California environmental advocacy group and Proposition 65 enforcer Global Community Monitor (GCM) has prevailed in its defense of a defamation cross-complaint brought by flooring giant Lumber Liquidators.
In a 21-page decision, Alameda County Superior Court Judge Wynne Carvill ruled that Lumber Liquidators’ lawsuit against Global Community Monitor (GCM) was a strategic lawsuit against public participation that violates California’s anti-SLAPP law.
Lumber Liquidators’ defamation claims stemmed from a Proposition 65 lawsuit GCM filed last July against the company for allegedly high levels of formaldehyde found in Chinese-made laminate flooring sold at its retail outlets. Lumber Liquidators responded with a defamation suit, after its’ demurrer was overruled by Judge Carvill last September.
“Lumber Liquidators tried to silence us and the court saw through it,” Denny Larson, Executive Director of Global Community Monitor said in a press release. “The court recognized that we have a constitutional right to free speech. The public likewise has a right to know if any product they buy may be harmful to their families’ health.”
California’s anti-SLAPP statute provides for the “early dismissal of unmeritorious claims filed to interfere with the valid exercise of the constitutional rights of freedom of speech and petition for the redress of grievances.”
Judge Carvill noted in his decision, “The anti-SLAPP statute is ‘construed broadly’ to achieve its goal of ensuring that ‘participation in matters of public significance’ is not ‘chilled through abuse of the judicial process.'” He concluded that Lumber Liquidators did not present sufficient evidence to show that its defamation-based claims against GCM “have any likelihood of success.”
In addition, the Court found that GCM is entitled to recover attorneys’ fees and costs incurred in defending the defamation suit. GCM’s attorney, Richard Drury of Lozeau Drury LLP stated, “This is a good day for free speech and for the consumers of the State of California who are concerned that Chinese-made laminate flooring sold by Lumber Liquidators contains cancer-causing formaldehyde far above levels allowed by law.”
The defamation allegations made by Lumber Liquidators were based on statements in a press release by GCM that was distributed after filing its Proposition 65 complaint against the company.
Lumber Liquidators took issue with the following statement from GCM’s press release:
“Products from Chinese factories emit toxic gas in excess of 100 times CA standards.”
In his decision, Judge Carvill notes that Lumber Liquidators’ trial burden would be to show the gist of GCM’s publication(s) as a whole was false. Because Lumber Liquidators is a “limited public figure,” the company would have to establish the statements were made with “actual malice.
Judge Carvill explained in his decision that “California law permits the defense of the alleged defamatory matter; it is sufficient if the substance of the charge be proved substantial truth and would absolve a defendant even if she cannot ‘justify every word of true, irrespective of slight inaccuracy in the details.’ …The essence of that inquiry …remains the same whether the burden rests upon plaintiff or defendant. Minor inaccuracies do not amount to falsity so long as ‘the substance, the gist, the sting, of the libelous charge be justified.’
Lumber Liquidators was unable to show that GCM’s statements were false or libelous.
Judge Carvill noted that it was unclear whether the statements made in the press release suggested the company’s products exceeded formaldehyde limits established by the California Air Resource Board (CARB) standards or Proposition 65 Safe Harbor Level for formaldehyde by 100 times.
“In sum, given that the gist of [GCM’s] statements about Lumber Liquidators and its products is that they emit too much formaldehyde to be lawfully sold in California. Lumber Liquidators’ cross-claims against [GCM] not only require a showing sufficient to defend against GCM’s complaint and prevail on its own declaratory relief cause of action. But would also require it to show GCM made its statements without any scientific basis for doing so.
By focusing on the ‘100 times’ statement in the subject press release, and arguing that it need only show that any part of its claims has some minimal merit, Lumber Liquidators misconstrues its’ legal burden for defending this Motion.
“What the current state of the record does show is that there are distinct differences of opinion between the parties by the competing declarations of their respective experts as to the type of testing that will ultimately carry the day for one side or the other…In other words, the appropriate standards for both CARB2 and Prop 65 compliance and their application to this case are hotly contested issues. What the record does not show, however, is that Lumber Liquidators defamation allegations against GCM have any likelihood of success,” Judge Carvill ruled.