Re: 9/24/01 - [HEPH] Defendants gpalcus and dickie13_62301's second special motion to strike is GRANTED
[In early February, 2001] Hollis-Eden, a San Diego biotech, filed a libel suit in San Diego Superior Court seeking unspecified damages against 11 participants who posted disparaging remarks about Hollis-Eden management on the popular Yahoo! message boards... In its libel suit, Hollis-Eden alleges the defendants, named only by their screen aliases, could be disgruntled former employees and shareholders or people working with short sellers to manipulate the stock... The anonymous message board participants accuse Hollis-Eden management, in colorful but intemperate language, of "dishonesty, deceit and fraud," of manipulating the stock for management's own gain, and of incompetence, according to the lawsuit... Hollis-Eden alleges the slurs hurt its business and reputation. The company is seeking the true identities of the message board participants from Yahoo!, which is not named in the lawsuit... The company, which posted a $21 million loss in the nine months ended Sept. 30, has an HIV drug in early-stage development. Its stock has fallen steadily from a 52-week high of $19.25 in March to yesterday's closing price of $5.09. siliconinvestor.com
Public Citizen, on behalf of defendants gpalcus and dickie13_62301, filed a special motion to strike under California's anti-SLAPP laws, which was granted in early March. HEPH appealed, moving papers have been drawn and delivered to the court through October, and a hearing will be scheduled sometime before the end of the year.
HEPH also amended their original lawsuit against the remaining defendants and added a new charge specifically to get around another anti-SLAPP ruling-- and re-included gpalcus. When the court was apprised that gpalcus was illegally added to the new suit, HEPH then dropped his name from the amended suit and filed a new lawsuit against him similar to the amended suit. Gpalcus then filed a special motion to strike the new suit against him. This second special motion to strike was also granted (see below).
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Hollis-Eden Pharmaceuticals v. (gpalcus)
Case No. GIC 767077
Dept. 62 (Enright)
ORDER ON SUBMITTED MATTER
DEFENDANT'S SPECIAL MOTION TO STRIKE
Having taken defendant's special motion to strike under submission, the court rules as follows.
The motion is is GRANTED.
The Court finds this lawsuit arises out of defendant's posting made in a public forum and concerns an issue of public interest. There can be no dispute that Yahoo!'s message boards are public fora. The message board pertaining to plaintiff alone has received approximately 19,000 postings. Plaintiff is a publicly traded company, issues public statements, and is involved in research pertaining to AIDS, hepatitis and malaria. The large number of postings about the company also indicate its financial viability is a matter of public concern.
The plaintiff has not shown that it will probably prevail on its claims because the essence of the March 21. 2001 posting is true. The posting generally complained about the company not releasing information, whether good or bad. The statement "that the Wimpie trials were bought after the fact and buried by HEPH" is essentially true. The declarations of Hollis and (gpalcus) show that after the Wimpie trials were conducted plaintiff entered into a settlement and transfer agreement regarding, inter alia, the complete data from the Wimpie trials, and plaintiff declined to release that data.
IT IS SO ORDERED
Kevin A. Enright
Judge of the Superior Court
Dated: September 24,2001
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Currently, only four defendants remain. At least three could not afford a defense and were forced to settle-- agreeing to stop posting anything 'negative' - to report to the company any perceived 'wrongdoing' by others - and agreeing to post over several successive days a company drafted and/or approved 'apology' to the company and specifically it's CEO, Richard Hollis. This one is representative - from poster heph_long, a once very active and productive poster: messages.yahoo.com.
Under California's anti-SLAPP laws, the plaintiff (HEPH) is responsible for paying the legal fees of the defendants. Through the March 30th ruling, the Public Citizen legal team has been court-awarded over $70,000 from HEPH. However, the meter is still running. The second defeat should add a similar hefty penalty. Ouch.
Most importantly, when the HEPH appeal is heard, it will be the first such anti-SLAPP appeal to have made it that far at the state level. Recall the Global Telemedia (GTMI) case was at the federal level.
- Jeff |
