Tide Turns for Targets of SLAPP Lawsuits : Courts: People named in public participation actions are fighting back by charging developers, property owners and others with malicious prosecution.

The three Kern County farmers who took out a newspaper advertisement favoring a controversial water project were stunned when they were suddenly hit with a libel suit by a powerful grower opposing the plan.

The farmers later found they were targets of a SLAPP--short for Strategic Lawsuit Against Public Participation--a device critics say is used to stifle free speech through intimidation. Hundreds of such suits have been filed in recent years against activists and ordinary citizens who spoke out against developers, property owners and other interests.

But now the tide seems to be turning: targeted individuals and groups are retaliating with so-called SLAPP-back suits--and racking up impressive court victories, particularly in SLAPP-happy California, a hotbed of such suits and countersuits.

The Kern farmers fought back against the J.B. Boswell Co., winning a $13.5-million jury verdict for malicious prosecution against the agribusiness giant that had unsuccessfully sued them during the bitter 1982 campaign over the proposed Peripheral Canal.

“Here was this million-dollar corporation suing us into silence over an $8,000 ad we put in the paper,” said Jeff Thomson, a 43-year-old alfalfa, grapes and garlic grower. “They were going after all we had--our farms and our homes. . . . We determined we had to take an offensive approach to that kind of treatment.”

In other SLAPP-back cases, a Sacramento lawyer won a $5.2-million verdict against Shell Oil Co. after the firm sued him for alleging its plastic pipe posed potential health hazards. And a Santa Clara County environmental activist, sued in a controversy over a proposed development, hit back and received a $260,000 verdict against the developer--more than one-third the firm’s net worth.

On other fronts, a state Court of Appeal recently removed a significant legal obstacle to SLAPP-backs that will make it far easier to bring malicious prosecution suits. In Sacramento, the state Senate recently approved a bill sponsored by Sen. Bill Lockyer (D-Hayward) that would make it harder to bring SLAPPs in the first place.

“People are starting to see SLAPPs for what they really are,” said University of Denver sociology professor Penelope Canan, who with law professor George W. Pring has made a nationwide study of the phenomenon and coined the acronym SLAPP. “They are going to court and finding that juries are willing to grant some very large damage awards for the loss of their political rights.”

However, those on the losing side in such disputes--who deny their cases were not validly brought--say that the anti-SLAPP campaign could itself intrude on important legal rights. The court ruling easing the way for malicious prosecution suits could deter businesses and others from going to court with legitimate grievances because of the threat of big jury awards, they warn.

“What chance really does a big corporation have against a family farmer . . . or a humongous developer against an environmentalist?” asked William H. Gavin III of San Jose, an attorney defending a developer in a SLAPP-back case. “The plaintiffs will have a field day.”

Spokesmen for developers say the SLAPP phenomenon is exaggerated, adding that the suits that are filed often reflect builders’ frustration with the ability of anti-growth forces to block developments with time-consuming environmental challenges.

“This is a very glamorous media issue,” said Richard J. Lyon, legislative advocate for the California Building Industry Assn. “It feeds the stereotype of David versus Goliath . . . but the problem that exists out there is comparatively very small, given the total development of our state.”

SLAPPs are relatively new arrivals on the legal scene. Pring and Canan, studying the phenomenon since 1984 under a National Science Foundation grant, have counted more than 400 cases nationwide in which a variety of citizen activists have been sued after they testified at public hearings, campaigned for or against ballot measures, circulated petitions or otherwise exercised well-established constitutional rights. About 14% of the cases studied originated in California.

The suits typically charge defamation, interference with business, conspiracy or other offenses on the part of the activists. Such cases now last an average of nearly three years and seek damages of more than $9 million. More than 80% of the SLAPPs are dropped or won by the defendant.

But, as the two scholars point out, even in “winning,” defendants must endure the cost and anxiety of a lawsuit--and often are forced to curtail, or cease, their political activities. People who would support their causes have second thoughts, fearing their own potential liability. Thus, the SLAPP succeeds, even if it loses in court.

The Kern farmers find themselves still fighting with the Boswell Co., nine years after the original suit was brought, with the two older farmers now pushing 70. “To this day, that suit has chilled them from getting involved in any political activity ever again,” said John M. Means, an attorney for the farmers.

In SLAPP-back actions, people who have been defendants are increasingly returning to court as plaintiffs, filing counter actions for malicious prosecution, civil rights violations and other injuries against the parties who sued them.

“The people who suddenly got hit with these multimillion-dollar lawsuits had never seen or heard of anything like it,” said Joseph W. Cotchett, a Burlingame lawyer who represents SLAPP targets. “It wasn’t until recently that they realized the true purpose of the suits was just to get environmentalists off the backs of developers. They got indignant and started to file SLAPP-back suits.”

“People are fed up with having their constitutional rights abridged and attempts to clobber them financially,” observed Phillip S. Berry of Oakland, who as the Sierra Club’s vice president for legal affairs has defended the group against several SLAPPs. “At bottom what’s involved is the right to free speech, assembly and petition the government for redress of grievances.”

The result of this new activity has been some notable victories by SLAPP-back forces:

- In the Kern County case, Jeff Thomson, his father, Jack Thomson, and Ken Wegis retaliated with their own suit after they were SLAPPed with a suit by Boswell that was dismissed. The firm had contended that the farmers’ ad, in questioning Boswell’s opposition to the canal, had wrongly accused the firm of trying to gain a monopoly on cotton growing in the area. A jury, in the largest SLAPP-back judgment to date, ruled in 1988 that Boswell was liable for $3 million in general damages and $10.5 million in punitive damages. The case is before a state Court of Appeal in Fresno.

- Raymond J. Leonardi, an attorney for a group of plumbing and pipe fitters, was sued for libel by Shell Oil Co. after he raised health questions about a plastic pipe it marketed. Laboratory tests showed the pipe contained cancer-causing substances. Shell’s suit was dismissed but Leonardi countersued and won a jury award of $175,000 general damages, $22,000 for lawyers’ fees and $5 million in punitive damages. The firm appealed the ruling. Last year, the state Supreme Court refused to hear the case, allowing the verdict to stand.

- Victor Monia, a Santa Clara County business executive who headed a local environmental group, and several others were sued for $40 million by Parnas Corp., a San Francisco developer, during a controversy over a proposed hillside development in Saratoga. The developer alleged libel in a political flier circulated by the environmentalists that tied the firm to allegedly questionable dealings with a local official. The suit was dismissed, then Monia SLAPPed back, winning a $260,000 damage award against the developer for malicious prosecution. The award was upheld in February by a state Court of Appeal.

Professor Pring sees SLAPP-backs as the most effective deterrent to meritless suits that try to silence legitimate political activity. “Hitting people who exercise their rights with a multimillion-dollar lawsuit is turning out to be a mistake--a very big mistake,” he said.

Meanwhile, other significant SLAPP-back cases are pending in state trial courts:

- Frederick Sylvester, a professional climber and former movie stuntman, was sued along with some other Lake Tahoe residents for $75 million by the Perini Land & Development Corp. over their opposition to a resort complex. The firm said Sylvester caused delays in the project by inducing other people to back out of an agreement not to oppose the resort in return for the firm’s promise to improve water-quality safeguards. Perini then dropped the suit; Sylvester has countersued.

- In a related case, the Sierra Club, which also had been sued by Perini, has filed a SLAPP-back suit against the developer for what the conservationist group claims was an improper attempt to squelch opposition to the project. The club is seeking $10 million in general and special damages and another $70 million in punitive damages.

Attorneys on both sides of such disputes are keeping close watch on the state Supreme Court to see whether the justices decide to review the ruling made by the Court of Appeal in the suit environmentalist Monia brought against Parnas Corp.

The appellate panel upheld a jury finding that Parnas had filed the libel suit without a “reasonable” belief the case was valid. Even relying on its previous lawyer’s advice in bringing the suit was no defense against a subsequent charge of malicious prosecution, the court said.

In its bid for review by the state high court, Gavin, who is Parnas’ appeals lawyer, argued that a different standard should apply. A malicious prosecution suit should not be allowed unless the underlying suit was “totally devoid of merit.”

Also awaited anxiously is further legislative action on Lockyer’s proposal to make it more difficult to bring SLAPPs in court. Under the measure, suits against people speaking out on public issues would be barred unless the plaintiff could show there was a “substantial probability” of winning the case.

Former Gov. George Deukmejian vetoed a similar measure last year, saying that judges are already empowered to fine parties who file “frivolous” lawsuits.