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In re Anonymous Online Speakers

July 12, 2010

IN RE: ANONYMOUS ONLINE SPEAKERS,
ANONYMOUS ONLINE SPEAKERS, PETITIONER,
v.
UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEVADA RENO, RESPONDENT,
QUIXTAR, INC.; SIGNATURE MANAGEMENT TEAM, LLC; APOLLO WORKS HOLDINGS, INC.; GREEN GEMINI ENTERPRISES, INC.; NORTH STAR SOLUTIONS, INC.; NORTHERN LIGHTS SERVICES, INC.; SUNSET RESOURCES, INC.; SKY SCOPE TEAM, INC., REAL PARTIES IN INTEREST.



Appeal from the United States District Court for the District of Nevada Edward C. Reed, Senior District Judge, Presiding. D.C. No. 3:07-cv-00505-ECR-RAM.

The opinion of the court was delivered by: McKEOWN, Circuit Judge

FOR PUBLICATION

OPINION

Argued and Submitted March 2, 2010 -- Las Vegas, Nevada.

Before: Sidney R. Thomas, M. Margaret McKeown, and Jay S. Bybee, Circuit Judges.

OPINION

The proceeding before us is but a short chapter in an acrimonious and long-running business dispute between Quixtar, Inc. ("Quixtar"), successor to the well-known Amway Corporation, and Signature Management TEAM, LLC ("TEAM"). Quixtar sued TEAM, claiming that TEAM orchestrated an Internet smear campaign via anonymous postings and videos disparaging Quixtar and its business practices. As part of the discovery process, Quixtar sought testimony from Benjamin Dickie, a TEAM employee, regarding the identity of five anonymous online speakers who allegedly made defamatory comments about Quixtar. Dickie refused to identify the anonymous speakers on First Amendment grounds. The district court ordered Dickie to disclose the identity of three of the five speakers.

The Anonymous Online Speakers seek a writ of mandamus directing the district court to vacate its order regarding the identity of the three speakers. Quixtar cross-petitions for a writ of mandamus directing the district court to order Dickie to testify regarding the identity of the anonymous speakers from the remaining two sources. Because neither party has established that it is entitled to the extraordinary remedy of mandamus, we deny both petitions.

BACKGROUND

Quixtar is a multilevel marketing business that distributes consumer products such as cosmetics and nutritional supplements through Independent Business Owners ("IBOs"). TEAM provides business training and support materials and has sold its products, including motivational literature and educational seminars, to Quixtar IBOs. TEAM was founded by two Quixtar IBOs, Orrin Woodward and Chris Brady. As IBOs, their contracts with Quixtar included post-termination non-competition and non-solicitation provisions. Disagreement regarding contract compliance and enforceability came to an impasse in August 2007, when both Woodward and Brady were terminated as IBOs, and they joined a class action against Quixtar.

TEAM and Quixtar became embroiled in several lawsuits across the country. In this suit, Quixtar asserts claims against TEAM for tortious interference with existing contracts and with advantageous business relations, among other claims. The tortious interference claims are premised on Quixtar's contention that TEAM used the Internet to carry out a "smear campaign" with the objective and effect of inducing Quixtar IBOs to terminate their contracts at Quixtar and join a competing multilevel marketing company affiliated with TEAM.

During discovery in this suit, Quixtar took the deposition of Dickie, TEAM's Online Content Manager. Dickie refused to answer questions regarding the identity of certain anonymous online speakers. In response, Quixtar brought a motion to compel Dickie to testify regarding his knowledge of the authors of statements from five different online sources: the "Save Us Dick DeVos" blog, the "Hooded Angry Man" video, the "Q'Reilly" blog, the "Integrity is TEAM" blog, and the "IBO Rebellion" blog. According to Quixtar, statements contained in these five fora support its claims of tortious interference, including comments such as: "Quixtar has regularly, but secretly, acknowledged that its products are overpriced and not sellable"; "Quixtar refused to pay bonuses to IBOs in good standing"; Quixtar "terminated IBOs without due process"; "Quixtar currently suffers from systemic dishonesty"; and "Quixtar is aware of, approves, promotes, and facilitates the systematic noncompliance with the FTC's Amway rules." Quixtar believes that the anonymous speakers of these statements are actually TEAM officers, employees, or agents.

After reviewing the specific statements from each source, the district court ordered Dickie to testify regarding his knowledge of the identity of the anonymous online speakers from three of the sources: "Save Us Dick DeVos," the "Hooded Angry Man" video, and the "Q'Reilly" blog. The Anonymous Online Speakers from those sources filed this petition for a writ of mandamus in an effort to block Dickie's testimony. Quixtar opposes the petition and cross-petitions for a writ of mandamus directing the district court to order Dickie to reveal the speakers from the remaining two sources- "Integrity is TEAM" blog and the "IBO Rebellion" blog.

ANALYSIS

I. ANONYMOUS SPEECH AND THE FIRST ...


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