Federal Court Examines Illinois’ Savings Clause, Job-Related Per Se Defamation in Warring Yelp.com Posts

Shortly after their business relationship imploded, the parties in Levin v. Abramson, 2020 WL 249649, brought dueling defamation claims in Federal court premised on March 2017 Yelp posts by the parties.

The former client defendant (the “Client”) skewered the plaintiffs lawyer and her law firm (“Lawyer”) on Yelp.com in which he braded the Lawyer, among other things, an incompetent predator who defrauded Client.

The Lawyer responded with a post of her own the same day.  She added some factual context to Client’s screed and portrayed the reason behind Client’s vitriol as a simple billing dispute.  Lawyer also added in her retort that Client had a pattern of suing all of his lawyers.

Lawyer’s Complaint alleged claims for defamation and false light invasion of privacy.  Client counter-sued for defamation, too, and added legal malpractice and breach of fiduciary duty claims based on Lawyer’s Yelp response.

The Lawyer moved to dismiss Client’s counterclaims and both parties filed cross-motions for summary judgment.

Lawyer’s Motion to Dismiss

Rejecting the Lawyer’s argument that the Client’s defamation suit was untimely, the Court examined the interplay between Code Sections 13-201 [735 ILCS 5/13-201], the one-year statute of limitations for defamation suits and 13-207 [735 ILCS 5/13-207], the Illinois “savings” statute that permits otherwise time-barred counterclaims in certain circumstances.

The Court noted that each side’s alleged defamatory Yelp posts were published on March 22, 2017.  So the defamation one-year limitation period would normally expire March 22, 2018.  The Lawyer filed her defamation suit on March 8, 2018 – two weeks before the defamation statute lapsed while Client filed his counter-claim in January 2019 – almost 10 months after the limitations ran.

However, since the Lawyer’s defamation claim accrued before the defendant’s defamation counter-suit lapsed – March 22, 2018 – Section 13-207 preserved or “saved” the defendant’s countersuit even though it wasn’t filed until 10 months later.

The court then focused on whether the Client sufficiently alleged per se defamation against the Lawyer’s Rule 12(b)(6) attack.

Two salient stripes of per se defamation include statements (1) that impute a plaintiff’s inability to perform or want of integrity in the discharge of his duties of office or employment and (2) that prejudice a plaintiff or impute a lack of ability in his or her trade.  These particular per se claims must directly involve a plaintiff’s job performance;  generalized personal attacks on a plaintiff’s integrity and character are non-actionable.

The Court rejected Lawyer’s truth defense argument – that her Yelp retort was substantially true.  The Court found that whether, as Lawyer said in her post, that Client had in fact sued all of his other lawyers, lost his bid to reverse his credit card payment to Lawyer, and that his complaints to ARDC and CBA were rejected, were questions more appropriate for a summary judgment motion and not a dismissal motion.

Next, the Court addressed Lawyer’s argument that Client failed to properly allege in his Counterclaim what his job was and therefore couldn’t make out a claim that Lawyer’s Yelp response prejudiced Client in his work.  The Court held that when considering Client’s Counterclaim exhibits and supporting affidavit [both of which established that client owned a record label] Client plausibly pled Lawyer’s Yelp statements could prejudice him in his role as business owner.  On this point, the Court also credited Client’s argument that plaintiff’s Yelp response could cause the record company to lose current and future clients.

Cross-Motions for Summary Judgment

Both sides moved for summary judgment on plaintiff’s defamation and false light claims.  The Court considered Lawyer’s argument that Client’s Yelp post contained actionable facts as opposed to non-actionable opinions.

Black-letter defamation law cautions that opinions that do not misstate facts are not actionable. Whether a given statement consists of a factual (and therefore actionable) assertion, the court considers (1) whether the statement has a precise and readily understood meaning, (2) whether the statement is verifiable, and (3) whether the statement’s literary or social context signals it has factual content.

The Court found that Client’s Yelp review contained both opinion and factual elements.  The Client’s statements that Lawyer illegally charged Client’s credit card, exceeded a $4,000 ghost-writing budget by nearly $10,000, and that Client’s credit card sided with him in his dispute with Lawyer were all verifiable enough to be factual.  The Court also found that defendant’s branding plaintiff a “con artist” – normally non-actionable name-calling or opinion – rose to the level of actionable fact when viewed in context with other aspects of the Yelp review.

According to the Court, for the Lawyer to win summary judgment on her defamation claim, she must show that no reasonable jury fact could decide that Client’s Yelp statements were substantially true. Conversely, on the Client’s cross-motion, the Court noted that he must establish that a jury could only conclude that his Yelp review statements were substantially true for him to prevail on his cross-motion.

The Court found the record revealed genuine disputed fact questions as to (1) who severed the Lawyer-Client relationship and when, (2) whether the Lawyer agreed to cap her fees at $4,000 [which Lawyer disputed], (3) whether there was in fact a $4,000 budget for Lawyer’s ghost-writing work and (4) whether Lawyer had authority to charge Client’s credit card once the $4,000 retainer was exhausted.  These factual discrepancies led the Court to deny the warring summary judgment motions.

Afterwords:

Levin meticulously dissects the governing legal standards that control pleadings and dispositive motion practice in Federal courts.

The case also provides a trenchant analysis of Illinois per se defamation law, particularly the contours of job performance-related per se defamation, the truth defense, and the importance of the fact-versus-opinion analysis inherent in such a claim.

 

 

Illinois’ Contribution Law and the ‘Savings’ Statute

Illinois has a 2 year statute of limitations (SOL) for contribution claims.  Contribution applies where two or more defendants have common liability to an injured plaintiff.  740 ILCS 100/1 (Illinois’s contribution statute).

The idea is that each defendant responsible for injuring a plaintiff should pay his share of liability to the plaintiff.  Section 13-204(b) of the Code prescribes the two year limitations period for contribution claims.

Another section of the Code of Civil Procedure, 735 ILCS 5/13-207 – labelled the “savings statute” – gives a defendant extra time to file an otherwise time-barred counterclaim or set-off under certain circumstances.

This statute protects against last minute filings by plaintiffs that would prevent a defendant from having a reasonable opportunity to assert counterclaims against that plaintiff.

Example: Assume plaintiff has personal injury claim against defendant and defendant has defamation claim against plaintiff arising from same underlying facts.  Illinois has a 2 year limitations period for personal injury claims (735 ILCS 5/13-202) and 1 year period for defamation (735 ILCS 5/13-201).  If plaintiff files personal injury suit on day 729 after he is injured and serves defendant some weeks later, the defendant’s defamation counterclaim would normally be barred since well over 1 year has elapsed from the underlying injury.  But, under the savings statute, the defendant now has 1 year from the date of service of plaintiff’s complaint to sue for defamation.

But consider this fact pattern: plaintiff serves defendant 1 on January 1, 2013 and serves defendant 2 on January 15, 2013.  Defendant 1 does not file any counterclaims.  Defendant 2 sues defendant 1 for contribution on January 14, 2015, the day before the 2-year SOL expires and defendant 1 is served on February 1, 2015.

Q:  Can defendant 1 now file a counterclaim for contribution against defendant 2 on or after February 1, 2015? Remember, defendant 1 was served with the underlying complaint on January 1, 2013 – so under 13-204(b)(see above), defendant 1 would have had until January 1, 2015 to file contribution counterclaims.  Clearly, defendant 1’s contribution action is time-barred by the 2-year SOL, right?

A: Wrong.  An off-shoot of the above fact pattern is exactly what the Illinois Supreme Court addressed in Barragan v. Casco case, 216 Ill.2d 435 (2005).  There, the Court reversed the Appellate Court and held that a contractor’s contribution counterclaim against a co-defendant architect could proceed even though it was time-barred under 13-204’s two-year SOL for contribution claims.

In Barragan, the plaintiff served the defendant contractor on July 25, 1997 and the defendant architect on September 15, 1997.  Under 13-204(b), the contractor and architect would have until July 25, 1999 and September 15, 1999 respectively to sue for contribution..  The architect filed its contribution claim against the contractor on July 29, 1999 – about six weeks before the 2-year limitations period expired.  The contractor filed its responsive contribution claim against the architect in December, 2000 – about 3.5 years after it was served by the underlying plaintiff and 16 months after the contribution 2-year limitations period expired.

The Court still permitted the contractor’s counterclaim to go forward under Code Section 13-207, the savings provision.  The  Court ruled that Section 13-207’s savings provision trumped the two-year SOL contained in Section 13-204(b) for contribution claims, noting that the contractor and architect were in an adversarial posture and that the contractor’s counterclaim was responsive to the architect’s.

Take-away: Personal injury defendants should be cognizant of Barragan and the interplay between 13-204 and 13-207.  If you – as a defendant – sue another defendant for contribution, be prepared for that defendant to counter-sue you for contribution beyond the 2-year limitations period.  This seems to penalize the timely filing defendant by allowing the contribution counter-defendant to circumvent the 2-year SOL for contribution.