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SLAPP Lawsuits: First Amendment Threats

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Early in 1999 Life Partners, Inc. filed a SLAPP suit against me in state court in Waco, Texas, charging me with defamation. I learned about it when a Waco reporter phoned. He asked how I felt about being sued for $3 million. I told him if ever I'm worth $1 million, I would give a party and invite the world.

I was not served.

Days passed. Weeks passed. I was not served. Early in February a friend contacted the court to order a copy of the complaint for me. He was instructed to send a written request with credit card information. He did. The complaint was not sent.

On March 5,1999 a summons and complaint were delivered by certified mail to my business address in Laguna Hills, California. The complaint stated "defamation" and nothing else. Not one word described what was alleged as defamatory. Not one word attempted to establish jurisdiction in Texas. At that time, I was a neophyte about law, about jurisdiction, about SLAPP lawsuits. I began to search for a lawyer.

Unknown to me, Pardo had gone to his favorite court and favorite judge, an elderly man known to be hard-of-hearing, and filed a default action. The hearing was held on April Fool's Day, 1999. Intentional?

Pardo and LPI were represented by Scott Peden, an attorney, general counsel, and president of LPI. Much later I received a copy of the transcript--a gift from an attorney I assisted pro bono. I laughed so much while reading it my dogs became excited, thinking it was play time.

I laughed to realize everything I ever heard about Texas courts was true. Hearsay is allowed (among other things). Pardo testified that my first book--the one with the chapter about him--defamed him. He admitted he never read a word and never saw a copy of the book. He was told by others.

Pardo testified as an expert. Peden asked the judge if he should qualify Pardo as an expert. The judge said, "No." He said no because, he explained, "I don't know anything about this, upside to downside." That was the start of my legal-inspired hysteria.

The judge "found" Wolk "displayed no expertise in the field of viatical settlements through either of her books" or the web site. Never mind that I was never given opportunity to display anything. And LPI's favorite state court judge opined that the allegations of plaintiff's complaint were admitted. All this, and the judgment, were based on the default hearing. Does "kangaroo court" come to mind?

The hearing concluded with the judge's ruling. Among the damages: Five thousand in attorney fees; actual damages of $1.5 million with post-judgment interest at the rate of ten percent per annum until paid; punitive and exemplary damages of $1.5 million with the same interest.

Additionally, I was ordered to turn over to Pardo every undistributed copy of both books and remove from my web site all statements to which he objected. This order extended to everyone affiliated with me. Amazon? Barnes and Noble? Pardo also asked the court to confiscate all my books that were in libraries or stored at my home. That request was denied. The judge thought it would be difficult to get California to permit them to invade my home, and it would be difficult to confiscate library books.

I did get an attorney. He did get the default reversed. The judge ordered a new trial and the plaintiff was ordered to amend the allegations: "enumerate in quotations each and every statement it contends Defendant made that is defamatory and, in addition, identify the specific source of each such statement." The amended complaint, filed July 13, 1999, asked for $5 million in damages. It quoted out of context a number of phrases and misrepresented other statements.

My attorney, Britton D. Monts of Dallas, Texas, was denied a special appearance. Monts appealed. He wanted to challenge jurisdiction--I had not visited Texas in more than twenty years, I did not direct my web site or book sales to Texas, etc. LPI cross-appealed, ostensibly to prevent a new trial.

Monts contacted LPI's counsel by phone and by mail, citing relevant case law and statutory authority to demonstrate conclusively the lack of jurisdictional basis for LPI's appeal. When LPI refused to dismiss its appeal, Monts filed a motion to dismiss the cross-appeal. Under Texas law orders granting new trials are interlocutory orders that cannot be appealed. Monts also sought sanctions--five hundred dollars in attorney fees--for LPI's frivolous appeal. On June 23, 1999 the appellate court denied LPI's appeal, granted Mont's motions to dismiss--but denied sanctions.

Monts dismissed his own appeal and did not challenge jurisdiction. My web site did reach Texas and, although my books were not sold in Texas they could be ordered for delivery in Texas--which is exactly the way LPI obtained a copy, according to the sales slip they introduced as evidence. Moreover, in 1999 there was little case law related to the internet. On the basis of this, I worried that LPI might file subsequent lawsuits against me, one after another, in the remaining forty-nine states, or anywhere in Europe or Asia.

The lawsuit displayed other hallmarks of SLAPP lawsuits--any tactic to run up the costs of defense. When finally the case settled, LPI insisted on a confidentiality clause. That taught me another lesson. I learned never to agree to confidentiality. Since that time LPI has violated that clause but I am silenced. They can choose to misrepresent the terms but if I attempt to address this, they will sue me. They know I cannot afford to sue them.

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Consumer advocate and author of books that exposed fraud in the viatical & life settlements industry, Wolk's primary interest now is preventing wrongful convictions (see www.AccidentalFelon.net/Michaels-story ).

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Protect your right to speak out without being sued... by Gloria Grening Wolk on Monday, Dec 26, 2011 at 10:45:39 AM