Can The Class Action Lawsuit Against Lance Armstrong Actually Work?

Posted by Mike Laszlo on January 26, 2013

The Lance Armstrong saga continues (we've written on Lance HERE, HERE, HERE)... this week saw a class action lawsuit filed against Lance Armstrong and various publishers on behalf of California consumers who claim they were misled by Defendants' statements and purchased Defendant Armstrong's books based upon the false belief that they were true and honest works of nonfiction.

When I first heard about the class action, I immediately thought "Are you kidding me?  Sure, we'd all like to sue Oliver Stone for subjecting us to JFK in 10th grade history class but this? ... come on."

SO, is this class action against Lance Armstrong legit? Actually, it might be.

Stutzman, et al v Lance Armstrong, et al, filed January 22, 2013 in the US District Court for the Eastern District of California, alleges Lance Armstrong et al, made multiple misrepresentations contained in Lance Armstrong's books, IT'S NOT ABOUT THE BIKE: My JOURNEY BACK TO LIFE and EVERY SECOND COUNTS, and advertisements and marketing for the books (including the front and back cover and flyleafs media press kits, during television and newspaper interviews, on Internet websites and at personal appearances made by Armstrong) as true and honest works of nonfiction when, in fact, Defendants knew or should have known that these books were works of fiction. Further, the lawsuit claims Lance Armstrong et al advertised marketed and sold these books as a works of nonfiction.

The Plaintiffs allege they were misled by Lance Armstrong's and the other Defendants' statements and purchased Lance Armstrong's books based upon the false belief that they were true and honest works of nonfiction. In their 59-page Complaint, Plaintiffs cite to the exhaustive and growing body of evidence and recent admissions by Lance Armstrong himself to support the allegations of misrepresentation and fraud regarding Lance Armstrong’s use of banned substances (EPO, blood doping, testosterone) during his professional cycling career.

Knowing that the mere claim that his success was due to superior physical training, proper diet and an extraordinary spirit and drive to succeed was not enough to quell suspicions and rumors that he doped, Defendant Armstrong wrote lengthy passages in IT'S NOT ABOUT THE BIKE: My JOURNEY BACK TO LIFE that were intended to convince readers and consumers - including Plaintiffs and the members of the Class - that the rumors of Armstrong's doping were unfair and untrue because of the extensive drug-testing regime employed by the DCI and the organizers of the Tour de France... Complaint ¶ 20

In order to survive a motion to dismiss, the Plaintiffs will have to overcome the pleading requirements of Federal Rule of Civil Procedure 9(b) which requires state-law claims grounded in fraud to be plead with particularity and requires a plaintiff to plead with particularity the circumstances constituting the fraud while malice, intent, knowledge, and other conditions of a person's mind may be alleged generally. “Averments of fraud must be accompanied by the ‘who, what, when, where, and how’ of the misconduct charged.” Yess v. Ciba–Geigy Corp. USA; Villegas v. Wells Fargo Bank, N.A. (N.D. Cal. Sept. 17, 2012).

The Complaint almost certainly meets Rule 9(b)’s requirements as to Lance Armstrong. As to the other named Defendants however, the Plaintiffs may not get so far. This lawsuit was brought in a Federal Court in the Eastern District of California – a court within the jurisdiction of the 9th Circuit. The United States Court of Appeals for the 9th Circuit has held that a book publisher owed no duty to a car dealership owner for allegedly publishing errors concerning emission systems in automobiles. Sinai v. Mitchell Books (9th Cir.1993). In 2000, a New York court followed the 9th Circuit’s lead and supported the proposition that publishers have no duty to investigate the accuracy of its books.

The Sinai court stated that absent an express warranty, publishers have no duty to investigate the accuracy of the contents of the books it publishes and concluded that such a duty could not be created because a publisher's right to publish free of fear of liability is guaranteed by the First Amendment and the overriding societal interest in the untrammeled dissemination of knowledge. While the Sinai case is 20 years old and may be revisited or distinguished at this point, it may be that the “deep pockets” of the publishers in the case might not be reachable by the Plaintiffs. Which would leave Lance Armstrong alone to pay any judgment.

This case will be interesting to watch in light of Lance Armstrong's recent admissions, alleged recent lies, and anticipated flood of lawsuits resulting therefrom.  If the case is permitted to move forward it will no doubt be because of Lance Armstrong's years of agressive lies and denials about his drug use during his cycling career.  The crux of the case is the contention that the Plaintiffs would not have purchased the books had the truth not been withheld by Lance Armstrong. 

The Boulder Business Lawyers at Laszlo & Associates, LLC provide legal counsel for businesses on a variety of business needs, including products liability, risk management, corporate protection, and legal compliance.

What is A Sur-Reply? And When is Filing One Permitted?

Posted by Mike Laszlo on August 10, 2012

Our blogs have been following the Lance Armstrong v. USADA, et al. case which is currently proceeding in the United States District Court for the Western District of Texas.  While the case presents intricate issues of constitutional due process; private versus state action; and enforceability of arbitration clauses, we have been intrigued by the technical and procedural issues the case has presented.  We wrote about pleading deadlines when Armstrong's attorneys miscalculated the response date ... and we discussed brief page limits when Armstrong asked for more space to argue his case.  Yesterday, Armstrong filed  a Sur-Reply in Opposition to USADA's Motion to Dismiss. 

First, what is a "Sur-Reply?"  A sur-reply is a reply filed in response to the reply to a motion… motions go like this: Motion >Response> Reply.  Party A ("movant") files a Motion that asks the court to do something and argues its position – Party B ("non-movant") files a response which argues against the Motion – Party A then files a Reply which supports the Motion – but Party A is limited to those arguments and law raised in its original Motion.  After the reply is filed, the issue is “fully briefed.” 

However, when the reply brief raises new material that was not included in the original motion, courts may permit the non-movant to respond to the new material in a “sur-reply.”  No authorization exists in the Federal Rules of Civil Procedure (or the local rules of Western District of Texas) that permit a sur-reply and therefore, the party wishing to file a sur-reply must motion the court for leave to file a sur-reply.  USDC WD Texas Local Rule 7(e)-(f) deals with responses and replies. 7(f) states: “A party may file a reply in support of a motion. Absent leave of court, no further submissions on the motion are allowed.”  Further, a motion for leave is it own motion, separate and distinct from the underlying motion, and therefore, under most local rules (and USDC WD Texas Local Rule CV-7 (i)) requires a “meet and confer" prior to filing.

So, what did Lance Armstrong file?  He filed a sur-reply brief – he did not comply with Local Rule 7 and file a motion asking the court for leave to file the sur-reply itself (strike one) and he did not comply with Local Rule 7(i) and meet and confer with USADA (strike two).  Further, Armstrong did not argue that a sur-reply brief was necessary under the circumstances of the case. He did not show that USADA had presented new material in its reply brief that it had not included in the original Motion to Dismiss. (strike three).  Thus, the Court should find that Armstrong’s surreply brief is improper and should be stricken.

Why did Armstrong’s legal team yet again disregard the local rules?  It’s anyone’s guess … but headed into today’s hearing, it’s my guess that Armstrong’s legal team is clearly trying (desperately so) to get as much information in front of the Court as possible.  Most likely, Judge Sparks read the sur-reply headed into today’s hearing – even if he says otherwise and doesn’t allow the filing to stand.  The goal by Armstrong being just to get it all out and argue like mad today.   

The Boulder business lawyers at Laszlo & Associates, LLC provide legal counsel to businesses on a variety of business needs including products liability, risk management, corporate protection and legal compliance.  For more information on our Boulder criminal defense practice, visit our website at www.laszlolaw.com/civil.  Contact one of our Boulder attorneys if you are need of assistance.