Healthsmart v. Kabateck, January 10, 2017,
Dr. Drobot used to sell medical devices to Pacific Hospital that he owned through a wholly owned holding company called Healthsmart. In January 2014, Dr. Drobot pled guilty to federal charges related to certain business schemes. According to the plea, he sold the devices at fraudulently inflated prices for the purpose of getting reimbursements from insurance companies; he referred patients to Pacific Hospital to get a kickback on spinal surgeries; and he provided financial benefits to a senator to influence legislation. One month later, a prior patient of Pacific Hospital filed a civil action based on those facts, and further alleged that counterfeit hardware was used in spinal surgeries. The patient’s attorneys made statements about the lawsuit to reporters at Fox 11 news and CBS radio. Dr. Drobot and Healthsmart sued the patient’s attorneys for defamation and related claims.
The trial court granted attorneys’ anti-SLAPP motion and awarded about $64,000 in fees against Dr. Drobot. Held: Affirmed.
The trial court granted attorneys’ anti-SLAPP motion and awarded about $64,000 in fees against Dr. Drobot. Held: Affirmed.
The court used the usual two-step process to evaluate anti-SLAPP motions – Does the challenged claim arise from activity protected by the anti-SLAPP lawsuit (e.g., free speech about an issue of public interest), and, if so, can the plaintiff prove the probability of prevailing on the claim.
Dr. Drobot argued that the attorneys were exercising their right to free speech, but not in connection with an public issue or issue of public interest. The public interest test is problematic because it can mean anything, since almost anything can be more or less connected to some aspect of the “public interest.” To avoid over-application the “public interest” prong, one court has fashioned the test to focus on whether the conduct concerns (1) “a person or entity in the public eye”; (2) “conduct that could directly affect a large number of people beyond the direct participants”; or (3) “a topic of widespread, public interest.”
Dr. Drobot argued that the attorneys were exercising their right to free speech, but not in connection with an public issue or issue of public interest. The public interest test is problematic because it can mean anything, since almost anything can be more or less connected to some aspect of the “public interest.” To avoid over-application the “public interest” prong, one court has fashioned the test to focus on whether the conduct concerns (1) “a person or entity in the public eye”; (2) “conduct that could directly affect a large number of people beyond the direct participants”; or (3) “a topic of widespread, public interest.”
The court had no trouble finding that this prong of the test had been met: Dr. Drobot and the hospital put the devices in thousands of people, consumers have an interest in being informed of issues concerning certain doctors and health facilities, and there were assertions of a widespread illegal physician kickback scheme raise issues concerning the integrity of the health care system, which is a matter of widespread public concern. On top of this, all of it was linked to allegations of bribing a senator. So prong one, no problem.
The burden then shifted to Dr. Drobot to show that his claims had minimal merit. Not a heavy burden; but he couldn’t meet it. The attorneys’ statements to the media were protected under Civil Code section 47, under the “fair report” privilege. Civil Code section 47(d)(1) defines a “privileged publication or broadcast” to include one made “[b]y a fair and true report in, or a communication to, a public journal, of (A) a judicial, (B) legislative, or (C) other public official proceeding, or (D) of anything said in the course thereof, or (E) of a verified charge or complaint made by any person to a public official, upon which complaint a warrant has been issued.” This privileged protects not only the media, but those who report to the media, including those attorneys who have a penchant for talking to the media.
A couple of footnotes: Attorneys should still exercise caution in how they speak to the media. The court has modified its opinion (no change in judgment) to include the following sentence: “More particularly, the attorney defendants in this case are protected from liability under the fair report privilege in informing the news media that they have alleged that plaintiffs used counterfeit screws in spinal surgeries and were part of a scheme that supplied prostitutes, but they are not protected if they informed the media that such facts were true.”
Second, the opinion contains this very interesting footnote about other litigation concerning against Dr. Drobot: “Other plaintiffs subsequently filed complaints against Drobot alleging similar facts and causes of action. Most of the lawsuits were filed by people who had surgery at hospitals other than Pacific Hospital. Drobot successfully demurred to the complaints of three such lawsuits and 27 other lawsuits were subsequently dismissed voluntarily. Drobot thereafter filed a verified complaint for malicious prosecution against the 30 plaintiffs and their attorneys, including the attorney defendants in this case. The attorney defendants in that malicious prosecution case filed an anti-SLAPP motion, which the court granted. Drobot appealed. That appeal, Healthsmart Pacific, Inc., et al. v. Golia, etc., et al., case No. B266311, is pending.”