NASIR: Welcome to our podcast where we cover business in the news and add our legal twist to that business news.
My name is Nasir Pasha.
MATT: And I’m Matt Staub.
NASIR: Why do you always laugh at me at every intro?
MATT: You always pause at a different spot. I don’t know.
NASIR: It’s for dramatic effect.
MATT: I notice it and no one else probably does.
NASIR: Yeah. No, you’re probably right.
MATT: So, there’s a story that’s been popping up and I think the actual story, I just did a quick Google search on this because I was actually trying to find out when the case initiated, 90 percent – maybe 95 percent – of the stories are about this part with Leonardo DiCaprio having to testify in this case which is such a minor part. To me, that’s just really, like, not news at all in the grand scheme of things with the actual substance of the case.
Let me get to the backstory here.
I think it was filed in 2014, right? Yeah, 2014, a lawsuit was filed by Andrew Greene. If you’re really into the Wolf of Wall Street, you might know who that is. Basically, he had a bunch of causes of action – libel, right to privacy, defamation, things like that or I guess the libel – basically saying the character of PJ Byrne, the actor in the Wolf of Wall Street, was a portrayal of him – him being Andrew Greene – and he was portrayed very poorly, I think. Let’s see – portrayed as a criminal, a drug user, and a degenerate through this character in the movie. Naturally, he files this complaint against who – the director?
NASIR: Yeah, or actually a bunch – not only Paramount, the director – let’s see.
MATT: Red Granite Pictures, some other entities.
NASIR: Appian Way LLC.
MATT: See, basically, he’s saying, “his character in this movie, it was supposed to be me and it was portrayed in a disadvantageous way and so I’m going to sue you.” I think, initially, it was for $50 million. Now, I think it’s around $25 million and it’s probably because some of the claims got kicked out. But that’s kind of where we’re at right now before we get into the Leo aspect of it.
NASIR: Yeah. If you guys have seen the movie, honestly, I doubt if you will remember who this guy is because I had to pull him up. I mean, he’s definitely a character in the film but he’s not a very memorable character.
NASIR: You know who I’m talking about, right? You’ve seen the film, right?
MATT: I watched a brief little clip. I think probably the most memorable part – well, one of the most memorable parts – that he’s in is when I think he’s the one – or at least one of the people – that’s involved, remember when they paid that woman to shave her head for $10,000?
NASIR: Oh, okay, yeah.
MATT: He was one of or maybe the only person that was the one shaving her head which he says never happened. What’s his name? Jordan… Jordan Belfort, the main character. You know, he says all this stuff happened. I’m sure it’s somewhat exaggerated but he said that the head-shaving thing happened. I think that’d be something that’d be easy to prove, right?
NASIR: Yeah, I mean, you would think, but bottom-line is, okay, right now, I guess he’s an investment banker. He claims he wasn’t or is not drug-addicted or misogynistic, “an obnoxious sleazeball” that he says Scorsese and Paramount Pictures basically framed him to be.
MATT: Yeah. So, he’s not happy about that. Probably also not happy about the fact that I’m sure he has a lot less money than he used to. So, naturally, he’s going to… You know, you see this movie, I’m sure he thinks, “Wow, it brings a lot of money, how can I profit off of this? I’m going to file this lawsuit claiming that they ripped off me and did so in a bad light.” That’s where things started in February 2014. A bunch of the claims got dismissed September of 2015, I believe, but the one that didn’t was libel and so, now, that is where we’re at today and this is the big story or this is, like I said, 90 percent of all the articles that are posted about Leonardo DiCaprio. Despite his attorney’s best attempts, he’s being forced to testify in this case. The reasons are a little bit flimsy, I think. You know, they’re saying that, obviously, he didn’t write the movie, right? Correct me if I’m wrong, the only part he had in the movie was just acting, right?
NASIR: Yeah, I think he’s actually a producer too and that’s part of the reason why the plaintiffs were wanting, you know, were justifying his involvement and this is a common tactic – the plaintiffs in this case or the plaintiff or their attorneys, they may have no real need for the deposition itself but it may be strategic because they know that, okay, you depose this famous actor that is obviously busy, he’s going to be pissed off that’s getting wrapped up in this lawsuit that he was just barely involved in making. He just did the acting and maybe produced it but he didn’t write the script or anything like that.
NASIR: And he definitely didn’t have any intention to defame anyone and he also didn’t play the actor of Andrew Greene either. So, he may put some tremendous pressure on Paramount that I’m sure Paramount wants to maybe use Leonardio DiCaprio in another movie in the future and I’m sure, as well as these other entities named, it may force them to settle. And so, it’s a very common tactic and, obviously, you can see how it’s made big news – the fact that he has to appear on a deposition.
ATT: Yeah, the plaintiff’s arguing that he’s a necessary party to testify because he met with the director and the producer and screenwriter in the script development process to discuss scenes and revisions. Scorsese and the screenwriter have already given their depositions. But, to me, that’s such a weak argument. Leonardo DiCaprio is going to meet with these three people and that somehow he’s going to focus on this one minute character that nobody even remembers from the movie, basically. I mean, what I really enjoyed about this is the plaintiff’s lawyers even offered to meet Leonardo in Los Angeles to accommodate his busy schedule. To me, it’s almost just like they want to meet him in person and be in the same room with him for a day – that’s how that comes off.
NASIR: In lieu of a deposition, they’re willing to get a signed autograph or a signed photograph.
MATT: He can be so smug, too. Like, you know that’s what he’s going to be like in this deposition because I don’t think he’s going to have much that’s going to benefit the plaintiff but it looks like they’re going to happen.
NASIR: We don’t know exactly but, yeah, there may be something we don’t know but you’re probably right. And so, what’s interesting about this case and why we can kind of take about the law a little bit is defamation in general. To kind of break that down, we’ve talked about it in the past and we’ll test this as well in the sense that we’ve talked about it in the context of Yelp and these bad reviews and negative reviews that may be defamatory. One of the elements of a defamatory statement, it has to be of and concerning the plaintiff. You have to actually prove that that defamatory statement is about you. And so, one of the legal issues that was brought up very early in the case which Matt alluded to in the motion to dismiss were most of the cases, I think there’s only two causes of action, I think, but the only one that was left standing was the libel or the defamation. The issue was, well, this is a movie. Is it really of and concerning this Andrew Greene or not? Because I’m sure you guys have seen this, you’ll see at the end of a movie where it’ll say something like “These are all fictional characters and anything that resembles a real-life character is mere coincidence” or some stupid disclaimer like that and I call it stupid because, in reality, that in itself isn’t really going to save you all of a sudden from a defamatory lawsuit just because you put in this disclaimer at the end that, okay, even though this looks real and we made it seem like it’s real, it’s not really real. And so, at this point, the judge said that, “well, this question of whether or not this movie and this character is ‘of and concerning the plaintiff’ or ‘of and concerning Andrew Greene’ is a question for the jury.” It’s not a question of law. And so, it depends upon whether or not a jury thinks that it’s of and concerning Andrew Greene.
MATT: Right. So, two things here, one you just hit on it. This isn’t saying that it is of and concerning. I mean, this is the motion to dismiss. So, whether they allege sufficient facts to demonstrate this of and concerning element. And so, I mean, kind of the way to look at it is whether a reasonable person could look at it and see some sort of connection. I mean, it’s a very broad way of putting it but that’s kind of what we’re looking at and whether that connection is enough. Whether a reasonable person viewing the allegedly defamatory work would understand that the character portrayed in the work was in fact, in this case, Andrew Greene acting as described. So, basically, if someone watched the movie, would they be able to figure out that this person is supposed to be him if it was? I mean, that’s what it really boils down to. I like how the judge put it in that knowing the real person would have no difficulty linking the two, superficial similarities are insufficient.
NASIR: Yeah, and I think, if they meet all the other elements and that’s the only issue, it’s kind of questionable because the actor was picked because he looked similar to the real Andrew Greene and that’s who he played. That’s who he was supposed to be. Even though this is supposedly a fictional character, everyone knows it’s not really. And so, in the past, there is some favorable case law in the sense that, when you’re parodying something and so forth and creating these kind of fictional movies based upon real-life events, there’s some leeway and the Wolf of Wall Street, obviously, it seems exaggerated and they also make it seem and how it was marketed is as if this is how things happened.
NASIR: So, I don’t know.
MATT: Jordan Belfort had to be involved in the making of this movie, right? I mean, that would be the obvious person that would bring a lawsuit. I mean, he seems, in the interview I saw, it seemed like he is in favor of the movie – this is after it came out. He wasn’t sued individually so that’s why, I mean, I don’t know, maybe he wasn’t involved at all. They had to somehow get the story from somewhere.
NASIR: Yeah, if I recall correctly, Jordan Belfort actually wrote a book called Wolf of Wall Street. And so, even though he was charged with defrauding investors for more than $200 million, it seems as though he was able to make $100 million – well, he’s making $100 million this year, apparently, this was back in 2014 but I’m pretty sure he made money on the movie as well in selling the script.
MATT: It’s interesting that he’s not being named as a defendant in this lawsuit then. Maybe he sold the script to whoever and then they are the ones that are being sued.
NASIR: Okay. So, there’s one report that he got about $1 million to sell the movie rights, but it is based upon his memoir. So, you’re right. In theory, it’s like, if it’s based upon his memoirs and it was really about him and it was not true, then you’re right. It seems like he should have been included as a defendant as well.
MATT: In this case, obviously, like you said, the story was in the news this past week, it was all stuff about Leonardo DiCaprio. He’s not a party to the lawsuit. He was in unwilling participant or unwilling person that’s just involved in terms of testifying. But what about there was another case that was decided this past week that was kind of the opposite in that it was a defamation lawsuit. A business owner – actually, I think it was an attorney or a law firm versus a disgruntled customer – and a third party really wanted to be involved – or yeah it was involved – it wanted to assert its rights and that’s Yelp which we haven’t talked about in a while. Real quick rundown of what happened here, disgruntled customer leaves this negative defamatory review on Yelp under their real name and also under a pseudonym. Eventually, the law firm, the attorney, they sue this individual. They sue her for defamation. Defendant never responds. They get a default judgment. They actually sued for damages. I think it was quite a bit. One of the things they also sued which was for requiring or ordering Yelp to remove the reviews and Yelp didn’t want to do that. And so, instead of just complying with this one simple request, Yelp fought it based on quite a few grounds, actually.
NASIR: Yeah, First Amendment protections and we’ve talked about this many times – the statutory protections that these types of online companies have which is under the Communications Decency Act. I think that’s commonly referred to as a CDA. What’s interesting, there might have been some other defenses as well but, ultimately, it was actually a pretty favorable decision on behalf of those that are advocates of being able to fight against these negative defamatory reviews that are completely not true. And the idea is, “So what if you get a judgment against the defendant but that review is still out there and it’s on Yelp? How do you remove it?” It was a default judgment. So, in order to enforce a default judgment against the defendant to make them remove the review, it’s a little bit more difficult rather than just going straight to Yelp and saying, “hey, this is a defamatory statement, you must remove it.” It’s interesting because Yelp in this case was not a party and they just kind of inserted themselves in there because, okay, all of a sudden, there’s an injunction that they have to comply with. And so, they appealed accordingly and basically told the judge, “Look, we are immune from liability under the CDA, this violates our First Amendment rights, et cetera,” and the judges agreed that he basically said – was it a he or a she? I’m sorry – the court basically said that the CDA does not apply because this is an injunction. There’s no actual liability that applies here. Therefore, CDA doesn’t apply and you have to comply with the order.
MATT: And the appellate court did send it back to trial court just for kind of a distinction on the judgment. The original judgment was Yelp had to take down the reviews that this person posted and subsequent posts from her or anyone else – I think that was the exact way it was worded. Basically, the appellate court said it was a little bit overbroad. You can require her to remove the reviews that she’d already posted. But, in terms of future reviews, that’s an overbroad restraint on speech which, I mean…
NASIR: That makes sense.
MATT: Yeah, I mean, it does. But, if she goes back and posts the exact same thing?
MATT: To me, if it stems from the same incident, then what’s the difference? I get it but, at the same time, it’s a little bit…
NASIR: Yeah, but a court has to be careful and we’ve talked about this.
MATT: You can’t prevent her from free speech forever so I get that aspect of it.
NASIR: Yeah, exactly, and that’s called prior restraint and courts are very reluctant to kind of have any kind of order that prevents speech from happening in the first place. They’d rather the speech to occur and, if it’s something that is not permitted to punish that speech in itself. In this case, yeah, like I said, it makes sense. This case, though, is a nice blueprint for others that are seeking kind of restitution or some kind of remedy to these kind of defamatory statements online because, first of all, everyone knows, if you sued Yelp for liability for defamation, you would lose and that’s what CDA is for. That’s what the Communications Decency Act gives them immunity to. But, if you’re able to identify the defendant and, by the way, I mean, even if you’re not able to identify, we’ve found ways to figure that out as well. But, if you sue somebody for defamation and you win – whether default judgment or otherwise, at least in California – it seems as though Yelp will have to comply. Now, whether this applies in every single case or not across the nation and whether or not this get appealed but I think it was a good decision. The only logic that Yelp had which possibly has some viable claims is that they say, well, by imposing the injunction and if we do not comply, we’ll be liable. And so, therefore, the CDA does apply because we have immunity to that liability. And so, that’s a clever argument but, in this case, the judge didn’t buy it.
MATT: I think, overall, it’s a favorable decision for businesses and business owners which is pretty rare in terms of dealing with Yelp. But, I guess, most of the people that have been unsuccessful have sued Yelp directly, right? I mean, for the most part.
NASIR: Yeah, and those cases suing Yelp directly are always going to fail. That CDA is a federal statute.
MATT: Yeah, there was one case that looked promising. It was some sort of procedural issue they screwed up on or I can’t recall.
NASIR: Well, when I first saw this case, I was questioning it because the headline said that CDA did not apply. We’ve talked about it in the past that, if Yelp involved themselves too much in the review and screening of these reviews then they could be waiving their liability or their immunity to this liability and we’ve talked about how Yelp’s algorithm, how that works. And so, they’ve obviously tested the waters to only involve themselves to the extent that they can and that’s why they depend upon this automatic filtering. But. If they were to go in there and start removing reviews that they didn’t like and whatsoever then they may open themselves up to liability. But, right now, so long as the review complies with their terms of service and it’s filtered using some stupid algorithm that they think is great, then they’ve been able to remain immune to the liability.
MATT: Careful what you say.
NASIR: Luckily, stupid is definitely an opinion. Well, it’s pretty much fact, let’s just say that.
MATT: Fair enough.
NASIR: All right. Well, I think that’s it for today. Nice Wolf of Wall Street tied with Yelp.
NASIR: I didn’t think those would go together but they do.
MATT: All right. Well, keep it sound and keep it smart.