Serova v. Sony Music Entertainment

         [REVIEW GRANTED BY CAL. SUPREME COURT]

         [257 Cal.Rptr.3d 401] APPEAL from an order of the Superior Court of Los Angeles County. Ann I. Jones, Judge. Affirmed in part and reversed in part with directions. (Los Angeles County Super. Ct. No. BC548468)

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         COUNSEL

         Katten Muchin Rosenman, Zia F. Modabber, Andrew J. Demko, Charlotte S. Wasserstein, Leah E. A. Solomon, Los Angeles; Kinsella Weitzman Iser Kump & Aldisert, Howard Weitzman and Suann C. Macisaac, Santa Monica, for Defendants and Appellants.

         Moss Bollinger, Jeremy F. Bollinger, Ari E. Moss, Sherman Oaks, and Dennis F. Moss, Los Angeles, for Plaintiff and Respondent.

          OPINION

         LUI, P. J.

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         [257 Cal.Rptr.3d 402] Defendants and appellants Sony Music Entertainment (Sony), John Branca, as co-executor of the estate of Michael J. Jackson (the Estate), and MJJ Productions, Inc. (collectively Appellants) appealed from an order of the superior court partially denying their motion to strike under the anti-SLAPP statute. (Code Civ. Proc., § 425.16.)^[1] We previously issued an opinion in this case holding that the claims of plaintiff and respondent Vera Serova (Serova) against Appellants should be struck under section 425.16. (Serova v. Sony Music Entertainment (2018) 26 Cal.App.5th 759, 237 Cal.Rptr.3d 487 (Serova I ).) Our Supreme Court granted review and subsequently transferred the case back to this court for reconsideration in light of the Supreme Court’s decision in FilmOn.com Inc. v. DoubleVerify Inc. (2019) 7 Cal.5th 133, 246 Cal.Rptr.3d 591, 439 P.3d 1156 (FilmOn ).

         The case concerns allegations that Appellants misleadingly marketed a posthumous Michael Jackson album entitled simply "Michael." Serova claims that the album cover and a promotional video wrongly represented that Jackson was the lead singer on each of the 10 vocal tracks on the album, when in fact he was not the lead singer on three of those tracks. Serova alleged claims under the Unfair Competition Law (UCL; Bus.& Prof. Code, § 17200 et seq.) and the Consumers Legal Remedies Act (CLRA; Civ. Code, § 1750 et seq.). Serova also brought a fraud claim against defendants Edward Joseph Cascio, James Victor Porte, and Cascio’s production company, Angelikson Productions, LLC (collectively, the Cascio Defendants), alleging that those defendants knowingly misrepresented to Appellants that Jackson was the lead singer on the three tracks at issue (the Disputed Tracks).^[2]

         Our prior opinion held that: (1) Serova’s claims against Appellants arose from conduct furthering Appellants’ right of free speech "in connection with a public issue" under section 425.16, subdivision (e)(3) and (4); and (2) Serova did not show a probability that her claims under the UCL and the CLRA would succeed because the claims concern noncommercial speech that is not actionable under those statutes.

         Upon reconsideration of these holdings in light of FilmOn, we conclude that our original opinion was correct. Consequently, we largely adopt that

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opinion, except that we have revised the discussion of the first step of the anti-SLAPP procedure in part 1 below to take account of the FilmOn decision and its application to the circumstances of this case.

         [257 Cal.Rptr.3d 403] FilmOn concerned only the first step of the anti-SLAPP analysis, i.e., whether particular claims arise from conduct that the anti-SLAPP statute protects. Specifically, FilmOn considered "whether the commercial nature of a defendant’s speech is relevant in determining whether that speech merits protection" under section 425.16, subdivision (e)(4). (FilmOn, supra, 7 Cal.5th at p. 140, 246 Cal.Rptr.3d 591, 439 P.3d 1156.) The court concluded that the context of a statement— including "the identity of the speaker, the audience, and the purpose of the speech" — is "relevant, though not dispositive, in analyzing whether the statement was made ‘in furtherance of’ free speech ‘in connection with’ a public issue." (Ibid ., quoting § 425.16, subd. (e)(4).)

          As we explained in our prior opinion, the representations that Serova challenges— that Michael Jackson was the lead singer on the three Disputed Tracks— did not simply promote sale of the album, but also stated a position on a disputed issue of public interest. Before the album was released, certain Jackson family members and others publicly claimed that Jackson was not the lead singer on the Disputed Tracks. Appellants disputed this claim. An attorney acting for the Estate released a public statement outlining the steps Appellants had taken to verify the authenticity of the tracks by consulting with experts and persons who were familiar with Jackson’s voice and recordings.

          Thus, the identity of the artist on the three Disputed Tracks was a controversial issue of interest to Michael Jackson fans and others who care about his musical legacy. By identifying the singer on the Disputed Tracks as Michael Jackson, Appellants’ challenged statements made a direct claim about the controversy itself. The statements were made publicly to an audience— potential purchasers of the album— that was likely to have an interest in the identity of the singer. And, although Appellants’ ultimate goal was presumably to sell albums by marketing songs sung by Michael Jackson, that goal did not make the controversy over the identity of the artist any less real or important to those who cared about the issue. The challenged statements furthered Appellants’ position on the controversy by articulating a consistent and unqualified belief in the identity of the artist. Appellants’ challenged statements were therefore sufficiently connected to an issue of public interest to warrant anti-SLAPP protection.

         Our Supreme Court’s decision in FilmOn did not address the second step of the anti-SLAPP analysis, which concerns the merits of a plaintiff’s claims. Nor did it address the criteria for identifying commercial and noncommercial

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speech under the First Amendment. That issue was the focus of our prior ruling that the speech that Serova challenges was outside the scope of the consumer protection laws on which her claims are based. Thus, we have no reason to reconsider our prior ruling on the second step of the anti-SLAPP procedure, which we reproduce (with minor changes) in part 2 below.

          BACKGROUND

          1. The Anti-SLAPP Procedure

         Section 425.16 provides for a "special motion to strike" when a plaintiff asserts claims against a person "arising from any act of that person in furtherance of the person’s right of petition or free speech under the United States Constitution or the California Constitution in connection with a public issue." (§ 425.16, subd. (b)(1).) Such claims must be stricken "unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim." (Ibid .)

         [257 Cal.Rptr.3d 404] Thus, ruling on an anti-SLAPP motion involves a two-step procedure. First, the moving defendant must show that the challenged claims arise from protected activity. (Baral v. Schnitt (2016) 1 Cal.5th 376, 396, 205 Cal.Rptr.3d 475, 376 P.3d 604 (Baral ); Rusheen v. Cohen (2006) 37 Cal.4th 1048, 1056, 39 Cal.Rptr.3d 516, 128 P.3d 713.) Second, if the defendant makes such a showing, the "burden shifts to the plaintiff to demonstrate that each challenged claim based on protected activity is legally sufficient and factually substantiated." (Baral, at p. 396, 205 Cal.Rptr.3d 475, 376 P.3d 604.) Without resolving evidentiary conflicts, the court determines "whether the plaintiff’s showing, if accepted by the trier of fact, would be sufficient to sustain a favorable judgment." (Ibid. )

         Section 425.16, subdivision (e) defines the categories of acts that are in " ‘furtherance of a person’s right of petition or free speech.’ " Those categories include "any written or oral statement or writing made in a place open to the public or a public forum in connection with an issue of public interest," and "any other conduct in furtherance of the exercise of the constitutional right of petition or the constitutional right of free speech in connection with a public issue or an issue of public interest." (§ 425.16, subd. (e)(3) & (4).)

         In 2003 the Legislature enacted section 425.17 to curb "a disturbing abuse of Section 425.16 ... which has undermined the exercise of the constitutional rights of freedom of speech and petition for the redress of grievances, contrary to the purpose and intent of Section 425.16." (§ 425.17, subd. (a).) Section 425.17 seeks to accomplish that goal by expressly excluding several categories of claims from the scope of section 425.16.

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          Section 425.17, subdivision (c) establishes such an exclusion for claims concerning some commercial speech. That subdivision provides that section 425.16 does not apply to "any cause of action brought against a person primarily engaged in the business of selling or leasing goods or services" if certain conditions exist, including that: (1) the statement at issue "consists of representations of fact about that person’s or a business competitor’s business operations, goods, or services" that was made to promote commercial transactions or was made "in the course of delivering the person’s goods or services"; and (2) the intended audience is an actual or potential customer or a person likely to influence a customer. (§ 425.17, subd. (c)(1) & (2).)

          Section 425.17 contains certain specifically defined exceptions. One of those exceptions states that the commercial speech provision in section 425.17, subdivision (c) does not apply to "[a]ny action against any person or entity based upon the creation, dissemination, exhibition, advertisement, or other similar promotion of any dramatic, literary, musical, political, or artistic work." (§ 425.17, subd. (d)(2).)

         2. Serova’s Allegations ^[3]

          The album "Michael" was released on or about December 14, 2010, about 18 months after Michael Jackson’s death. Sony released the album in conjunction with the Estate.

          The album contained 10 songs. Serova alleges that the three songs on the Disputed Tracks— "Breaking News," "Monster," [257 Cal.Rptr.3d 405] and "Keep Your Head Up" (the Songs)— have been controversial "[s]ince Michael’s inception."

          Serova claims that the Cascio Defendants recorded the initial versions of the Disputed Tracks and had "exclusive knowledge" that the lead vocals for the Songs were actually performed by a singer other than Michael Jackson. Serova alleges that Cascio then falsely represented to Appellants that Michael Jackson was the singer.

          Prior to "Michael’s" release, various members of Michael Jackson’s family and others familiar with his recordings disputed whether he was the lead singer on the Disputed Tracks. In response to those concerns, Sony and the Estate (through Attorney Howard Weitzman) both publicly issued statements confirming their belief that Jackson was the singer.

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          In his statement (the Weitzman Statement), Weitzman explained that many persons who were familiar with Jackson’s work had confirmed that he was the lead singer on the Disputed Tracks, including former producers, engineers, performers, and directors who had worked with Jackson. He stated that the Estate and Sony had also retained forensic musicologists who examined the Disputed Tracks and concluded that the lead singer was actually Jackson. He also stated that he had spoken to the singer whom some persons had "wrongfully alleged was a ‘soundalike’ singer that was hired to sing" on the Disputed Tracks, and that the singer had denied any involvement with the project. Weitzman explained that, "given the overwhelming objective evidence resulting from the exhaustive investigations," Sony decided to include the Disputed Tracks on the album "because they believed, without reservation, that the lead vocal[s] on all of those tracks were sung by Michael Jackson."

         The album cover for "Michael" (Album Cover) included a statement that " ‘[t]his album contains 9 previously unreleased vocal tracks performed by Michael Jackson.’ "^[4] A video released before the album (the Promotional Video) described "Michael" as " ‘a brand new album from the greatest artist of all time.’ " While appearing on the Oprah Winfrey show, Cascio also stated that Jackson performed the lead vocals on the Disputed Tracks.

          The Complaint alleges that the lead singer on the Disputed Tracks actually sounds like the "soundalike" singer mentioned in the Weitzman Statement. Serova claims she discovered evidence indicating that the lead singer on the Disputed Tracks was not Michael Jackson. Among other things, she claims that: (1) Cascio did not produce any "demos, outtakes, alternate takes, and multi-track recordings" when requested; (2) Jackson never mentioned that he had recorded the Songs; (3) the Songs did not appear on a list of ongoing or planned projects found in Michael Jackson’s house after his death; and (4) various persons that the Weitzman Statement said had confirmed that the lead singer on the Disputed Tracks was Jackson in fact had doubts about that conclusion.

          Serova also hired an audio expert who prepared a report concluding that Michael Jackson "very likely did not sing" the lead vocals on the Disputed Tracks. The report was peer-reviewed by another expert who concluded that the study’s "methodologies and conclusions were reasonable."

          The Complaint alleges claims against all defendants under the CLRA and UCL, and asserts a fraud claim against the Cascio Defendants only. The

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Complaint claims [257 Cal.Rptr.3d 406] that thousands of putative class members purchased "Michael" and lost "money or property" as a result of the alleged misleading representations.

          3. Appellants’ Anti-SLAPP Motion

         Appellants and the Cascio Defendants filed motions to strike under section 425.16. Appellants argued that Serova’s claims arose from protected speech under prong one of the anti-SLAPP procedure. With respect to prong two, Appellants argued that Serova could not succeed on her claims against them because their challenged statements about the identity of the lead singer on the Disputed Tracks were noncommercial speech as a matter of law and no reasonable consumer could find the statements misleading.

          To permit a ruling on the anti-SLAPP motions in advance of discovery, the parties stipulated that, "solely for purposes of this determination on the Motions," Michael Jackson did not sing the lead vocals on the three Disputed Tracks (the Stipulation). The parties also stipulated to the authenticity ...