California Group Off the Hook for Defamation Suit Brought by Maine Lobster Industry

The First Circuit Court of Appeals has dismissed a defamation lawsuit by Maine lobster interests against a California environmental group that urged the public to avoid eating North American lobster because, the group alleged, lobster fishing poses a risk to an endangered whale.

The court ruled that because the statements by the nonprofit Monterey Bay Aquarium Foundation did not specifically target the five lobster industry plaintiffs, their lawsuit was barred by the group defamation rule.

Three Maine lobster fishing companies and two associations maintained that the statements by Aquarium were inaccurate as to their fishing methods and harmful to each of them. They argued that other fishing industries pose a greater risk to rare whales than lobstering.

In the federal district court for Maine, Aquarium moved to dismiss the case on the grounds that the group defamation rule barred the plaintiffs’ claims under Maine law. Under this rule, a defamatory statement about a large group is not actionable unless the statement or its context indicates that it is targeted at specific members of the group.

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The lower court denied Aquarium’s request to dismiss and allowed the plaintiffs’ action to go forward. The district court concluded that Aquarium’s statements applied equally to each plaintiff as required by the group defamation rule.

However, the First Circuit appeals court has now disagreed with the district court’s application of the group defamation rule and reversed. While there is an exception to the group defamation rule’s ban on lawsuits where the alleged defamatory statements reference particular parties, the First Circuit found that the lobster industry plaintiffs failed to satisfy this exception by establishing that the statements were “of and concerning” them.

The five plaintiffs that brought the defamation suit are Bean Maine Lobster, Inc., a company that “markets and sells high-quality mid-coast Maine-caught lobster and lobster foods”; the Maine Lobstermen’s Association, Inc., a nonprofit “that represents roughly 1,200 of Maine’s 5,600 lobstermen”; the Maine Coast Fishermen’s Association, Inc., a nonprofit “that works to enhance the sustainability of Maine’s fisheries” and “advocates for the needs of community-based fishermen”; (4) Maine Lobster and Processing, LLC, “a third-generation Maine lobster company and . . . one of the leading lobster producers in the United States”; and Bug Catcher, Inc., “a lobster fishing company” in Maine run by “a sixth-generation lobsterman.”

For many years, Aquarium has raised concerns about the impact of fishing on the North Atlantic right whale. According to Aquarium, one threat to the whale is the risk of entanglement in fishing gear, including the buoy lines lobstermen use to mark the placement of their lobster traps.

In the last decade, the Maine lobster industry has implemented changes to its fishing practices to protect whales. The industry has decreased the amount of rope in the water, created more exacting requirements for weak links, weak rope and break-aways to weaken vertical fishing lines, and closed nearly 1,000 square miles of fishing grounds for an entire season each year.”

Nevertheless, in September 2022, Aquarium issued a press release announcing that it had assigned “red ratings” (meaning consumers should “avoid” the seafood) because of the “dire risk to the endangered North Atlantic right whale” posed by the fisheries. The press release stated that the red ratings were based on “significant risks of entanglement in pot, trap, and gillnet fisheries to the endangered North Atlantic right whale and the lack of timely, effective management necessary to mitigate entanglement risks and promote recovery of the species.”

At the same time, Aquarium emphasized that there was not enough information to cite any one fishery as responsible for entanglements and until such information was available, “all relevant fisheries that may overlap with [the North Atlantic right whale] pose risks.” Aquarium did not identify by name any of the plaintiffs or any other individual, association, or company involved in the Maine lobster industry.

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The lobster plaintiffs claimed that they lost substantial business following Aquarium’s announcements. The owner of Bug Catcher estimated that he lost about 20% of his business since the Aquarium issued its “red” rating. And in one instance, a major customer of Maine Lobster and Processing specifically cited the “red” rating when it announced that it would no longer be purchasing lobster from the Gulf of Maine.

The First Circuit appeals court noted that since the 1800s, courts have justified the group defamation rule, in part, based on the concern that affording every member of a large group a cause of action would threaten to stifle “free discussion” beneath an avalanche of “embittered and boundless litigation.”

The plaintiffs acknowledged that the statements contained no explicit reference to any of them individually. They insisted, however, that the group defamation rule should not bar their claims because of the statements’ factual nature. They argued that the assertion that the type of fishing gear used by the plaintiffs endangers the right whale meant that the statements necessarily apply to every member of the fishery. Thus, they contended, the statements are materially different from the hyperbole usually lobbed at entire industries that are subject to critique, and for that reason, the district court was correct to permit their claims to proceed.

However the appeals court noted that the only evidence that they cited in support of their contention that the particular-reference exception applies was their allegation that some of the plaintiffs’ customers had understood the red rating to refer to them.

The First Circuit found that the fact that customers cited the rating as a reason for ceasing business did not supply the required evidence that the customers “believed the statements were about the plaintiffs specifically” and not “aimed at the American lobster fishery in general.”

The court also said it was not convinced that the statements in fact applied to each plaintiff. Some of the plaintiffs are lobstermen or associations representing those using the fishing gear targeted by Aquarium but others, including lead plaintiff Bean Maine, are involved in downstream activities such as marketing and selling of lobster.

The Maine Lobstermen’s Association (MLA) issued a statement that it is “deeply disappointed” by the federal appeals court decision to dismiss the lawsuit.

“The court dismissed our case, but it did not validate the Aquarium’s claims about Maine lobster. Those are two very different things. The ruling did not address MLA’s allegations that the Aquarium’s false claims have harmed Maine’s lobster fishery,” said Patrice McCarron, MLA executive director.

McCarron added that her organization “stands firm in its position that the Aquarium’s red listing harms the Maine lobster fishery by telling consumers to avoid Maine lobster while ignoring decades of meaningful conservation by the very people who depend on a healthy ocean.”

A similar case brought in U.S. District Court for the Northern District of California against Aquarium by fishermen based in Massachusetts was dropped in 2024.