Sulla et al v. Horowitz et al

Filing 37

ORDER REMANDING ACTION TO STATE COURT - Signed by CHIEF JUDGE SUSAN OKI MOLLWAY on 10/4/12. " Because Defendants have failed to establish that this court has subject matter jurisdiction over the removed state-law claims, this acti on is remanded to the Circuit Court of the Third Circuit, State of Hawaii, pursuant to 28 U.S.C. §§ 1331, 1332, and 1447. The Clerk of Court is directed to mail a certified copy of this order to the clerk of the State Court." ( emt, )CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Leonard G. Horowitz, Sherri Kane and Phillip L. Carey, Esq. shall be served by first class mail at the addresses of record on October 5, 2012.

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
PAUL J. SULLA, JR.; and PAUL
J. SULLA, III,
Plaintiffs,
vs.
LEONARD G. HOROWITZ; and
SHERRI KANE,
Defendants.
_____________________________
LEONARD G. HOROWITZ; and
SHERRI KANE,
Counterclaim-Plaintiffs,
vs.
PAUL J. SULLA, JR.; and PAUL
J. SULLA, III,
Counterclaim-Defendants
and
HERBERT M RITKE, an
individual; RON RITKE, an
individual; JASON HESTER, an
individual; JASON HERSTER,
OVERSEER THE OFFICE OF
OVERSEER, a “corporate sole”
and his successors, over/for
the popular assembly of
revitalize, a gospel of
believers, a corporation;
JOHN S. CARROLL; REED HAYES;
ISLAND TITLE CO; STEWART
TITLE GUARANTY, CO.; GARY
DUBIN; DUBIN LAW OFFICES;
BENJAMIN BROWER; JANET S.
HUNT; COUNTY OF HAWAII; STATE
OF HAWAII; and GOOGLE INC.
Additional Defendants
_____________________________

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CIVIL NO. 12-00449 SOM/KSC
ORDER REMANDING ACTION TO
STATE COURT

ORDER REMANDING ACTION TO STATE COURT
I.

INTRODUCTION.
On July 20, 2012, Paul J. Sulla, Jr., and Paul J.

Sulla, III, “residents” of Hawaii, filed a Complaint in state
court.

See ECF No. 1-1.

The Complaint named as Defendants

Hawaii “residents” Leonard G. Horowitz and Sherri Kane.

Id.

The

Complaint alleges that Sulla, Jr., is an attorney who represented
a party that foreclosed on property owned by Horowitz’s nonprofit corporation, Bloodline of David.

Id. ¶ 10.

The Complaint

alleges that Defendants thereafter began publishing defamatory
statements over the internet, including through a website located
at www.paulsullafraud.com.

Id. ¶¶ 10, 12.

The website allegedly

falsely states that Sulla, Jr., is engaging in fraud, organized
crime, securities schemes, racketeering, arms sales, money
laundering, embezzlement, and CIA cult experiments, and that he
pads bills, steals money, and has been “busted.”

Id. ¶ 13-38.

The Complaint asserts two state-law claims based on defamation
and defamation per se.

Id. ¶¶ 46-55.

On August 8, 2012, Horowitz and Kane removed the statecourt case to this court.

See ECF No. 1.

They filed a

counterclaim and additional claims on September 7, 2012.
No. 12.

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See ECF

On September 24, 2012, this court issued an order to
show cause why this action should not be immediately remanded to
state court.

See ECF No. 30.

On September 27 and October 2, 2012, Horowitz and Kane
responded to the order to show cause.

See ECF Nos. 34 and 35.

Because the court lacks subject matter jurisdiction,
the court remands the improperly removed Complaint to the Circuit
Court of the Third Circuit, State of Hawaii.
II.

ANALYSIS.
This court, noting that all parties might be citizens

of Hawaii, expressed concern that it might lack diversity
jurisdiction supporting the state-law claims asserted in the
Complaint.

The court therefore issued the September 24, 2012,

order to show cause why this action should not be remanded.

See

ECF No. 30.
The responses to the order to show cause did not
challenge the lack of diversity jurisdiction, but instead
asserted federal question jurisdiction.

See ECF Nos. 34 and 35.

Defendants argue that, because the allegedly defamatory
statements were published via the internet, this court has
exclusive jurisdiction pursuant to 47 U.S.C. § 230(c)(1) and
§ 230(e)(3).

This court disagrees.

In relevant part, § 230 states:
(c) Protection for “good samaritan” blocking
and screening of offensive material
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(1) Treatment of publisher or speaker
No provider or user of an interactive
computer service[1] shall be treated as
the publisher or speaker of any
information provided by another
information content provider.
. . . .
(e) Effect on other laws
. . . .
(3) State law
Nothing in this section shall be
construed to prevent any State from
enforcing any State law that is
consistent with this section. No cause
of action may be brought and no
liability may be imposed under any State
or local law that is inconsistent with
this section.
The Ninth Circuit has noted that § 230 protects most
internet services from “liability for publishing false or
defamatory material so long as the information was provided by
another party.”

Carafano v. Metrosplash.com Inc., 339 F.3d 1119,

1122 (9th Cir. 2003).

The Ninth Circuit has stated that “an

‘interactive computer service’ qualifies for immunity so long as
it does not also function as an ‘information content provider’

1

“The term ‘interactive computer service’ means any
information service, system, or access software provider that
provides or enables computer access by multiple users to a
computer server, including specifically a service or system that
provides access to the Internet and such systems operated or
services offered by libraries or educational institutions.” 47
U.S.C. § 230(f)(2).
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for the portion of the statement or publication at issue.”2
at 1123.

Id.

Accordingly, “so long as a third party willingly

provides the essential published content, the interactive service
provider receives full immunity regardless of the specific
editing or selection process.”

Id. at 1124.

The Ninth Circuit

has therefore ruled that an internet dating service was not
liable for a third-party’s submission of a false profile to its
website, see id., and that Google, Inc., was not liable for an
anonymous negative business review posted on Google’s online
business directory.

Black v. Google, Inc., 457 Fed. Appx. 622

(9th Cir. 2011) (unpublished memorandum decision).
Section 230 does not shield persons from liability for
defamatory statements that they make via the internet.

See

Batzel v. Smith, 333 F.3d 1018, 1031 (9th Cir. 2003) (drawing
distinction between statements created and developed and
statements republished on the internet); Seldon v. Magedson, 2012
WL 4475274, *16 (S.D.N.Y. July 10, 2012) (noting that § 230’s
“grant of immunity applies only if the interactive computer
service provider is not also an ‘information content provider’—a
person or entity who is ‘responsible, in whole or in part, for
the creation or development of’ the complained-of content”).

2

“The term ‘information content provider’ means any person
or entity that is responsible, in whole or in part, for the
creation or development of information provided through the
Internet or any other interactive computer service.” 47 U.S.C.
§ 230(f)(3).
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Whether Horowitz and/or Kane are responsible for the
allegedly defamatory statements on the website, or whether they
simply republished the statements, is not relevant to the issue
of whether this case must be remanded to state court.

Contrary

to the representations of Horowitz and/or Kane, § 230 does not
provide this court with exclusive jurisdiction over defamation
claims arising from statements made via the internet.

See Yellow

Freight Sys. v. Donnelly, 494 U.S. 820, 823 (1990) (“To give
federal courts exclusive jurisdiction over a federal cause of
action, Congress must, in an exercise of its powers under the
Supremacy Clause, affirmatively divest state courts of their
presumptively concurrent jurisdiction.”).

Nor does § 230 provide

for concurrent federal and state jurisdiction.

Far from creating

a federal claim, it preempts certain state claims: “No cause of
action may be brought and no liability may be imposed under any
State or local law that is inconsistent with this section.”

47

U.S.C. § 230(e)(3).
Courts determine whether federal question jurisdiction
exists based on the “well-pleaded complaint rule, which provides
that federal jurisdiction exists only when a federal question is
presented on the face of the plaintiff’s properly pleaded
complaint.”

Rivet v. Regions Bank of La., 522 U.S. 470, 475

(1998) (citations and internal quotation marks omitted).

A

defense asserted by a defendant to a complaint is not part of the

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plaintiff’s well-pleaded complaint.

See id.

The Supreme Court

has stated: “a case may not be removed to federal court on the
basis of a federal defense, even if the defense is anticipated in
the plaintiff’s complaint, and even if both parties admit that
the defense is the only question truly at issue in the case.”
Id. (citation and punctuation omitted).

While a plaintiff cannot

avoid removal by failing to plead necessary federal questions,
id., § 230 is clearly in the nature of a defense.

Section 230

therefore does not provide this court with federal question
jurisdiction.
Nor is the court persuaded by Defendants’ citation of
Article III, Section 2, of the United States Constitution, which
provides that the Supreme Court has “original jurisdiction”
concerning “Cases affecting Ambassadors, other public Ministers
and Consuls, and those in which a State shall be Party.”
Defendants claim that Sulla is a minister and that this case
therefore affects a “public Minister.”

However, Article III,

Section 2 does not provide this court with jurisdiction
concerning any matter affecting a church or a minister.

See

Living in Jesus Truth Ministry v. Wise, 2012 WL 3222148, *5 (D.
Nev. Aug. 3, 2012) (applying Article III, Section 2’s reference
to “public Ministers” to only “public ministers of a foreign
state”); United States v. Coplon, 84 F. Supp. 472, 477 (S.D.N.Y.
1949) (“The term ‘public minister generally denotes an emissary

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of one sovereign to another sovereign sent to perform diplomatic
duties.”).

In any event, Article III, Section 2 vests original

jurisdiction over “Cases affecting Ambassadors, other public
Ministers and Consuls” in the Supreme Court, not this court.
Defendants’ reference to a criminal statute, 18 U.S.C.
§ 247, similarly provides no justification for removing
Plaintiffs’ defamation claims.

Section 247 simply pertains to

crimes concerning damage to religious property and obstruction of
persons in the free exercise of religious beliefs.

It does not

prevent state courts from adjudicating defamation claims or
provide this court with federal question jurisdiction over such
claims.

And, of course, a federal criminal law could be enforced

only by a federal prosecutor, not by any private party.
III.

CONCLUSION.
Because Defendants have failed to establish that this

court has subject matter jurisdiction over the removed state-law
claims, this action is remanded to the Circuit Court of the Third
Circuit, State of Hawaii, pursuant to 28 U.S.C. §§ 1331, 1332,
and 1447.

The Clerk of Court is directed to mail a certified

copy of this order to the clerk of the State Court.

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IT IS SO ORDERED.
DATED: Honolulu, October 4, 2012.

/s/ Susan Oki Mollway
Susan Oki Mollway
Chief United States District
Judge
Sulla, et al. v. Horowitz, et al., Civ. No. 12-00449 SOM/KSC; ORDER REMANDING ACTION
TO STATE COURT

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