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First Amendment Limits Media Liability for Inducing Breach of Nondisclosure Agreement

So holds a (nonprecedential) California Court of Appeal decision in the Jenni Rivera heirs vs. Univision case, though the decision is narrowly tied to these particular facts.


From yesterday's opinion by Judge John Segal in Jenni Rivera Enterps., LLC v. Latin World Entm't Holdings, Inc.:

These appeals arise from a dispute concerning a television production based on the life of the Mexican-American celebrity Jenni Rivera, who died in a plane crash in December 2012. The entity that controls most of Rivera's assets, Jenni Rivera Enterprises, LLC (JRE), entered into a nondisclosure agreement with Rivera's former manager, Pete Salgado, that restricted his disclosure and use of certain personal information about Rivera and her family. Alleging Salgado breached that agreement by disclosing information to the producers and the broadcaster of a television series based on Rivera's life, JRE sued Salgado and the program's producers for breach of contract, interference with contract, and inducing breach of contract. JRE also sued the program's broadcaster for interference with contract and inducing breach of contract….

The court concluded that the plaintiffs' claim against Univision Network & Studios for tortiously inducing Salgado to breach his contract were viable as a matter of California law, but were preempted by the First Amendment, given that "Univision had no knowledge of the nondisclosure agreement at the time it entered into the license agreement with BTF [the producers of the series about Rivera]," and that all Univision did after learning of the agreement appeared to "consist[] of continuing to pay license fees to BTF and promoting Salgado's involvement with the Series":

"While refusing to recognize a broad privilege in newsgathering against application of generally applicable laws, the United States Supreme Court has also observed that 'without some protection for seeking out the news, freedom of the press could be eviscerated.'" The United States Supreme Court has consistently limited the press's newsgathering privilege, however, to circumstances in which the press "lawfully obtains truthful information about a matter of public significance." …

Courts determine whether the media obtained information lawfully by considering whether the media obtained the information by "routine reporting techniques" or "traditional means of news-gathering." … "At one extreme, "'routine … reporting techniques,'" such as asking questions of people with information ("including those with confidential or restricted information") could rarely, if ever, be deemed an actionable intrusion…. At the other extreme, violation of well-established legal areas of physical or sensory privacy—trespass into a home or tapping a personal telephone line, for example—could rarely, if ever, be justified by a reporter's need to get the story. Such acts would be deemed highly offensive even if the information sought was of weighty public concern; they would also be outside any protection the Constitution provides to newsgathering." … [T]he "First Amendment is not a license to trespass, to steal, or to intrude by electronic means into the precincts of another's home or office" ….

California courts have not determined where intentionally interfering with a nondisclosure agreement falls on this continuum. Cases from other jurisdictions involving a First Amendment defense to claims against media for intentional interference with contract or economic relations have rejected those claims. (See, e.g., Seminole Tribe of Florida v. Times Pub. Co., Inc. (Fla.Dist.Ct.App. 2001) 780 So.2d 310, 318 [under Florida law, a plaintiff tribe failed to show reporters had an improper motive to interfere with the tribe's relationship with its employees by using routine news gathering techniques to obtain and publish truthful but confidential information about the tribe's casino operations]; see also Huggins v. Povitch (N.Y.Sup.Ct., Apr. 19, 1996, No. 131164) 1996 WL 515498; Dulgarian v. Stone (1995) 420 Mass. 843, 852; but see Falwell v. Penthouse Intern., Ltd. (W.D.Va. 1981) 521 F.Supp. 1204, 1209 [suggesting in dicta that a publisher could be liable for inducing freelance writers "to violate the terms under which [an] interview was granted"].) …

We need not decide the broad question whether the torts of inducing a breach of contract and interfering with a contract are "independent torts" such that the First Amendment can never provide a defense to such claims when they arise from conduct that leads to the publication or broadcast of truthful and newsworthy information.

Here, it is uncontroverted Univision had no knowledge of the nondisclosure agreement at the time it entered into the license agreement with BTF. The evidence of Univision's actions, after it learned of the nondisclosure agreement, that arguably contributed to Salgado's continued breaches of the agreement consisted of continuing to pay license fees to BTF and promoting Salgado's involvement with the Series.

Even if those actions were sufficient to serve as the basis of liability for tortious interference, they are not sufficiently "wrongful" or "unlawful" to overcome the First Amendment newsgathering and broadcast privileges. Therefore, the First Amendment protected Univision's use and broadcast of the Series….