United States District Court, M.D. Florida, Fort Myers Division
AFI HOLDINGS OF ILLINOIS, LLC d/b/a Happy Leaves, Inc., Plaintiff,
WATERMAN BROADCASTING, a Florida corp., GRAHAM HUNTER, LISA SPOONER, PETER BUSCH, and JOSEPH DORN, M.D., Defendants.
OPINION AND ORDER
E. STEELE SENIOR UNITED STATES DISTRICT JUDGE
matter comes before the Court on review of defendant Joseph
Dorn, M.D.'s Motion to Dismiss (Doc. #27) filed on April
13, 2018. Plaintiff filed a Response in Opposition (Doc. #36)
on April 30, 2018. For the reasons set forth below, the
Motion is denied.
27, 2017, plaintiff AFI Holdings, LLC d/b/a Happy Leaves,
Inc., (“AFI”) filed suit in Lee County, Florida
alleging defamation and commercial disparagement against
Defendant Waterman Broadcasting (“Waterman”). The
case was removed to the Middle District of Florida based on
diversity jurisdiction. AFI filed an Amended Complaint (Doc.
#22), adding the individual defendants. AFI alleges that
defendants' statements during WBBH-TV's July 1, 2016
segment on AFI's sales of the hemp oil extract
“Charlotte's Web” on Groupon defamed AFI and
disparaged its product.
Amended Complaint alleges as follows: AFI d/b/a Happy Leaves
distributes hemp oil extract for another company named CW
Hemp, Inc., which manufactures “Charlotte's
Web” in Colorado. (Doc. #22, ¶ 12.)
Charlotte's Web is a commercially available full plant
hemp extract. The active ingredient in Charlotte's Web is
cannabidiol (CBD). CBD can be harvested from both hemp and
cannabis. (Id., ¶ 13.) CBD oils harvested from
hemp, such as Charlotte's Web, have very low levels of
tetrahydrocannadion (THC) compared to those harvested from
cannabis and they are not regulated in the same way.
(Id., ¶ 14.) Plaintiff alleges that according
to Florida Bill 893.02, which became effective on July 1,
2014, the term “cannabis” does not include any
cannabis that contains 0.5 percent or less of THC and more
than 15 percent of CBD. (Id., ¶ 15.) The
Charlotte's Web hemp oil extract sold by AFI on Groupon
contains less than 0.3 percent of THC and does not fall
within the definition of “cannabis” under Florida
law. (Id., ¶¶ 16, 18.) Hemp oil extract is
separate and distinct from marijuana and marijuana oil
extract is sold legally throughout all 50 states. Hemp oil
extract is not “pot” or “medical
marijuana” and industrial hemp products are currently
distributed in thousands of health and wellness stores across
the United States. (Id., ¶¶ 17, 22.)
Hemp, Inc.'s business model allows for exclusive regional
distributorships of Charlotte's Web. Prior to July 2,
2016, AFI enjoyed an exclusive agreement with CW Hemp, Inc.
to sell Charlotte's Web on Groupon. AFI was CW Hemp's
only distributor selling through Groupon. (Doc. #22, ¶
23.) The Groupon account was particularly lucrative for AFI.
In June 2016, AFI's monthly gross sales of
Charlotte's Web on Groupon were approximately $75, 000.
(Id., ¶ 24.)
1, 2016, defendants Lisa Spooner and Peter Busch were on-air
anchors, and Graham Hunter was an on-air reporter for
WBBH-TV, located in Fort Myers, Florida. The station is owned
and operated by Waterman Broadcasting. (Doc. #22,
¶¶ 25-28.) During WBBH-TV's 11:00 p.m. newscast
on that date, defendants aired a segment about AFI and
Charlotte's Web. The segment identified defendant Joseph
Dorn, M.D. as an “expert” on the subject.
(Id., ¶ 29.)
the broadcast, defendants knowingly made false and/or
reckless statements about AFI and Charlotte's Web in a
way to sensationalize the story. (Doc. #22, ¶ 30.)
Plaintiff alleges that defendants made the following
statements: Ms. Spooner falsely claimed that Charlotte's
Web was “medical marijuana” and that “200mg
of Charlotte's Web Pot” could be purchased for
“forty bucks.” She stated that “pot”
and “medical marijuana' could now be purchased on
Groupon via AFI. (Id., ¶ 31.) Mr. Busch falsely
stated that “only five dispensaries in Florida are
allowed to sell it under Florida law” in reference to
the Charlotte's Web to imply AFI was violating Florida
law. He also stated that “Graham Hunter spoke to an
expert about how it's actually being sold in this
ad” in referring to AFI's advertisement on Groupon.
(Id., ¶ 32.) Mr. Hunter falsely claimed that
“there's really no way to know exactly what's
in this stuff without buying it and testing it.”
(Id., ¶ 33.) Mr. Hunter also provided
misleading pictures and videos for the segment, and also
conducted street interviews. (Id., ¶¶
34-35.) Hunter stated that he contacted Groupon to notify it
of the story and sent an email to AFI's owner when in
fact the email was only sent to AFI two hours before airing
the segment, asking: “What is your product?” and
“How is this legal to dispense to the U.S.?”
(Id., ¶ 40.) The segment was aired before
receiving a response.
relevant to the instant Motion, plaintiff alleges that Dr.
Dorn stated during the segment in reference to AFI that
“somebody like this, they're not playing by the
rules, so who in the world knows what they're
selling.” (Doc. #22, ¶ 36.) Plaintiff alleges that
this implies that AFI was violating Florida law by selling
Charlotte's Web in Florida via Groupon. (Id.)
result of the segment, Groupon discontinued all sales of
Charlotte's Web on its website. (Doc. #22, ¶¶
43-44.) Plaintiff states that Groupon would not have known
about the story but for Waterman and Mr. Hunter notifying it.
(Id., ¶ 45.) AFI was the only distributor of
Charlotte's Web on Groupon and following the July 1, 2016
segment, AFI's total sales were reduced to zero.
(Id., ¶ 46.)
14, 2016, Waterman posted an online statement retracting its
July 1, 2016 story about AFI and Charlotte's Web,
On July 1, 2016 NBC-2.com published a story here about a
(sic) Illinois based company called Happy Leaves selling a
product called Charlotte's Web on Groupon.
In our story we characterized the product as ‘pot'
and medical marijuana. It is not. According to their company,
the product is derived from hemp and Charlott'e Web
contains no illegal drugs or regulated drugs which require a
special license to sell.
The active ingredient in Charlotte's Web is called CBD
(cannabidiol). CBD can be harvested from both hemp and
cannabis. CBD oils harvested from hemp have very low levels
of tetrahydrocannadion (THC) than those ...