Unfair Competition at Common Law
To state a common law claim for unfair competition, a plaintiff must allege
“a reasonable expectancy of entering a valid business relationship, with which the
defendant wrongfully interferes, and thereby defeats the plaintiff’s legitimate
expectancy and causes him harm.”203 Plaintiffs argue that Owens had a reasonable
expectancy of entering into and continuing a valid business relationship with
Facebook.204 As discussed above, there is no “improper” or “wrongful” interference,
where Defendants’ conduct was protected by the First Amendment. In Agilent Tech,
Inc. v. Kirkland, the Delaware Chancery Court noted that for an unfair competition
claim, it is not wrongful if a defendant’s interference is protected by the First
Amendment.205 Moreover, in Blatty, the Supreme Court of California affirmed the
lower court’s judgment dismissing numerous claims including unfair competition as
First Amendment limitations are applicable to all of the plaintiff’s claims. 206
203
Agilent Tech., Inc. v. Kirkland, 2009 WL 119865, at *5 (Del. Ch. Jan. 20, 2009) (quoting
Rypac Packaging Mach. Inc. v. Poges, 2000 WL 567895, at *8 (Del.Ch. May 1, 2000)).
204
Pls. Am. Compl., ¶ 159.
205
Agilent Techs., Inc., 2009 WL 119865, at *8.
206
Blatty v. New York Times Co., 728 P.2d 1177 (Cal. 1986) (en banc).
54
Therefore, Plaintiffs’ claim for unfair competition against both Defendants must be
dismissed under Delaware Superior Court Civil Rule 12(b)(6).
CONCLUSION
For the reasons stated above, I GRANT both Defendants’ Motions to Dismiss
for Failure to State a Claim under Delaware Superior Court Civil Rule 12(b)(6).
This case is dismissed.
IT IS SO ORDERED.
/s/ Craig A. Karsnitz
cc: Prothonotary
55