Summary of a Recent
Judicial Development in
Animal Feeding Operations

Anti-SLAPP Counterclaim Damage Award Overturned
Due to Plain Error Committed by Trial Court

Eric H. Foy,
National AgLaw Center Research Associate

Summary of Decision

In Sand Livestock Systems, Inc. v. Svoboda, 756 N.W. 2d 299 (Neb. Ct. App. 2008), the Nebraska Court of Appeals affirmed the trial court's judgment which ruled against a livestock company and others on their defamation suit, but reversed and remanded an award of damages by the trial court pursuant to environmentalist group defendants' anti-SLAPP (strategic lawsuit against public participation) counterclaim. The Court of Appeals held that the trial court committed plain error by allowing the jury to determine whether the livestock company had a substantial basis in fact and law to commence or continue the defamation suit-a question of law.

Background

The livestock company, in the business of constructing hog confinement facilities, filed suit in district court against an environmentalist group for causes of action sounding in libel and false light invasion of privacy. Id. at 305-06. The allegations stemmed from allegedly false and defamatory statements contained in the defendants' letter to the Nebraska Department of Environmental Quality (DEQ). Id. at 306. The defendants answered and brought a counterclaim alleging that livestock company violated Nebraska's statutory provisions concerning strategic lawsuits against public participation (SLAPP), Nebraska Revised Statute §§ 25-21, 241 to 25-21, 246. Id. As the basis for their counterclaim, the defendants asserted that the defamation suit was filed to harass, intimidate, punish, and maliciously inhibit the free exercise of the defendants' right to petition the issuance of a permit to construct a livestock waste control facility. Id. at 307.

Arguments

On appeal, the livestock company asserted that: (1) the jury's verdict was not supported by the evidence; (2) the district court's instruction of the jury concerning the anti-SLAPP counterclaim constituted plain error; (3) the jury's award of damages pursuant to the counterclaim was not supported by the evidence; (4) the district court's erred in its refusal to grant a new trial; and, (5) the district court should have granted the livestock company's motion for remittitur. Id. at 309-10.

Analysis and Holdings

The court's analysis focused on whether the trial court committed plain error in connection with the submission of the counterclaim to the jury. Id. at 314. To answer this question, the court first addressed whether the jury should have determined if the livestock company had a substantial basis in fact and law to commence or continue its defamation suit. Id. at 314-15. Because this was a question of first impression, the court looked for guidance from Nebraska's case law concerning malicious prosecution. Id. at 316. The Nebraska Supreme Court, in Jones v. Brockman, 190 Neb. 15, 205 N.W.2d 657 (1973), determined that the existence of probable cause in a malicious prosecution case was a question of law for the court to decide and not a question of fact for the jury. Id. at 317. Applying the Jones holding to the instant case, the court determined that the question of whether the livestock company had a substantial basis in fact and law to commence or continue the defamation suit was a task beyond the responsibilities of a lay jury, and there was a significant danger that jurors may not appreciate the distinction between an unsuccessful and a legally untenable claim. Id. at 318. For those reasons, the court concluded the trial court committed plain error by allowing the jury to determine whether the livestock company had a substantial basis in fact and law to commence or continue the defamation suit. Id. at 318-19.

The case was decided on September 16, 2008.