OVERHILL FARMS, INC V. LOPEZ











Filed 11/15/10; pub. order 12/14/10 (see end of opn.)











IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION THREE

OVERHILL FARMS, INC., Plaintiff and Respondent, v. NATIVO LOPEZ et al., Defendants and Appellants.

G042984 (Super. Ct. No. 30-2009-00125409) O P I N I O N

Appeal from an order of the Superior Court of Orange County, Robert J. Moss, Judge. Affirmed.
Law Office of Carol A. Sobel and Carol A. Sobel for Defendants and Appellants.
Rutan & Tucker, Steven J. Goon and Chris M. Heikaus Weaver, for Plaintiff and Respondent.
* * *

INTRODUCTION
In 2009, the United States Internal Revenue Service (IRS) informed plaintiff Overhill Farms, Inc. (Overhill) that 231 of its then-current employees had provided invalid social security numbers. Overhill was advised its use of invalid tax identification information exposed it to the imposition of penalties and criminal liability. Overhill contacted the employees identified by the IRS, advised them that their social security numbers were invalid according to the IRS, and provided them the opportunity to correct the erroneous information to avoid the termination of their employment with Overhill. One of the identified employees provided Overhill information showing that the employee’s invalid social security number was an error. The remainder of the identified employees either admitted they had submitted an invalid social security number and were not authorized to work in the United States, or ignored Overhill’s requests for information; their employment with Overhill was thereafter terminated.
Several of Overhill’s employees, including defendants Teresa Cortez, Alma Salinas Renteria, Bohemia Y. Agustiano Saguilan, Marcelino Arteago, Agapita Padilla and Fernando Morales Lira, led by defendant Nativo Lopez, a “community activist” (collectively referred to as defendants), participated in protests outside Overhill’s two plants and outside of one of Overhill’s customer’s place of business. Defendants’ protest efforts included issuing a press release, carrying signs, and handing out leaflets, flyers, and handbills which stated, inter alia, that Overhill had used a “supposed discrepancy” in social security numbers as a pretext for employment terminations which were both racist and a targeted attack on older and more senior employees.
Overhill sued defendants for defamation, intentional interference with prospective economic advantage, intentional interference with contractual relations, extortion, and unfair competition; all of Overhill’s claims were based on alleged defamatory statements made by defendants in the course of the protests. Although Overhill sought damages, it alleged that defendants are “virtually judgment proof,” and made clear that injunctive relief to prohibit future misconduct was its primary goal. Defendants filed an anti-SLAPP motion to strike the first amended complaint pursuant to Code of Civil Procedure section 425.16.[1] The trial court granted the anti-SLAPP motion as to the unfair competition claim, but otherwise denied the motion. The court concluded that although Overhill’s claims arose out of protected conduct, Overhill had carried its burden of proving a probability of prevailing on the merits of all its claims except its unfair competition claim.
We affirm. Defendants’ primary contention on appeal is that none of their alleged statements were actionable as defamation because none declared or implied a provably false assertion of fact under the totality of the circumstances. (See Milkovich v. Lorain Journal Co. (1990) 497 U.S. 1, 19 (Milkovich).) However, the statements reflected in defendants’ written press release, leaflets and flyers accused Overhill of more than harboring racist attitudes; they accused Overhill of engaging in a mass employment termination based upon racist and ageist motivations. Such a contention is clearly a “provable fact”; indeed an employer’s motivation for terminating employment is a fact plaintiffs attempt to prove routinely in wrongful termination cases. Nor can we excuse the statements on the basis they were made on “fully disclosed facts.” The record indicates defendants revealed only very selected facts in support of their claims that Overhill had used the discrepancies in social security numbers as a mere pretext for the firings.
Defendants’ other arguments fare no better. We presume there was substantial evidence to support the court’s determination Overhill demonstrated a prima facie case in support of its other causes of action, and defendants did not demonstrate otherwise. Moreover, the bulk of defendants’ contentions in connection with these causes of action rest on the assumption they did nothing wrongful in connection with their “peaceful protests.” We have already concluded, however, that there is substantial evidence they made provably false statements in the course of those protests. Finally, we find no merit in defendants’ assertion the court committed reversible error in its evidentiary rulings. Among other problems, there is no showing that the rulings, even if erroneous, were prejudicial.
FACTS
Overhill is a publicly traded company which manufactures frozen food products and employs 1,000 employees in Vernon, California. Most of Overhill’s production workers are members of the United Food and Commercial Workers Union, Local 770 (the union), which is their certified collective bargaining representative (the union).
I.
The IRS Informs Overhill Several of its Employees Have Provided Invalid Social Security Numbers; Overhill Terminates the Employment of Those Employees Identified by the IRS Who Fail to Provide A Valid Social Security or Valid Tax Identification Number within 60 Days.
In 2008, the IRS conducted a revenue and payroll audit of Overhill. In 2009, the IRS notified Overhill that many of its employee provided invalid social security numbers and that it might be subjected to over $80,000 in penalties for its “role in reporting tax withholding through an invalid social security number.” The IRS provided Overhill with a list identifying former employees and 231 then-current employees, who had provided an invalid social security numbers (the IRS list). An IRS agent orally informed Overhill’s tax attorney that Overhill could not continue to employ anyone who was unable to provide a valid number.
On April 6, 2009, Overhill sent a letter to each of the employees identified on the IRS list, including Agustiana, Renteria, and Cortez, which informed them that they had provided an invalid social security or tax identification number and offered them the opportunity to correct any errors or discrepancies within 30 days, during which time they would continue to be paid. Only one employee attempted to provide information showing the invalid social security number was an error. Overhill confirmed the invalid social security number was an error, corrected the mistake, and the employee remained employed with Overhill. A few other employees responded to the letter by admitting they had provided false social security numbers, permanent residence cards, and had entered the United States illegally. In addition, 31 employees voluntarily resigned from their employment without addressing the invalid social security numbers issue.
However, the vast majority of the employees who were sent the letter (including Augustiana, Renteria, and Cortez) did not respond to the letter or request additional time to correct the problem with their social security number. Notwithstanding their failure to respond to the April 9 letter, Overhill sent these employees a second letter on May 1, providing the employees an additional 30-day period (until May 31) to comply with the instructions. These employees were suspended, but continued to receive benefits at Overhill’s expense through May 31.
Before making the final decision to terminate the employment of the employees who were identified on the IRS list and failed to provide information correcting the invalid social security numbers, Overhill’s president and director of human resources met with representatives from the union who acknowledged that nearly all of the effected employees are not “authorized to work in the United States.” In a letter dated April 30, 2009, the union’s packinghouse director informed Overhill that “we are in the process of obtaining the tax payer identification numbers for those employees who have been identified with invalid social security numbers.” However, the union never provided any such numbers or copies of any applications seeking to obtain such numbers.
Effective May 31, 2009, Overhill terminated its employment relationship with “all employees who had been identified by the IRS as having invalid social security numbers and who had failed to explain why they had furnished invalid numbers and/or still had not furnished valid numbers,” which included Agustiana, Renteria, and Cortez. Overhill explained to these employees that their failure to provide a valid social security or tax identification number exposed Overhill to audits and penalties by the IRS and to criminal liability if Overhill continued to use numbers the IRS had concluded were invalid.
II.
Defendants Protest Overhill’s Response to IRS Notification
Defendant Nativo Lopez is the national director of Hermandad Mexicana Latinoamericana (HML) which is an organization “engaged in advocating for the rights for workers to come together to organize for fair treatment in the workplace.” Lopez was approached by employees of Overhill “to help them organize in response to threatened mass firings of long-time employees” due to issues with their tax identification information.
Lopez agreed to help organize a response to Overhill’s decision to terminate the employment of employees without valid social security numbers.[2] That response included issuing a press release dated June 3, 2009, conducting demonstrations in front of Overhill’s plants at which participants carried signs, and distributed leaflets and flyers, and protesting in front of Panda Express, one of Overhill’s customers, and passing out handbills there as well.
A.
The Press Release
The press release asserted employees were protesting “racist firings by Overhill,” and explained that although “the company alleges discrepancy of social security numbers, . . . the Social Security Administration clearly establishes with employers that such discrepancy is NOT a cause for termination.” The press release asserted that Overhill dismissed workers and “threatens to continue pursuing the policy of dismissing workers and replacing them with part-time workers who do not enjoy any benefits under the current collective bargaining agreement,” and that “[i]t’s no accident that many of the dismissed workers have the greatest seniority — many in excess of 10 and 15 years with the company, and numerous with 19 and 20 years of service.”
B.
The Signs, Leaflets, and Flyers
The signs carried by participants during the demonstrations stated, “OVERHILL FARMS UNFAIR and RACIST EMPLOYER.” The leaflets distributed at the protests contained the heading “OVERHILL FARMS UNFAIR AND RACIST.” The leaflet explained that Overhill had recently terminated many of its employees “due to supposed discrepancy of information on their social security numbers” although “the Social Security Administration has declared in letters to both employers and employees that such discrepancy is NOT a cause for dismissal, lay-off, or suspension from employment.” The leaflet asserted that Overhill’ president has “used this as a pretext to eliminate one-fourth of [its] workforce, amongst the most senior, and replace them with part-time classified employees with no benefits.” The leaflet further asserted, “[m]any of us are single female heads-of-household with various children” and that “[i]n this era of recycling, [Overhill’s president] has decided to recycle out the more senior workers and recycle in new, fresh, and innocent worker, but with lower wages and no benefits.” The leaflet stated Overhill’s president “is confident that we are passive and will accept this racist and discriminatory abuse against Latina women immigrants and our families without a fight. But he is wrong.”
Protest participants also passed out flyers urging recipients to boycott Overhill, stating, as relevant to this appeal, that Overhill is “[a]n abusive and racist employer in the manner that it treats its workers,” which “discriminates against Latinos”; has “unfairly terminated 300 workers,” has “fired workers for expressing themselves freely according to the First Amendment of the U.S. Constitution,” has “exploited Latinos for 30, 20, 15 and 10 years and then threw them to the streets — many single female heads-of-household,” and has exploited part-time workers “visciously as if modern slavery were in place.”
C.
The Handbills Urging Panda Express Customers to Express Concern About the Employment Terminations at Overhill.
Lopez also helped workers organize demonstrations at Panda Express, which is one of Overhill’s customers, during which participants distributed handbills. The handbill urged customers to contact the corporate office of Panda Express “and tell them you are concerned about the unjust terminations and discriminatory treatment by Overhill Farms company to their employees.” It further stated “[o]ver 300 workers were unfairly terminated by Overhill Farms, many of them with 10, 15, and 20 years seniority with the company.”
BACKGROUND
Overhill filed a first amended complaint against defendants alleging claims for defamation, intentional interference with prospective economic advantage, intentional interference with contractual relations, extortion, and unfair competition. Overhill’s claims were based on defendants’ alleged false statements regarding the circumstances surrounding Overhill’s employment termination decision.
Defendants filed a special motion to strike under the anti-SLAPP law. The trial court granted the motion as to the unfair competition claim, but otherwise denied the motion. The trial court explained its ruling as follows: “The court finds that defendants met their burden of making a prima facie showing that the complaint arises out of the defendants’ exercise of their right of free speech as they have demonstrated that the complaint arises out of statements or writings made by defendants the majority of which occurred in a public forum, concerning an issue of public interest. However, the court further finds that plaintiff has met its burden of proof, at least with respect to the first four causes of action, establishing a probability of prevailing on the merits. Defendants are incorrect that federal labor law preempts state tort law under these circumstances. Defamation actions are not preempted where false statements of fact are made during the labor dispute with malice and actual injury. While referring to a plaintiff as ‘racist’ could be mere opinion under some circumstances, under the context of this dispute the clear implication of defendants’ accusation was that they were fired because of their race. [Plaintiff] has submitted substantial evidence that this was not true. As for the other causes of action, they all arise out of the same conduct. The court does not find there is a probability of prevailing on the 17200 claim because there was no evidence to support the conclusion that defendants were engaged in a ‘business’ act or practice.”
DISCUSSION
Defendants contend the trial court erred by denying the anti-SLAPP motion as to their claims for defamation, intentional interference with prospective economic advantage, intentional interference with contractual relations, and extortion. Defendants further contend the trial court abused its discretion in overruling certain of defendants’ objections to evidence Overhill produced in opposition to the motion and in sustaining certain of Overhill’s objections to evidence defendants produced in support of the motion. No defendant contends on appeal that he or she was not personally responsible for any of the statements at issue in this case, or otherwise makes distinct arguments pertaining only to him or herself. Consequently, we will assume, for purposes of our analysis, Overhill produced sufficient evidence showing the defendants were acting in concert in the publication of each of the alleged defamatory statements.
I.
Section 426.16 and Standard of Review
“Section 425.16, subdivision (b)(1) requires the court to engage in a two-step process. First, the court decides whether the defendant has made a threshold showing that the challenged cause of action is one arising from protected activity. The moving defendant’s burden is to demonstrate that the act or acts of which the plaintiff complains were taken ‘in furtherance of the [defendant]’s right of petition or free speech under the United States or California Constitution in connection with a public issue,’ as defined in the statute. [Citation.] If the court finds such a showing has been made, it then determines whether the plaintiff has demonstrated a probability of prevailing on the claim. Under section 425.16, subdivision (b)(2), the trial court in making these determinations considers ‘the pleadings, and supporting and opposing affidavits stating the facts upon which the liability or defense is based.’” (Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 67.) “‘The defendant has the burden on the first issue, the threshold issue; the plaintiff has the burden on the second issue.’ [Citation.]” (Kajima Engineering & Construction, Inc. v. City of Los Angeles (2002) 95 Cal.App.4th 921, 928.) To establish a probability of prevailing on a claim, “‘the plaintiff “must demonstrate that the complaint is both legally sufficient and supported by a sufficient prima facie showing of facts to sustain a favorable judgment if the evidence submitted by the plaintiff is credited.”‘“ (Navellier v. Sletten (2002) 29 Cal.4th 82, 88-89, quoting Wilson v. Parker, Covert & Chidester (2002) 28 Cal.4th 811, 821, quoting Matson v. Dvorak (1995) 40 Cal.App.4th 539, 548.)
We independently review the trial court’s order denying an anti-SLAPP motion de novo. (Flatley v. Mauro (2006) 39 Cal.4th 299, 325-326.) “‘We consider “the pleadings, and supporting and opposing affidavits . . . upon which the liability or defense is based.” [Citation.] However, we neither “weigh credibility [nor] compare the weight of the evidence. Rather, [we] accept as true the evidence favorable to the plaintiff [citation] and evaluate the defendant’s evidence only to determine if it has defeated that submitted by the plaintiff as a matter of law.” [Citation.]’ [Citation.]” (Id. at p. 326.) We further observe that the anti-SLAPP statute is to be broadly construed. (§ 425.16, subd. (a).)
II.
Defendants Carried Their Burden of Showing Overhill’s Claims Arose Out of Protected Activity.
Here, the trial court concluded defendants carried their burden of demonstrating Overhill’s claims arose out of protected activity within the meaning of section 425.16, subdivision (b)(1), and thus moved on to consider whether Overhill carried its burden of demonstrating the probability of prevailing on the merits of its claims.
In the opening brief, defendants argue the trial court erred in concluding they carried their burden on the first prong of section 425.16, subdivision (b)(1) only on the basis Overhills’ claims were based on acts covered by section 425.16, subdivision (e)(3), because they contend the subject conduct also fell within protected conduct contained in section 425.16, subdivisions (e)(1), (2) and (4). Although defendant states in the opening brief that “[t]he trial court correctly recognized that Defendants met their burden, and it is not an issue in this appeal,” defendants devote seven pages in the opening brief and another four pages in the reply brief to arguing how they also carried their burden under these other subparts of section 425.16, subdivision (e). In the reply brief, defendants state: “Respondent contends that there is no issue on appeal concerning the applicability of the SLAPP statute because, once the court found that Appellants’ ‘acts’ in furtherance of their speech and petition rights came within the scope of § 425.16[, subdivision] (e)(3), it was of no import that the trial court did not separately assess the applicability of any of the remaining prongs of § 425.16[, subdivision] (e) advanced by Appellants. [Citation.] The court’s omission is crucial precisely because §§ 425.16[, subdivisions] (e)(1) and (2) provide broader protection for statements made during or ‘in connection with an issue under consideration or review by a legislative, executive or judicial body or any other official proceeding authorized by law.’”
Defendants’ argument does not make sense. As the trial court found that the conduct underlying Overhill’s claims was protected conduct within the meaning of the anti-SLAPP statute, contrary to defendants’ assertion, they had nothing more to gain by demonstrating the conduct was protected under multiple provisions of section 425.16, subdivision (e). In any event, the trial court’s order containing its ruling on the anti-SLAPP motion does not state the alleged conduct underlying Overhill’s is only protected under section 425.16, subdivision (e)(3).
We therefore next consider whether the trial court erred by concluding Overhill demonstrated a probability of prevailing on its claims.
III.
Overhill Demonstrated a Probability of Prevailing on Its Claims Because They Are Based on A Provably False Statement of Fact.
In the appellate briefs, the parties acknowledge that for purposes of the anti-SLAPP motion, the merit of Overhill’s claims for intentional interference with prospective economic advantage, intentional interference with contractual relations, and extortion rise or fall on the merit of Overhill’s defamation claim because all of these claims were based on wrongful conduct in the form of defendants making allegedly defamatory statements. We therefore focus our analysis on whether Overhill showed a probability of prevailing on its defamation cause of action.
A.
Overhill Was Required to Show Defendants Declared or Implied a Provably False Assertion of Fact In Support of Its Defamation Claim.
A claim for defamation, in the form of libel, can be based on “a false and unprivileged publication by writing . . . which exposes any person to hatred, contempt, ridicule, or obloquy, or which causes him to be shunned or avoided, or which has a tendency to injure him in his occupation.” (Civ. Code, § 45.) Statements of opinion which imply a false assertion of fact are actionable. (Milkovich, supra, 497 U.S. at pp. 18-19.) In Milkovich, supra, the United States Supreme Court rejected the respondents’ argument that statements of opinion are never actionable, explaining: “If a speaker says, ‘In my opinion John Jones is a liar,’ he implies a knowledge of facts which leads to the conclusion that Jones told an untruth. Even if the speaker states the facts upon which he bases his opinion, if those facts are either incorrect or incomplete, or if his assessment of them is erroneous, the statement may still imply a false assertion of fact.” On the other hand, “a statement of opinion relating to matters of public concern which does not contain a provably false factual connotation will receive full constitutional protection.” (Id. at pp. 19-20.)
In Franklin v. Dynamic Details, Inc. (2004) 116 Cal.App.4th 375, 385 (Franklin), a panel of this court stated: “[A]fter Milkovich, the question is not strictly whether the published statement is fact or opinion. Rather, the dispositive question is whether a reasonable fact finder could conclude the published statement declares or implies a provably false assertion of fact. [Citations.] Milkovich did not change the rule that satirical, hyperbolic, imaginative, or figurative statements are protected because ‘the context and tenor of the statements negate the impression that the author seriously is maintaining an assertion of actual fact.’ [Citation.]” (See Milkovich, supra, 497 U.S. at p. 20 [noting that “statements that cannot ‘reasonably [be] interpreted as stating actual facts’ about an individual” are protected so as to ensure “that public debate will not suffer for lack of ‘imaginative expression’ or the ‘rhetorical hyperbole’ which has traditionally added much to the discourse of our Nation”]; Nygard, Inc. v. Uusi-Kerttula (2008) 159 Cal.App.4th 1027, 1048 [“Thus, ‘rhetorical hyperbole,’ ‘vigorous epithet[s],’ ‘lusty and imaginative expression[s] of . . . contempt,’ and language used ‘in a loose, figurative sense’ have all been accorded constitutional protection.”].)
In determining whether a statement declares or implies a provably false assertion of fact, courts apply the totality of the circumstances test. (Franklin, supra, 116 Cal.App.4th at p. 385.) “Under the totality of the circumstances test, ‘[f]irst, the language of the statement is examined. For words to be defamatory, they must be understood in a defamatory sense . . . . [¶] Next, the context in which the statement was made must be considered.’” (Ibid; see Nygard, Inc. v. Uusi-Kerttula, supra, 159 Cal.App.4th at p. 1049 [Court consider the totality of the circumstances “[t]o ascertain whether the statements in question are provably false factual assertions”].) Whether a challenged statement “declares or implies a provable false assertion of fact is a question of law for the court to decide [citations], unless the statement is susceptible of both an innocent and a libelous meaning, in which case the jury must decide how the statement was understood.” (Franklin, supra, 116 Cal.App.4th at p. 385.)
B.
Overhill provided Evidence of Provably False Statements
In its first amended complaint, Overhill alleged defendants had accused it of, among other things, being “racist,” and using an “alleged social security number discrepancy” as an excuse “to target[] long-term employees, especially women, Hispanics and older workers for termination.” We review the evidence produced by Overhill in support of each of the alleged defamatory statements by defendants – which consists of the press release, signs, leaflets, flyers, and handbills – to determine whether Overhill satisfied its burden of providing a prima facie showing defendants made a provably false assertion of fact. In our view, it did.
Overhill produced evidence that defendants carried signs stating Overhill Farms was a “Racist Employer,” passed out leaflets stating that Overhill Farms inflicted “racist and discriminatory abuse” on its workforce, passed out flyers stating Overhill was “abusive and racist” and “discriminates against Latinos,” passed out handbills generally referring to “unjust terminations and discriminatory treatment by Overhill,”[3] and issued a press release stating in part that “IMMIGRANT WORKERS PROTEST RACIST FIRINGS BY OVERHILL FARMS.”
The term “racist” is of course an exceptionally negative, insulting, and highly charged word — it is hard to imagine being called much worse. It is, however, also a word that lacks precise meaning, so its application to a particular situation or individual is problematic; indeed, defendants contend no court has ever found the use of the term “racist” to be actionable defamation in a context similar to this one.
In Stevens v. Tillman (7th Cir. 1988) 855 F.2d 394, 402, for example, the Seventh Circuit held that use of the term racist was not actionable under Illinois defamation law, observing (over 20 years ago) that the term lacked a precise meaning, can imply many different kinds of fact, and is no more than meaningless name-calling. The appellate court further observed, “[t]he word has been watered down by overuse, becoming common coin in political discourse.” (Ibid.) We agree that general statements charging a person with being racist, unfair, or unjust – without more – such as contained in the signs carried by protestors, constitute mere name calling and do not contain a provably false assertion of fact. Similarly, references to general discriminatory treatment, such as that contained in the handbill and flyer here, without more, do not constitute provably false assertions of fact. (See, e.g., Beverly Hills Foodland v. United Food & Commercial Workers Union, Local 655 (8th Cir. 1994) 39 F.3d 191, 196 [“‘[T]o use loose language or undefined slogans that are part of the conventional give and take in our economic political controversies — like ‘unfair’ and ‘fascist’ — is not to falsify facts.’ [Citations.]”].)
However, defendants did not merely accuse Overhill of being “racist” in some abstract sense. The press release contains language which expressly accuses it of engaging in racist firings and declaims upon the disparate impact the firings have had on “immigrant women.” Similarly, after discussing Overhill’s termination of one-fourth of Overhill’s work-force, the leaflets explicitly assert that the discrepancy in social security numbers was merely a “pretext” to eliminate certain workers, and refers to Overhill’s conduct as “racist and discriminatory abuse against Latina women immigrants.” Moreover, in almost every instance, defendants’ characterization of Overhill as “racist” is supported by a specific reference to its decision to terminate the employment of a large group of Latino immigrant workers. The assertion of racism, when viewed in that specific factual context, is not merely a hyperbolic characterization of Overhill’s black corporate heart – it represents an accusation of concrete, wrongful conduct.
Surprisingly, defendants actually deny they ever asserted Overhill engaged in “racist firings,” and go so far as to complain the court “improperly inferred” they had claimed the terminated employees were fired because of their race. According to defendants, their leaflets and materials state only “that the terminated employees were fired due to purported social security discrepancies,” and they were complaining only because they viewed termination on that basis to be “unfair.” Even ignoring the fact that defendants’ press statement uses the phrase “racist firings by Overhill” in its title, this argument is disingenuous.
The gist of the press statement, leaflets and flyers was that while Overhill was claiming the employment terminations were based strictly on the disparities in social security numbers, that claim was false, as the Social Security Administration had decreed that such discrepancies were not grounds for termination. Thus, defendants were clearly portraying the “supposed” discrepancies as merely convenient cover for Overhill’s true, racist, intent. Indeed, the leaflet explicitly characterizes the social security number discrepancies as a mere “pretext” for the firings. Defendants’ assertion no such contention was made is disturbingly inconsistent with their own writings.
And a claim of racially motivated employment termination is a provably false fact. Indeed, that very fact is subject to proof in wrongful termination claims on a regular basis. If we were to conclude that an employer’s racist motivation for terminating an employee’s job were not “provable,” it would come as a great shock to the Fair Employment and Housing Administration. (See Gov. Code, §§ 12900 et seq.)
Of course, we recognize that certain factual claims, if based upon “fully disclosed” facts, “can be punished only if the stated facts are themselves false and demeaning’ . . . The rationale for this rule is that ‘[w]hen the facts underlying a statement of opinion are disclosed, readers will understand they are getting the author’s interpretation of the facts presented; they are therefore unlikely to construe the statement as insinuating the existence of additional, undisclosed facts.’ [Citation.] When the facts supporting an opinion are disclosed, ‘readers are free to accept or reject the author’s opinion based on their own independent evaluation of the facts.’ [Citation; see also Partington v. Bugliosi (9th Cir. 1995) 56 F.3d 1147, 1156-1157 [‘when an author outlines the facts available to him, thus making it clear that the challenged statements represent his own interpretation of those facts and leaving the reader free to draw his own conclusions, those statements are generally protected by the First Amendment’]; Chapin v. Knight-Ridder, Inc. (4th Cir. 1992) 993 F.2d 1087, 1093 [‘[b]ecause the bases for the . . . conclusion are fully disclosed, no reasonable reader would consider the term anything but the opinion of the author drawn from the circumstances related’]; Phantom Touring, Inc. v. Affiliated Publications (1st Cir. 1992) 953 F.2d 724, 730 [if author discloses basis for statement, it can only be read as the author’s ‘personal conclusion about the information presented, not as a statement of fact’].)” (Franklin, supra, 116 Cal.App.4th at p. 387, citing Standing Committee v. Yagman (9th Cir. 1995) 55 F.3d 1430, 1438-1439].)
However, that rule is of no assistance to defendants, for the simple reason that their statements do not fully and accurately disclose the facts surrounding the firings. While defendants’ press release and leaflets do acknowledge that an “alleged” or “supposed” discrepancy in social security numbers led to their firing – and claim that “such a discrepancy” is not grounds for termination of employment – they do not even begin to acknowledge the full story, i.e. that Overhill did not fire anyone merely because a “discrepancy” had been identified. What actually happened is that Overhill notified the affected employees their social security numbers had been identified as “invalid,” gave them substantial opportunity to resolve the problem and provide a valid number, and only terminated the employment of those who either admitted falsifying their documents, or failed or refused to respond to the issue at all. While the mere identification of a discrepancy may not be grounds for firing, an employee’s failure or refusal to correct an invalid social security number and supply a proper one, when asked by the employer to do so, is an entirely different matter.[4]
The evidence here was sufficient to demonstrate that defendants’ disclosure of facts underlying the employment termination was materially incomplete and misleading, making their “racist firing” claim sound far more credible than it actually is. Consequently, the rule that “[a] statement of opinion based on fully disclosed facts can be punished only if the stated facts are themselves false and demeaning [citation]” (Franklin, supra, 116 Cal.App.4th at p. 387), does not apply here.[5]



TO BE CONTINUED AS PART II….

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