VITALIANO, District Judge.
Plaintiff Eric Brahms commenced this diversity action
The following facts are taken from the amended complaint, as well as other evidence of which the Court may take notice on a Rule 12(b)(6) motion, and are assumed to be true for purposes of that motion.
Brahms's claims are based on comments made online on the Vintage Rolex Forum ("VRF"), an internet forum where users discuss various topics related to vintage Rolex watches. (Compl. at ¶ 8.) VRF is owned and operated by Carver and moderated by Marcano, and it is hosted by Network54.com ("Network54"), an internet website hosting company that is not a party to this action. (Id. at ¶¶ 9-11). Brahms is in the business of buying, refurbishing and selling vintage Rolex watches. (Id. at ¶ 7.) In April 2011, he registered a free account on VRF under the username "Beever." (Id. at ¶ 11.) Linked to Brahms' account were his full name and a Yahoo.com email address. (Id. at ¶ 13.) As the moderator and operator of VRF, Marcano and Carver had access to this information.
In a separate VRF discussion thread, also proceeding on October 19, 2011, a user named "Morgan King" posted the following:
(Coogan Aff. Ex. 4 at 1.) Brahms confirmed that the email addresses and eBay name were his, adding "Nice work."
Later that evening, in a different discussion thread, Marcano (posting as tomvoxl) demanded an apology from Brahms for accusations he made against Marcano in the earlier exchange, particularly Brahms' statement that Marcano was "duping the innocent." (Coogan Aff. Ex. 5 at 1.) Specifically, Marcano wrote "I would like an apology for this, Beever/Eric Brahms/edouble141/ericbee ...." (Id., Compl. at ¶ 20.) Carver, weighing in for the first time, agreed that Marcano was owed an apology. (Coogan Aff. Ex. 5 at 1.) In a lengthy post, Brahms responded with numerous examples of slights that Marcano had made against him, and demanded his own apology for these "extremely condescending remarks." (Id. at 3-4.) Carver then responded that "Mr. Beever is no longer with us," indicating that Brahms had been banned from the forum. (Id. at 4.)
The following month, on November 18, 2011, Brahms was indicted in Supreme Court, New York County, along with 27 other individuals, for his role in an alleged credit card counterfeiting scheme. According to the indictment, the conspirators stole credit card numbers in restaurants and used them to create forged credit cards, which they then used to purchase goods. (See Coogan Aff. Ex. 6 (Indictment).)
The news of Beever's troubles did not escape notice on VRF. On December 5, 2011, a user identified as "Frank" posted on VRF, "Eric Brahms aka Beever — Arrested for Fraud, Fencing Jewelry & Rolex," and linked to the two news articles. (Compl. ¶ 22-24.) Marcano responded that Brahms was a "pathetic and unhinged individual and in the end just another 2-bit thief and counterfeiter."
Nearly a year later, on September 27, 2012, Brahms sent Carver an email requesting that the negative posts about him be removed from the forum. (Compl. ¶ 29.) He received no response. (Id.) On November 12, 2012, Carver wrote a post on VRF entitled "Whatever happened to the Eric Brahms case?" (Id. ¶ 31; Coogan Aff. Ex. 10.) Carver sought legal advice from the forum, apparently in response to a November 1, 2012 letter from Brahms' attorney demanding removal of the offending postings and threatening suit. Carver's post included a link to the December 5, 2011 thread. (Complaint ¶ 31; Coogan Aff. Ex. 10, 11.)
Brahms filed the complaint in this case on November 14, 2012. On February 20, 2013, while the parties were in the process of briefing this motion to dismiss, Brahms pleaded guilty to charges of grand larceny in the fourth degree and criminal possession of a forged instrument in the second degree. (See Coogan Affirmation in Further Support of Defendants' Motion to Dismiss ("Coogan Reply Aff.") Ex. 1 (transcript of Brahms' guilty plea allocution.))
After they were posted, the comments about Brahms — along with the links to the relevant news articles — became available to anyone conducting an internet search for his name. (Compl. ¶ 28). Brahms alleges that these comments contain untrue statements of fact and have eliminated his ability to buy or sell Rolex watches or parts to anyone anywhere in the world. He alleges further that these posts have also caused him to be rejected by landlords, banks, and brokerage accounts, and banned by PayPal and eBay. (Id. at 33.)
Under Federal Rule of Civil Procedure 8(a)(2), a complaint need only contain "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). This rule does not compel a litigant to supply "detailed factual allegations" in support of his claims, Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), "but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation," Ashcroft v. Iqbal, 556 U.S. 662, 667, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). "A pleading that
A complaint must be dismissed under Rule 12(b)(6) if it does not "contain sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'" Id. (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. Determining plausibility is "a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 1950. That said, the factual allegations are paramount — "a complaint need not pin plaintiff's claim for relief to a precise legal theory" nor provide "an exposition of his legal argument." Skinner v. Switzer, 562 U.S. 521, 131 S.Ct. 1289, 1296, 179 L.Ed.2d 233 (2011). In analyzing well-pled facts, a court must accept as true all allegations in the complaint and draw all reasonable inferences in favor of the pleader. See Gorman v. Consol. Edison Corp., 488 F.3d 586, 591-92 (2d Cir.2007).
A court may consider on a Rule 12(b) motion, in addition to the pleading itself, documents that are annexed to or referenced in the complaint, documents that the plaintiff relied on in bringing the suit, and matters of which judicial notice may be taken. See Chambers v. Time Warner, Inc., 282 F.3d 147, 152-53 (2d Cir.2002) (citations omitted); Rothman v. Gregor, 220 F.3d 81, 88 (2d Cir.2000). In this case, the Court will look to Network54's "Terms of Use" (the "Network54 TOU" or the "TOU"), (see Coogan Aff. Ex. 2), the Daily News and New York Times articles that mentioned Brahms (see Coogan Aff. Exs. 8 and 9), and the relevant VRF discussion threads, (see Coogan Aff. Exs. 5 and 6), all of which are referenced in the complaint and provided in full by defendants with their briefing, notwithstanding that Brahms declined to attach these documents to his complaint. See Holowecki v. Fed. Express Corp., 440 F.3d 558, 565-66 (2d Cir.2006) ("`[w]hen a plaintiff chooses not to attach to the complaint ... a [document] upon which [he] solely relies and which is integral to the complaint, the court may nevertheless take the document into consideration in deciding the defendant's motion to dismiss ....'") (quoting Int'l Audiotext Network, Inc. v. Am. Tel. & Tel. Co., 62 F.3d 69, 72 (2d Cir.1995), aff'd, 552 U.S. 389, 128 S.Ct. 1147, 170 L.Ed.2d 10 (2008)).
Brahms claims defamation based on Marcano's December 5, 2011 statement calling him a "2-bit thief and counterfeiter," and Carver's subsequent republication of the post containing that statement the following year. The parties agree that New York law applies to the defamation claim.
"Defamation is the injury to one's reputation either by written expression, which is libel, or by oral expression, which is slander." See Idema v. Wager, 120 F.Supp.2d 361, 365 (S.D.N.Y.2000), aff'd 29 Fed.Appx. 676 (2d Cir.2002). To
Crucially, only a provable statement of fact is actionable as defamation. See McNamee, 762 F.Supp.2d at 600; Gross v. New York Times Co., 82 N.Y.2d 146, 153, 603 N.Y.S.2d 813, 623 N.E.2d 1163 (1993) ("Since falsity is a necessary element of a defamation cause of action and only `facts' are capable of being proven false, `it follows that only statements alleging facts can properly be the subject of a defamation action.'"). It is axiomatic that statements of opinion cannot constitute actionable defamation. Egiazaryan v. Zalmayev, 880 F.Supp.2d 494, 503 (S.D.N.Y. 2012) (statements of opinion "receive `absolute protection' under the New York Constitution") (quoting Celle v. Filipino Reporter Enters. Inc., 209 F.3d 163, 178 (2d Cir.2000)). Nor can "[l]oose, figurative or hyperbolic statements, even if deprecating the plaintiff" be the subject of a defamation action. Dillon, 261 A.D.2d at 38, 704 N.Y.S.2d 1 (citation omitted); see also Gross, 82 N.Y.2d at 152, 603 N.Y.S.2d 813, 623 N.E.2d 1163 ("rhetorical hyperbole" is not actionable). The dispositive inquiry is whether a reasonable reader could have concluded that the statements were conveying facts about the plaintiff. Gross, 82 N.Y.2d at 152-53, 603 N.Y.S.2d 813, 623 N.E.2d 1163. Set in this footing, Marcano argues that his statement was not one of fact, but rather a protected expression of opinion, and that any reasonable reader would have interpreted it as such.
"Distinguishing between assertions of fact and nonactionable expressions of opinion has often proved a difficult task." Brian v. Richardson, 87 N.Y.2d 46, 51, 660 N.E.2d 1126, 637 N.Y.S.2d 347 (1995). The New York courts have set out the following factors to consider in making the distinction: "(1) whether the specific language in issue has a precise meaning which is readily understood; (2) whether the statements are capable of being proven true or false; and (3) whether either the full context of the communication in which the statement appears or the broader social context and surrounding circumstances are such as to `signal ... readers or listeners that what is being read or heard is likely to be opinion, not fact.'" Id. (quoting Gross, 82 N.Y.2d at 153, 603 N.Y.S.2d 813, 623 N.E.2d 1163). In weighing these factors, "the court should look to the over-all context in which the assertions were made and determine on that basis `whether the reasonable reader would have believed that the challenged statements were conveying facts about the libel plaintiff.'" Id. (quoting Immuno AG. v. Moor-Jankowski, 77 N.Y.2d 235, 254, 566 N.Y.S.2d 906, 567 N.E.2d 1270 (1991)).
The upshot is that context is key. In Gross, for example, the allegedly defamatory statements were made in an investigative article in the news section of the New York Times, a context which the Court of Appeals held to suggest that the statements were factual in nature. Gross, 82 N.Y.2d at 155-56, 603 N.Y.S.2d 813, 623 N.E.2d 1163. By contrast, New York courts have held the following contexts to be strongly suggestive that any alleged statements were opinion or allegations, rather than fact: the editorial page of a newspaper, Brian, 87 N.Y.2d at 53, 637 N.Y.S.2d 347, 660 N.E.2d 1126; a letter to
The allegedly defamatory statement in this case was made on an internet forum where people typically solicit and express opinions, generally using pseudonyms. The statement was also clearly "rhetorical hyperbole" or a "vigorous epithet," Gross, 82 N.Y.2d at 152, 603 N.Y.S.2d 813, 623 N.E.2d 1163, particularly when viewed in the context of the heated argument — replete with name-calling — in which Marcano and Brahms had engaged only weeks earlier. Indeed, Marcano made explicit that his comment was a mere allegation, stating later: "Hey, [Brahms] might not be guilty in the long run." (Berland Aff., Ex. 1, at 6.)
Brahms argues that Marcano's statement was "a statement of opinion that implies a basis in facts which are not disclosed to the reader or listener," as opposed to one that "is accompanied by a recitation of the facts on which it is based or ... does not imply the existence of undisclosed underlying facts." Gross, 82 N.Y.2d at 153, 603 N.Y.S.2d 813, 623 N.E.2d 1163 (citations omitted). The two kinds of statements, the New York Court of Appeals has explained, are qualitatively different:
Id. at 153-54, 603 N.Y.S.2d 813, 623 N.E.2d 1163 (citations omitted). See also Sandals, 86 A.D.3d at 42-43, 925 N.Y.S.2d 407 (email was "pure opinion" in part because "each remark [was] prompted by or responsive to a hyperlink" directing the reader to the facts upon which it was based); Clark v. Schuylerville Cent. School Dist., 24 A.D.3d 1162, 1163, 807 N.Y.S.2d 175 (3d Dep't 2005) ("[A] statement of opinion accompanied by a full recitation of the facts on which it is based will be deemed a pure opinion ...."); Dillon, 261 A.D.2d at 41, 704 N.Y.S.2d 1 (statement
Marcano made the statement at issue, there is no serious dispute, in response to two news articles, posted by a different user, and it was clear that Marcano based his view that Brahms was a "2-bit thief and counterfeiter" on those articles. Marcano even quoted a passage from one article upon which he drew his conclusion. (Declaration of Jason H. Berland in Opposition to Defendants' Motion to Dismiss ("Berland Aff."), Ex. 1, at 1.) No reasonable reader could have inferred from the posted conversation that Marcano knew additional, undisclosed facts about Brahms that supported his post.
Despite drawing all reasonable inferences in plaintiff's favor, upon the pleadings and the evidentiary materials properly before the Court, Brahms cannot state plausible defamation claims. Pointedly, in light of the nature of Marcano's internet statement and the context in which it was posted, especially the fact that it was accompanied by the news articles on which it was so obviously based, Marcano's posted comments are protected opinion and cannot be the subject of a defamation action. It follows that no claim can stand against Carver for simply republishing Marcano's post. The defamation claims against both defendants are thus dismissed.
Brahms next claims that when he opened up a VRF account, Carver and Marcano entered into a contract with him, and that defendants breached that contract in two ways: (1) by publishing Brahms' e-mail address, eBay username, and other identifying information on VRF, and (2) by failing to remove the information upon request. (Compl. ¶ 43-44.) Specifically, Brahms alleges that defendants breached paragraph 8 of the Network54 TOU, which prohibits users from posting content on Network54-hosted websites that, among other things, "infringes upon privacy rights, such as specific addresses, phone numbers, social security numbers, or credit card numbers." (Id. at ¶ 8).
As the parties agree, the Network54 TOU are, by their own terms, governed by California law. (See Coogan Aff. Ex. 2 at ¶ 21); Motorola Credit Corp. v. Uzan, 388 F.3d 39, 51 (2d Cir.2004) ("[W]here the parties have chosen the governing body of law, honoring their choice is necessary to ensure uniform interpretation and enforcement of that agreement and to avoid forum shopping."). Under California law, Brahms can enforce the contract as a third party beneficiary only if the contract was made expressly for his benefit. Cal. Civ.Code § 1559. "If a contract does not clearly evince the intent to benefit a third party, that party is not a beneficiary of the contract." Northstar Financial Advisors, Inc. v. Schwab Investments, 781 F.Supp.2d 926, 943 (N.D.Ca.2011); E. Aviation Grp., Inc. v. Airborne Express, Inc., 6 Cal.App.4th 1448, 1452, 8 Cal.Rptr.2d 355 (2d Dist.1992).
Providing further illumination, a third party is not an intended beneficiary of a contract under California law if he is only incidentally or remotely benefited by it, notwithstanding that the contract, "if carried out according to its terms, would inure to [the third party's] benefit." E. Aviation Grp., Inc., 6 Cal.App.4th at 1452, 8 Cal.Rptr.2d 355. "To determine whether a third party is an intended beneficiary or merely an incidental beneficiary to the contract involves `construction of the parties' intent, gleaned from reading the contract as a whole in light of the circumstances under which it was entered." Jackson v. Am. Plaza Corp., 08-cv-8980, 2009 WL 1158829 at *3 (S.D.N.Y.2009) (quoting Hilderman v. Enea TekSci, Inc., 551 F.Supp.2d 1183, 1195 (S.D.Cal.2008)). For example, a physician was only an incidental beneficiary of a contract between a health care service provider and its enrollees, even though the contract required the provider to make payments to the physician for the enrollees' care, because the intent of the agreement — and the payments — was to benefit the enrollees. Ochs v. PacifiCare of California, 115 Cal.App.4th 782, 9 Cal.Rptr.3d 734 (2d Dist. 2004) (motion to dismiss); see also E. Aviation
A recent case offers analysis of the website Craigslist's terms of use, also governed by California law. The court determined that the terms of use were not intended to benefit — or be enforceable by — third party users. Jackson, 08-cv-8980, 2009 WL 1158829. The plaintiff in Jackson, a real estate company that used Craigslist to advertise rental properties, sued a competitor for "posting the same advertisements over and over again" in violation of Craigslist's terms of use, which prohibited users from repeatedly posting the same content. Id. at *2. Examining the text of the contract and the circumstances under which it was entered into, the Jackson court found that the contracting parties had not intended to benefit other Craigslist users when they entered into the terms of use, and, as a result, one user could not sue another for its breach of those terms. The Jackson court's analysis is highly instructive.
First, the Craigslist terms of use provided that they would "constitute the entire agreement between [the user] and Craigslist...," which, the court found, demonstrated an intent to create contractual rights and duties only between the two contracting parties. Id.
Second, the Craigslist terms of use stated that a user's "only recourse upon becoming `dissatisfied with Craigslist in any way' is to cease using Craigslist." Id. at *4. The court found that this provision demonstrated an intent to "limit the remedies available to a discontented user and bar that user" from enforcing the terms of use by litigation. Id. This conclusion was further supported by an additional provision that stated "[C]raigslist has the right, but is not obligated, to strictly enforce the [terms of use] through self-help, community moderation, active investigation, litigation and prosecution." Id.
Third, the terms of use established an internal grievance procedure, requesting that users report any violations of the terms of use by "flagging the posting(s) for review[] or by emailing ... abuse@craigslist.org." Id. at *5. The Jackson court found that this provision "strongly suggest[ed] that "Craigslist did not also intend to endow users with the right to pursue grievances against TOU violators through litigation."" Id. (citing Register.com, Inc. v. Verio, Inc., 356 F.3d 393, 399-400 (2d Cir.2004)).
Finally, the court determined that the provision the defendant allegedly violated existed solely for the benefit of Craigslist. The court noted that the highlighted paragraph prohibited repeatedly posting the same content "or otherwise impos[ing] an unreasonable or disproportionately large load on [Craigslist's] infrastructure." Id. This language indicated "that Craigslist's principal concern with repetitive posting was that it burdens the Craigslist infrastructure," not that it might hurt other users. Id. All in all, the court held, "any benefit received by plaintiffs [was] incidental." Id.
Second, much like Craigslist, the Network54 TOU provide that "[u]sers should report any violations of Network54's terms of use to support@Network54.com." (Coogan Aff., Ex. 2, ¶ 24). This provision "strongly suggests" that the Network54 TOU "did not also intend to endow users with the right to pursue grievances against TOU violators through litigation." Jackson, 2009 WL 1158829, at *5.
Finally, the text of paragraph 8 of the Network54 TOU — the provision that Carver and Marcano allegedly violated — indicates that it was created for Network54's benefit, and that any benefit that Brahms or any other user might receive from it was incidental. Paragraph 8, under the microscope, provides a list of content that users are prohibited from posting. In addition to content that is "libelous or offensive to another individual or organization," or "infring[ing] upon privacy rights," paragraph 8 bars users from publishing content that involves "mail fraud and pyramid schemes," "hatred and racism of any kind," or "unauthorized use or distribution of copyrighted material(s)." (Coogan Aff., Ex. 2, ¶ 8). It is true that in prohibiting its users from posting content that could be injurious or offensive to others, Network54 benefited all of its users, including Brahms. Indeed, it equally benefits all people in the world, whether they are Network54 users or not, who might be targeted by offensive remarks on a Network54-hosted website. This, however, is the epitome of an incidental, but not intended third party, benefit. It would be unreasonable to infer, consequentially, that in requiring its users to agree to paragraph 8, the Network54 TOU was intended to benefit, as a matter of California contract law, all persons who could potentially be injured by content posted on a Network54-hosted website, and to permit enforcement of the TOU against a breaching user under a third party beneficiary theory. The only reasonable understanding of paragraph 8 is that by prohibiting users from posting offensive or wrongful content, Network54 intended to protect itself from legal liability, providing an incidental benefit to others. The provision that defendants allegedly violated exists for the benefit of Network54, not Brahms or any other Network54 user.
Unlike in Jackson, the Network54 TOU do not expressly limit a discontented user's remedies to ceasing use of Network54. See Jackson, 08-cv-8980, 2009 WL 1158829, at *4. Notwithstanding, the absence of an explicit limiting provision, alone, does not evince an intent to vest third party users with the right to enforce the TOU. See Kalmanovitz v. Bitting, 43 Cal.App.4th 311, 314, 50 Cal.Rptr.2d 332 (1st Dist.1996) ("[T]he contracting parties must clearly manifest their intent to benefit the third party.") (emphasis added). Even drawing all reasonable inferences in his favor, Brahms is not a third-party beneficiary of the Network54 TOU under California law.
For the foregoing reasons, defendants, motion to dismiss is granted.
The Clerk of Court is directed to enter judgment for defendants and to close this case.
SO ORDERED.