Tenth Circuit Issues A Troubling Ruling Limiting New Mexico's Anti-SLAPP Statute In Federal Court

from the It's-Erie-how-problematic-this-decision-is dept

Last week the Tenth Circuit refused to let New Mexico's anti-SLAPP statute be used in federal court in diversity cases. The relatively good news about the decision is that it is premised heavily on the specific language of New Mexico's statute and may not be easily extensible to other states' anti-SLAPP laws. This focus on the specific language is also why, as the decision acknowledges, it is inconsistent with holdings in other circuits, such as the Ninth. But the bad news is that the decision still takes the teeth out of New Mexico's statute and will invite those who would abuse judicial process in order to chill speech to bring actions that can get into the New Mexico federal courts.

In this case, there had been litigation pending in New Mexico state court. That litigation was then removed to federal court on the basis of "diversity jurisdiction." Diversity jurisdiction arises when the parties in the litigation are from separate states and the amount in controversy is more than $75,000 and the issue in dispute is solely a question of state law. Federal courts ordinarily can't hear cases that only involve state law, but because of the concern that it could be unfair for an out-of-state litigant to have to be heard in a foreign state court, diversity jurisdiction can allow a case that would have been heard in state court to be heard by the federal one for the area instead.

At the same time, we don't want it to be unfair for the other party to now have to litigate in federal court if being there means it would lose some of the protection of local state law. We also don't want litigants to be too eager to get into federal court if being there could confer an advantage they would not have had if the case were instead being heard in state court. These two policy goals underpin what is commonly known as the "Erie doctrine," named after a 1938 US Supreme Court case that is still followed today.

The Erie doctrine is why a case removed to federal court will still use state law to decide the matter. But sometimes it's hard to figure out how much state law needs to be used. Federal courts have their own procedural rules, for instance, and so they are not likely to use procedural state rules to govern their proceedings. They only will use substantive state law. But it turns out that figuring out which a law is, procedural or substantive, is anything but straightforward, and that is the question at the heart of this Tenth Circuit case: was New Mexico's anti-SLAPP law procedural, in which case the federal court did not have to follow it, or substantive, in which case it did? And unfortunately in this case, Los Lobos Renewable Power LLP v. Americulture, Inc., the Tenth Circuit decided it was "hardly a challenging endeavor" to decide that it was only procedural.

It based a significant portion of its decision on language unique to the New Mexico statute that differed from other states' and emphasized its procedural operation:

Unlike many other states’ anti-SLAPP statutes that shift substantive burdens of proof or alter substantive standards, or both, under no circumstance will the New Mexico anti-SLAPP statute have any bearing on the suit’s merits determination. See, e.g., Makaeff v. Trump Univ., LLC, 715 F.3d 254 (9th Cir. 2013) (addressing a California anti-SLAPP statute that shifted substantive burdens and altered substantive standards).

It also looked to a New Mexico state supreme court decision that had used substantive/procedural language as part of its consideration of a different anti-SLAPP case:

The New Mexico Supreme Court’s recent decision in Cordova v. Cline, 396 P.3d 159 (N.M. 2017), supports our reading of the anti-SLAPP statute to a tee. ... The court could not have made itself any clearer: “While the Anti-SLAPP statute provides the procedural protections [the members] require, the Noerr-Pennington doctrine is the mechanism that offers [the members] the substantive First Amendment protections they seek.”

But picking out this language of the Cordova case to base its holding on suggests that the Tenth Circuit seriously misread what the New Mexico Supreme Court case was saying and all the effort it had made in its ruling to ensure that the state anti-SLAPP law would, in fact, have substantive effect in that case:

To curtail SLAPP suits, New Mexico enacted an Anti-SLAPP statute. Section 38-2-9.1. The Legislature enacted the Anti-SLAPP statute with the policy goal of protecting its citizens from lawsuits in retaliation for exercising their right to petition and to participate in quasi-judicial proceedings. Section 38-2-9.2. In order to accomplish this goal, the Legislature created expedited procedures for dismissing actions "seeking money damages against a person for conduct or speech undertaken or made in connection with a public hearing or public meeting in a quasi-judicial proceeding before a tribunal or decision-making body of any political subdivision of the state," Section 38-2-9.1(A), and allowing for the recovery of costs and attorney fees incurred in pursuing the dismissal, Section 38-2-9.1(B). … We conclude that the Legislature intended to protect all public participation, whether it be in quasi-judicial proceedings or public hearings. The specific protection in the Anti-SLAPP statute for participation in public hearings before tribunals also comports with a national political ethos, that "encourage[s], promote[s], and purport[s] to protect citizens' testifying, debating, complaining, campaigning, lobbying, litigating, appealing, demonstrating, and otherwise `invoking the law' on public issues." George W. Pring & Penelope Canan, "Strategic Lawsuits Against Public Participation" ("SLAPPS"): An Introduction for Bench, Bar and Bystanders, 12 Bridgeport L. Rev. 937, 945-46 (1992); see also Rowe & Romero, supra, at 221-23 (summarizing a lawsuit filed in state district court against protestors who appealed city approval of Wal-Mart's development plan to the district court and then the Court of Appeals and describing the lawsuit as a SLAPP because it was intended to discourage the protestors' public participation in opposing the development).

It's this language from the New Mexico Supreme Court opinion upholding the anti-SLAPP statute that should have informed the Tenth Circuit's analysis, not the substantive/procedural language that it used in an entirely different context than in the case before the Tenth Circuit. The bottom line is that with an operative anti-SLAPP law public participation in New Mexico is protected from costly litigation. Without it public participation in New Mexico has no such protection. But the Tenth Circuit's ruling means that New Mexico speakers only get the benefit of that protection if the people who try to sue them are local to New Mexico. If they instead have the misfortune of being sued by an out-of-state plaintiff able to assert diversity jurisdiction to get the case into federal court, they will suddenly be stripped of it.

The degree to which this deprivation obviously frustrates New Mexico legislative intent to protect speech, and leaves speech vulnerable to chilling abuse of process, shows just how substantive anti-SLAPP law really is, and thus just how out-of-step with the Erie doctrine the Tenth Circuit deeming it merely procedural really is. It's also inconsistent with another part of the decision where the Tenth Circuit itself seemed to recognize the anti-SLAPP law's substantive import.

As part of the same decision, the court also had to rule on whether it could even consider this interlocutory appeal of the district court's denial to enforce the New Mexico anti-SLAPP statute. Due to a missed deadline by the defendant, the court had to engage in a meaningful analysis that included assessing just how pivotal it was for the court to rule on the anti-SLAPP applicability question now, and not after the full case examining the merits of the lawsuit had concluded. And the court found that it was indeed very important:

"[W]ere we to wait for this case to conclude in the court below by ordinary process, the statute’s sole aim would already be lost. Defendants would have already incurred the ordinary time and expense of litigation that the statute potentially grants them a right to avoid. Indeed, we can reverse the rulings of a hi court, but we cannot order away proceedings and legal fees that have already passed into history. Nor can we remand the case with instructions to “do it again, but faster this time.”

This very same finding regarding the law's effect, a finding that underpinned the Tenth Circuit's ability to even consider the appeal at all, should also have led it to conclude that the anti-SLAPP law was in fact substantive, and thus applicable in federal court. Instead, however, when it came to considering the question of its applicability the court suddenly forgot about this significance. It based its decision on semantics, rather than substance, and in contravention of what the Erie doctrine at its root requires.

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Filed Under: 10th circuit, anti-slapp, defamation, diversity, erie doctrine, federal court, free speech, new mexico, slapp, state court

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  • This comment has been flagged by the community. Click here to show it
    Anonymous Coward, 23 Mar 2018 @ 7:05pm

    Techdirt so desperate for filler that published this dull dreck.


    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 23 Mar 2018 @ 7:27pm


    Thanks for taking the time to write this, Cathy. It's a good article, about an interesting case.

    Now I'm actually inclined to disagree with your take here. I still have a fairly high regard for our federal appellate bench, and a unanimous three judge panel on the merits ought to get serious consideration.

    Unfortunately, I'm not sure I have time to really dig into this case and make a more substantive comment. So I'm left with, well, thanks for taking the time to write this up. I enjoyed reading it.

    reply to this | link to this | view in chronology ]

  • identicon
    Annonymouse, 24 Mar 2018 @ 6:23am

    As always the one line of inquiry never followed when it comes to questionable decisions inless it is already blatantly obvious...

    Follow the money.

    It is not much harder to buy 2 or 3 judges as it is just one.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 24 Mar 2018 @ 8:19am

      Questions [was Re: ]

      … when it comes to questionable decisions…

      The decision in this case, at least on the surface, is just not that questionable.

      I take it you're absolutely pursuaded by Cathy's argument. You can't imagine any possible way the panel opinion could have gotten the law right?


      It is not much harder to buy 2 or 3 judges as it is just one.

      Oh, so you're vastly experienced in buying judges? You go down to the warehouse store, and purchase federal judges all the time — on sale — right off the pallets — by the boxful?

      reply to this | link to this | view in chronology ]

    • icon
      Cathy Gellis (profile), 24 Mar 2018 @ 10:23am


      This is a poor decision by the court. But there are a lot more likely reasons for it to have gotten it wrong than corruption. Maybe the lawyering was bad. Maybe they had bad clerks. Maybe they just didn't have the judicial imagination to see what the effects would be. Plus it's a pretty progressive thing, with significant effects, to allow the anti-SLAPP law to operate in federal court, and there's often a lot of inertia that makes courts resist doing things that so change the status quo. So condemn the judges' conclusion, as it's warranted, but think twice before condemning THEM, because there's absolutely no evidence to support such disparagement of the independent federal judiciary.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 24 Mar 2018 @ 11:09am

        Re: Re:

        Maybe they just didn't have the judicial imagination to see what the effects would be.

        If the federal court of appeals panel totally and completely messed up supervising the federal district court's procedure, then the New Mexico legislature could just revise and amend the state's anti-slapp statute.

        Amending the New Mexico statute wouldn't affect the outcome of this particular case, of course, but it would ameliorate any deeper effects. Yes?

        reply to this | link to this | view in chronology ]

        • icon
          Cathy Gellis (profile), 24 Mar 2018 @ 11:30pm

          Re: Re: Re:

          Yes, in theory, they could write a statute that looks more like California's. But I don't know how likely that is, it won't help in this case, and it really shouldn't be necessary.

          reply to this | link to this | view in chronology ]

          • identicon
            Anonymous Coward, 25 Mar 2018 @ 9:58am

            Re: Re: Re: Re:

            … it won't help in this case…

            A clear circuit split isn't strictly necessary for cert, but it sure helps a whole lot.

            reply to this | link to this | view in chronology ]

            • icon
              Cathy Gellis (profile), 25 Mar 2018 @ 6:52pm

              Re: Re: Re: Re: Re:

              I wouldn't give this good odds for cert since it was so specific to New Mexico's language. Possibly ripe for review en banc though, but I don't know if a petition asking for it has been filed, and they aren't always granted. In fact, in most circuits, rehearings are quite rare.

              reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 25 Mar 2018 @ 9:37pm

    Opinion below

    (Our discussion got me interested enough to read the district court's decision which has now been affirmed by the Tenth Circuit. Here are convenience links.)

    Los Lobos Renewable Power v AmeriCulture (D.N.M. 2:15-cv-00547-MV-LAM)

    reply to this | link to this | view in chronology ]

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