Saturday, January 30, 2010

A Rolling Stone gathers no right of publicity liability

Stewart v. Rolling Stone LLC, --- Cal.Rptr.3d ----, 2010 WL 317016 (Cal.App. 1 Dist.)

Fascinating case! Indie rock musicians from the bands Xiu Xiu and Fucked Up sued to represent a class of over 100 bands who all appeared in an editorial feature, “Indie Rock Universe,” in the November 15, 2007 issue of Rolling Stone. The feature is a four-page foldout described as a “butterfly gatefold,” which has four ad pages and five editorial pages. It begins with an ad on the left. Then there's a page of editorial copy on the right. When the page is turned, two pages of ads appear as a “gate,” which can be opened like French doors. Then the four-page remainder of the editorial feature appears; if you are looking at all four pages of the editorial at once, the ads are not visible.

The feature here, which was listed along with two other similar features in the magazine’s table of contents, had “hand-drawn cartoon-like illustrations accompanied by both handwritten and typeset text.” Artist’s site; the artist wasn’t involved with the ad pages. The Camel ads featured “a collage of photographs.” The ad theme continues from the intro page through the gate, and then resumes when the gate pages are folded back to re-inclose the feature.

Plaintiffs sued Rolling Stone and R.J. Reynolds for violations of the California common-law and statutory right of publicity and unfair business practices. The trial court denied Rolling Stone’s motion to dismiss, holding that Rolling Stone’s “layout decision” was an “allegedly integrated 9-page advertisement” that a trier of fact could conclude was commercial speech “inextricably intertwined” with the Camel ad. Rolling Stone appealed, using California’s anti-SLAPP statute, under which if a cause of action arises from protected speech activity, the plaintiff must establish a reasonable probability of prevailing on the merits.

In 2003, the anti-SLAPP statute was amended to exempt certain lawsuits against people in the business of selling goods or services if the statements at issue were representations of fact about those goods or services or those of a competitor, made for sales purposes, to a buyer/customer audience. Despite plaintiffs’ rather strained arguments, the court had little trouble concluding that the exemption didn’t apply here. Rolling Stone is engaged in the business of selling magazines, not cigarettes, and the statements here weren’t factual representations about Rolling Stone or its competitors.

The key question was whether the feature was commercial or noncommercial speech. It was, as the anti-SLAPP law requires, made in connection with a matter of public interest; a feature on a popular music genre easily qualifies. The trial court found that the decision to put the feature within the gatefold format was protected by the First Amendment. Although there was a profit motive, that’s true of standard newspaper publication, including basic editorial decisions. It was the feature itself, regardless of the layout decision, that was protected speech.

Plaintiffs argued that the anti-SLAPP statute doesn’t cover commercial speech. The court disagreed. In fact, the exception for competitor speech suggests to the contrary. “Defendants’ acts on which the counts alleged in the complaint are based, are the acts of designing and publishing, within the advertising gatefold layout, an editorial feature containing plaintiffs’ band names. Those acts arose from protected activity for purposes of the anti-SLAPP statute as they were done in furtherance of defendants’ constitutional right of freedom of speech made in connection with a public issue.”

So, could the plaintiffs show a reasonable probability of prevailing on the merits? The common law requires appropriation of a plaintiff’s identity to the defendant’s advantage without consent and with injury; the statute adds in that the use of the name, voice, etc. for advertising purposes must be “knowing,” and requires a direct connection between the use and a commercial purpose. The statute expressly exempts use in connection with news and public affairs, similar to the exceptions developed to the common-law cause of action. The unfair competition action, meanwhile, requires a showing of likely public deception and injury/lost money or property as a result of the unfair competition.

Here’s where it gets really interesting. Rolling Stone argued that actual malice would be required to prevail; plaintiffs argued that actual malice applies only to defamation. The court held that they were wrong.

Media defendants can invoke the First Amendment as a defense to misappropriation claims. And actual malice has been applied to similar claims, such as one brought by Clint Eastwood about his alleged involvement in a love triangle, which the publisher touted in ads. Eastwood held that scienter of the alleged calculated falsehood was the proper standard of fault. Moreover, Comedy III cautioned against giving a broad scope to the right of publicity lest it allow censorship of unflattering commentary. So actual malice applies.

There are a couple of missing steps here, at least if you take the right of publicity as extending beyond false endorsement. Most obviously: actual malice makes sense as applied to falsehood. But what does actual malice (or reckless disregard) mean as applied to the right of publicity? Reckless disregard of someone’s publicity rights? But publicity rights are creations of law, not facts. Is this now a standard about knowledge of the law? That’s not what the actual malice requirement is supposed to focus on; it’s about how badly the defendant screwed up the truth of the underlying factual statement, not whether it had any clue what the law was. (I’m not a fan of the right of publicity by any means; I just don’t think actual malice is a helpful concept here.)

Meanwhile, false or misleading commercial speech is not constitutionally protected. And a public figure need not show actual malice to prevail against commercial speech (here the court cited Procter & Gamble Co. v. Amway Corp., which is a competitor disparagement case). But here, the feature was noncommercial speech as a matter of law.

Under Nike v. Kasky, categorizing speech requires an assessment of the speaker, the intended audience, and the message content. A commercial speaker has (or is acting on behalf of someone who has) a direct business interest in the goods that are the subject of the speech at issue. Rolling Stone isn’t in the business of selling cigarettes. It’s the medium by which ads are delivered by the actual commercial speakers, the advertisers. Its editorial purpose is noncommercial: assessing the current American scene. The other two Kasky factors supported the noncommerciality conclusion; the content of the commercial message had nothing to do with Rolling Stone.

The plaintiffs argued that it was hard to tell where, if at all, the Camel ad begins and ends. The court didn’t think the distinction was that difficult. The graphic designs were quite different, one hand-drawn cartoons and the other collages of photographs, with different backgrounds. The only “nexus” between them was their mutual references to independent music. “None of the band names in the Feature appear in the Camel ad, and none of the language or elements of the Camel ad appear in the Feature. … [P]laintiffs have not cited us to a case, and our research has disclosed none, in which a magazine’s editorial content has been deemed transformed into commercial speech merely because of its proximity to advertisements touching on the same subject matter.” The court did not find it significant that a prior feature used standard typeface and a statement that the feature was presented by Rolling Stone, along with a typical editorial border design. The absence of a border was consistent with the artistic theme of the feature, and it was still distinct from the Camel ad. Moreover, the name of the magazine and the page number appeared on the feature, but not on any of the ad pages.

It was undisputed that R.J. Reynolds had no role in designing the feature. Consistent with industry practice, Rolling Stone maintains a wall between editorial and advertising staff. The artist and staff who created the feature were unaware at the time that R.J. Reynolds had bought the surrounding ad space. R.J. Reynolds knew that the general topic of the gatefold was indie rock, but didn’t know the specific content. It paid only for the four pages of ads it designed itself. There was no evidence that anyone at Rolling Stone or R.J. Reynolds had any concerns that the ad and the feature would be perceived as an integrated whole. (Here the court cited a bunch of cases where, by contrast, the media defendant knew about the potential of a statement to mislead.)

In the end, there was no legal precedent to convert noncommercial speech into commercial speech based on the former’s proximity to the latter, nor to convert a noncommercial speaker into a commercial speaker in the absence of any direct interest in the product or service being sold.

That brings us back to actual malice, which isn’t at issue in ordinary right of publicity cases where the challenged speech is pure commercial speech and the celebrity’s identity is used to sell a product. There was insufficient evidence of actual malice, in that there was no intentional collusion to misappropriate plaintiffs’ identities. At best, there was a triable issue only with respect to whether defendants were negligent, in that they could have done more to ensure that the feature and the ads were distinct. But negligence isn’t sufficient to show actual malice.

And here’s another misfit between actual malice and the right of publicity. Though Rolling Stone’s staff had no prior concern about the appearance of integration in this gatefold, after this case, aren’t they on notice that people might perceive integration (as the artists did; see also this discussion thread)? So isn’t the standard for malice changed, going forward, especially as product placement/integration becomes ever more the default expectation, see, e.g., 30 Rock and The Colbert Report? This is highlighted by the court’s apparent comfort with the idea that Rolling Stone was negligent in publishing the gatefold. The problem is that the thing about which knowledge/reckless disregard is assessed—whether the feature would be a misappropriation of identity (again, a legal conclusion)—isn’t related to the reasons we protect (or don’t protect) speech, the way that knowledge/reckless disregard for falsity is related to the reasons we tolerate a lot of factual error in noncommercial speech. The right of publicity isn’t about falsity, though it should be; as such, actual malice simply doesn’t fit. (And by the way, if the feature was noncommercial speech, how could it even count as an actionable appropriation of identity? That is, how could Rolling Stone even have been negligent about whether this was actionable, unless noncommercial speech can at times violate the right of publicity and this is one of those times? In which case, I guess, we're looking at Comedy III for when noncommercial speech is actionable--but that's a standard that would look to the content of the feature, not to its level of integration with commercial speech, which was where the court suggested the negligence lay. In other words, the incoherence here is all the way down. And also: is there now an actual malice standard applied to a straight-up Comedy III type case, such that the plaintiff has to prove knowledge or reckless indifference as to the absence of transformation? What, I ask again, is the actual malice with respect to?)

In a footnote, the court took judicial notice of the fact that R.J. Reynolds had been sued over this ad for violating the master settlement agreement prohibiting it from using cartoons in its ads. A California court found that the California AG failed to prove that R.J. Reynolds intended that its ads surround the cartoons or had advance knowledge that the ads would be positioned with or intertwined with cartoons. A similar Pennsylvania case, however, found that the ads “envelope, integrate and cross-pollinate” the cartoons “so completely as to constitute a single integrated whole.” But these aren’t admissible to prove the truth of the facts found; defendants also weren’t parties to those cases.

Plaintiffs’ unfair competition law claim also failed because they didn’t demonstrate injury in fact/lost money or property. Their claim was based on damage to reputation because of misappropriation. As no actionable misappropriation occurred, they couldn’t win on their UCL claim.

In a coda, the court also found that the freedom of the press barred the claims here. Editorial control and judgment extends to the content and placement of ads. Fear of liability shouldn’t impose self-censorship on publishers. The trial court faulted Rolling Stone for selling ads to enclose the feature, letting R.J. Reynolds design the ad to “integrate” with a feature about indie rock, failing to identify the feature as a Rolling Stone feature, and failing to ensure that the feature and the ad were sufficiently distinct. Even if this was all true, the court found, Rolling Stone’s conduct would still be privileged.

Finally, the court noted that the November 15, 2007 issue of Rolling Stone was “replete” with full-page ads—108 of 215 pages. Thus, all the editorial content is “in a sense, ‘embedded’” with ads. The gatefold layout might intensify readers’ exposure, “because the pages run more or less contiguously and because the format requires readers to lift the advertising pages to the left and to the right, instead of just mindlessly turning them.” But there was no principled legal distinction between ordinary preceding-and-following placement and the gatefold format.

The court acknowledged that the placement of the feature “may have caused plaintiffs some distress, insofar as their bands’ names appeared in such close proximity to R.J. Reynold’s expressions of corporate sponsorship for independent music.” But without actual malice, the lawsuit still failed.

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