CZ Services, Inc. v. Express Scripts Holding Company
- James Donato
- 3:18-cv-04217
- U.S. District Court · Northern District of California
- 2
In CZ Services v. Express Scripts, Judge Donato ruled CZ was not a public figure for defamation claims and declined ESI’s request concerning damages testimony.
CZ Services, Inc. and CareZone Pharmacy LLC were treated as not being public figures for their defamation claims. Express Scripts’ request concerning the timing of damages evidence and references was declined.
What happened
In CZ Services, Inc. v. Express Scripts Holding Company, Express Scripts asked whether CZ Services and CareZone Pharmacy were public figures for CZ’s defamation claims. The court answered no, based on the limited evidence that CZ had created or entered a public controversy.
The court said Express Scripts mainly relied on CZ’s internal plans, two emails, and one 2018 CNBC report. It found that this evidence did not show a public controversy, although it said the issue could be reconsidered if trial evidence showed otherwise.
The court also declined Express Scripts’ request to require CZ to present its damages theories before witness Hsieh testified or before CZ referred to those theories. Judge Donato left the court’s earlier order on Hsieh’s damages testimony in place.
The detailed version
- CZ Services, Inc. v. Express Scripts Holding Company · No. 3:18-cv-04217
- James Donato
- Jan. 26, 2022
Background
CZ Services, Inc. and CareZone Pharmacy LLC, collectively referred to as CZ, brought defamation claims against Express Scripts Holding Company and other defendants. Express Scripts asked the court to decide whether CZ was a public figure for those claims. The issue matters because public-figure status can affect the legal requirements for proving defamation.
Public-figure ruling
The court explained that an entity may be an all-purpose public figure if it has pervasive fame or notoriety, or a limited-purpose public figure if it voluntarily enters a particular public controversy. The court also explained that a public controversy is more than a matter that merely interests the public; it must be a dispute that has received public attention because people beyond the direct participants will feel its effects.
Express Scripts argued that CZ voluntarily created a public controversy by planning to encourage patients to send complaints to government agencies. Express Scripts relied mainly on CZ’s internal documents, identified two emails as evidence that those efforts had produced results, and pointed to one 2018 CNBC news report.
The court found this evidence insufficient to show that CZ had voluntarily created or entered a public controversy. It described the single news report as limited and noted that the report mainly concerned Express Scripts’ termination of its contract with CZ. The court ruled that CZ was not a public figure for its defamation claims. The court stated that it could reconsider that status if trial evidence indicated otherwise.
Witness Hsieh and damages evidence
The court had previously deferred a decision on Express Scripts’ motion to exclude witness Hsieh’s damages testimony until after hearing the testimony at trial. Express Scripts then asked the court to require CZ to show evidence supporting its damages theories before Hsieh testified and before CZ referred to those theories. The court declined that request and left the prior order in place.
Disposition
The court ruled that CZ was not a public figure for purposes of its defamation claims on the evidence then before it. It also declined Express Scripts’ request concerning the timing of CZ’s damages evidence and references to its damages theories. The order was signed by Judge James Donato on January 26, 2022.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.