Over the past several months, I have posted a number of articles about the campaign of intimidating copyright demand letters from Mathew Higbee, who tries to extract money from individuals, nonprofits and small businesses by threatening to file frivolous copyright lawsuits. This is the first in what I expect will be series of articles about a different sort of campaign of frivolous threats: companies that try to clean up their reputations by hiring lawyers to send frivolous threats of libel litigation. I'm not sure which is worse.
Today’s story begins with an article that ran in the Washington Post back in June, 2020, focusing on the role played by a small Miami-based pharmaceutical corporation, run by hedge fund managers and called Ridgeback Biopharmaceutics. The Post noted that Ridgeback had invested in a potential antiviral therapy, developed at Emory University with public financing, but that, when it failed to secure federal financing to develop the drug further, it made a killing by selling its rights to Merck. These facts, the reporter suggested, illustrate “the perception that companies are profiteering during a global medical crisis — especially in cases where inventions were funded by taxpayers.” The article also tied the situation to the revelations from BARDA whistleblower Rick Bright, who cited this as one of the examples of political pressure being applied to secure federal financing for private profit.
The article quoted a few nongovernmental sources commenting on the situation, including the executive of a rival biotech firm; Harvard Medical School Professor Aaron Kesselheim, and Jamie Love, the founder of Knowledge Ecology International. Both Kesselheim and Love were quoted as expressing concern that Ridgeback was “flipping” the medication – Kesselheim said that it was analogous to a house flipper, while Love said that “'molecule-flipping' is a good characterization of what it is.” This language was reflected in the headline of the article: “Hedge fund manager stands to profit on ‘flip’ of taxpayer-funded coronavirus drug.” Love also noted that it had, in the past, been unusual to see much engagement by private investors in medications addressed to Ebola and SARS, which have been “backwater areas in neglected disease.” But now, he said, private parties were rushing to invest.
Ridgeback’s Libel Offensive
Ridgeback’s owner, it seems, is the unusual capitalist who finds it insulting to be accused of having made a quick profit by finding investment opportunities in an arena long neglected by other investors. But instead of simply sending a note explaining why it disagreed, and trying to persuade its critics based on the merits of the evidence, Ridgeback hired Thomas Clare, a well-known plaintiffs’ libel lawyer, to complain to the Washington Post’s editors and legal department about the article; the result was that the Post made some minor changes in the article, described in an editor’s note. Mr. Clare claims that the Post “agreed” to make these changes (although it is not clear that there has been any “agreement.”) But the article’s central point, about molecule- flipping and profiteering, remained unchanged.
Ridgeback then turned its sights on Jamie Love, sending him a letter that warned that the Washington Post had already changed its story in response to its “concerns”; stated that Love’s “flipping” statement was “demonstrably false"; and ”demand[ed] that [Love] set the record straight by immediately retracting your defamatory remarks.” Mr. Clare made a few factual representations about what his client had done vis-a-vis the chemical on question. His letter continued by contending the Love had wrongly used the word “backwater” to denigrate the African continent as well as China and Hong King, and seeking retraction of that statement as well (a later letter appears to suggest that Love’s allegedly calling Africa a backwater was “racist” — that accusation could be itself defamatory if it were not so plainly a baseless opinion; name-calling is generally not defamatory). To underline the legal peril in which Love had supposedly placed himself, Mr. Clare dropped a footnote stating that the letter should be considered a demand for retraction under section 770.02 of the Florida Statutes. It is my assumption that Mr. Clare was hoping that, if he could intimidate Love into retracting his use of the term “flipping,” he could then go back to the Post and ask for further changes. Interestingly enough, Mr. Clare did not make any complaint to the Harvard professor who had also been quoted by the Post using the term “flipping.” It is my assumption that Mr. Clare and his client figured that the Harvard professor would be very able to defend himself against a frivolous libel claim, but that Love might be an softer target.
Love, however, did not back down. Instead, he wrote back to explain why he had said what he said, and asking a detailed list of pointed questions questions, asking as well for documentation of Mr. Clare’s statements praising his client. For example, he said he could not assess the accuracy of Ridgeback’s denial of “molecule flipping” without seeing Ridgeback’s agreements with Emory and with Merck, outlining the companies’ relative roles in the development of EIDD-2801, the relevant COVID medication. He also noted that he had not, as Mr. Clare claimed, said that Africa or Hong Kong is a backwater – he said that certain diseases have been neglected and thus have been backwaters for investment. He noted that, instead of expounding Ridgeback’s role in developing EIDD-2801, Mr. Clare’s letter was largely devoted to praising his client’s work om mAb114, an Ebola medication. Apart from noting that this was something of a tangent from the claim that Ridgeback had been defamed about its COVID work, Love posed some pointed questions about the relative shares of government and Ridgeback funding in this work. Love concluded, “if Ridgeback wants some type of compliment for its efforts in this space, regarding the risking of its own money, I . . . would need facts and more than just a letter from a boutique law firm that specializes in defamation litigation.”
After Love had received no response to these questions, I followed up Love’s query a few days later with some questions of my own. I told Mr. Clare that I was working on an article about bullying libel demand letters, not only asking whether Ridgeback was ready to answer Love’s questions and provide him with documents, but also pointing out some reasons to think that Ridgeback could not succeed on a defamation claim. First of all, Mr. Clare had not so much taken issue with the veracity of Love’s statements as quoted by the newspaper as with the context into which the Washington Post had placed the quotations; but if that was the issue, then Ridgeback’s gripe was with the article and not with Love. Second, given that Mr. Clare wanted Love to be afraid of being sued because of Mr. Clare’s kvelling about how the mighty Washington Post had already backed down, it was remarkable that the Post story had retained the assertion that Ridgeback was guilty of flipping. So if Mr. Clare was satisfied with the Post’s clarifications as he was claiming to be, why was he threatening to sue Love for using the term? And as for the “backwater” comment, no reasonable person could read the quotation from Love and think he was characterizing specific geographical areas as backwaters – he said that certain diseases were backwaters for investment, and not only is there no reason to think that what Love said is false, but Emory University itself has described the project from which its COVID-19 treatment emerged as being devoted to attacking diseases that are “generally not profitable enough for industry to pursue, and thus are considered neglected diseases.”
Moreover, even Love’s “backwater” reference was false, even if it was not merely an opinion, defamation claims can be asserted only by the person about whom the defamatory statement was made – how would Ridgeback have standing to sue for alleged defamation of a continent or a disease? Plainly, with regard to Love’s use of the term “backwater,” in this respect, Mr. Clare’s letter is just plain chest-thumping intended to intimidate both because its sender is a big macher, and because a longer letter citing additional complaints might make Love worry more about his potential exposure.
My note to Clare also pointed to the caption on his letter to Love, "Not for Publication or Attribution." I was wondering whether, like an earlier Virginia defamation lawyer, John Dozier, he thought he could prevent the victims of his bullying from calling public attention to his demands. This caption is apparently a common feature of demand letters from his firm. See here, here and here.
Ridgeback’s Response to Being Accused of Bullying
Ridgeback responded, first to me and then to Love, by repeating its assertion that it was not molecule flipping, but it stoutly refused to produce any evidence to support its contentions, and the tone of its responses was, in a number of respects, considerably milder. Both letters asserted that Ridgeback has a continuing role in the development of the COVID medication, but neither letter included any specific dollar amounts, neither compared the amount of taxpayer investment with the amount of private investment; and most important they did not include any of the documentation that Love and I had requested. They letters seemed, at best, a face-saving maneuver accompanying Ridgeback’s declaration that it was not going to sue Love despite his failure to meet the demand for retraction.
The letters contained statements that I consider false. First, Mr. Clare declared to me that “any suggestion that Ridgeback has threatened to sue Mr. Love is completely false”; to Love, he wrote that I “seem to be under the misapprehension that Ridgeback has threatened to sue you for libel . . ..For the avoidance of all doubt, Ridgeback has never made such a threat, and we sent our previous letter to (1) identify the false, misleading, and damaging statements that you made and (2) determine whether you were quoted accurately.” He went on to say that, given that the Washington Post “has made retractions,” after what Mr. Clare told me was his “confronting” the Post and engaging with its libel counsel (does he admit to threatening to sue the Post>), he was not going to bother engaging any back -and-forth with Love about the conclusory facts that he was asserting in his letters.
Well, no. Mr. Clare’s letter to Love did not simply “request” that Love clarify his remarks (although his second letter to Love phrases this as a request). He told Love that his quoted assertion about Ridgeback was “demonstrably false,” and the letter was a demand, not a request “I demand that you set the record straight by immediately retracting your defamatory remarks.” Lest Love be in any doubt that he was facing the prospect of being sued, Mr. Clare dropped a footnote to the Florida retraction statute, which limits the damages that can be awarded in a libel suit if the alleged defamer responds appropriately to a demand for retraction. The letter closed with a warning that Love should “treat this with the seriousness that Ridgeback deserves.”
Now, Tom Clare is too sophisticated a lawyer to think that a letter like this would not be treated as a threat of litigation, and, indeed, I have chatted with a number of friends in DC who represent media companies in libel litigation, including against Mr. Clare. Every one of them indicated either (or both) that the letter should fairly be read as at least implicit threatening to sue, or that, if one of their clients received a letter like this, indeed from a libel specialist lawyer, their client would be prudent to assume that they faced suit if they failed to retract.
It is a mild threat, to be sure – it did not explicitly say “we will sue you,” and it did not include litigation hold language. But it seems to me that Mr. Clare imperils his own credibility by denying that Ridgeback ever threatened to sue.
Conclusions – IS Ridgeback a Molecule Flipper?
I generally recommend that when people received demand letters, the best response is to describe, in level-headed manner, why they are right and why they were entitled to say what they said; it is best to write such letters in consultation with potential litigation counsel (even if the lawyer does not sign the letter). Love’s letter – which so far as I can tell was written before obtaining potential libel counsel— was very well done. He did a very good job of keeping the temperature down, and his side comments on the impact of cancer on a family represent a nice personal touch. And the upshot was a complete capitulation on Ridgeback’s part.
And more than that: it seems to me that the upshot of the exchange of correspondence is to raise one’s level of confidence in the fairness of Love (and Kesselheim) having characterized Ridgeback as a molecule flipper.
I come to this question without any predispositions, other than the fact that I have known Jamie Love for many years and I respect his judgment; and colleagues at Public Citizen who do specialize in these issues share Love’s concerns, especially in light of the questions Love posed and Ridgeback’s having blown them off. Love and Kesselheim gave their reasons, and although Mr. Clare disputes them, his demand letter to Love said that it is “demonstrably false.” In libel law terms, to say something that is “demonstrably false” could be only an assertion that it is capable of being proved false – that is, to say, the phrase can be only an assertion the statement is one of fact, which could be true or false, and not of opinion, which is not actionable.
And most important, when given the opportunity to document falsity, Mr. Clare punted, saying that it is not worth presenting evidence on the question because the Washington Post has already “made retractions.” But of course the Post has not retracted the part of its article that said that characterized Ridgeback’s actions as a “flip.” At most, it appears to me that the Post made some small clarifications on issues that are tangential to the gist of the concerns that Mr. Clare expressed to Love. Moreover, Mr. Clare has undercut the credibility of the assertions made in his own letters by directly denying having threatened to sue Love, and by asserting in his letters that Love referred to Africa as backwater. Neither of these statements is remotely true. So, if the statement that Ridgeback is a molecule flipper is just as false (or just as true) as the statements that Ridgeback never threatened to sue Love and that Love called Africa a backwater, then it would appear that there is good reason to believe that Ridgeback is a molecule flipper.
I do give Mr. Clare credit, however, for telling Love explicitly that Love need no longer be concerned that he is facing suit for his statements. Unlike Mathew Higbee, who commonly leaves the targets of his threatening letters to worry about whether a lawsuit is coming even after he and his client decide not to pursue litigation, Mr. Clare showed his class by retracting his threat of litigation – if only after claiming that he had never made a threat in the first place.