Appealability of Anti-SLAPP Orders In California and the 9th Circuit

California's "anti-SLAPP" statute, Code of Civil Procedure Section 425.16, allows the court to strike certain lawsuits - those arising from acts of speech or petition in the public interest - early in a case unless the plaintiff can establish a probability of prevailing. Defendants may file an anti-SLAPP motion in a California court. They may also do so in a federal court sitting in diversity and applying California law. There is at least one important difference between state and federal court anti-SLAPP motions, however: whether there is a right to an immediate appeal from the resulting ruling.

In state court, there is a statutory right to appeal from most orders granting or denying an anti-SLAPP motion. But federal courts follow their own rules of appealability. The 9th U.S. Circuit Court of Appeals has determined that it has jurisdiction over some anti-SLAPP appeals, but a recent published decision indicates that there are limits to that jurisdiction.

Greensprings Baptist Christian Fellowship Trust v. Cilley, 2010 DJDAR 19335 (9th Cir. 2010) arose from a malicious prosecution suit in federal district court. The district court granted the defendants' anti-SLAPP motion, finding that the plaintiff had not presented sufficient evidence of the merit of its claims. But, citing the federal policy favoring liberal amendment of claims, the court granted the plaintiff leave to amend its complaint. The defendants then appealed, arguing that the district court should have followed California law, which generally prohibits granting leave to amend after the grant of an anti-SLAPP motion.

The 9th Circuit began by considering whether it had jurisdiction over the appeal. It explained that federal appellate courts can review two kinds of rulings: final decisions on the merits, and a small class of collateral orders. An order granting an anti-SLAPP motion with leave to amend is not a final decision on the merits because it permits further litigation. The only other possible basis for jurisdiction, then, is the collateral order doctrine.

To be appealable, a collateral order must meet three requirements: It must conclusively determine the disputed question. It must resolve an important issue completely separate from the merits of the action. And it must be effectively unreviewable on appeal from the final judgment. The U.S. Supreme Court has instructed courts to apply this test stringently. Digital Equipment Corp. v. Desktop Direct Inc., 511 U.S. 863, 868 (1994).

Greensprings focused on the first collateral order requirement, whether the ruling conclusively determined a disputed question. The relevant question was whether the anti-SLAPP statute barred the suit. The order granting the anti-SLAPP motion with leave to amend did not answer that question. Instead, it deferred an answer: By allowing the plaintiff to plead additional facts, the district court indicated that it would revisit the impact of the anti-SLAPP statute in light of the amendment. As a result, the order was inherently tentative and the 9th Circuit had no jurisdiction to review it under the collateral order doctrine. Greensprings therefore dismissed the defendants' appeal as unreviewable.

The collateral order doctrine does not, however, doom all appeals from anti-SLAPP rulings. Greensprings acknowledged that unlike an order granting a motion with leave to amend, an order denying an anti-SLAPP motion is conclusive as to whether the statute requires dismissal. A denial also satisfies the second collateral order requirement, because it resolves an important issue apart from determining whether the lawsuit actually has merit - namely, whether the suit may have merit.

What about the third requirement for collateral order appeals, whether an order denying an anti-SLAPP motion would be effectively unreviewable on appeal from the final judgment? According to Englert v. MacDonnell, 551 F.3d 1099 (2009), it depends which state's anti-SLAPP statute is involved. State law regarding the right to appeal an anti-SLAPP ruling does not directly impact the 9th Circuit's jurisdiction. But the 9th Circuit treats the availability of an interlocutory state court appeal as shedding light on whether immediate review is necessary to safeguard the right protected by the anti-SLAPP statute.

For example, the Oregon anti-SLAPP statute does not provide for an immediate appeal. The 9th Circuit therefore has reasoned that the intent of the statute must not be to immunize defendants from the burden of litigation. Otherwise, Oregon would have permitted defendants to appeal before proceeding to trial. Rather, the statute's intent must be to facilitate an early trial court examination of the plaintiff's claim to ensure that it has at least some merit. Immediate review of an anti-SLAPP ruling is not necessary to effectuate that intent, so an order based on the Oregon statute does not satisfy the collateral order doctrine.

By contrast, California's anti-SLAPP statute does create a right to appeal. That means California must have intended to shield defendants who have a meritorious anti-SLAPP claim from the burden of further litigation. Postponing review of the anti-SLAPP ruling until after the trial would thwart that intent. The 9th Circuit thus recognizes that denial of a California anti-SLAPP motion is effectively unreviewable on appeal from a final judgment, and so satisfies the collateral order doctrine. For now, then, the 9th Circuit can decide an appeal from a district court order denying an anti-SLAPP motion based on the California statute. But that will only be true as long as the California statute demonstrates an intent to immunize defendants from further litigation by making anti-SLAPP rulings immediately appealable. The Legislature added that statutory appeal right in 1999. Now, a California Court of Appeal is urging the Legislature to reconsider.

Grewal v. Jammu, 2011 DJDAR 607 (Cal.Ct.App. 2011) illustrates the potential costs of permitting an immediate appeal. A group of defendants moved to strike the plaintiff's libel claims on anti-SLAPP grounds. The trial court denied the motion, and the defendants appealed. That appeal automatically stayed proceedings on the merits of the causes of action affected by the motion. Varian Medical Systems v. Delfino, 35 Cal.4th 180, 186 (2005). The defendants obtained several extensions, then dismissed their appeal without filing an opening brief.

A year later, in response to an amended complaint, another group of defendants filed an anti-SLAPP motion. The motion targeted two of the same causes of action as to which the trial court had denied the previous anti-SLAPP motion. Not surprisingly, the trial court denied the second motion as well, and the moving parties appealed. That appeal again stayed proceedings. The Court of Appeal eventually affirmed, rejecting the appeal as utterly without merit. By then, it had been five years since the plaintiff filed his suit and, as the court noted, "trial is not yet in sight."

Treating the case as an example of what is wrong with anti-SLAPP litigation, Grewal called on the Legislature to consider eliminating the right to appeal an anti-SLAPP ruling. Any such change could have a far-reaching impact, given the explosion of anti-SLAPP litigation in California in recent years. As just one example, Grewal noted that there were 558 anti-SLAPP motions filed in 2009, compared to just 55 motions in 1999.

Grewal emphasized that in light of this burgeoning litigation, an automatic right of appeal has serious consequences for plaintiffs: Even if an anti-SLAPP motion was properly denied, a defendant can stay the case and cause the plaintiff to incur additional expense by appealing. But eliminating the right to appeal carries its own set of consequences. Where the trial court erroneously denies an anti-SLAPP motion, the defendant will have to continue litigating non-meritorious claims. That prospect could deter defendants from exercising their right to speech and petition, undermining the core purpose of the anti-SLAPP statute.

It will be up to the Legislature to decide whether the current statutory scheme properly strikes the balance between these competing considerations. Until it does, orders denying anti-SLAPP motions under Code of Civil Procedure Section 425.16 will continue to be appealable in California courts and, by indirect extension, in the 9th Circuit.