Wednesday, February 27, 2013

Halal Chicken, McDonalds, and the Majed Moughni Facebook Injunction: How Far Can Judge Kathleen MacDonald Go to Silence Dissent to an Arguably Unfair Class Action Settlement?

In the 2006 to 2009 time frame, I wrote a blog called Blue Dog Thoughts. I ruminated on political issues (a presidential election was in process) and Internet trivia (e.g., one police officer's arresting reaction to his too salty McDonald's hamburgers). But family (kids hitting high school, driving them to wrestling matches, track meets, school plays, marching band events, dances) and work issues ultimately had me put my blog to bed. Life hasn't slowed, but I find myself getting the itch to once again pick up my figurative pen.

My first post is inspired by Walter Olsen's heads up on Overlawyered where he alerts us to Judge Kathleen MacDonald's February 7, 2013, order requiring Majed Moughni to (1) take down previous Facebook posts (criticizing the arguably lawyer enriching, unnamed class participant stiffing settlement); (2) keep his mouth shut in the future about any disagreement he might have with the proposed settlement (unless he got prior approval from the judge or the lawyers who are destined to receive a good chunk of the so-called settlement funds); (3) turn over the names and contact information of anyone who agreed with Moughni via the "Like" function of Facebook; and (4) post on his community Facebook page, Judge MacDonald's own notice of the terms of the proposed settlement. The lawsuit involves the sale of arguably non-halal (analogous to kosher) chicken sandwiches allegedly sold by McDonald's to people who care that the food they eat is prepared according to the tenets of their faith. In this post, I discuss my opinion of the Court's order and this class action settlement based on my understanding of the facts as I've ascertained them from reading various posts and other sources on the Internet. To the extent those facts turn out to be wrong or incomplete, my opinions may change.

In any event, I find this to be an interesting First Amendment case. Leaving aside hyperbole for the moment, we have a clash of two competing ideas. Judge MacDonald and the Jaafar and Mahdi Law Group (the attorneys appointed to represent the interests of the proposed class plaintiffs) want to control the manner in which this settlement is presented to the public. And a judge has a not unlimited right to control how parties before the Court and attorneys representing those parties communicate with the public about ongoing, active litigation. Thus, in their motion for injunctive relief, Jaafar and Mahdi Law Group cites Michigan's Rules of Professional Conduct, Rule 3.6:
A lawyer shall not make an extrajudicial statement that a reasonable person would expect to be disseminated by means of public communication if the lawyer knows or reasonably should know that it will have a substantial likelihood of materially prejudicing an adjudicative proceeding.
as well as Rule 4.2:
In representing a client, a lawyer shall not communicate about the subject of the representation with a party whom the lawyer knows to be represented in the matter by another lawyer, unless the lawyer has the consent of the other lawyer or is authorized by law to do so.
and also argues the Court's right to silence and control the content  of Moughni's speech based on a court's power to control matters before it:
Circuit courts have the “jurisdiction and power to make any order proper to fully effectuate the circuit court’s jurisdiction and judgments.” It is long settled that a trial court possesses inherent and essential authority to control the proceedings before it. A circuit court‘s inherent authority“is not governed so much by rule or statute, but by the control necessarily vested in courts to manage their own affairs so as to achieve the orderly and expeditious disposition of cases."
Encompassed within this “inherent authority” is the power to“sanction litigants and their counsel” as well as dismiss an action where necessary. More speci´Čücally, the trial court has broad power to authorize, supervise and manage the manner and content of class notice. [Citations Omitted].
All for the proposition that the Court can order Moughni to cease telling people that he considers this settlement unfair to the actual victims of the alleged torts. When we speak about parties and lawyers before the Court, this makes sense. The judge needs to control his case. He or she will want to ensure that juries are not improperly influenced and that parties (such as class plaintiffs) know of potential settlements or other significant developments. If a party's lawyer or the party has a problem with this, they are already before the Court and can argue their points.

So you might understand why at least some people feel that the Court's order was appropriate. Certainly, there is support from experts such as Robert Sedler, a constitutional law professor at Wayne State University. He opined that there is no First Amendment issue, saying there is a "narrowness to the order." But where does this leave a tough-minded activist lawyer like Majed Moughni? This is a man who strongly believes in free speech. He's helped lead protests against terrorists such as the "Underwear Bomber" Umar Farouk Abdulmutallab. He's been threatened with death by terrorist Ali Charaf Damache (currently on trial in Ireland for those threats). He's counter-protested against the obscene antics of a man like "Pastor" Terry Jones, while still standing up for the man's right to speak.

It's inevitable that as a potential class member (he and his family reside in the area), a man like Majed Moughni will want to express his opinion on a settlement that funnels hundreds of thousands of dollars to a Dearborn law firm (and two Dearborn charities*), yet grants not a single dollar, not even a coupon for a genuinely Halal Chicken Sandwich to any individual unnamed class plaintiff. After all, the proposed settlement doesn't even enjoin McDonalds from committing the same alleged violations (selling Chicken Sandwiches in the future as halal when those Sandwiches arguably didn't qualify for that label). But those unnamed class plaintiffs are barred from suing McDonald's for their individual claims unless they object to the settlement. And Moughni clearly feels that they should object.

He isn't a named party to the lawsuit. He represents no party to the action and can't easily appear before the Court to state his opinion on proposed settlement. There is a hearing set for March 1, 2013, but if an individual doesn't file a formal objection to the proposed settlement, they won't be able to speak at the hearing. So Majed Moughni went to his Dearborn Area Community Page on Facebook and blasted the settlement with his opinion that it was a "backroom deal," urged other community members to object to the settlement, and stated that he had hired an attorney to try to intervene.

If you're a class action attorney about to score several hundred thousand in attorney fees, the last thing you want is people objecting to your proposed class action settlement [in the particular settlement agreement at issue, Section 6.1 provides that only twenty-five people need to opt-out of the settlement and McDonald's would have the right to walk away from the settlement]. So you're going to want to silence a man like Moughni and do it quick. You might visit his office and try to strong arm him into shutting up. Probably, you'll threaten him with a defamation lawsuit or filing a complaint with the state bar. But someone like Moughni isn't going to back down. This is a guy who didn't back off when a terrorist threatened him with death. So you need a hammer and a big one. You go to the judge who's already approved your lovely big-fee settlement and ask for an injunction shutting this man up and ideally making him mouth via mandatory Facebook posts the party line as laid out in the Court's own class notice of proposed settlement [the settlement agreement has a clear-sailing provision, which forbids defendants from objecting to the proposed attorney fees and obviously class-counsel won't object to their fees, another incentive to silence an objector such as Moughni].

Given that Moughni isn't a named party before the Court or a lawyer representing any party before the Court and this is a matter of public interest, a lot of judges would outright deny the requested injunction on the ground that it constitutes an unconstitutional prior restraint on free speech. But Judge Kathleen McDonald is made of sterner stuff and chose to grant class counsel everything they asked for while silencing Moughni's attempt to argue the motion.

Thankfully for Moughni, Paul Levy and the Public Litigation Citizen Group stepped up to the plate and agreed to represent him. They filed a motion to vacate the injunction with the Court.  According to Paul Levy,

The judge's actions represent a jaw-dropping attack on the First Amendment.

The ACLU of Michigan also asked for leave to file an amicus brief supporting Mougni's motion to vacate the injunction. The Public Litigation Citizen Group and the ACLU both point out that prior restraint on protected speech, i.e., shutting someone up before they speak, because you know you aren't going to like what they say, is generally—except in rare circumstances—unconstitutional. Keep in mind, we're not talking about commercial speech here (Moughni isn't representing anyone in this action), we're not talking about a situation where Moughni has signed a confidentiality agreement, or threatened to publish obscene material, or intends to yell fire in a crowded theater.

We speak of a man's right to publicly criticize his government when it (through the Court in this instance) proposes to act in a way that he disagrees with. Fundamentally, this is what free speech is all about. So I agree with Paul Levy and the ACLU in this scenario and not with Judge MacDonald and Professor Sedler.

The hearing on the motion to vacate is set for the same March 1st date as the hearing on approval of the settlement.  So even if the Court vacates the injunction, it will likely have accomplished class counsel's purpose of silencing dissent during the opt-out period.

* For discussion on how cy pres class action settlements can and should be structured, a good case to review is Nachshin v. AOL LLC.

** Update Post.