C.A. Upholds Ruling That Suit Against Sen. Clinton Was SLAPP

Wednesday, October 17, 2007

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C.A. Upholds Ruling That Suit Against Sen. Clinton Was SLAPP

From Staff and Wire Service Reports

Claims that Democratic presidential frontrunner Sen. Hillary Clinton, D-N.Y., tried to subvert campaign fundraising laws were properly thrown out under the anti-SLAPP statute, the Court of Appeal for this district ruled yesterday.

Peter F. Paul’s contention that the senator was engaged in a conspiracy to avoid reporting nearly $2 million to Clinton’s successful 2000 campaign in New York, as part of which he was induced to make the donations by promises of a future business relationship with former President Bill Clinton, which never materialized, was supported by “insufficient circumstantial evidence for Paul to carry even the minimal burden on a special motion to strike,” Presiding Justice Dennis Perluss wrote in an unpublished opinion.

The former president was originally named as a defendant in the case, but was dismissed on demurrer.

Judicial Watch Replaced

Paul is a businessman and former associate of comic book illustrator Stan Lee. He was originally represented by Judicial Watch, but his counsel in the latest proceedings are affiliated with another conservative advocacy group, the U.S. Justice Foundation, which is based in San Diego County.

Paul claims he spent more than $1.9 million to underwrite the lavish Hollywood fundraising gala in August 2000 that attracted Brad Pitt, Diana Ross and Cher.

Paul said he financed the event and other fundraisers because Bill Clinton agreed to join the board of his company, Stan Lee Media, after he left the White House. Paul has said the event cost nearly $2 million, but campaign reports at the time estimate it was about $500,000.

The Hollywood fundraiser was the subject of a criminal trial of Hillary Clinton’s former national finance director, David Rosen, who was acquitted in May 2005 of lying to the Federal Elections Commission about the event. Rosen was also a defendant in the case, but his anti-SLAPP motion, like Clinton’s, was granted by Los Angeles Superior Court Judge Aurelio Munoz, and that ruling was previously upheld by the Court of Appeal.

Deposition Denied

Munoz also denied Paul’s motion for leave to take Hillary Clinton’s deposition with respect to the issues raised by the anti-SLAPP motion, a ruling that was also upheld by the Court of Appeal.

Paul said he may seek review in the state’s highest court.

“It doesn’t matter to me whether she’s a defendant,” Paul said. “What counts is getting Hillary Clinton under oath.”

The case has had an interesting procedural history.

It was originally assigned to Judge Ernest Hiroshige, but Paul’s attorneys filed an affidavit of prejudice under Code of Civil Procedure Sec. 170.6. Hiroshige is an appointee of Jerry Brown and a longtime member of the Japanese-American Democratic Club.

The case was reassigned to Judge David Workman—who has since retired—who was a member of the Los Angeles County Republican Central Committee for six years prior to his election to the bench in 1980. But Workman was “papered” by attorneys for Rosen.

The case then went to Munoz, a Democrat and Brown appointee, who originally dismissed it under the fugitive disentitlement doctrine because Paul was fighting extradition from Brazil on charges of manipulating the price of Stan Lee Media Inc. stock.

Paul was later extradited and refiled the suit. He pled guilty to the securities charge two years ago.

Munoz had originally denied Clinton’s motion on the ground that it was not heard within the 30-day limit then imposed by the statute. The Court of Appeal reversed, saying the motion may have been timely and that even if it was not, the judge had discretion to hear it on its merits, leading to his ruling in favor of Clinton and her committee in April of last year.

Paul’s attorneys argued that Hillary Clinton broke federal campaign finance laws, and was thus not entitled to the protection of the anti-SLAPP law, because she helped plan the Hollywood fundraiser. That involvement alleged made Paul’s campaign contributions “hard money” far exceeding the $2,000 limit a person could give under federal law at the time.

But Perluss called that argument “fatally flawed,” and noted a FEC audit found that neither Clinton nor her Senate campaign accepted any illegal funds in connection with the Hollywood fundraiser.

“In fact, the record as presented to us strongly suggests Senator Clinton’s and Clinton for Senate’s conduct was perfectly legal,” he wrote.