Forensic Election Fraud Analysts Allege Defendants Defamed Them as “Retaliation for Plaintiffs’ Refusal to Report False Findings of Election Fraud”

From Apelbaum v. Lambert, decided Friday by Judge Robert White (E.D. Mich.):

Yaacov Apelbaum and his cybersecurity firm, XRVision, Ltd. (Plaintiffs), commenced this diversity breach of contract and defamation action against attorney Stephanie Lynn Lambert [the case caption calls her Stefanie Lynn Lambert], her law office {collectively referred to as the Lambert Defendants}, and Bill Bachenberg, after the parties allegedly contracted for Plaintiffs to investigate potential fraud during the 2020 general election….

Following the 2020 election, the Lambert Defendants, with financial assistance and partial direction from Bachenberg, promoted various claims of election fraud, including through lawsuits challenging election results. Pursuant to these efforts, the Lambert Defendants pursued various election fraud investigations, and they hired Plaintiffs to conduct forensic analyses of election results and/or procedures in Michigan and Pennsylvania. As particularly relevant here, the parties in March 2022 “entered into an agreement for Plaintiffs to perform a forensic analysis of Fulton County, Pennsylvania’s elections systems, in exchange for $200,000.” The parties later expanded the scope of Plaintiffs’ analysis “for an additional fee of $350,000.”

Plaintiffs allegedly performed their obligations of this agreement, but after they found and reported no evidence of election fraud in June 2022, Defendants never paid them as agreed. Further, the Lambert Defendants also allegedly started a defamation campaign against Plaintiffs around August 2022 to dissuade the Pennsylvania Senate, among others, from doing business with Plaintiffs. According to Plaintiffs, they had at the time finalized negotiations with the Pennsylvania Senate to perform a forensic analysis of the whole state’s election system, but Lambert Defendants’ conduct caused the Pennsylvania Senate to terminate this relationship….

The court allowed plaintiffs’ defamation claims against the Lambert defendants to go forward (because of Bachenberg’s settlement agreement with the parties, the claims against Bachenberg weren’t considered). The defamation allegations were basically this:

Lambert … falsely stated that the Plaintiffs had conflicts of interest with her clients and/or her firm, that she would sue the Plaintiffs if they were to be engaged in these relationships, and implicitly that she would take legal action against the relationships themselves if they were to hire Plaintiffs. To wit: “Your office will receive a formal letter from my office today. Yaacov Apelbaum has a conflict of interest. He was hired by Fulton County. He is bound by privilege. His firm will be sued if he performs any analysis on Fulton County data for the Senate.”  …

Lambert … also indicated, in written and verbal communications with representatives of the Pennsylvania Senate, the Wisconsin State Legislature, and the Arizona Senate, that the Plaintiffs were:

1. incompetent.
2. secretly working as malicious operatives of the federal government; and
3. entirely lacking any ability in the fields of cybersecurity and forensic analysis.

And the court reasoned that the claims could go ahead, based on the facts as plaintiffs plausibly alleged them to be:

First, the statement that Plaintiffs were legally conflicted from performing any analysis of Fulton County election data could surely deter—and allegedly did so here with respect to the abandoned negotiations with the Pennsylvania Senate—third parties from hiring Plaintiffs for such services, particularly with the included warning of legal action. Construing the complaint in Plaintiffs’ favor, it is reasonable to infer, largely as a matter of common sense, that a third party would not want to hire Plaintiffs for services for which they would be subject to suit because of or otherwise limited by a conflict of interest.

The statement that Plaintiffs “secretly work[ ]” as “malicious operatives” also sufficiently impugns their honesty and integrity such that a third party would certainly hesitate to associate with them. And average people could reasonably construe a lack of these facilities as making Plaintiffs unfit to perform the sensitive cybersecurity and forensic auditing services they offer. See Likewise, the statements that Plaintiffs are “incompetent” and “entirely lacking any ability in … cybersecurity and forensic analysis” without a doubt adversely relate to Plaintiffs’ conduct in their business or profession. Further, the Court must accept as true at this stage that the statements “were deliberately made to persuade the Pennsylvania Senate against using Plaintiffs’ forensic services.”

Next, the Court cannot conclude as a matter of law at this early stage that any of these statements constitute nonactionable pure opinion. To the extent the Lambert Defendants couch the conflict-of-interest statement as protected legal opinion, they do not substantively explain how it (or any of the other allegedly defamatory statements) could not be objectively verified.

Accepting the allegations as true, however, whether Plaintiffs were conflicted as a matter of law or contract, or secretly and maliciously worked as federal operatives, are objectively verifiable facts. Both alleged defamatory statements were presented as straightforward expressions of fact, not as subjective beliefs, and they can be verified by the records concerning Plaintiffs’ prior work involving Fulton County and the federal government. And to the extent the statements concerning Plaintiffs’ professional capabilities involve a greater potential for subjectivity, these also were made as straightforward expressions of fact rather than mere belief.

Further, all the alleged statements at this stage constitute at most mixed opinion because they each imply knowledge of undisclosed facts privy to the Lambert Defendants.  Critically, it can be reasonably inferred that Lambert Defendants made each allegedly defamatory statement based on their prior involvement with Plaintiffs, particularly the work Plaintiffs allegedly did for the Lambert Defendants in both Michigan and Pennsylvania. And it is therefore reasonable for those hearing only that Plaintiffs (1) had a conflict of interest, (2) were generally incompetent and lacking any ability in their fields of business, and (3) operated secretly and maliciously for the federal government to conclude that the Lambert Defendants based their knowledge, and any purported opinion statement, on specific previous interactions with Plaintiffs that the Lambert Defendants never disclosed or explained.

For example, the Lambert Defendants allegedly made the statement that Plaintiffs were conflicted with no explanation of Plaintiffs’ prior work that caused a conflict. Similarly, the general statements impugning Plaintiffs’ performance and honesty imply specific knowledge of Plaintiffs’ prior dealings or work that, again, the Lambert Defendants allegedly did not disclose. Nevertheless, because (1) the Lambert Defendants do not clearly and substantively brief an argument that the specific allegedly defamatory statements at issue were each nonactionable pure opinion and (2) the issue is context-specific and fact-driven, the Court concludes that this is more appropriate for resolution on a motion for summary judgment after the close of discovery.

Plaintiffs’ general assertions that the allegedly defamatory statements “were and are provably false statements of fact” are more so the type of conclusory allegation that requires some additional supporting facts to plausibly establish the element of falsity. The same is true concerning actual malice and Plaintiffs’ generalized allegations that Lambert Defendants “acted with willful misconduct, malice, fraud, wantonness, oppression, and/or entire want of care which would raise the presumption of conscious indifference to consequences, and they specifically intended to cause Plaintiffs harm.”

Nevertheless, the Court concludes that the complaint provides sufficient factual matter to reasonably infer these elements…. [T]he complaint alleges that the parties worked together without issue on numerous projects until the point when Plaintiffs disclosed no evidence of election fraud in Fulton County and declined Lambert Defendants’ request to falsely report otherwise, at which point Lambert Defendants became “furious.” And this allegedly occurred while Lambert Defendants were promoting claims of election fraud, “us[ing] the public controversy from the 2020 Presidential Election to establish themselves as leading promoters (and profiteers) of election fraud narratives, and earn[ing] substantial income … [for] participat[ion] in election fraud investigations and lawsuits.”

Accordingly, the complaint as a whole can be fairly read to allege that the Lambert Defendants orchestrated a deliberate defamation campaign against Plaintiffs with the specific intent to dissuade others from doing business with Plaintiffs, not due to legitimate concerns, but in retaliation for Plaintiffs’ accurate report finding no evidence of election fraud and refusal to falsely report otherwise. Under these and other circumstances described below, the Court concludes that the elements of falsity and actual malice, while largely implicit in Plaintiffs’ factual allegations, are nonetheless sufficiently supported.

First, it is reasonable to infer, construing the complaint in Plaintiffs’ favor, that there was no conflict concerning work involving Fulton County. Not only do Plaintiffs specifically assert within their general allegations (and thus beyond the conclusory allegations within each cause of action) that the Lambert Defendants’ statement otherwise was in fact false, it can also be inferred that Plaintiffs would not have been negotiating to perform work for the Pennsylvania Senate if a conflict did indeed exist to preclude such work. Similarly, Plaintiffs include numerous factual allegations describing their expertise and experience in their field of business, and these implicitly support that the alleged disparagements of Plaintiffs’ honesty, abilities, and performance were also false.

Further, if any of the allegedly defamatory statements were true, the Lambert Defendants presumably would not have worked repeatedly with Plaintiffs on numerous successive projects. Instead, they allegedly stopped working with Plaintiffs only after Plaintiffs, to the Lambert Defendants alleged frustration, failed to falsify a report.

The element of actual malice can likewise be reasonably inferred from the complaint. Specifically, Lambert Defendants’ alleged experience working with Plaintiffs on numerous projects over the course of a year, including the Fulton County work primarily at issue, reasonably should have provided specific knowledge of the falsity (given the allegations at this stage) of each allegedly defamatory statement.

And where the overall defamation claims are fairly read to allege retaliation for Plaintiffs’ refusal to report false findings of election fraud—which as a matter of common sense would interfere with Lambert Defendants’ alleged efforts to promote and earn money from claims of fraud—it can be accepted at this preliminary stage that the Lambert Defendants maliciously published the defamatory statements with at least a reckless disregard for the truth, if not full knowledge of the statements’ inaccuracy….

The court also allowed plaintiffs’ breach of contract claim and relacted claims to go forward.

Jonathon Christian Burns (Burns Law Firm) and Todd A. Stuart (SBS Law PLC) represent plaintiffs.