Medical Marijuana, Inc. v. ProjectCBD.com

6 Cal. App. 5th 602, 212 Cal. Rptr. 3d 45, 2016 Cal. App. LEXIS 1113
CourtCalifornia Court of Appeal
DecidedNovember 21, 2016
DocketD068523
StatusPublished
Cited by28 cases

This text of 6 Cal. App. 5th 602 (Medical Marijuana, Inc. v. ProjectCBD.com) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Medical Marijuana, Inc. v. ProjectCBD.com, 6 Cal. App. 5th 602, 212 Cal. Rptr. 3d 45, 2016 Cal. App. LEXIS 1113 (Cal. Ct. App. 2016).

Opinion

Opinion

AARON, J.—

I.

INTRODUCTION

Defendants ProjectCBD.com (Project CBD), Martin Lee, and Aaron Cantu (jointly the Project CBD defendants) appeal from the trial court’s order *606 denying their special motion to strike 1 counts 1 and 3, asserting causes of action for libel and false light, in the first amended complaint filed by plaintiffs Medical Marijuana, Inc. (MMI), and HempMeds PX, LLC (HempMeds) (jointly plaintiffs).

On appeal, the Project CBD defendants contend that the trial court incorrectly determined that plaintiffs demonstrated a probability of prevailing on counts 1 and 3 against the Project CBD defendants. The Project CBD defendants also claim that the trial court erred in concluding that plaintiffs are not limited public figures, meaning that plaintiffs would not have to demonstrate that the Project CBD defendants acted with actual malice in publishing an article about plaintiffs, and/or that the court erred in concluding in the alternative that plaintiffs demonstrated that the Project CBD defendants acted with actual malice in publishing the article.

We conclude that the trial court’s ruling with respect to the Project CBD defendants’ anti-SLAPP motion directed at counts 1 and 3 was correct, albeit on grounds different from those relied on by the trial court. We therefore affirm the court’s order and remand the matter for further proceedings.

II.

FACTUAL AND PROCEDURAL BACKGROUND

A. Factual background 2

1. The parties

Plaintiff MMI holds investments in numerous industrial hemp businesses, including plaintiff HempMeds. HempMeds manufactures and sells Real Scientific Hemp Oil (RSHO), a product containing cannabidiol (CBD) derived from the industrial hemp plant. MMI also holds interests in KannaLife Sciences, Inc. (KannaLife).

According to the first amended complaint, Jason Cranford, another defendant, resigned from KannaLife’s board of directors and then began competing with MMI and HempMeds by selling CBD products through his Colorado *607 medical marijuana dispensary, Rifle Mountain, LLC (Rifle Mountain), which is also named as a defendant in the case.

Defendant Project CBD is a California nonprofit organization that identifies itself as an organization dedicated to promoting and publicizing research regarding CBD and other components of the cannabis plant. Defendant Martin Lee is Project CBD’s founder and director. According to Lee, “Project CBD does not solicit customers anywhere. It sells no products whatsoever.” However, a witness declaration presented with respect to the Project CBD defendants’ anti-SLAPP motion states that the witness observed Lee promoting and selling a competing CBD product called “ ‘Care By Design.’ ” On this basis, plaintiffs assert that “Lee is in the industrial hemp business and uses the auspices of his purported non-profit, Project CBD, for promoting his products in competition with MMI.”

Defendant Aaron Cantu wrote an article about MMI, HempMeds, Kann-away and the RSHO product. The article, originally published on the Project CBD website on October 14, 2014, and “[ujpdated” on November 4, 2014, is titled Hemp Oil Hustlers: A Project CBD Special Report on Medical Marijuana Inc., HempMeds & Kannaway (the Hemp Oil Hustlers Article). Also named as defendants in the case are CannLabs, Inc. (CannLabs); Genifer Murray, identified as the chief executive officer of CannLabs; and Stewart Environmental Consultants, LLC (Stewart Labs).

2. The factual allegations in the operative pleading giving rise to the lawsuit

According to the operative pleading, after Cranford resigned from the board of KannaLife, Cranford, through Rifle Mountain, began to sell CBD products in direct competition with RSHO. On or around April 26, 2014, Cranford posted on Facebook that he intended to have RSHO tested at a diagnostic lab. Cranford also allegedly posted that a child became ill after having a bad reaction to RSHO.

Rather than have the RSHO sample tested at the facility Cranford identified in his April 26, 2014 Facebook posting, Cranford took the sample to Stewart Labs to be tested for “volatile organic compounds (VOC) and heavy metal concentrations.”

According to the pleading, in late May 2014, Stewart Labs released to Cranford a “preliminary report” regarding the RSHO sample. Plaintiffs allege that after receiving the preliminary report, Cranford immediately released copies of “ ‘preliminary’ test results” on another individual’s Facebook page, and posted on his own Facebook page information regarding where the results had been posted.

*608 Plaintiffs further allege that on May 8, 2014, Murray “posted false statements about Plaintiffs and its RSHO on the internet.” Plaintiffs incorporated into the operative pleading a quotation of Murray’s alleged false statements. Plaintiffs allege that on May 19, 2014, another individual “re-posted” Murray’s statements, with very minor alterations to the text. On May 26, 2014, another individual “who followed Cranford’s story, posted [on Facebook] the photos of preliminary test results from Stewart [Labs] that Cranford had previously posted.” According to the complaint, as a result of Murray’s and Cranford’s Facebook “announcements,” “people throughout the world have read and followed the story and re-posted it on their Facebook timelines, further publishing the false statements concerning Plaintiffs.”

At some point after the “re-posting]” of Murray’s statements, Cranford allegedly posted to Facebook a solicitation for contact from individuals who “had suffered negative reactions after taking Plaintiffs’ RSHO product.”

According to the operative complaint, on May 30, 2014, Stewart Labs published the hnal test results from its analysis of the RSHO sample that had been submitted to it by Cranford. Plaintiffs allege that “[t]he hnal results showed signihcant different reporting values, especially for heavy metals such as lead, molybdenum, nickel, selenium, and silver, among other metals.” Despite being aware of the Stewart Labs’ hnal test results, on June 1, 2014, Cranford posted a link to a statement written on Facebook by “ ‘Sarah Hadigan’ ” who asserted in her statement that her “ ‘daughter is dead because of this product [i.e., RSHO],’ ” among other things.

The operative pleading does not allege further conduct by any of defendants after June 1, 2014, until October 14, 2014, the date on which plaintiffs allege that the Project CBD defendants “published” the Hemp Oil Hustlers Article on Project CBD’s website. In the portion of the hrst amended complaint in which plaintiffs set forth the general allegations on which they base their later enumerated claims for relief (i.e., in the general allegations of the pleading), they allege that the Hemp Oil Hustlers Article was written by Cantu and published by Project CBD on its website and then further published on other websites, 3

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Shin v. Aya Healthcare CA1/4
California Court of Appeal, 2026
Littlefield v. Littlefield
California Court of Appeal, 2024
Aguila v. American Zurich Ins. Co. CA2/4
California Court of Appeal, 2024
Foroughi v. Creighton CA1/5
California Court of Appeal, 2024
Tash v. Devoir Oblige Capital Group CA2/3
California Court of Appeal, 2024
Cabot v. Lakin CA2/4
California Court of Appeal, 2023
Fulkerson v. Albert & Mackenzie LLP CA3
California Court of Appeal, 2023
Tokio Marine America Ins. v. Prestig CA2/7
California Court of Appeal, 2022
Arellano v. City of San Diego CA4/1
California Court of Appeal, 2022
Davis v. Purple Mountain Empire X CA4/1
California Court of Appeal, 2022
Xera Health v. Scheele CA4/1
California Court of Appeal, 2021
Hawk v. Hulett CA4/1
California Court of Appeal, 2021
VCA Animal etc. v. Yu CA4/2
California Court of Appeal, 2021
Chen v. Paypal
California Court of Appeal, 2021
Winco Foods v. Thayer CA4/2
California Court of Appeal, 2021
Levy v. Murray CA4/1
California Court of Appeal, 2021

Cite This Page — Counsel Stack

Bluebook (online)
6 Cal. App. 5th 602, 212 Cal. Rptr. 3d 45, 2016 Cal. App. LEXIS 1113, Counsel Stack Legal Research, https://law.counselstack.com/opinion/medical-marijuana-inc-v-projectcbdcom-calctapp-2016.