District court orders denying motions to strike under California’s anti-SLAPP statute are not immediately appealable under the collateral order doctrine, according to a significant Ninth Circuit ruling that overturned its 2003 precedent in Batzel v. Smith, 333 F.3d 1018 (9th Cir. 2003).
The Ninth Circuit agreed with other circuits that have addressed the issue and held that denial orders do not resolve issues “completely separate from the merits of the action” and do not render the decision “effectively unreviewable on appeal from a final judgment.”
Ajay Thakore and Gopher Media LLC, a digital marketing agency, filed suit against Andrew Melone and American Pizza Manufacturing in the U.S. District Court for the Southern District of California, alleging that American Pizza falsely advertised its use of fresh ingredients when the restaurant really uses frozen crust. Melone and American Pizza filed a counterclaim alleging that Gopher Media, under the control of Thakore, paid its employees to leave more than 100 negative reviews of American Pizza on various review websites, and that Thakore made false statements about Melone and American Pizza on social media.
In response to the counterclaim, Thakore and Gopher Media filed an anti-SLAPP motion to strike the counterclaim under California Civil Procedure Code § 425.16. They argued that the internet reviews and other comments are speech about a public issue and, therefore, protected First Amendment speech. The district court denied the motion, and Thakore and Gopher Media filed an interlocutory appeal.
After hearing oral argument, a three-judge panel ordered briefing on whether the appeal should be heard en banc to reconsider (1) whether California’s anti-SLAPP statute applies in federal courts and (2) whether the Batzel decision correctly held that denial of a motion to strike under California’s anti-SLAPP statute is immediately appealable under the collateral order doctrine.
Jurisdiction in federal courts of appeal is generally limited to appeals from a final decision by the district court. 28 U.S.C. § 1291. The collateral order doctrine establishes “a narrow class of decisions that do not terminate the litigation, but must, in the interest of achieving a healthy legal system, nonetheless be treated as final.” Digit. Equip. Corp. v. Desktop Direct, Inc., 511 U.S. 863, 867 (1994) (citation modified). To fall into this narrow class, a district court decision must (1) conclusively determine the disputed question, (2) resolve an important issue completely separate from the merits of the action, and (3) be effectively unreviewable on appeal from a final judgment. Will v. Hallock, 546 U.S. 345, 349 (2006). An issue is completely separate from the merits if it is “significantly different” and “conceptually distinct” from the “fact-related legal issues that likely underlie the plaintiff’s claim on the merits.” Johnson v. Jones, 515 U.S. 304, 314 (1995) (citation omitted). A court considers whether an order is “effectively unreviewable” by considering “the value of the interests that would be lost through rigorous application of a final judgment requirement.” Will, 546 U.S. at 351–52 (quoting Digit. Equip. Corp., 511 U.S. at 878–79).
In Batzel v. Smith, the Ninth Circuit held that it has jurisdiction to review orders denying anti-SLAPP motions under California’s statute pursuant to the collateral order doctrine. Batzel, 333 F.3d at 1025. The court concluded that the “[d]enial of an anti-SLAPP motion resolves a question separate from the merits in that it merely finds that such merits may exist, without evaluating whether the plaintiff’s claim will succeed.” Id. The court also reasoned that “[i]f the defendant were required to wait until final judgment to appeal the denial of a meritorious anti-SLAPP motion, a decision by this court reversing the district court’s denial of the motion would not remedy the fact that the defendant had been compelled to defend against a meritless claim brought to chill rights of free expression.” Id. The court found it “instructive” that California’s anti-SLAPP statute expressly provides that an order denying an anti-SLAPP motion may be appealed immediately in California state courts.
Since the court’s ruling in Batzel, denials of anti-SLAPP motions have been immediately appealable in the Ninth Circuit. But there was growing pressure to overturn this ruling.
The Ninth Circuit overturned Batzel, holding that orders denying anti-SLAPP motions under California’s statute do not resolve questions “completely separate from the merits” and are not “effectively unreviewable after final judgment.”
Citing its post-Batzel experience, the court held that the questions that must be answered to resolve an anti-SLAPP motion are, in fact, “inextricably intertwined” with the merits. According to the court, because the legal and factual questions that must be determined in the two-step anti-SLAPP analysis will likely reemerge at later stages of the case, holding otherwise would unnecessarily create piecemeal appellate review.
The court recognized that some important interest may be lost if a defendant must wait to appeal (e.g., a party may have to defend a meritless action all the way through trial). However, the court held that this does not render the decision “effectively unreviewable.” The court noted it had already reached this same conclusion about orders granting an anti-SLAPP motion. Hyan v. Hummer, 825 F.3d 1043, 1046–47 (9th Cir. 2016). So, the Ninth Circuit’s holding unifies the court’s approach for review of an anti-SLAPP motion, regardless of whether the motion was granted or denied by the district court.
Judge Bennet, joined by Judge Callahan, concurred fully with the majority, but wrote separately to affirm that California’s anti-SLAPP statute and attorney fee shifting provisions create a substantive right applicable in federal court under the Erie doctrine.
Separately, Judge Bress, joined by Judges Collins, Lee, and Bumatay, also concurred with the majority, but wrote separately to argue that the court should have held that California’s anti-SLAPP statute does not apply at all in federal courts. Judge Bress cited other circuits (e.g., the Second, Fifth, Tenth, Eleventh, and D.C. circuits) that have gone this route and rejected the application of state anti-SLAPP statutes in federal court. Judge Bress argued that the Ninth Circuit should abandon its minority position, resolve the longstanding circuit split, and reaffirm that federal procedural rules, not state anti‑SLAPP mechanisms, govern in federal civil litigation.