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Metabolic Research v. Scott J. Ferrell; Michael

February 9, 2012

METABOLIC RESEARCH, INC., PLAINTIFF-APPELLEE,
v.
SCOTT J. FERRELL; MICHAEL A. PAL CAMPOS; THOMAS HESS; SARA JORDAN, DEFENDANTS-APPELLANTS.



Appeal from the United States District Court for the District of Nevada James C. Mahan, District Judge, Presiding D.C. No. 2:09-cv-02453-JCM-PAL

The opinion of the court was delivered by: Singleton, District Judge:

FOR PUBLICATION

OPINION

Argued and Submitted June 17, 2011-San Francisco, California

Before: Jay S. Bybee and Mary H. Murguia, Circuit Judges, and James K. Singleton, Senior District Judge.*fn1

Opinion by Judge Singleton

OPINION

In this decision, we determine whether an order denying a pretrial special motion to dismiss under Nevada's anti-SLAPP statute,*fn2 Nev. Rev. Stat. §§ 41.635-670, is immediately appealable under the collateral order doctrine first recognized in Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 546-47 (1949). We previously considered related issues under Oregon law in Englert v. MacDonell, 551 F.3d 1099, 1103-07 (9th Cir. 2009), and California law in Batzel v. Smith, 333 F.3d 1018, 1025-26 (9th Cir. 2003). We find that Nevada's statute is similar to Oregon's, and dismiss the appeal for lack of jurisdiction.

I. FACTUAL AND PROCEDURAL HISTORY

On October 20, 2009, Scott J. Ferrell, an attorney practicing law in Orange County California, sent "demand letters" to Metabolic Research, Inc. ("Metabolic"), at its address in Las Vegas, Nevada, and to General Nutrition Centers, Inc. ("GNC"), at its address in Pittsburgh, Pennsylvania. The demand letters purported to notify the recipients that they had violated California Civil Code §§ 1750-1756, the California Consumer Legal Remedies Act ("CLRA"), by falsely advertising the properties and potential benefits of a product named Stemulite, which they marketed as a natural fitness supplement. Ferrell represented that he was acting on behalf of Michael Campos, Thomas Hess, and Sarah Jordan, all of whom he alleged purchased Stemulite in California, in reliance on the supposed false advertising, and had not received the purported benefits. Ferrell further claimed that he was acting on behalf of a purported class of similarly-situated persons. In this decision, Ferrell, his clients, and his prospective clients will be collectively referred to as "Ferrell," unless otherwise indicated.

In his demand letters, Ferrell set out what he contended were representative false claims and summarized what he contended constituted violations of the CLRA. Ferrell demanded that Metabolic and GNC cease their false advertising of Stemulite, identify all consumers who purchased Stemulite within the applicable limitations period, and provide each of these consumers with an appropriate refund. In addition, Ferrell demanded that Metabolic and GNC disgorge all revenues from sales of Stemulite for consumers who could not be identified and implement "an appropriate corrective advertising campaign," including a labeling "disclaimer."

Ferrell concluded the letters with an offer to compromise and allowed Metabolic and GNC thirty days from the date of his letters to agree to an injunction "that include[d] an appropriate disclaimer" in which case, Ferrell agreed to take no further action, except to enforce the injunction. However, if Metabolic and GNC chose not to accept the offer, Ferrell stated that he would file a lawsuit (presumably in California) and seek all available relief.*fn3

On November 19, 2009, Metabolic filed a lawsuit in Nevada State Court against Ferrell, his putative class action plaintiffs, and various "Does," all identified as California residents, charging extortion. See Nev. Rev. Stat. § 207.470 (allowing treble damages for racketeering in aid of extortion).*fn4

Metabolic's complaint further charged racketeering based upon multiple publications of the demand letter (to Metabolic, to GNC and to GNC principals), conspiracy to engage in racketeering, civil extortion, tortious interference with contract, and tortious interference with prospective economic relations, i.e., interfering with the agreement between Metabolic and GNC. Metabolic sought declaratory relief and punitive damages. Metabolic's lawsuit directly referenced Ferrell's demand letter, which Metabolic characterized as an accusation of mail fraud, in violation of 18 U.S.C. ยงยง 1341, 1343. Metabolic, in apparent anticipation of an anti-SLAPP motion by Ferrell, expressly relied upon Flatley v. Mauro, which Metabolic ...


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