• October 14, 2009

An interesting little puzzle: if a public entity and a “gad-fly” advocacy group enter into a settlement agreement whereby the gad-fly will not address any further challenges to the public entity’s conduct that he originally challenged through litigation, will a later complaint by the public entity for the breach of that settlement agreement against the gad-fly be precluded by the Minnesota anti-SLAPP statute? 

Sometimes but not always? How would the trial court handle such a claim to dismiss the breach-of-settlement agreement complaint?  At what stage could the trial court determine whether there is “clear and convincing evidence” that the gad-fly’s conduct fell outside the conduct protected by the statute? 

I would favor a ruling that such a settlement agreement would be void as a matter of public policy although that does not appear to have been argued before the Minnesota Supreme Court.  Minnesota’s anti-slapp statute was passed to protect against lawsuits brought to deter or discourage First Amendment conduct (i.e., petitioning government, exercising free speech rights):  “Lawful conduct or speech that is genuinely aimed in whole or in part at procuring favorable government action is immune from liability, unless the conduct or speech constitutes a tort or a violation of a person’s constitutional rights.”

Having brought an action against a major media company for defamation and having been threatened with an “Anti-SLAPP” counterclaim (SLAPP = “strategic litigation against public participation”) (a very empty threat under the circumstances), I note with interest that the Minnesota Supreme Court has just heard argument (10/8/09, video available here) in Middle-Snake-Tamarac Rivers Watershed District v. Stengrim, Case No. A08-0825.  This appears to be the first time the Minnesota Supreme Court has addressed this statute passed in 1994.  

Middle-Snake-Tamarac involved a challenge by landowners to a flood control project, which, after protracted litigation, was settled for $1.7 million. As part of the settlement, the Landowners promised “to address no further challenges in litigation or otherwise against establishment of the Project.”  

A year later the District brought an action that Stengrim, one of the Landowners, violated the settlement agreement by, essentially, interfering with the Project’s going forward. Stengrim answered that his conduct was immune from liability under Minnesota’s Anti-SLAPP statute.  The district court rejected Stengrim’s defense, reasoning that the Anti-SLAPP statute did not apply to motions to enforce a settlement agreement.  The Minnesota Court of Appeals reversed the district court, remanding for the district court “to address whether the District met its statutory burden to prove by clear and convincing evidence that Stengrim’s conduct was not immune.”  

One aspect of the case getting the Minnesota Supreme Court’s attention is the “clear and convincing evidence that the acts of the moving party are not immunized from liability” standard of proof under Minn. Stat. 554.02, Subd. 2(3) vis-a-vis the preponderance of the evidence standard that would apply to the complainant’s cause of action.  At length, the Court (Magnuson, C.J.) asks, “Does this question (whether the allegedly protected conduct falls outside the protection of the statute) have to go to trial?”  

Other angles of interest to the Minnesota Supreme Court: did the gad-fly waive his rights to petition the government in his settlement agreement?  Is “contract breach” “unlawful conduct” that would fall outside the protections of the anit-SLAPP statute?  

Again, in my view, it is a mistake for our law to permit a public entity to settle a case in whole or in part by causing its adversary to surrender its First Amendment rights, which is how I think one has to read the Middle-Snake-Tamarac settlement agreement.  Rather, settlements in such cases can presumably include concrete commitments and concessions by the public entity and the gad-fly, alike, rather than some vague promise of “no further challenges in litigation or otherwise” (and, perhaps, such settlement agreements can also provide for the court to retain jurisdiction to address on-going disputes).

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