• February 26, 2014
Shadrach's whistle

Using Anti-Anti-SLAPP Maneuver Against False Whistle-Blowers?

Update (February 26, 2016): This just in: Ramsey County Judge Shawn Bartsh has held that Minnesota’s anti-SLAPP statute is unconstitutional in that it supplants a party’s constitutional right to a jury with a threshold judge’s determination. More later….

Original post (Septemer 10, 2014): Here is a hypothetical for you: business-person steals a business’ confidential business information and trade secrets and provides them to government regulators under the mistaken belief that the information reveals illegal conduct. (We’ll call the hypothetical business-person, “Accused Thief” and we’ll call the hypothetical business, “Alleged Victim.”) (And, by the way, who’s to know whether it was really a “mistaken belief” or simply an inappropriate form of competition between businesses, i.e., an “intentionally mistaken belief”?)

Let’s say Alleged Victim sues Accused Thief for conversion, misappropriation of trade secrets, etc. in connection with Accused Thief’s actions.

Accused Thief answers by invoking the an “anti-SLAPP” statute, which protects citizens rights to participate in government.

So, now, at the theshhold of the lawsuit, before either side is permitted to do any discovery, Alleged Victim has to come forward with “clear and convincing evidence” that Accused Thief’s actions were not “genuinely aimed in whole or in part at procuring favorable government action“? (The pending case of MDI v. Hooten bears some resemblance to this hypothetical.)

Minnesota Litigator has previously repeatedly covered Minnesota’s “anti-SLAPP statute,” a statute designed to deter the improper use of our court system as a weapon (here, for example, and here). (The classic example is a rich wrong-doer suing a news organization for publishing something that is true but unflattering. Such a wrong-doer could, in theory, (a) extract a settlement from a defendant just so the defendant can avoid the expense of litigation, or (b) could deter the free exchange of information with the threat of huge litigation costs.

In June, the Minnesota Supreme Court left open the possibility of a constitutional challenge to Minnesota’s anti-SLAPP statute, as the statute has been construed by Minnesota Courts.

The pending Hennepin County case of MDI v. Hooten v. MDI might bring the issue, eventually, back up to the Minnesota Supreme Court on the constitutionality of Minnesota’s anti-SLAPP statute (or it might be dismissed on other grounds or the court might have other reasons for never reaching the constitutional issue).

"A Tough Knot to Crack" (photo by Jay Fanelli)

“A Tough Knot to Crack” (photo by Jay Fanelli)

So the question might still remain for some time to come.

But consider MDI’s position (the “Alleged Victim”). It would seem likely that the Alleged Thief was mistaken, at best, about MDI’s alleged wrong-doing (here is Judge Schiltz’s opinion dismissing claims against MDI). So, in order for MDI to vindicate its rights in regard to the misappropriation of its confidential information, MDI, prior to any discovery, must come forward with “clear and convincing evidence” of its defendants’ allegedly bad state of mind? That is, MDI would have to come forward with clear and convincing evidence that Accused Thief held no sincere belief that its seeking regulatory action was legit “in whole or in part”?

It seems to me that MDI should able to move forward in light of the carve-out in Minn. Stat. 554.03 providing, “unless the conduct…constitutes a tort.” I will speculate that MDI might have “clear and convincing evidence” that its confidential business information was misappropriated.

Nevertheless, this puzzle of placing a burden of “clear and convincing evidence” before any discovery is undertaken does present a risk that Minnesotans’ rights to a jury to adjudicate their claims (where the burden of proof is merely the lower standard of a “preponderance of the evidence”) might be barred by Minnesotans failure to meet the higher standard of “clear and convincing evidence” in response to an anti-SLAPP motion before any discovery has even been undertaken.

Could this be an example of a well-meaning statute designed to prevent a serious social ill which, as applied and construed by courts, backfires in violation of the state and federal constitutions?

As I said, it is unclear that Hennepin County District Court Judge Karen A. Janisch will need to address the constitutionality of Minnesota’s anti-SLAPP statute in the MDI v Hooten v MDI case (counsel for defendants in that case, Randall Tigue, certain does not think so). But, now or later, I expect someone will have to.

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