Recent Ninth Circuit Cases of Interest - Surreptitious Recording

With an office in California, Hicks Thomas LLP monitors decisions issued by the California appellate courts and by the U.S. Court of Appeals for the Ninth Circuit. A recent decision by the latter caught our attention.

Safari Club International v. Rudolph involved a bitter dispute between SCI and its former president, Dr. Lawrence Rudolph. In 2012, after various club members accused Rudolph of serious wrongdoing, SCI “terminated Rudolph’s contract, stripped him of his awards, and expelled him from membership.” Litigation ensued in multiple states, with Rudolph suing not only SCI itself but also its then-current president, John Whipple. While that litigation was pending, Rudolph invited Whipple to what turned out to be a five-hour lunch at a Los Angeles restaurant. Whipple accepted the invitation because he “still considered Rudolph a good friend, and believed Rudolph felt the same way.” During the lunch, Rudolph “steered the discussion to the ongoing litigation between himself, Whipple, and SCI. They talked about Whipple’s role in the underlying events and the conduct of various SCI board members.”

Here is where it gets exciting: “Unbeknownst to Whipple, Rudolph recorded both audio and video of the entire conversation.” He later reduced that recording to a film meant to show the world that “the allegations against Rudolph were false and malicious.” Naturally, Rudolph posted both the unedited recording and the film to YouTube. Importantly, however, “Rudolph never asked for, nor [sic] obtained, Whipple’s consent to record the conversation.” Whipple then sued Rudolph in California for invasion of privacy and related torts. In its recent decision, the Ninth Circuit affirmed the district court’s ruling that Whipple’s lawsuit could proceed notwithstanding Rudolph’s contention that his surreptitious recording was in furtherance of his right of free speech.

The case is interesting for illustrating the interplay between, and serious consequences imposed by, the various statutes that prohibit the recording of private conversations. A federal statute generally makes it a crime to record such conversations but makes an express exception for recording one’s own conversations or “where one of the parties . . . has given prior consent.” But states need not recognize this exception, and California does not, making it a crime to record private conversations “without the consent of all parties.” A violation of that prohibition can lead not only to criminal liability but also to civil liability to the victim for the greater of $5,000 or three times actual damages for each violation.

But other states, including Texas, follow the federal “one-party consent” rule. A multi-state business, or a business with clients or contractors in other states, needs to consider carefully the interplay between the sometimes conflicting rules. The difficulty is illustrated by a California Supreme Court case involving the unconsented recording of telephone conversations between employees in Georgia (a one-party consent state) and clients in California (an all-party consent state). In an appropriately Solomonic decision, the court in Kearney v. Salomon Smith Barney, Inc. applied the Georgia rule for past actions but the California rule for future ones. As a further illustration of the uncertainty facing multi-state actors, the court observed that the various “decisions that had considered a legal challenge to the recording of an interstate telephone conversation had reached differing conclusions as to which state’s law should apply.”

We’ll look next week at another recent Ninth Circuit decision.