Judge Gail Killefer, Case Number: 23STCV00341, Date: 2024-11-25 Tentative Ruling

This is a defamation action. On January 9, 2023, Plaintiffs Andrew Lehman, Monica Lynn Riley (collectively “Plaintiffs”), and Minors 1 to 3 filed this action. On January 18, 2024, Plaintiffs orally requested the Court to dismiss Minors 1 to 3, and the Court granted the request.

On June 20, 2023, Plaintiffs filed the First Amended Complaint (FAC) against Defendants Blogger, Inc. D/B/A lawintexas.com, Browserweb Incorporated, Browser Web, LLC, John Burke, Joanna Burke, Mark Burke, and Does 1 to 10. The FAC alleges Plaintiff Andrew Lehman owns a litigation support business and that Defendants John and Joanna Burke’s house in Burke’s Kingwood, Texas was foreclosed upon in the United States District Court in the Southern District of Texas. As a result, Defendants allegedly have maliciously targeted all persons in the legal system involved in the foreclosure action, including Plaintiff Andrew Lehman. Defendants, around June 2020, allegedly posted photos of Plaintiffs and their three children and intentionally defamed Plaintiffs on the website lawintexas.com and other platforms. Plaintiff Andrew Lehman allegedly lost business as a result of Defendants’ defamation.

The FAC alleges the following causes of action: (1) Defamation (Common Law and Civ. Code § 46), (2) Intentional Interference with Prospective Economic Advantage, (3) Violation of Business & Professions Code § 17200 et seq. (Unfair Competition Law), 4) Civil Conspiracy, 5) Harassment, 6) Stalking, 7) Misappropriation of Likeness (Civ. Code § 3344), 8) Use of Minor’s Likeness without Consent (Civ. Code § 3344), 9) Intentional Infliction of Emotional Distress, 10) Negligence, and 11) Injunctive Relief. The FAC seeks damages in the amount of $15 million and a permanent injunction, in addition to other remedies.

On November 17, 2023, Plaintiffs dismissed all Defendants other than Blogger, Inc. at a case management conference hearing. Defendant failed to appear in the case. On June 18, 2024, the Court ordered Plaintiffs to file documents for a default prove-up.

On August 28, 2024, default was entered against Defendant Blogger, Inc. Plaintiffs also filed their Request for Default Judgment (Form CIV-100), CCP § 585 declarations, and the summons and proof of service for the First Amended Complaint.

On September 3, 2024, Plaintiffs filed the proposed default judgment (Form JUD-100) and an amended declaration of Plaintiff Andrew Lehman.

On September 25, 2024, Plaintiffs filed a Memorandum of Points & Authorities in Support of the Default Judgment as to Defendant Blogger, Inc. (MPA). Plaintiffs argue that default judgment and injunctive relief should be granted based on the reasoning in the case Alpha Phoenix Industries LLC v. SCInternational Incorporated et al. (Case No. CV-12-1848-PHX-SMM), heard against Defendants John and Joanna Burke in the United States District Court for the District of Arizona. (MPA, Exh. 1.)

On September 30, 2024, Plaintiffs filed a proposed order regarding the request for injunctive relief and default judgment award in a tentative ruling format. The matter is now before the court.

I. Legal Standard

California Rules of Court, Rule 3.1800 sets forth the requirements for default judgments. In pertinent part, the rule dictates that a party must use form CIV-100 and file the following documents with the clerk: (1) except in unlawful detainer cases, a brief summary of the case identifying the parties and the nature of plaintiff's claim; (2) declarations or other admissible evidence in support of the judgment requested; (3) interest computations as necessary; (4) a memorandum of costs and disbursements; (5) a declaration of nonmilitary status for each defendant against whom judgment is sought; (6) a proposed form of judgment; (7) a dismissal of all parties against whom judgment is not sought or an application for separate judgment against specified parties under CCP § 579, supported by a showing of grounds for each judgment; (8) exhibits as necessary; and (9) a request for attorney fees if allowed by statute or by the agreement of the parties. (Cal. Rules of Court, Rule 3.1800(a)(1)-(9).)

“The elements of a cause of action for injunctive relief are (1) a tort or other wrongful act constituting a cause of action; and (2) irreparable injury, i.e., a factual showing that the wrongful act constitutes an actual or threatened injury to property or personal rights which cannot be compensated by an ordinary damage award.” (Brownfield v. Daniel Freeman Marina Hospital (1989) 208 Cal.App.3d 405, 410.) Notably, “injunctive relief is a remedy and not, in itself, a cause of action, and a cause of action must exist before injunctive relief can be granted.” (Camp v. Board of Supervisors (1981) 123 Cal.App.3d 334, 356.)

IV. Discussion

A. Default Judgment

Plaintiffs have filed a CIV-100 form with the appropriate sections filled out, including a declaration of mailing (mailed on August 20, 2024 and August 28, 2024) and declaration of nonmilitary status for the Defendant. Costs and disbursements were waived. Plaintiffs dismissed all Defendants except Blogger, Inc. on November 17, 2023. Plaintiff submitted a proposed judgment on Form JUD-100 and in tentative ruling format. Plaintiffs have also filed CCP § 585 declarations on behalf of Andrew Lehman and Monica Lynn Riley. The declarations contain a brief summary of the case and nature of Plaintiffs’ claim. Plaintiffs do not seek interest, and thus, an interest calculation is not needed. Plaintiff have also filed a proof of service of summons and FAC. Defendant Blogger, Inc. was served through registered agent, Jennifer Franz, at 1201 N Orange St., Suite 600, Wilmington, DE 19801 on July 12, 2023 (POS filed July 13, 2024) and again on January 26, 2024 (POS filed August 28, 2024). The Court finds all California Rules of Court, Rule 3.1800 requirements have been met.

On the CIV-100 Form and JUD-100, Plaintiffs request for a judgment in the amount of $5,000,000.00 to be entered—this amount does not exceed the amount requested in the FAC. Yet in the MPA and proposed order (tentative ruling format), Plaintiffs request $2,315,342.00. This amount was calculated by averaging the yearly income for Plaintiff’s business from 2015 to 2024 (See MPA, Exh. 2.) The average yearly income for 2015 to July-2020 (when the alleged defamation began) was $551,048.40. The average yearly income for mid-2020 to three-fourths through 2024 was $87,980.00. Plaintiffs subtracted the latter from the former to get $463,068.40—the average loss in earnings per year after the alleged defamation. This amount was multiplied by 5 years (2020 to 2024) to get a total of $2,315,342.00—the total loss in earnings due to the alleged defamation.

Plaintiffs’ method of calculation is based off of a previous judgment against Defendants John and Joanna Burke in the case Alpha Phoenix Industries LLC v. SCInternational Incorporated et al. (Case No. CV-12-1848-PHX-SMM), granted by the United States District Court for the District of Arizona. In that case, the district court found default judgment appropriate and awarded compensatory damages in the amount of $291,029.00. The court calculated this amount by calculating the pre-defamation monthly average of sales and determining the amount of lost sales for each month after the defamation. The court totaled the amount of lost sales for March 2012 to June 2012 of 11,641 and multiplied the total sales by $25.00, the profit amount per sale corroborated by a witness. The total lost profit was $291,029.00.

The Court notes that it cannot consider authority from other jurisdictions but acknowledges the existence of this case. In the light of the similar circumstances, the Court finds this method of calculation reasonable. The only flaw in the calculation is the five-year multiplier. The Court finds that July 2020 to November 2024 is around 4.3 years, not 5 years. Thus, the correct calculation should be $463,068.40 x 4.3 = $1,991,194.12.

The Court GRANTS default judgment against Blogger, Inc. in the amount of $1,991,194.12.

B. Injunctive Relief

Plaintiffs argue that this Court should grant injunctive relief ordering Defendant Blogger, Inc. to delete its 14 defamatory articles and one social media post. Such injunctive relief is similar to that granted in Alpha Phoenix Industries LLC v. SCInternational Incorporated et al. (Case No. CV-12-1848-PHX-SMM). In that case, the district court found that plaintiff API was a private figure, and defendants John and Joanna Burke defamed plaintiff. The district court found that plaintiffs suffered and would continue to suffer from defendants’ defamatory statements posted on interactive computer services websites. The court found that although it could not order the web service providers to remove the postings under 47 U.S.C. §230(c)(l), defendants could be ordered to remove the postings because 1) the postings cause irreparable harm to plaintiff; 2) plaintiff’s remedies at law are inadequate to compensate the harm; 3) the communications were defamatory and thus the public’s interests would not be injured by the order to remove the postings; and 4) a balancing of the hardships weighed in favor of plaintiff. The Court again notes that it cannot consider authority from other jurisdictions but acknowledges the existence of this case.

The Court assesses 1) whether Plaintiff has stated a claim for defamation; and 2) whether Plaintiff will suffer irreparable harm. The Court also discusses a potential prior restraint issue.

“The elements of a defamation claim are (1) a publication that is (2) false, (3) defamatory, (4) unprivileged, and (5) has a natural tendency to injure or causes special damage.” [Citations.] The defamatory statement must specifically refer to, or be “‘of and concerning,’” the plaintiff. [Citations.]” (John Doe 2 v. Superior Court (2016) 1 Cal.App.5th 1300, 1312.)

The Court finds that by failing to answer this defamation action, Defendant Blogger, Inc. admits to the factual allegations in the FAC. “‘Substantively, [t]he judgment by default is said to ‘confess’ the material facts alleged by the plaintiff, i.e., the defendant's failure to answer has the same effect as an express admission of the matters well pleaded in the complaint.’ [Citations.] The ‘well-pleaded allegations’ of a complaint refer to ‘all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law.’ [Citations.]” (Kim v. Westmoore Partners, Inc. (2011) 201 Cal.App.4th 267, 281.)

The Court finds that, where allegations in the FAC and Plaintiffs’ declarations are taken as true, Plaintiffs have proved that Defendant Blogger, Inc. published false, unprivileged, and injurious statements regarding Plaintiffs. For example, Plaintiff Andrew Lehman’s declaration states the following:

“2. Beginning with its first publication in July of 2020, the Defendant began a four year tirade of publishing over 100 articles, blogs, and other social media about the Plaintiff and his wife and children making fun of them and publishing private pictures, home addresses, school addresses, and harassing and stalking the plaintiff with cyber expertise, all to the commercial benefit of its up and coming legal news blog www.lawsintexas.com which had just begun its circulation.”

“3. The Defendant and its owner Mark Burke were formerly clients of Mr. Lehman’s company Certified Forensic Loan Auditors LLC some years before and the Defendant’s owner Mark Burke had lost his home to foreclosure and had a distaste for the Plaintiff Andrew Lehman as a result. “

“4. Defendant’s initial publication was entitled “the CFPB claim restitution from Forensic Loan Scam Company… the fact is the $3 million is suspended. This thief [ANDREW LEHMAN] hasn’t got $30,000.00 let alone $3, million.” The article went on to show pictures of Plaintiff with his wife and 3 minor children all under the age of 13 years, calls Lehman a scam, fraud, Pimp, Drug Dealer, Murder and thief all of which are untrue, false, and malicious intended to injur[e] the reputation of Plaintiff.”

The FAC also contains numerous examples of Defendant Blogger, Inc.’s defamatory statements. Defendant Blogger, Inc., by failing to appear in this action, admits to the well-pleaded allegations in the FAC. (See Kim, supra, 201 Cal.App.4th at p. 281.) The Court finds that Plaintiff has provided sufficient evidence to prove a cause of action for defamation.

Plaintiff will suffer irreparable harm from the defamatory statements if they are allowed to remain on the website. Plaintiffs have provided evidence that Plaintiff Andrew Lehman has lost significant income as a proximate result of Defendant Blogger, Inc.’s defamatory statements:

“14. These actions of the Defendant are causing the Plaintiff to lose approximately $250,000.00 - $500,000.00 annually, from 2020, 2021, 2022, 2023, 2024, and will certainly cause the Plaintiff to continue to lose income in the future because of the permanent disparagement that has occurred by Defendant from his false and defamatory publications.”

“18. As a proximate result of Defendant’s disparaging Plaintiff on the internet and preventing Plaintiff’s internet-based companies from getting clients and damaging the professional reputation the damages from 2020 ($250,000), 2021 ($500,000), 2022 ($500,000), 2023 ($500,000), and 2024 ($500,000) are already accumulated over $2,000,000 in lost wages alone.”

Plaintiff further suffers from emotional damage as a result of the defamatory statements:

“20. Plaintiff has also been forced to get medical treatment from the severe stress and anxiety from the nonstop harassment from the Defendant and now sees a Psychiatrist once a month, and a therapist twice a week while also being prescribed medications for depression, anxiety, and post-traumatic stress syndrome.”

The Court finds that Plaintiffs will suffer irreparable harm as long as the statements remain on the website. Remedies at law are not adequate—as long as the defamatory statements remain on the website, Plaintiff will likely continue to suffer loss of economic profits and emotional damages. Because Plaintiffs have stated a cause of action for defamation and proved they will suffer irreparable harm, the Court finds a permanent injunction ordering Defendant Blogger, Inc. to remove its defamatory articles and social media post is warranted here. (See Brownfield, supra, 208 Cal.App.3d at p. 410.)

The Court notes that there may be First Amendment issues regarding injunctions awarded in defamation cases. There is also a layer of complexity added where the issue of defamation is determined via default judgment as is the case here.

“An order prohibiting a party from making or publishing false statements is a classic type of an unconstitutional prior restraint.” (Evans v. Evans (2008) 162 Cal.App.4th 1157, 1167.) But “an injunction issued following a trial that determined that the defendant defamed the plaintiff that does no more than prohibit the defendant from repeating the defamation, is not a prior restraint and does not offend the First Amendment.” (Balboa Island Village Inn, Inc. v. Lemen (2007) 40 Cal.4th 1141, 1148.)

The Court resolves these issues by comparing this case to Hassell v. Bird (2016) 247 Cal.App.4th 1336, 1360. In that case, the trial court granted a default judgment against an individual who posted defamatory comments about the plaintiff law firm on Yelp, a nonparty customer review website. The trial court granted a preliminary injunction 1) ordering the defendant to take down its comments on Yelp and 2) ordering Yelp to remove all reviews posted by defendant and to remove any subsequent comments within 7 business days of the court’s order. (Id. at p. 1345.) Yelp, as the website operator, appealed the injunction to remove defendant’s comments, arguing the injunction was an improper prior restraint and that the Communications Decency Act (CDA) (47 U.S.C. §230(c)(l)[1]) barred the injunction. The Appellate Court found the injunction was not an improper prior restraint and was not barred by the CDA. (Id. at p. 1361, 1365.) The Supreme Court overruled the Appellate Court decision finding that Yelp could validly challenge the injunction under the CDA even though it was not a defendant. (Hassell v. Bird (2018) 5 Cal.5th 522, 527.)

Unlike in Hassell, the injunction here does not require a third-party web servicer (like Yelp) to take down defamatory comments of others, which may create issues under the CDA. Defendant Blogger, Inc. made defamatory statements on its own website.

The Court draws similarities to Hassell only to the extent the Appellate Court interpreted Balboa Island’s holding that injunctions to prohibit the repeating of speech found to be defamatory is not a prior restraint. The Appellate Court found “nothing in Balboa Island supportive of [the] contention that [its holding that an injunction issued following a trial that determined defendant made defamatory statements is not a prior restraint is limited to determinations following a jury trial]. In fact, the injunction in [Balboa Island] was issued after a bench trial.” (Hassell, supra 247 Cal.App.4th at p. 1361.) The Appellate Court essentially found that, where the trial court determined the defendant made defamatory statements via default judgment, that there was no prior restraint issue. It was of no issue that there was no jury trial. The Supreme Court did not question this reasoning. Neither the Appellate Court nor the Supreme Court in Hassell found any issue with the trial court’s decision to impose an injunction ordering the defendant to take down the defamatory comments it made on Yelp via default judgment.

Under Balboa Island and Hassell, the Court here has properly determined that Defendant Blogger, Inc.’s articles and social media post were defamatory, and thus, a permanent injunction requiring Defendant Blogger, Inc. to take down its defamatory articles and social media post is not a prior restraint.

The Court GRANTS the Request for Injunctive Relief, ordering Defendant Blogger, Inc. to remove its defamatory 14 articles and one social media post.

The Court GRANTS the Request for Default Judgment and Request for Injunctive Relief.

[1] 47 U.S.C. §230(c)(l) states the following: “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.”