Ninth Circuit Purges Anti-SLAPP Motion for Contract Claims
In an action involving the popular film series The Purge, the US Court of Appeals for the Ninth Circuit affirmed a district court denial of the defendants’ anti-SLAPP motion, holding that the plaintiff’s breach of implied-in-fact contract claim under state law did not arise from protected free speech activity. Douglas Jordan-Benel v. Universal City Studios, Inc., et al, Case No. 15-56045 (9th Cir., June 20, 2017) (Pregerson, J).
In 2011, Douglas Jordan-Benel penned a screenplay entitled Settler’s Day about “a family’s attempt to survive an annual, state-sanctioned, 24-hour period in which citizens are allowed to commit any crime without legal consequences.” In attempts to sell the screenplay for further production, Jordan-Benel’s agent submitted it to the managing director of United Talent Agency (UTA). Given custom and practice in the entertainment industry, and based on prior dealings between UTA and Jordan-Benel’s agent, UTA understood that the submission of the screenplay was for the purpose of selling it to a UTA client, and not merely gratuitous. Although UTA informed Jordan-Benel’s agent that it would “pass” on the screenplay, the screenplay was provided to two UTA clients, who then wrote the script for The Purge, which was eventually released as films in 2013 and 2014 (along with a third film that was released in 2016).
Jordan-Benel alleged that The Purge script copied ideas from Settler’s Day. In 2015, he filed a claim in state court for breach of implied-in-fact contract against UTA and other parties involved in the production of The Purge films (collectively, the defendants). In response to Jordan-Benel’s lawsuit, the defendants filed an anti-SLAPP motion to strike the state law claims on grounds that they arose from exercise of the defendants’ right of free speech. California’s anti-SLAPP law provides for early dismissal of meritless First Amendment cases aimed at chilling expression. The district court denied the motion, ruling that Jordan-Benel’s breach of contract claims arose from the failure to pay for the use of Jordan-Benel’s ideas, and not from an act in furtherance of free speech rights, such as the creation and production of The Purge films. Defendants appealed.
On appeal, the Ninth Circuit worked through an exercise of identifying the claim at issue in the lawsuit in order to properly examine the merits of defendants’ anti-SLAPP motion. Defendants contended that Jordan-Benel’s claims arose from the creation, production, distribution and content of The Purge films. The Ninth Circuit, however, agreed with Jordan-Benel and the district court that the claim at issue was simply a breach of implied-in-fact contract for defendants’ failure to compensate Jordan-Benel as a writer/creator for use of his screenplay idea.
Having identified the claim at issue, the Court conducted its review of the anti-SLAPP motion under the following two-part test:
From what conduct does the claim arise?
Is that conduct in furtherance of the rights of petition of free speech?
To answer the first question, the Ninth Circuit turned to guidance from the California Court of Appeal, which focuses its anti-SLAPP analysis on the specific conduct that the claim challenges. While common law generally does not recognize a claim of “idea theft” or treat ideas as property, the California Supreme Court has held that contract law may provide protection to a person who submits an idea to others with the understanding that the submission is made in consideration of a promise of payment for its use. According to California courts, California law recognizes an “idea theft” cause of action based on the “implied promise to pay the reasonable value of the material disclosed.” The Ninth Circuit determined that the “conduct” from which Jordan-Benel’s breach of implied-in-fact contract claim arose was defendants’ failure to pay for the use of the screenplay idea, not the making of the films. In other words, the alleged free speech activity of creating and distributing The Purge films was not the specific wrongful act that gave rise to Jordan-Benel’s claim.
Turning to the free speech question, the Ninth Circuit concluded that defendants’ conduct (i.e., failure to pay Jordan-Benel) was not in furtherance of the right of free speech. Thus, the Court agreed with the district court and concluded that application of anti-SLAPP was not a defense to the breach of contract claim.