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C.I.C.S. Employment Services, Inc. v. Newport Newspapers, Inc.

Court of Appeals of Oregon

April 11, 2018

C.I.C.S. EMPLOYMENT SERVICES, INC., Plaintiff-Respondent,
v.
NEWPORT NEWSPAPERS, INC., dba Newport News-Times; Rick Beasley; and James Rand, Defendants-Appellants.

          Argued and submitted November 8, 2017.

          Lincoln County Circuit Court 16CV10840; David V. Cramer, Judge pro tempore.

          Judith A. Endejan, Washington, argued the cause for appellants. With her on the briefs was Garvey Schubert B a r er.

          Cody Hoesly argued the cause for respondent. With him on the brief were Larkins Vacura Kayser LLP, Michael R. Seidl, Kelly Fisher, and Seidl Law Offce PC.

          Before Armstrong, Presiding Judge, and Tookey, Judge, and Shorr, Judge.

         Case Summary: Defendants appeal a limited judgment denying as untimely their special motion to strike under ORS 31.150, the anti-SLAPP (Strategic Lawsuit Against Public Participation) statute, that they fled in response to plaintiff's defamation action. Plaintiff brought its defamation action in Multnomah County Circuit Court. Defendants moved to change venue to Lincoln County, and plaintiff stipulated to the change. Once the case moved to Lincoln County, defendants fled their special motion to strike. At that point, more than 60 days had elapsed since plaintiff served defendants with its complaint, in excess of the statutory deadline for anti-SLAPP motions under ORS 31.152(1). The trial court denied defendants' motion as untimely and declined to exercise its discretion under ORS 31.152(1) to consider the untimely motion. On appeal, defendants argue that their anti-SLAPP motion was not untimely because the motion to change venue tolled the fling deadline. In the alternative, defendants argue that the trial court abused its discretion by failing to consider the motion regardless of the late fling. Held: The trial court did not err in denying defendants' [291 Or.App. 317] anti-SLAPP motion. First, the motion was untimely because defendants fled the motion more than 60 days after they were served with the complaint, and the 60-day statutory deadline was not tolled while defendants' venue motion was pending. Second, the trial court did not abuse its discretion when it declined to consider the untimely motion because defendants did not provide either sufficient legal grounds or a factual basis to excuse the untimely fling.

         [291 Or.App. 318] SHORR, J.

         Defendants appeal a limited judgment denying their special motion to strike brought under ORS 31.150, Oregon's Anti-Strategic Lawsuits Against Public Participation (anti-SLAPP) statute, which they filed in response to a defamation action initially filed by plaintiff in Multnomah County Circuit Court. The case was transferred to Lincoln County Circuit Court pursuant to a motion to change venue filed by defendants and stipulated to by plaintiff. Defendants then filed their special motion to strike. The Lincoln County Circuit Court determined that defendants' motion was untimely because it was filed more than 60 days after plaintiff served its complaint on defendants, which was past the statutory deadline. The trial court then declined to exercise its discretion under the statute to consider the motion despite that deficiency. On appeal, defendants argue that the motion was not untimely, but, if it was, the court abused its discretion by denying the motion on that basis. For the reasons stated below, we affirm the ruling denying defendants' anti-SLAPP motion as untimely.

         We state the following background solely as context for understanding defendants' argument on appeal. Plaintiff in this case is C.I.C.S. Employment Services, Inc., a Lincoln City company that provides pre-employment background screening services to employers. Defendants are Newport Newspapers, Inc., dba Newport News-Times, Rick Beasley, a journalist for the paper, and James Rand, the paper's publisher. In 2015, hackers breached a database owned by plaintiff and stole the personal information of over 80, 000 individuals, including over 40, 000 Oregonians. That information was subsequently used to defraud the Internal Revenue Service. In February 2016, Newport News-Times published a story written by Beasley that reported on the breach and IRS fraud. In response, plaintiff filed a complaint in Multnomah County Circuit Court on April 1, 2016, alleging defamation against defendants. Plaintiff alleged that the Newport News-Times article's headline and text gave readers the inaccurate impression that plaintiff was somehow "linked" to the hacking and fraud rather than being the victim of the crime.

         [291 Or.App. 319] Because this appeal concerns whether defendants timely filed their special motion to strike, we recite the relevant dates in some detail. The initial complaint was served on defendant Newport Newspapers, Inc., on April 6, 2016. On April 19, plaintiff filed an amended complaint, which added a second claim for relief for negligent hiring and retention of Beasley. Beasley and Rand were served with the amended complaint on April 26 and May 10 respectively. Newport Newspapers, Inc., accepted service of the amended complaint through its attorney on May 17.

         One month later, on June 17, 2016, defendants filed a motion to change venue to Lincoln County pursuant to ORS 14.080(2) and ORS 14.110(1)(a).[1] Plaintiff eventually stipulated to that motion on July 28 and the trial court entered an order to change venue on August 10.

         On August 31, 2016, defendants filed a special motion to strike plaintiff's claims under the anti-SLAPP statute, ORS 31.150, in Lincoln County Circuit Court. Oregon's anti-SLAPP statute provides a mechanism for "a defendant who is sued over certain actions taken in the public arena to have a questionable case dismissed at an early stage." Yes on 24-367 Committee v. Beaton, 21Clackamas River Water v. Holloway, 261 Or.App. 852, 854 n 1, 322 P.3d 614 (2014). Relevant to this case, the statute allows defendants to move to strike [291 Or.App. 320] nonmeritorious claims that arise out of any "conduct in furtherance of the exercise of * * * the constitutional right of free speech in connection with a public issue or an issue of public interest." ORS 31.150(2)(d). Courts should "liberally" construe the statute "in favor of the exercise of the rights of expression" it protects, enumerated in ORS 31.150(2). ORS 31.152(4). If granted, the motion effectively operates as a motion to dismiss without prejudice under ORCP 21. ORS 31.150(1).

         Oregon's anti-SLAPP statute requires a defendant to file a special motion to strike within 60 days from service of the complaint, although the trial court may exercise its discretion to permit a late filing. See ORS 31.152(1) (stating that the motion "must be filed within 60 days" after service of the complaint "or, in the court's discretion, at any later time"). We have previously explained that "the statute was intended to provide an inexpensive and quick process" to determine if claims that might infringe free speech are frivolous. Page v. Parsons, 249 Or.App. 445, 461, 277 P.3d 609 (2012). That legislative intention "accounts for *** the 60-day time period for the filing of the special motion to strike in ORS 31.152(1)." Horton v. Western Protector Insurance Company, 217 Or.App. 443, 452, 176 P.3d 419 (2008). Here, the Lincoln County Circuit Court denied defendants' motion as untimely because it was filed more than 60 days-in fact, at least 106 days-after the date of service. The trial court also declined to exercise its discretion to permit a late filing. The court gave its decision from the bench, stating that "the deadline should have been followed and I just don't think that there's a legitimate basis not to have done so." After explaining that the court was deciding "the case on the procedural issue" of timing, the court went on to explain that, even if the motion had been timely, it would have denied the motion on the merits. The written order issued by the court similarly reflected, first, that the court was denying defendants' motion as untimely and the court did "not find good cause for the exercise of [its] discretion" to permit a later filing and, second, that the court would have also denied the motion on the merits.

         On appeal, defendants maintain that their motion was timely because Multnomah County was the "wrong [291 Or.App. 321] venue" for the case. As a result, defendants argue that the 60-day deadline was tolled while defendants' motion to change venue was pending and did not begin to run again until the case had been transferred to Lincoln County. Alternatively, defendants argue that, if the ...


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