Restaurant protest splits high court

SACRAMENTO —  The California Supreme Court appeared to be divided Monday over whether courts may bar individuals from repeating defamatory statements instead of simply requiring them to compensate the victim monetarily.

Meeting for arguments in Sacramento, at least three justices on the seven-member court appeared to believe so-called prior restraint orders may at times be justified.

Chief Justice Ronald M. George said some people who defame may not have accessible assets and therefore would have no motivation to stop without a court order.

“Aren’t there going to be some people who are judgment-proof?” he asked.

The case before the court was brought by the Balboa Island Village Inn, a restaurant and bar in Newport Beach that won a court order prohibiting a neighbor from making false and scurrilous statements about the business.

The order, which has not been enforced pending appeal, makes Anne Lemen, 58, a nurse, vulnerable to fines or jail if she tells anyone that the bar serves tainted food, has Mafia connections, produces child pornography, encourages lesbian activities, distributes illegal drugs or participates in prostitution -- all charges that a lower court found Lemen had falsely made.

Lemen, who has denied making many of the disputed statements, owns a house next to the restaurant and led a petition drive several years ago to prevent the business from obtaining an expanded entertainment permit. She and other Balboa Island residents complained at the time that the bar was noisy, produced litter and attracted unsavory types to the island.

She collected 400 signatures against Village Inn’s application. While collecting those signatures, she defamed Village Inn, J. Scott Russo, a lawyer for the bar, told the court.

Because ascertaining monetary damages would be difficult, if not impossible, to calculate, Russo said, a court order was needed to stop Lemen from hurting his client’s business.

Duke University Law professor Erwin Chemerinsky, who argued on behalf of Lemen, said determining monetary damages in defamation cases was always difficult because one must put a value on reputation. That doesn’t mean that it cannot be done, he said.

Chemerinsky told the court that the U.S. Constitution prohibits prior restraint orders as a remedy for defamation. What if Lemen eventually obtained proof that one of her charges was true? he asked. She would have to go to court to receive permission before she could tell anyone.

Justice Marvin R. Baxter asked what should happen if a restaurant owner faced the loss of his or her livelihood because of defamation. Chemerinsky replied that such a victim could recover monetary damages for economic losses.

Baxter suggested that monetary damages might not suffice if the owner “wants to be in the restaurant business -- that has been his dream.”

Justice Carol Corrigan also expressed irritation that a victim of defamation might have to return to court repeatedly to protect his reputation.

Other justices seemed troubled about the breadth of the court order. If upheld, it would prevent Lemen from making any of the disputed comments, even in the privacy of her home, and from contacting Village Inn employees.

Justice Carlos R. Moreno asked if the order would prohibit Lemen from making the statements “to anyone, anywhere in the world.”

Russo, the restaurant’s owner, conceded that it would.

“Why, isn’t it overly broad?” asked Justice Ming W. Chin.

Russo said the order was permissible because it barred only specific statements that a judge determined Lemen had actually made.

He said the order did not constitute prior restraint because the Constitution does not protect defamatory speech.

Justice Joyce L. Kennard noted that homes on Balboa Island cost millions of dollars, and she doubted that the Village Inn would have trouble collecting monetary damages if it could show that Lemen affected business.

“When we are dealing with a restraint on one of the most cherished constitutional provisions -- protection of speech -- we should only in extremely narrow circumstances allow permanent injunctions,” she said.

Justice Kathryn M. Werdegar asked Chemerinsky if the order could be narrowed to make it legally permissible. Although Chemerinsky insisted any such order would be unconstitutional, he said such an order could be narrowed by restricting the speech in time, place and manner.

If the court upholds the order under the U.S. Constitution, the case will probably go to the U.S. Supreme Court. If the court rules on state constitutional grounds, it has final say on the matter. The court also could send the case back down to a trial judge and ask that the order be narrowed.

The court will rule on the case within 90 days.

maura.dolan@latimes.com