Illinois Appellate Court Strikes Down Anti-Disparagement Injunction

From Parrot Pointe Marine, Inc. v. Sandow, decided two weeks ago by the Illinois Appellate Court, in an opinion by Justice Thomas Welch joined by Justices Judy Lynn Cates and Milton Wharton; the dispute stemmed out of a marina's eviction of a boat owner, but the trial court also included this in its order:

The Parties shall not engage in any pattern of conduct that involves the making or publishing of written or oral statements or remarks which are disparaging, deleterious or damaging to the integrity, reputation or good will of the other Party.

Unconstitutional, said the appellate court:

[T]he plaintiff indicates that the trial court's prohibition on either party making or publishing any damaging statement against the other was the result of the defendant engaging in a campaign to spread false information about the plaintiff in an effort to deter business…. Although any negative comments against the plaintiff and the plaintiff's business practices might be offensive and could result in loss of business, the interest of an individual being free from public criticism of his business practices does not warrant the use of the court's injunctive power. Thus, we find that the court's prior restraint imposed on the defendant's speech was not the least restrictive means of attaining its goal as the court's injunctive power should not be used to silence criticism of others' business practices.

The court also said that even injunctions against libelous statements are "usually" unconstitutional; but my research suggests that, at least in Illinois, "usually" doesn't mean "always": See, e.g., Allcare, Inc. v. Bork, 531 N.E.2d 1033, 1038 (Ill. App. Ct. 1988) (stating that an injunction can be issued to bar "commercial disparagement" following "a long standing and persistent pattern by defendants of defaming plaintiff or of disparaging its products or services"); see also Reschke v. Lee, No. 2016-L-008399, at 1 (Ill. Cir. Ct. Cook Cty. Aug. 30, 2016) (issuing anti-libel injunction); Kaupert v. Kim, No. 12 CH 28082, at 2 (Ill. Cir. Ct. Cook Cty. Dec. 13, 2012) (same); Houlihan Smith & Co. v. Forte, No. 10 CH 16477 (Ill. Cir. Ct. Cook Cty. Apr. 16, 2010) (same). (See my Anti-Libel Injunctions article for more.)

Comments

[santamonica811]

Eugene,
Imagine a case where the parties agree to this sort of injunction. As part of a settlement, perhaps. I assume that a party can contract away at least some of her rights that she'd otherwise have. (Unless the terms are so objectionable that a court might say, "For social policy reasons, you MAY not contract away this right.")

If I were the defendant in a case, I might be very happy to have the other side say to me, "We'll settle for $1,000,000. Or, we'll settle for $50,000, plus an agreement that you will not talk smack about us for X years." I'm really happy to have this second option. But can a court tell me and the other side that the court simply cannot sanction such a settlement?

Or, if the court allows the agreement, and an appellate court later says, "Nope. That clause is invalid."; what happens to the rest of the settlement? Since it was an essential part of the settlement agreement, I assume that the both sides must be allowed to resurrect the lawsuit, yes? I presume (but am not sure) that it would be a miscarriage of justice to (1) allow for settlement that gives only 5 cents on the dollar, based on a particular extra agreement, (2) later void that extra agreement, but (3) still enforce the finality of the rest of the settlement.