RAMOS, District Judge.
This is a tort action concerning accusations that Victor Restis and Enterprises Shipping and Trading S.A. (collectively, "Plaintiffs") have engaged in prohibited business transactions in Iran. Plaintiffs bring this action against American Coalition Against Nuclear Iran Inc., a/k/a United Against Nuclear Iran ("UANI"), Mark D. Wallace, David Ibsen, Nathan Carleton, Daniel Roth, Martin House, Matan Shamir, Molly Lukash, Lara Pham, and Does 1-10 (collectively, "Defendants"), alleging that as a result of UANI's "name and shame" campaign to destroy their reputations, Defendants are liable for defamation, tortious interference with prospective economic advantage, tortious interference with contract, intentional infliction of emotional distress, and prima facie tort. Pending before the Court is Defendants' motion to dismiss the Second Amended Complaint ("SAC").
Plaintiff Victor Restis, a citizen and resident of Greece, is a highly successful and respected entrepreneur in the shipping industry. SAC ¶ 23.
Defendant UANI is a not-for-profit corporation that, according to its website, seeks to prevent Iran from fulfilling its ambition of obtaining nuclear weapons. Id. ¶ 25. To that end, UANI engages in private sanctions campaigns and legislative initiatives focused on ending corporate support of the Iranian regime. Id. According to the SAC, although UANI advertises itself as an American not-for-profit organization, it is in fact primarily funded by foreign interests and governments whose interests and agendas are not disclosed to the public. Id.
Plaintiffs have named various UANI officers and employees as defendants in the instant action. Defendant Mark D. Wallace, a co-founder and current CEO of UANI, is a former representative of the Management and Reform Section of the U.S. Mission to the United Nations. Id. ¶ 26. Defendant David Ibsen is the Executive Director of UANI. Id. ¶ 27. In that capacity, Defendant Ibsen runs the day-to-day operations of UANI, and has been "integrally involved" in UANI's "name and shame" campaigns. Id. Mr. Ibsen allegedly directed the campaign against Plaintiffs, participated in drafting the defamatory publications, and coordinated UANI staff in producing and distributing the publications. Id. Defendant Nathan Carleton, the Communications Director for UANI, manages UANI's public communications and has similarly been integrally involved in its "name and shame" campaigns, including that against Plaintiffs. Id. ¶ 28. Defendant Carleton helped draft the defamatory publications, distributed many of them as press releases, and personally spoke with and emailed various reporters in order to disseminate the defamatory allegations against Plaintiffs. Id.
Matan Shamir is UANI's Director of Research and Projects. Id. ¶ 29. According to Defendant Shamir's LinkedIn profile, he directs research efforts on companies doing business with Iran and manages UANI's social media campaign on Facebook, Twitter, and YouTube. Id. Defendant Shamir "directly contributed" to the creation and publication of the defamatory publications, including by drafting versions
Plaintiffs have also named the following individuals as defendants: Martin House, a UANI Project Director; Lara Pham, UANI's Director of Operations; and Daniel Roth. Id. ¶¶ 31-33.
According to Plaintiffs, UANI launched a "Shipping Campaign" to target, inter alia, international cargo shippers in order to ensure that Iran's shipping and port sectors were isolated from international markets. Id. ¶ 39. In March 2013, UANI called on United States port authorities to deny docking privileges to any shipping company that continues to do business in Iran. Id. At the same time, UANI pressured international shipping companies to pull out of Iran. Id.
On May 13, 2013, UANI sent a public letter to Mr. Restis in his capacity as the Chairman of First Business Bank ("FBB"). Id. ¶ 40.
Plaintiffs allege that Defendants sent copies of the May 13, 2013 letter to at least 18 other individuals, including senior Members of Congress, representatives of the Obama Administration, and members of the Greek Government. Id. ¶ 43.
According to Plaintiffs, UANI relied on two fraudulent and facially unreliable documents as supposed confirmation of the allegations in the May 13, 2013 letter. Id. ¶ 42. First, Plaintiffs allege that UANI relied on a letter dated April 25, 2012, purportedly from Mr. Cambis, which is addressed to Professor Christos Kazantis, the CEO of FBB. Id. In that letter, Mr. Cambis discussed the relationship between his company, Athene Consulting House, and the Iranian MoP, and according to UANI, attempts to recruit Mr. Restis as a
Plaintiffs state that UANI repeated the false accusations in four press releases issued on May 13 and May 14, 2013. Id. ¶¶ 44, 45. Two of the press releases graphically depicted two large images of Iran President Mahmoud Ahmadinejad. Id. The press releases named Defendant Carleton as the contact for media inquiries. Id.
Also on May 13, 2013, UANI posted the allegations in a "sensationalized `call to action'" on its website. Id. ¶ 46. According to Plaintiffs, the home screen of UANI's website showed a large photograph of Mr. Restis with a picture of a tanker ship in front of him, and featured an active link titled: "Call on Greek Businessman VICTOR RESTIS & RESTIS GROUP ENTITIES to end all Iran business schemes." Id. When users clicked on the link, they were taken to a webpage entitled "Action Alert," which encouraged them to "Take Action" by providing their names and contact information. Id. UANI promised to then convey to Plaintiffs the individual's demand that they "end their purported role as `front-men for the illicit activities of the Iranian regime' and their `very significant, unethical—indeed illegal—support [of] the Iranian MoP. . . .'" Id.
On May 14, 2013, UANI further disseminated the statements through Facebook posts and Twitter messages. See id. ¶¶ 47, 49-51. Readers of one such Facebook post made at least 33 comments, including insulting and threatening messages that refer to Mr. Restis as "a `bastard,' an `animal,' a `Greek f* *k,' a `crook,' a `piece of crap,' a `self satisfied smug bastard without any scruples,' a `Christian pig,' and an `evil, greasy, greedy bastard.'" Id. ¶ 48.
On July 15, 2013, UANI repeated its accusations against Plaintiffs in two press releases consisting of a statement by Defendant Wallace. Id. ¶ 52. According to Plaintiffs, the press releases initially attempted to minimize the earlier defamation by falsely claiming that UANI merely expressed its "serious concerns" relating to the purported business dealings between Mr. Restis, Dimitris Cambis, and Iran. Id. Nonetheless, these press releases reiterated the earlier defamatory statements and assumed them to be true. Id. Indeed, the July 15, 2013 press releases referred to the "dark cloud" surrounding Mr. Restis' business relationships and claimed that Plaintiff failed to adequately describe his activities relating to Mr. Cambis. Id. In these publications, UANI called on the United States Government to investigate Mr. Restis' and offered to aid the investigation by turning over any relevant materials to the government. Id.
Also on July 15, 2013, UANI disseminated the press releases through a Facebook post, which contained a photograph of Mr. Restis superimposed on top of an Iranian oil tanker. Id. ¶ 53. Plaintiffs allege that this Facebook post prompted at least one reader to threaten Mr. Restis with violence. Id.
On the same day, Defendants disseminated the defamatory statements through UANI's Twitter site. Id. ¶ 54. The tweet juxtaposed a photograph of Ayatollah Khamenei with text calling for the investigation
Plaintiffs allege that the May 2013 and July 2013 communications had their intended effect: these false and disparaging statements were widely disseminated and re-published by numerous media outlets, websites and blogs. Id. ¶ 56.
In February 2014, Defendants launched a second wave of defamatory publications accusing Plaintiffs of secretly doing business in Iran and falsely denying such activities. Id. ¶ 82. Defendants claimed that the Bergen Max, an EST cargo ship, made multiple ports of call to Iran, and that such activities proved the truth of UANI's initial allegations. Id. ¶¶ 82, 87. According to Plaintiffs, however, these ports of call involved legal and authorized shipments of humanitarian food aid to Iran, generally by major American companies. Id. ¶ 82.
On February 5, 2014, Defendants issued two versions of a press release regarding the alleged business activities of the Bergen Max. Id. ¶ 87. The press release implied that the Bergen Max's activities violated the sanctions against Iran through ports of call to the Bandar Imam Khomeini port, which is host to the Iranian regime-controlled front company, Tidewater Middle East Co. ("Tidewater"). Id. According to the press release, both the United States and the European Union have designated Tidewater a sanctioned entity. Id. The press releases further charged Mr. Restis with falsely denying Defendants' accusations. Id. Also on February 5, 2014, Defendants tweeted a message regarding the Bergen Max. Id. ¶ 88. The next day, Defendants published two versions of a press release calling for a boycott of Plaintiffs' businesses and shared the links to the February 5 and 6, 2014 press releases through a Facebook post and three tweets. See id. ¶¶ 89-93.
On February 7, 2014, Defendants issued two versions of a press release regarding UANI's release of a compendium of statements attributed to Mr. Restis or his counsel, denying any business relationships with Iran. Id. ¶ 94. According to Plaintiffs, the purpose of the press release was to falsely portray Mr. Restis as a liar in connection with such denials. Id.
Plaintiffs allege that Defendants also worked with sympathetic journalists to craft stories that present Plaintiffs unfavorably. Id. ¶ 96. In particular, on February 8, 2014, Defendants republished an article previously published in Trade Winds, a maritime industry publication, which contained a number of false and defamatory statements provided by Defendants regarding settlement negotiations in the instant litigation. Id. On February 9, 2014, Defendants tweeted a message regarding the Trade Winds article, stating that Mr. Restis was unsuccessful in buying UANI's silence. Id. ¶ 97.
On February 10, 2014, Defendants issued two versions of a new press release, which again falsely stated or implied that Plaintiffs violated the sanctions by doing business in Iran and falsely denied such association. Id. ¶ 98. The press release called for Plaintiffs to cease making ports of call in Iran, and encouraged their business partners to terminate relationships with Mr. Restis. Id. Defendants disseminated the press release on that date in three tweets, each with a photograph of Ayatollah Khamenei. See id. ¶¶ 99-101.
On February 11, 2014, Defendants issued two versions of a press release that repeated the defamatory allegations, accused Plaintiffs of falsely denying the allegations,
Defendants issued additional press releases on February 17, 19, and 25, 2014. See id. ¶¶ 104-106. Of particular note, the February 19 press release accused Mr. Restis of trying to avoid giving testimony in the instant litigation by failing to appear for his deposition. Id. ¶ 105. Plaintiffs state that Defendants purposely scheduled the deposition in New York because they knew Mr. Restis could not leave Greece as part of a criminal investigation in his home country. Id.
Plaintiffs contend that each of the publications in this second wave of the "name and shame" campaign conveyed the defamatory per se message that Plaintiffs are, inter alia, "`front men' engaged in `illicit,' `unethical,' and `indeed illegal' business `schemes' with the Iranian regime. . . ." Id. ¶ 107.
According to the SAC, Defendants carefully selected and employed highly offensive and sensational words and images "for the singular purpose of garnering global attention to their ongoing campaign maliciously misinforming" the global community, including regulatory and governmental authorities and the international media, regarding Plaintiffs' business associations in Iran. Id. ¶ 108.
Plaintiffs allege that they have suffered severe reputational harm and extraordinary economic damages in excess of $3 billion, and that Mr. Restis has been subjected to severe emotional distress. Id. ¶¶ 125, 130. Plaintiffs claim that as a result of Defendants' campaign, EST has been placed on a "blacklist" of companies that purportedly engage in transactions with Iranian interests, causing the financial institutions on which Plaintiffs rely to carry out their day-to-day operations to refuse to handle even small transactions with Plaintiffs until they receive an official declaration that the transaction does not involve Iran. Id. ¶ 127.
Plaintiffs identify three transactions in particular that have been adversely affected as a result of Defendants' campaign against Plaintiffs. First, Mr. Restis asserts that he was unable to complete a planned stock offering for Golden Energy, the tanker company he owned in part and managed. Id. ¶ 132. In the year before Defendants' defamation campaign, Golden Energy began the process of listing its stock for trading on the New York Stock Exchange by submitting shares to an initial public offering ("IPO"). Id. Golden Energy was days away from submitting its final Form F-1 approval documents to the U.S. Securities and Exchange Commission when, on May 25, 2013, the underwriters "abruptly withdrew" from the IPO. Id. ¶¶ 134, 135. Mr. Restis and Golden Energy were forced to postpone the IPO indefinitely as a result. Id. ¶ 135. According to Plaintiffs, Golden Energy would have raised an estimated $1.01 billion, with a total estimated value to Mr. Restis personally of hundreds of millions of dollars. Id. ¶ 136. Additionally, in the wake of Defendants' allegations, the Cyprus government abruptly terminated the application of Mr. Restis' joint venture, RX-Drill Energy Cyprus Ltd. ("RX-Drill"), for underwater mining rights for natural gas and other hydrocarbons. Id. ¶ 137. Plaintiffs assert that such rights would have extended for 35 years and been worth approximately $100 million per year. Id. Representatives of the Cyprus government informally confirmed that Defendants' accusations caused the rejection of the RX-Drill application. Id. ¶ 138. Finally, after Defendants published false allegations that the
When ruling on a motion to dismiss pursuant to Rule 12(b)(6), the Court must accept all factual allegations in the complaint as true and draw all reasonable inferences in the plaintiff's favor. Koch v. Christie's Int'l PLC, 699 F.3d 141, 145 (2d Cir.2012); see also, e.g., Ruotolo v. City of New York, 514 F.3d 184, 188 (2d Cir.2008). However, the Court is not required to credit "mere conclusory statements" or "threadbare recitals of the elements of a cause of action." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)); see also id. at 681, 129 S.Ct. 1937 (citing Twombly, 550 U.S. at 551, 127 S.Ct. 1955). "To survive a motion to dismiss, a complaint must contain sufficient factual matter . . . to `state a claim to relief that is plausible on its face.'" Id. at 678, 129 S.Ct. 1937 (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955). A claim is facially plausible "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. (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955). More specifically, the plaintiff must allege sufficient facts to show "more than a sheer possibility that a defendant has acted unlawfully." Id. Federal Rule of Civil Procedure 8 "marks a notable and generous departure from the hyper-technical, code-pleading regime of a prior era, but it does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions." Id. at 678-79, 129 S.Ct. 1937. If the plaintiff has not "nudged [his] claims across the line from conceivable to plausible, [the] complaint must be dismissed." Twombly, 550 U.S. at 570, 127 S.Ct. 1955.
"Under New York law, the elements of a defamation claim are `a false statement, published without privilege or authorization to a third party, constituting fault . . . and it must either cause special harm or constitute defamation per se.'" Peters v. Baldwin Union Free Sch. Dist., 320 F.3d 164, 169 (2d Cir.2003) (quoting Dillon v. City of New York, 261 A.D.2d 34, 704 N.Y.S.2d 1, 5 (1st Dep't 1999)); see also Harris v. Allstate Ins. Co., 83 F.Supp.2d 423, 434 (S.D.N.Y.2000). Plaintiffs allege that Defendants' "name and shame" campaign was based on defamatory per se accusations. See, e.g., SAC ¶ 142.
Defendants offer two principal arguments for the dismissal of the defamation claim. First, they contend that the claim cannot be sustained as against certain defendants. See Defs. Mem. L. 12. Second, Defendants argue that none of the statements identified by Plaintiffs state a claim for defamation. Id. at 18. The Court will consider these arguments in turn.
Defendants charge that the defamation claim must be dismissed against certain individual defendants because the SAC fails to allege that those defendants participated in the creation or publication of the statements at issue. Id. at 12.
While the Original Complaint provided little more detail regarding Defendants Ibsen and Carleton than their names and titles, the SAC adequately alleges defamation against these defendants. With respect to Mr. Ibsen, the SAC specifies that he runs the day-to-day operations of UANI, directed the "name and shame" campaign against Plaintiffs, participated in drafting the defamatory publications, and coordinated UANI staff in producing and distributing the publications. SAC ¶ 27. Similarly, Plaintiffs claim that Mr. Carleton, inter alia, directs UANI's public communications, has been integrally involved in the campaign against Plaintiffs, helped draft the defamatory publications, distributed many of them as press releases, and communicated with various reporters to spread the allegations. Id. ¶ 28. Clearly then, Defendants' argument that Plaintiffs have not pleaded defamation against Defendants Ibsen and Carleton is no longer viable.
Plaintiffs have also adequately stated a claim for defamation against the five individual defendants added in the SAC. First, the SAC alleges that Defendants Shamir, Pham, and Roth participated in the drafting and publication of the defamatory statements. See id. ¶¶ 29, 32, 33. Similarly, the SAC adequately pleads the participation of Ms. Lukash because she allegedly helped craft the defamatory statements and readied them for publication, as well as drafted an "Action Alert" sent to UANI readers informing them of the defamatory allegations. See id. ¶ 30. Finally, Defendant House is alleged to have met with a reporter for a maritime industry publication to further disseminate the defamatory allegations. Id. ¶ 3 1. The SAC also notes that according to Mr. House's LinkedIn profile, he leads campaigns for UANI that publicize major shipping sanctions frauds. The allegations of his involvement in the publication of UANI's statements are sufficient. See Treppel, 2005 WL 2086339, at *3 (stating that defamation may be pleaded against all who take part in the publication of actionable statements); cf. Pisani v. Staten Island Univ. Hosp., 440 F.Supp.2d 168, 179 (E.D.N.Y.2006) (finding that plaintiff adequately pleaded defamation against former co-workers who were alleged to have, inter alia, prepared and approved for publication the statement at issue). Accordingly, because each individual defendant allegedly participated in the drafting and/or publication of the defamatory statements, Plaintiffs' defamation claim cannot be dismissed on this basis.
Defendants claim that any defamation claim predicated on the defamatory Facebook posts or comments of third persons must be dismissed. Defs. Mem. L. 19. In particular, according to Defendants, Section 230(c)(1) of the Communications Decency Act of 1996 directs that "no provider or user of an interactive computer service shall be treated as a publisher or speaker
Defendants next contend that they cannot be liable for statements that are substantially true. Defs. Mem. L. 20. Specifically, Defendants argue that UANI statements regarding the following are true, as proven by reports cited by, and therefore incorporated by reference in, the Original Complaint: (i) FBB's "split into a `good' and a `bad' bank due to `rising bad debts and losses,'" and property-related tax evasion charges against Mr. Restis as a result of intentional undervaluing of investments in Cyprus, and (ii) accusations that FBB executives and shareholders, including Mr. Restis, took out loans from the Greek state worth hundreds of millions of Euros, which are unlikely to be repaid. Id.; see Compl. ¶¶ 53(k), 53(l). Because the SAC omits any references to these statements by UANI, the Court need not consider the parties' arguments on this ground.
On a motion to dismiss a claim of defamation, the court must decide whether the statements alleged to have caused plaintiff injury are "reasonably susceptible" to the defamatory meaning imputed to them. Dworin v. Deutsch, No. 06 Civ. 13265(PKC), 2008 WL 508019, at *3 (S.D.N.Y. Feb. 22, 2008) (quoting Kelly v. Schmidberger, 806 F.2d 44, 46 (2d Cir. 1986)). A statement is "reasonably susceptible" of a defamatory meaning "when it `tend[s] to expose a person to hatred, contempt or aversion, or to induce an evil or unsavory opinion of him in the minds of a substantial number in the community.'" Id. at *3 (quoting Levin v. McPhee, 119 F.3d 189, 195 (2d Cir.1997) (internal quotation marks and citation omitted)).
Under New York law, expressions of pure opinion, as opposed to statements of fact, are not actionable, and receive full constitutional protection. Torain v. Liu, 279 Fed.Appx. 46, 46 (2d Cir.2008). "[W]hether a statement is opinion or rhetorical hyperbole as opposed to a factual representation is a question of law for the court." Mr. Chow v. Ste. Jour Azur S.A., 759 F.2d 219, 224 (2d Cir.1985); see also Levin, 119 F.3d at 196 (holding that resolution of whether a statement amounts to fact or opinion is a matter for the court under New York law). The following three factors are generally considered by New York courts to determine whether a statement is actionable fact or non-actionable opinion: (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. Gross v. N.Y. Times Co., 82 N.Y.2d 146, 156, 603 N.Y.S.2d 813, 623 N.E.2d 1163 (1993) (quoting Steinhilber v. Alphonse, 68 N.Y.2d 283,
Unlike the Federal Constitution, the New York Constitution provides for absolute protection of opinions. Celle v. Filipino Reporter Enters. Inc., 209 F.3d 163, 178 (2d Cir.2000). "If, however, the facts upon which an opinion is based are set forth for the reader, and the plaintiff alleges that both the opinion and the facts upon which it is based are false, the opinion and facts may form the basis of the defamation claim." Dworin, 2008 WL 508019, at *3 (citing Jewell v. NYP Holdings, Inc., 23 F.Supp.2d 348, 377 (S.D.N.Y. 1998)). In addition, a statement of opinion which implies that it is based on facts that support the opinion, which are unknown to persons reading or hearing it, is an actionable "mixed opinion." Id. (quoting Steinhilber, 68 N.Y.2d at 289, 508 N.Y.S.2d 901, 501 N.E.2d 550). Furthermore, opinions based on false facts are actionable against a defendant who had knowledge of the falsity or probable falsity of the underlying facts. Davis v. Ross, 754 F.2d 80, 86 (2d Cir.1985) (quoting Hotchner v. CastilloPuche, 551 F.2d 910, 913 (2d Cir.1977)); see also DiFolco v. MSNBC Cable L.L.C., 622 F.3d 104, 114 (2d Cir.2010) (reversing dismissal of a defamation claim based on a statement of opinion because plaintiff properly alleged that defendants had knowledge of the falsity of the underlying facts).
Defendants argue that the UANI statements cited in Plaintiffs' allegations are not capable of defamatory meaning for four principal reasons.
First, Defendants assert that certain statements made by UANI are not capable of being proven true or false because of language that is "loose, figurative, hyperbolic, or otherwise too vague to impart factual information." Defs. Mem. L. 23. In particular, Defendants claim that assertions that conduct is illegal or fraudulent can, depending on the context in which such statements were made, be too vague to be actionable. Id. Accordingly, Defendants argue that the Court should strike or dismiss, inter alia, the following paragraphs from the SAC to the extent they rely on such words or phrases as "illegally," "scheme," and "illicit":
Defendants' piecemeal approach here is misguided. In Immuno AG v. Moor-Jankowski, the New York Court of Appeals stated that "[i]t has long been our standard in defamation actions to read published articles in context to test their effect on the average reader, not to isolate particular phrases but to consider the publication as a whole." 77 N.Y.2d 235, 250, 566 N.Y.S.2d 906, 567 N.E.2d 1270 (N.Y.1991) (emphasis added); see also Steinhilber, 68 N.Y.2d at 290, 508 N.Y.S.2d 901, 501 N.E.2d 550 (noting that the "essential task" is to decide whether the words complained of, considered in the context of the entire communication and of the circumstances in which they were spoken or written, may be reasonably understood as implying the assertion of undisclosed facts justifying the opinion); Brian v. Richardson, 87 N.Y.2d 46, 51, 637 N.Y.S.2d 347, 660 N.E.2d 1126 (N.Y.1995) (citing Immuno for the proposition that courts should not "sift[] through a communication" to isolate and identify assertions of fact, but should instead look to the overall context in which the assertions were made). Defendants have not demonstrated that the words and phrases at issue here are loose, figurative, hyperbolic, or vague. For this argument, Defendants rely upon 600 W. 115th St. Corp. v. Von Gutfeld, 80 N.Y.2d 130, 589 N.Y.S.2d 825, 603 N.E.2d 930 (N.Y.1992). There, the New York Court of Appeals considered a defamation claim involving such words as "illegal" and "fraudulent." However, the context in which those statements were made makes Defendants' reliance on Von Gutfeld unavailing.
In contrast, UANI's statements were not made spontaneously at a "heated public hearing," nor are they intemperate in tone. Rather, the statements are alleged to have been made as part of a sophisticated and coordinated international campaign in letters, press releases, Facebook posts, and tweets drafted by communications professionals and former diplomats. Defendants presumably meant what they said and intended their words to be understood in accordance with their plain meaning. In addition, Defendants' accusations are grounded in assertions of fact about Plaintiffs' business activities and are not framed in hyperbole, but rather purport to rely on documents that establish the existence of Plaintiffs' "scheme." Cf. Kelly, 806 F.2d at 48 (finding statement that plaintiff priests placed church property "in their own names" to be factual and imputing corrupt and possibly criminal conduct); Coliniatis v. Dimas, 848 F.Supp. 462, 466, 467 (S.D.N.Y. 1994) (determining that letter making accusation on "information of substantial but not absolute reliability" that company executive was engaged in a kick-back scheme could be factually verified and did not contain loose, figurative, or hyperbolic language that would negate the impression that the writer was asserting a statement of fact); Held v. Pokorny, 583 F.Supp. 1038, 1040 (S.D.N.Y.1984) (noting that while rhetorical hyperbole and vigorous epithets are expressions of opinion, "[a]ccusations of criminal or unethical activity. . . are expressions of fact, as are allegations relating to one's professional integrity that are susceptible of proof" (footnotes omitted)); see also Trump v.
Defendants next contend that statements calling for government officials or the public to take action are not capable of defamatory meaning and cannot support a claim for defamation because they cannot be proven true or false. Defs. Mem. L. 24. Plaintiffs counter that such an argument seeks to invent a new standard where parties could "cloak any outrageous, defamatory claims in a call to action and face no liability." Pls. Opp. Mem. L. 28. Indeed, the Court is not aware of any case law from the Second Circuit or New York state courts that stands for the principle that "calls to action" cannot be actionable as defamatory statements. Moreover, as noted by Plaintiffs, the cases Defendants cite for this proposition are inapposite. See Org. for a Better Austin v. Keefe, 402 U.S. 415, 419, 91 S.Ct. 1575, 29 L.Ed.2d 1 (1971) (First Amendment case not involving defamation claim); Egiazaryan v. Zalmayev, 880 F.Supp.2d 494, 507-08 (S.D.N.Y.2012) (dismissing defamation claim on the basis that defendant's accusations of anti-Semitism were found to be either not plausibly false or statements of opinion). Accordingly, Defendants' request that the Court dismiss or strike statements in the SAC identified as calls to action is denied.
Defendants further contend that the context in which UANI's statements were made renders them non-actionable. Defs. Mem. L. 25. First, Defendants charge that their statements are protected as "pure advocacy" by virtue of the fact that the statements advance UANI's mission as an advocacy group. Id. at 27. To the contrary, the mere fact that Defendants engage in advocacy does not give them blanket immunity to make false accusations. Pls. Opp. Mem. L. 23. Indeed, none of the authorities on which Defendants rely stands for the proposition that advocacy cannot as a matter of law give rise to a defamation claim. See Egiazaryan, 880 F.Supp.2d at 510 (stating that speech including epithets, fiery rhetoric, and hyperbole signal advocacy, not that advocacy is protected speech); Brian, 87 N.Y.2d at 53, 637 N.Y.S.2d 347, 660 N.E.2d 1126 (noting that the context in which challenged statements were made—an Op-Ed piece "rife with rumor, speculation and seemingly tenuous inferences"—supported conclusion that accusations of an illegal conspiracy could not have been understood by a reasonable reader as assertions of fact); Yang v. Shanghai Cafe Inc., No. 10 Civ. 8372, 2012 WL 398641, at *4 (S.D.N.Y. Feb. 8, 2012) (finding that restaurant workers' flyers advocating boycott of restaurant for wage theft contained statements of pure opinion because of, inter alia, the flyers' tone and title—"Dumpling Festival Corporate Sponsor . . . Exploits Workers and Should be Punished"—and the use of the word "exploit").
Second, Defendants argue that the specific context of UANI's publications makes their contents non-actionable opinions.
Defendants further argue that UANI's presentation of the evidence on which its conclusions were based reflects Defendants' expression of opinion. Defs. Mem. L. 28. However, UANI's statements are still actionable if either the facts on which they rely are false or if the statements mischaracterized the facts. See Medcalf v. Walsh, 938 F.Supp.2d 478, 486 (S.D.N.Y. 2013) ("`[A] statement of opinion that is accompanied by a recitation of the facts on which it is based or one that does not imply the existence of undisclosed underlying facts' is protected as a statement of opinion and thus not a false statement of fact." (quoting Gross, 82 N.Y.2d at 154, 603 N.Y.S.2d 813, 623 N.E.2d 1163)); Dworin, 2008 WL 508019, at *3. Here, Plaintiffs claim both that the documents on which Defendants relied are "patently fraudulent," and that Defendants mischaracterized the documents.
Moreover, a statement may still be actionable if it implies that the speaker's opinion is based on the speaker's knowledge of facts that are not disclosed to the reader. Sang v. Hai, 951 F.Supp.2d 504, 520 (S.D.N.Y.2013) (quoting Levin, 119 F.3d at 197). Indeed, such statements may be actionable because a reasonable listener or reader would infer that the speaker or writer "knows certain facts, unknown to the audience, which support the opinion and are detrimental to the person toward whom the communication is directed." Gross, 82 N.Y.2d at 153, 603 N.Y.S.2d 813, 623 N.E.2d 1163 (internal
In sum, then, the Court rejects the argument that the context of UANI's statements protects Defendants from liability.
Finally, Defendants contend that UANI's press releases, tweets, and Facebook posts are non-actionable because they "did no more than include a headline-like caption or statements, and directed readers to the longer and more thorough statements of UANI's opinion through links." Defs. Mem. L. 29. In Triano v. Gannett Satellite Information Network, Inc., Nos. 09 Civ. 2497(KMK), 09 Civ. 2533(KMK), 2010 WL 3932334, at *4 (S.D.N.Y. Sept. 29, 2010), the court relied on New York state court precedent for the principle that a headline is not actionable if it is a "fair index" of the article in which it appears. See also Karedes v. Ackerley Grp., 423 F.3d 107, 115 n. 1 (2d Cir.2005) (noting that plaintiff's argument that a newspaper headline is independently libelous regardless of whether the content of the article is itself libelous "adds little" in light of the plaintiff's concession that the headline fairly indicated the substance of the article); Test Masters Educ. Servs., Inc. v. NYP Holdings, Inc., 603 F.Supp.2d 584, 589 (S.D.N.Y.2009) (finding use of the word "SCAM" in article headline was a fair index of the article's contents and that the allegedly libelous statements fell within the "true and fair" privilege of N.Y. Civil Rights Law § 74). While Defendants accurately proffer the standard for whether a headline is actionable, they provide no case law applying this principle to press releases, Facebook posts, or tweets, which provide more factual content than mere headlines.
To the contrary, decisions from courts in this Circuit suggest that defamatory statements published on Facebook and Twitter, as well as statements made in press releases, could indeed be actionable in defamation suits. See DiFolco, 622 F.3d at 114 (holding that reporter stated a claim for defamation based on statements made on television industry website); Pisani, 440 F.Supp.2d at 179 (denying motion to dismiss defamation claim based on allegations that defendants prepared and approved for publication statements issued in press release on attorney general's website regarding plaintiff's involvement in Medicaid fraud case); see also Miss Universe L.P. v. Monnin, 952 F.Supp.2d 591, 598 (S.D.N.Y.2013) (confirming arbitration award on basis that arbitrator did not exceed powers in awarding $5 million in damages for defamation where statements were made, inter alia, on Facebook; arbitrator had found that the defamatory Facebook posts were factual, capable of proof, false, and "obviously harmful to [plaintiff's] business reputation" (internal quotation marks and citation omitted)); Feld v. Conway, 16 F.Supp.3d 1, 4, No. 13 Civ. 13122(FDS), 2014 WL 1478702, at *3 (D.Mass. Apr. 14, 2014) (granting motion to dismiss defamation claim based on
For the reasons set forth above, Defendants' motion to dismiss the defamation claim is DENIED.
Plaintiffs allege that Defendants tortiously interfered with Plaintiffs' business relationships. Under New York law, the elements of a claim for tortious interference with prospective economic advantage are (1) a business relationship with a third party; (2) the defendant's knowledge and intentional interference with that relationship; (3) the defendant acted solely out of malice, or used dishonest, unfair, or improper means; and (4) injury to the business relationship. See Kirch v. Liberty Media Corp., 449 F.3d 388, 400 (2d Cir.2006) (quoting Carvel Corp. v. Noonan, 350 F.3d 6, 17 (2d Cir.2003)).
Plaintiffs base this claim on allegations that Defendants knew of Plaintiffs' relationships with various third parties—including the underwriters for the Golden Energy IPO and the government of Cyprus in connection with the RX-Drill mining rights agreement
In Chao v. Mount Sinai Hospital, the Second Circuit observed that "`New York law considers claims sounding in tort to be defamation claims . . . where those causes of action seek damages only for injury to reputation, [or] where the entire injury complained of by plaintiff flows from the effect on his reputation.'" 476 Fed.Appx. 892, 895 (2d Cir.2012) (emphasis added) (quoting Jain v. Sec. Indus. & Fin. Mkts. Ass'n, No. 08 Civ. 6463(DAB), 2009 WL 3166684, at *9 (S.D.N.Y. Sept. 28, 2009)).
Similarly, in Jain, the plaintiff brought claims for defamation and, inter alia, tortious interference with prospective business relations based on statements made in a letter written by a trade organization's board secretary, director, and general counsel. 2009 WL 3166684, at *1. There, the plaintiff alleged that the defendant forwarded copies of the letter to the plaintiff's co-workers, and that she was terminated as a result. Id. at *2. After dismissing the defamation claim, the court found that "the gravamen of Plaintiff's alleged injury [with respect to the tortious interference claim]. . . is either harm to her reputation or harm that flows from the alleged effect on Plaintiff's reputation, such as her termination from S & P, the resulting loss of income and benefits, as well as the inability to find additional work." Id. at *9. Accordingly, the court dismissed the tortious interference claim because the allegations and related injuries arose from the dissemination of the letter and the alleged effect it had on the plaintiff's professional reputation, both inside and outside of the firm. Id. at *10.
Plaintiffs' tortious interference with prospective economic advantage claim is foreclosed by Chao. While Plaintiffs allege in connection with this cause of action that they have suffered economic injuries, including lost profits, loss of third party contracts and economic opportunities, see SAC ¶ 155, all of these alleged injuries arose out of UANI's allegedly defamatory statements. For example, the SAC states that the campaign irreparably damaged the reputation of Golden Energy in the eyes of potential investors and regulators, and that the "deciding factor" for the underwriters' withdrawal was Defendants' false allegations that Plaintiffs were "front-men" for the Iranian regime and engaged in illegal business schemes. Id. ¶ 135. Similarly with respect to the RX-Drill joint venture, Plaintiffs allege that representatives of the Cyprus government informally confirmed that the government terminated the agreement in principle because of Defendants' defamatory statements. Id. ¶ 138. Specifically, Plaintiffs claim they were told that the Cyprus government would not conduct business with Mr. Restis and his companies because it feared the criticism and accusations it would face for "cooperating with a `conspirator' and a `financier of international terrorism.'" Id. Accordingly, as in Chao and Jain, the entire injury pleaded in relation to the tortious interference with prospective economic advantage cause of action flows from the effect of the defamatory comments on Plaintiffs' reputation. Defendants' motion to dismiss the tortious interference with prospective economic advantage claim is therefore GRANTED.
Plaintiffs claim that Defendants are liable for tortious interference in
As an initial matter, as with the tortious interference with prospective economic advantage claim, this claim must fail as duplicative of the defamation cause of action. See Chao, 476 Fed.Appx. at 895 (affirming dismissal of tortious interference with contract claim where plaintiff also alleged defamation claim and the alleged injury flowed from harm to reputation). This cause of action is also premised on alleged contracts with the underwriters for the Golden Energy IPO and the government of Cyprus. Accordingly, this cause of action is also foreclosed by Chao. Moreover, the tortious interference with contract claim fails for two further reasons.
First, this claim must be dismissed because, inter alia, the named Plaintiffs were not parties to the contracts at issue. Plaintiffs argue in opposition that they have pleaded Mr. Restis' ownership interests in both Golden Energy and the RX-Drill joint venture, Pls. Opp. Mem. L. 14; see SAC ¶¶ 132-138, and rely on LoPresti v. Massachusetts Mutual Life Insurance Co., 30 A.D.3d 474, 476, 820 N.Y.S.2d 275 (2d Dep't 2006), for the proposition that even if Plaintiffs were not direct parties to the agreements in question, they can still bring the tortious interference claim as a third-party beneficiary of such contracts. Pls. Opp. Mem. L. 14. Plaintiffs have not pleaded facts sufficient to satisfy the elements of a third-party beneficiary claim. Defs. Reply Mem. L. 8; see, e.g., Found. Ventures, LLC v. F2G, Ltd., No. 08 Civ. 10066(PKL), 2010 WL 3187294, at *9 (S.D.N.Y. Aug. 11, 2010) (stating that in order to claim third-party beneficiary status under New York law, plaintiff must plead (1) the existence of a valid and binding contract between other parties, (2) that the contract was intended for the third party's benefit, and (3) that the benefit to plaintiff is sufficiently immediate, rather than incidental, to indicate the assumption by 31 the contracting parties of a duty to compensate the plaintiff if the benefit is lost (quoting Henneberry v. Sumitomo Corp., No. 04 Civ. 2128(PKL), 2005 WL 991772, at *12 (S.D.N.Y. Apr. 27, 2005))).
Courts in this Circuit have consistently denied tortious interference with contract claims where the plaintiff was neither a party to, nor an intended third-party beneficiary of, the contract in question. See, e.g., Wells Fargo Bank Nw., N.A. v. Energy Ammonia Transp. Corp., No. 01 Civ. 5861(JSR), 2002 WL 1343757, at *1 (S.D.N.Y. June 18, 2002) (granting motion to dismiss tortious interference with contract counterclaim on ground that defendants lacked standing because they were neither parties to, nor third-party beneficiaries of, the contract at issue); cf. LoPresti, 30 A.D.3d at 476 (dismissing tortious interference with contract claim
Plaintiffs have not pleaded that they were third-party beneficiaries of the agreements in question, and have not provided sufficient details regarding those contracts in order to allow the Court to make such a finding. Moreover, any argument that Mr. Restis is a third-party beneficiary of the Golden Energy and RX-Drill contracts simply by virtue of his corporate ownership interests appears misplaced. See Solutia Inc. v. FMC Corp., 385 F.Supp.2d 324, 338 (S.D.N.Y.2005) (stating that a benefit received through corporate ownership is insufficient to establish rights as a third-party beneficiary under New York law); Tradition Chile Agentes de Valores Ltda. v. ICAP Sec. USA LLC, No. 09 Civ. 10343 (WEIP), 2010 WL 4739938, at *10 (S.D.N.Y. Nov. 5, 2010) (granting motion to dismiss parent corporation's tortious interference with contract claim involving subsidiary's employment agreements because the agreements evinced no intent to benefit parent corporation); United Int'l Holdings, Inc. v. Wharf (Holdings) Ltd., 988 F.Supp. 367, 372 (S.D.N.Y.1997) (finding that parent corporation was not a third-party beneficiary based on the fact that it received a "direct benefit" from payments made from assets held by its wholly owned subsidiaries). Accordingly, Plaintiffs' tortious interference with contract claim cannot be sustained.
Secondly, even if Plaintiffs had standing to bring the tortious interference with contract claim, the SAC fails to allege that the contracts in question were breached.
Plaintiff Restis alleges that Defendants are liable for intentional infliction of emotional distress as a result of the "name and shame" campaign. SAC ¶ 164. Under New York law, the tort of intentional infliction of emotional distress has four elements: (1) extreme and outrageous conduct; (2) intent to cause severe emotional distress; (3) a causal connection between the conduct and the injury; and (4) severe emotional distress. See Bender v. City of New York, 78 F.3d 787, 790 (2d Cir.1996). "New York sets a high threshold for conduct that is `extreme and outrageous' enough to constitute intentional infliction of emotional distress." Id.; see also Gay v. Carlson, 60 F.3d 83, 89 (2d Cir.1995) ("We have noted that New York courts have been `very strict' in applying these elements." (quoting Martin v. Citibank, N.A., 762 F.2d 212, 220 (2d Cir.1985))). Indeed, as the Second Circuit recognized in Stuto v. Fleishman, New York courts have found liability for intentional infliction of emotional distress "only where the conduct has been so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized society." 164 F.3d 820, 827 (2d Cir.1999) (internal quotation marks omitted) (quoting Howell v. N.Y. Post Co., 81 N.Y.2d 115, 121, 596 N.Y.S.2d 350, 612 N.E.2d 699 (N.Y.1993) (quoting Murphy v. Am. Home Prods. Corp., 58 N.Y.2d 293, 303, 461 N.Y.S.2d 232, 448 N.E.2d 86 (N.Y. 1983))). The standard is "set deliberately high to ensure that a plaintiff's claim of emotional distress is genuine and to dissuade litigation where only bad manners and hurt feelings are involved." Thai v. Cayre Grp., 726 F.Supp.2d 323, 336-37 (S.D.N.Y.2010). As courts in this Circuit have recognized, defamatory statements generally cannot constitute the extreme and outrageous behavior required for an intentional infliction of emotional distress claim. See, e.g., House v. Wackenhut Servs., Inc., No. 10 Civ. 9476(CM)(FM), 2011 WL 6326100, at *5 (S.D.N.Y. Dec. 16, 2011) (quoting Carlson v. Geneva City Sch. Dist., 679 F.Supp.2d 355, 372 (W.D.N.Y. 2010)); Ostrowsky v. Dep't of Educ., No. 12-CV-2439 (RRM)(JO), 2013 WL 5963137, at *11 (E.D.N.Y. Nov. 7, 2013).
Even if Defendants' actions were sufficiently extreme and outrageous, however, Plaintiffs' claim for intentional infliction of emotional distress fails for another reason—a claim for intentional infliction of emotional distress fails where it falls within the ambit of another tort. Fordham v. Islip Union Free Sch. Dist., 662 F.Supp.2d 261, 276 (E.D.N.Y.2009). Courts in this Circuit consistently dismiss intentional infliction of emotional distress claims where plaintiff alleges no facts beyond those necessary to sustain another tort claim. For example, in M + J Savitt, Inc. v. Savitt, No. 08 Civ. 8535(DLC), 2009 WL 691278, at *14 (S.D.N.Y. Mar. 17, 2009), the court granted defendants' motion to dismiss an intentional infliction of emotional distress claim in part because the statement on which it was based fell within the ambit of plaintiff's claim for defamation. See also Anyanwu v. Columbia Broad. Sys., Inc., 887 F.Supp. 690, 693 (S.D.N.Y.1995) (granting motion to dismiss intentional infliction of emotional distress claim because New York courts have held that a separate cause of action "for what are essentially defamation claims" should not be entertained). Relatedly, the Second Circuit decided in Chao that all New York state tort claims—not just tortious interference—are barred where the entire injury alleged
Plaintiffs specify that Defendants' "deliberate and malicious `name and shame' campaign of false and defamatory statements" caused Mr. Restis severe mental pain. SAC ¶¶ 165, 166. Accordingly, Mr. Restis' intentional infliction of emotional distress claim "falls entirely within the ambit" of the defamation claim. Defendants' motion to dismiss the intentional infliction of emotional distress claim is therefore GRANTED.
Plaintiffs further allege that Defendants' "name and shame" campaign constitutes prima facie tort. Id. ¶ 171.
As with the other tort claims, the factual allegations underlying the prima facie cause of action relate to the dissemination of allegedly defamatory materials; accordingly this cause of action must fail. Cf. id. (affirming dismissal of prima facie tort claim on Rule 12(b)(6) motion where the claim "repeatedly avail[ed] itself of the terminology of defamation"); Chao v. Mount Sinai Hosp., 2010 WL 5222118, at *14 (S.D.N.Y. Dec. 17, 2010) (granting motion to dismiss prima facie tort claim because it related "only to defamatory allegations" and therefore "must fail"). Defendants' motion to dismiss the prima facie tort claim is therefore GRANTED.
Finally, Defendants request that the Court strike all non-actionable statements. Defs. Mem. L. 30. Rule 12(f) of the Federal Rules of Civil Procedure provides that a court may strike from a pleading any redundant, immaterial, impertinent, or scandalous matter. Fed.R.Civ.P. 12(f). Indeed, allegations may be stricken where they have no bearing on the parties' claims or defenses, will likely be prejudicial, or where they have criminal overtones. Aventis Envtl. Sci. USA LP v. Scotts Co., No. 99 Civ. 4015(LAP)(THK), 2003 WL 1787295, at *2 (S.D.N.Y. Apr. 3, 2003). "However, `the courts should not tamper with pleadings unless there is a strong reason for so doing.'" Id. (quoting Lipsky v. Commonwealth United Corp., 551 F.2d 887, 893 (2d Cir.1976)). "[I]t is settled that the motion [to strike] will be denied, unless it can be shown that no evidence in support of the allegation would be admissible." Lipsky, 551 F.2d at 893; see also Ulla-Maija, Inc. v. Kivimaki, No. 02 Civ. 3640(AGS), 2003 WL 169777, at *4 (S.D.N.Y. Jan. 23, 2003) (observing that motions to strike are disfavored and will not be granted unless it is clear that the allegations can have no possible bearing on the subject matter of the litigation).
In their reply memorandum, Defendants state that Plaintiffs' pleadings contain "a mass of irrelevant or inflammatory material," including extensive references to offensive Facebook comments, claims of non-parties, and repeated references to FBB. Defs. Reply Mem. L. 3. However, Defendants have failed to show that these allegations have no bearing on Plaintiffs' claims, or that Plaintiffs would be unable to admit any evidence in support of such allegations at trial. Accordingly, Defendants have not provided the strong reason required in order for the Court to tamper with the pleadings. Defendants' request to strike is therefore DENIED.
For the reasons set forth above, Defendants' motion to dismiss is GRANTED in part and DENIED in part. Specifically, Defendants' motion to dismiss the tortious interference with prospective economic advantage, tortious interference with contract, international infliction of emotional distress, and prima facie tort claims is GRANTED; Defendants' motion to dismiss the defamation claim is DENIED. The Clerk of the Court is respectfully directed to terminate the motion (Doc. 25).
It is so ORDERED.
Plaintiffs claim that Defendants mischaracterized the documents by stating that they were "confirmation" and "corroboration" of Defendants' assertions of Plaintiffs' involvement in illegal activities with the Iranian regime. Id. ¶ 145.
