Defamation Suit Over Businessman's Wife Calling Prominent Businesswoman "Prostitute" Dismissed

"No one likes being called names. But not every alleged insult gives rise to a lawsuit in federal court. Especially where Ms. Mai has alleged that she is so important as to be a public figure, yet failed to allege Ms. Elsaden made her allegedly defamatory statement with actual malice."

From today's decision by Judge Charlotte Sweeney in Mai v. Elsaden (D. Colo.):

This case begins with a conversation. Plaintiff Tiffany Mai alleges that on Friday, July 5, 2024, Defendant Laura Elsaden—without provocation—described Ms. Mai as a prostitute to partygoers at a dance. This description, Ms. Mai alleges, is wrong and has caused her approximately $50,000,000 in damages.

The court concluded that Mai was a public figure:

Ms. Mai alleges the following throughout her complaint:

• She is an "award-winning businesswoman and philanthropist who has achieved considerable success as the owner of multiple insurance agencies in Colorado and California and is the founder of several entrepreneurial ventures;"
• She has "prominence in business and social circles;"
• She, along with her husband, run the "prestigious C Lazy U Ranch," that is "known for its elite membership and guests from around the world," and the Ranch is "valued at over $7.9 million;"
• Mai maintains the Ranch to "cultivate and maintain business relationships;"
• The Ranch is a "premier, luxury dude ranch for discerning travelers and guests;"
• Guests visit the Ranch "from all over the world, including top businesspeople and people of means from both the United States and abroad."

These allegations show Ms. Mai is a person who has "assumed a role of especial prominence in the affairs of society." And not only has Ms. Mai allegedly assumed this prominent role in American society—she has done so globally. These allegations underscore the extent to which Ms. Mai "occup[ies]" a "position[] of such persuasive power and influence" as to be a "public figure for all purposes," and bely Ms. Mai's argument that there is only a "small number" of Ranch community members. Particularly where the "elite" guests for the "prestigious" and "luxury" C Lazy U Ranch come from "around the world" and arrive for business purposes, and Ms. Mai operates the Ranch to maintain "business relationships" rather than for purely recreational or personal purposes.

The court also concluded that, given Mai's public figure status, it didn't matter under Colorado law whether the allegations were matters of public concern. (The court cited Seible v. Denver Post Corp. (Colo. App. 1989), which states that "publications which concern either a public figure or a matter of public concern are constitutionally protected, and a showing of actual malice is necessary to defeat the protection and make a defamatory publication actionable.") The court then went on to concluded that Mai hadn't adequately alleged that Elsaden knew her allegations were false or acted with reckless regard of that (the legal meaning of the confusing phrase "actual malice"):

[A]t most Ms. Mai has advanced conclusory allegations that Ms. Elsaden's statement was malicious. Reading the Complaint in its entirety, Ms. Mai has not pleaded facts showing Ms. Elsaden made her statement with either actual knowledge it was false or reckless disregard as to whether it was true.

And the court concluded with the quote I excerpted in the subtitle to this post:

No one likes being called names. But not every alleged insult gives rise to a lawsuit in federal court. Especially where Ms. Mai has alleged that she is so important as to be a public figure, yet failed to allege Ms. Elsaden made her allegedly defamatory statement with actual malice.

Mai's husband's defamation lawsuit against Elsaden, based on related claims against him made the same day, remain pending. [UPDATE 5/20/2025 12:19 pm: Less than two hours ago, the court denied Elsaden's motion to dismiss in the husband's case, so it is proceeding at least to the motion for summary judgment.]

Comments

[John F. Carr]

I've seen calls for limiting the public figure exception so it doesn't apply to this type of case. The plaintiff is apparently just a socialite, not a government official or person driving government policy.

[David Nieporent]

We see this sort of legal incompetence — perhaps outright malpractice — all too often in which a lawyer files a defamation suit bragging about how famous and important and powerful his client is, but then doesn't plead actual malice.

I assume the former is fanservice for the client; the client doesn't want to read a dry complaint that merely charges defamation and pleads the elements, but rather wants a flowery description of how wonderful the client is and how evil and terribly damaging the defendant's conduct is. But the lawyer needs to tell the client, "No."

(Obviously if the client is a public figure, then by the end of the case s/he should have to prove actual malice — but first put the burden on the defendant to demonstrate public figure status instead of conceding the point at the outset!)

[Drewski]

I think you're kind of talking out of your ass as to the general case. The purpose of puffing up the client is to set the groundwork for a big award. You need to show lots of damages. Failing to plead actual malice isn't malpractice by any means since you can just amend the complaint.

Not going to bat for this lawyer, who seems to be struggling.

[Martinned2]

So the conclusion here is that the defendant might well have sincerely believed that the plaintiff was a prostitute? Otherwise, what's the point of this entire exercise?

[Stupid Government Tricks]

Ms Mai got her panties in a twist and went full retard when she should have just made some joke about the defendant's husband being her last client.

[TheAmazingEmu]

It does seem difficult in a case like this to allege lack of actual malice without conclusory language. If you put, "defendant had no reason to believe plaintiff was a prostitute," is that conclusory? What about "defendant knew the statement against plaintiff was false"? At some point, it seems like discovery - where you can ask the plaintiff to state any facts that led them to believe the statement was true - would be appropriate.

[Stupid Government Tricks]

The judge should have told Ms Mai to either prove the actual malice or grow a thicker skin.