Basile v. Prometheus Global Media, LLC

2020 IL App (1st) 190602-U

• Court: Appellate Court of Illinois
• Decided: July 6, 2020
• Docket: 1-19-0602
• Status: Unpublished

Opinion

2020 IL App (1st) 190602-U No. 1-19-0602 Third Division July 2, 2020

NOTICE: This order was filed under Supreme Court Rule 23 and may not be cited as precedent by any party except in the limited circumstances allowed under Rule 23(e)(1). ______________________________________________________________________________ IN THE APPELLATE COURT OF ILLINOIS FIRST DISTRICT ______________________________________________________________________________ NICOLE BASILE, ) Appeal from the ) Circuit Court of Plaintiff-Appellee, ) Cook County. ) v. ) No. 17 L 009521 ) PROMETHEUS GLOBAL MEDIA, LLC, ) Honorable ) Daniel T. Gillespie, Defendant-Appellant. ) Judge, presiding.

JUSTICE COBBS delivered the judgment of the court. Presiding Justice Ellis and Justice McBride concurred in the judgment.

ORDER

¶1 Held: Defendant’s interlocutory appeal under Illinois Supreme Court Rule 306(a)(9) is dismissed for lack of jurisdiction.

¶2 This appeal involves the application of the anti-SLAPP statutes of Illinois and California.

The term “SLAPP,” which is an acronym for Strategic Lawsuit Against Public Participation, refers

to a meritless lawsuit aimed at preventing citizens from exercising their political rights or at

punishing them for having done so. Sandholm v. Kuecker, 2012 IL 111443, ¶ 33. “The traditional

SLAPP paradigm involves a large and powerful corporation or entity that sues an individual or No. 1-19-0602

grassroots political organization for defamation, intentional interference with economic advantage,

or some other similar tort.” Ryan v. Fox Television Stations, Inc., 2012 IL App (1st) 120005, ¶ 13.

The goal of a plaintiff in a SLAPP is not necessarily to win the litigation, but rather to chill the

speech of the defendant and others through the delay, expense, and distraction associated with

defending against a lawsuit. Sandholm, 2012 IL 111443, ¶ 34. Thus, although SLAPPs are

meritless by definition, SLAPP plaintiffs nevertheless accomplish their goals through the ancillary

effects of the lawsuits themselves. Id.

¶3 Recognizing that existing safeguards against SLAPPs were inadequate to protect

defendants from these ancillary effects, many states, including Illinois and California, have enacted

special anti-SLAPP statutes. While such legislation varies from state to state, the statutes typically

provide a mechanism for early dismissal and the award of attorney’s fees to a successful defendant.

¶4 Here, plaintiff-appellee, Nicole Basile, filed a complaint against defendant-appellant,

Prometheus Global Media, LLC, alleging defamation per se, defamation per quod, and false light

invasion of privacy. Defendant filed a motion to dismiss the complaint, citing California’s anti-

SLAPP statue. In response, plaintiff argued that Illinois’ anti-SLAPP statute, not California’s,

applied to this case. The circuit court denied the motion to dismiss, reasoning that it did not need

to decide which statute applied because defendant was not entitled to relief under either state’s

law. Defendant petitioned this court for leave to file an interlocutory appeal under Illinois Supreme

Court Rule 306(a)(9), which we granted. However, we now decide that we lack jurisdiction to

consider defendant’s arguments, and we therefore dismiss the appeal.

¶5 I. BACKGROUND

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¶6 Plaintiff is an Illinois resident who formerly lived and worked in Los Angeles, California

as a payroll accountant in the television and film industries. Defendant is a Delaware limited

liability company with its principal place of business in New York. The Hollywood Reporter,

which is wholly owned and published by defendant, is a Los Angeles-based magazine and website

that focuses on the television, film, and entertainment industries.

¶7 In December 2014, an article entitled “Sony Hack: Studio Security Points to Inside Job”

appeared in print edition of The Hollywood Reporter and on the magazine’s website. The article

concerns the highly publicized November 2014 cyber attack in which hackers obtained and leaked

confidential data from Sony Pictures Entertainment (Sony), including unreleased films and

personal information of Sony employees. This article is the subject of plaintiff’s complaint.

¶8 After the subheadline that “North Korea might hate a new movie, but studio sources lean

toward an ex-employee scenario ***,” the article briefly recounts the background of the attack,

what information was stolen, and what measures Sony and other studios have taken to enhance

their cyber security in its wake. The article then continues with a critical transition paragraph:

“Now the question of who is behind the attack has become a chilling Hollywood whodunit.

While the hackers have identified themselves only as Guardians of Peace, emails pointing

journalists to allegedly stolen files posted on a site called Pastebin came from a sender named

‘Nicole Basile.’ A woman by that name is credited on IMDb as an accountant on the studio’s 2012

hit film The Amazing Spider-Man, and her LinkedIn page says she worked at Sony for one year in

2011. Basile couldn’t be reached for comment and the studio declined to confirm if she works or

has worked there.”

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¶9 The article next explains the “[i]nitial speculation” that the hack was perpetrated by the

government of North Korea in retaliation for an upcoming Sony film involving a CIA plot to

assassinate North Korean leader Kim Jong-un. However, the following sentence states, “Inside the

studio, though, sources say there is little evidence that North Korea is behind the attack.” The

article then quotes a cyber security expert who also found it “hard to believe that North Korea

[was] the perpetrator,” and instead “theorize[d] an employee or ex-employee with administrative

access privileges [was] a more likely suspect.” The expert reasoned that an outside hacker would

have needed months to find such sensitive information within the Sony network and would not

have used “such things as Hushmail, Dropbox, and Facebook” because those sites track user

information and cooperate with law enforcement. 1 After quoting the expert, the article asserted

that the “possibility of a disgruntled employee wreaking havoc is very real,” as Sony had laid off

hundreds of employees in the year preceding the attack. The article then concluded by detailing

the potential financial impact of the leaked films and by noting that Sony was working with the

FBI to investigate the attack as a criminal matter.

¶ 10 A. The Federal Suit

¶ 11 On November 11, 2015, plaintiff filed a complaint against defendant in the U.S. District

Court for the Northern District of Illinois, alleging that the article constituted defamation per se

and false light invasion of privacy. 2 In particular, plaintiff claimed that the article portrayed her as

responsible for the cyber attack through its “overall meaning” and three false and defamatory

1 Although not mentioned in the original article, a follow-up article, which is not the subject of plaintiff’s claims, indicates that the hackers used the e-mail address “nicole.basile@hushmail.com.” 2 Plaintiff’s federal complaint also named the article’s authors as defendants. However, the district court dismissed the authors for lack of personal jurisdiction, plaintiff did not name them in her state court complaint, and they are not parties to this appeal.

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statements: (1) that her name was the only alias used by the hackers, (2) that she was a former

Sony employee, and (3) that she had “disappeared” and could not be found for comment despite

reasonable efforts.

¶ 12 In a written order dated December 7, 2016, the district court granted defendant’s motion

for judgment on the pleadings and dismissed the complaint. Applying Illinois defamation law, the

district court found that the article could not reasonably be construed as imputing criminal activity

to plaintiff because it “recognize[d] that the identity of the actual perpetrators are unknown,”

explained that any of a number of laid-off former Sony employees might be responsible, and did

not accuse plaintiff of sending the e-mail to journalists. The district court also found that the article

did not disparage plaintiff’s ability to perform her job, and was therefore not defamatory per se.

The district court further stated that, even if the article had been defamatory per se, plaintiff would

still not have been entitled to relief because the article was capable of a reasonable innocent

construction. Finally, the court rejected plaintiff’s false light claim because it was based on the

same statements as her defamation claim.

¶ 13 On appeal, however, it was discovered that complete diversity did not exist between the

parties because one of defendant’s members was a citizen of Illinois. Accordingly, the Seventh

Circuit remanded to the District Court with instructions to dismiss the case for lack of jurisdiction.

¶ 14 B. The State Suit

¶ 15 On October 20, 2017, plaintiff filed the instant complaint in the Circuit Court of Cook

County pursuant to section 5/13-217 of the Code of Civil Procedure (Code) (735 ILCS 5/13-217

(West 2016)), which allows a plaintiff to commence a new action in the circuit court within a year

of a dismissal in a district court for lack of jurisdiction. The state court complaint mirrored the

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federal court complaint with respect to the claims of defamation per se and false light invasion of

privacy, but also added a claim of defamation per quod based on plaintiff’s contentions that the

article was defamatory on its face and that she suffered special damages in the form of lost income

and business opportunities as a result.

¶ 16 Defendant filed a motion to dismiss the complaint pursuant to section 2-615 of the Code,

arguing that the article was “not defamatory as a matter of law” and was capable of a reasonable

innocent construction. Defendant further contended that plaintiff’s claim of defamation per quod

should also be dismissed because she did not allege special damages with sufficient particularity.

Lastly, defendant maintained that plaintiff’s false light claim failed because it was based on the

same nonactionable statements as her defamation claims.

¶ 17 In response, plaintiff argued that the article was defamatory per se because it conveyed that

the hacker was a disgruntled ex-Sony-employee while mentioning only her—by name—as an ex-

employee connected to the stolen data. Plaintiff also maintained that her claim of defamation per

quod remained viable because the article was defamatory on its face and she pled special damages.

¶ 18 Following a hearing, the circuit court denied defendant’s section 2-615 motion. In so

ruling, the court stated that the mention of plaintiff’s name in relation to the stolen information

was “the punch line” of the article and was “arguably colorfully a defamatory statement” that

amounted to defamation per se. With respect to the plaintiff’s claim of defamation per quod, the

court reiterated that the article was defamatory on its face and also found that plaintiff adequately

pled special damages where she alleged, in the court’s words, an “inability to get hired in [the film

industry] and lost wages as a result.”

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¶ 19 Defendant next filed a motion to dismiss the complaint pursuant to section 2-619 of the

Code, arguing that California’s anti-SLAPP statute (Cal. Proc. Code § 425.61(b)(1); 735 ILCS

110/15 (West 2016)), was “an affirmative matter which warrant[ed] dismissal of the Complaint

with prejudice as a matter of law.” Specifically, defendant contended that California’s anti-SLAPP

statute should apply to this case because, as the article was primarily researched, written, edited,

and published out of The Hollywood Reporter’s Los Angeles office, California had the most

significant contacts and strongest interest in having its anti-SLAPP law applied. Defendant further

asserted that it was entitled to an early dismissal under California’s anti-SLAPP statute because

plaintiff was unable to show a reasonable probability of success on the merits. In particular,

defendant maintained that plaintiff’s claims were destined to fail under Illinois defamation law

because the article was not defamatory and was capable of a reasonable innocent construction.

¶ 20 Plaintiff responded that Illinois’ anti-SLAPP statute, the Citizen Participation Act (735

ILCS 110/1 et seq. (West 2016)), should apply because the case was brought in an Illinois court,

both parties were citizens of Illinois, and the injury was “largely realized in Illinois.” Plaintiff also

argued that, even if the California anti-SLAPP statute were applicable, her complaint would still

survive dismissal because the court had already determined that she pled a prima facie case of

defamation by denying defendant’s section 2-615 motion.

¶ 21 At a hearing on the section 2-619 motion, the court instructed defendant to provide

additional briefing as to whether there was a conflict of law between the California and Illinois

anti-SLAPP statutes. In its supplemental brief, defendant argued that a choice of law analysis was

required because the California statute was “much broader in scope” than its Illinois counterpart.

In particular, defendant noted that California’s statute applies to all speech “in connection with a

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public issue,” whereas Illinois’ statute applies only to speech aimed at procuring a favorable

governmental action or outcome. See Cal. Proc. Code § 425.61(b)(1) (West 2016); 735 ILCS

110/15 (West 2016).

¶ 22 In response, plaintiff argued that the court should apply the Illinois statute because

“California’s anti-SLAPP law is plainly procedural, and not substantive.” Specifically, plaintiff

contended that the California statute merely provided a procedural mechanism through which the

case could be dismissed at an early stage if it were meritless as a matter of substantive Illinois

defamation law.

¶ 23 After receiving the supplemental briefing, the circuit court ruled that it need not conduct a

choice of law analysis because “under either statute, [d]efendant’s 2-619 motion must be denied.”

The court explained that defendant could not prevail under Illinois’ anti-SLAPP statute because

the article was not related to defendant’s participation in government and could not reasonably be

construed as nondefamatory. In line with its ruling on defendant’s section 2-615 motion, the court

stated that “the only reasonable interpretation an ordinary reader could be left with is that plaintiff

participated in the cyber-attack” because the article claimed that (1) the attack was “likely

committed by an ex-employee,” (2) plaintiff was an ex-employee, and (3) the stolen information

“emanated from Nicole Basile.” Similarly, the court further held that, although the article was the

kind of speech covered by the “broader” California anti-SLAPP statute, that statute would not

entitle defendant to an early dismissal because plaintiff had established a prima facie case of

defamation and a reasonable probability of success on the merits. Accordingly, the court denied

defendant’s motion to dismiss without proceeding any further with a choice of law analysis. Over

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plaintiff’s objection, this court granted defendant’s petition for leave to appeal pursuant to Illinois

Supreme Court Rule 306(a)(9) (eff. Nov. 1, 2017).

¶ 24 II. ANALYSIS

¶ 25 A. Jurisdiction

¶ 26 Before we can reach the merits of defendant’s arguments, we must consider the scope of

our jurisdiction over this case. See Xcel Supply, LLC v. Horowitz, 2018 IL App (1st) 162986, ¶ 26

(“An appellate court always has an independent duty to consider its own jurisdiction and dismiss

an appeal if jurisdiction is lacking.”). This court’s jurisdiction is generally limited to appeals from

final judgments, unless the ruling to be reviewed falls within one of the exceptions for interlocutory

appeals specified by our supreme court. Inland Commercial Property Management, Inc. v. HOB I

Holding Corp., 2015 IL App (1st) 141051, ¶ 17. The Illinois Constitution grants our supreme court

the exclusive and final authority to prescribe the scope of interlocutory appeals. People v. Holmes,

235 Ill. 2d 59, 66 (2009). Thus, “[i]f a supreme court rule does not grant the right to appeal from

a nonfinal judgement, then there is no right to an interlocutory appeal and the appellate court does

not have jurisdiction to hear that appeal.” Mund v. Brown, 393 Ill. App. 3d 944, 997 (2009). The

scope of a supreme court rule is a question of law, which we review de novo. McCarthy v. Taylor,

2019 IL 123622, ¶ 17.

¶ 27 Here, defendant petitioned for, and was granted, a permissive interlocutory appeal under

Supreme Court Rule 306(a)(9), which applies only to appeals “from an order of the circuit court

denying a motion to dispose under the Citizen Participation Act.” Defendant maintains that this

rule grants us jurisdiction to consider his arguments involving California’s anti-SLAPP statute

because the circuit court denied the underlying motion to dismiss based in part on a finding that

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defendant would not be entitled to an early dismissal under the Citizen Participation Act. In

interpreting the scope of a supreme court rule, we employ the same principles that govern the

interpretation of statutes. McCarthy, 2019 IL 123622, ¶ 17. As with statutory interpretation, the

starting point in construing a supreme court rule is the plain language of the rule itself. In re

Michael D., 2015 IL 119178, ¶ 9. When the language of a rule is clear, it must be given effect

without resort to other tools of interpretation. Id.

¶ 28 The language of Rule 306(a)(9) plainly and clearly requires a defendant to have filed “a

motion to dispose under the Citizen Participation Act.” Defendant’s motion to dismiss here makes

no reference to the Citizen Participation Act, and instead relies solely on the protections of

California law. Indeed, defendant’s position below—which it maintains on appeal—was that the

Citizen Participation Act has no application to this case. Thus, defendant’s motion to dismiss was

not “a motion to dispose under the Citizen Participation Act” within the meaning of Rule 306(a)(9).

The circuit court’s ruling on the motion therefore falls outside of the limited scope of the rule.

¶ 29 Moreover, the record shows that the circuit court’s consideration of the Citizen

Participation Act was in no way crucial to its ruling on defendant’s motion. Rather, the circuit

court interpreted the Citizen Participation Act only in addressing the threshold matter of whether

California law had any application to this case. The circuit court ultimately determined that it did

not need to decide whether to apply the Illinois or California anti-SLAPP statute because

defendant’s motion would be unsuccessful under either state’s law. See Townsend v. Sears,

Roebuck, & Co., 227 Ill. 2d 147, 155 (2007) (“A choice-of-law determination is required only

when a difference in law will make a difference in the outcome.”). Thus, even assuming, arguendo,

that California law applied, defendant’s motion would still have been denied. The circuit court’s

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choice-of-law analysis in no way transformed defendant’s motion into one filed “under the Citizen

Participation Act” for purposes of Rule 306(a)(9). As such, the court’s ruling clearly falls outside

the ambit of the rule, and we lack jurisdiction to review it.

¶ 30 Nor are we persuaded by defendant’s argument that “[a]n appeal at this juncture is

consistent with the salutary policy of determining the merits of defamation cases as early in the

litigation process as the circumstances allow.” As previously explained, our jurisdiction in this

case extends only to the narrow limits set forth in Rule 306(a)(9), namely a denial of a motion

brought under the Citizen Participation Act. The rules governing permissive interlocutory appeals

must be strictly construed. Morrissey v. City of Chicago, 334 Ill. App. 3d 251, 258 (2002).

¶ 31 Furthermore, even if we were to ignore the plain language of the rule, we cannot say that

our supreme court intended to allow interlocutory appeals involving other states’ anti-SLAPP

statutes. Before the addition of Rule 306(a)(9), there was significant uncertainty as to whether the

denial of a motion under the Citizen Participation Act was subject to interlocutory review. See

Ryan, 2012 IL App (1st) 120005, ¶ 9 n.1. Our supreme court clarified the issue in 2011 by

amending Rule 306 to explicitly allow for such appeals. However, our supreme court did not

include a similar provision for other states’ anti-SLAPP statutes, even though many states—

including California—had already enacted anti-SLAPP legislation. See Sandholm, 2012 IL

111443, ¶ 33(noting that more than 20 states had enacted anti-SLAPP statutes by August 2007).

Our supreme court has also not expanded the scope of Rule 306(a)(9) in the over nine years since

it was added. Notwithstanding the policies expressed by other states’ legislatures, our supreme

court’s exclusion of foreign anti-SLAPP statutes from the rules governing interlocutory appeals

strongly suggests that our supreme court did not intend for motions under those statutes to be

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subject to interlocutory appeals. See Bridgestone/Firestone, Inc. v. Aldridge, 179 Ill. 2d 141, 152

(2007) (“[T]he inference that all omissions should be understood as exclusions stands despite the

lack of any negative words of limitation.”). Defendant’s policy argument is therefore unavailing.

¶ 32 III. Conclusion

¶ 33 In sum, defendant’s arguments regarding California law do not fall within the narrow

limits of Rule 306(a)(9), which applies only to the Citizen Participation Act. Accordingly, we

lack jurisdiction to consider the arguments in an interlocutory appeal under the rule. This appeal

is therefore dismissed.

¶ 34 Dismissed.

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