In the 2011 suit, a judge ruled that Marty Singer's communications were not protected, setting off reactions in the legal community. ACLU warned about the consequences of trying to interpret legal letters so minutely as to make them open to claims of extortion.
On Tuesday, California appeals court judge Steven Suzukawa analyzed that Singer's communication in the letter did not constitute criminal extortion. Citing Flatley v. Mauro, in which the California Supreme Court had found a narrow exception in cases where "the defendant concedes, or the evidence conclusively establishes, that the assertedly protected speech or petition activity was illegal as a matter of law."
Suzukawa observed in his ruling "In contrast with the demand letters in Flatley … Singer's demand letter did not expressly threaten to disclose Malin's alleged wrongdoings to a prosecuting agency or the public at large."
The judge went ahead to observe that Malin's argument did not stand because "The demand letter accused Malin of embessling money and simply informed him that Arazm (Singer's client and Malin's business partner) knew how he had spent those funds. There is no doubt the demand letter could have appropriately noted that the filing of the complaint would disclose Malin had spent stolen monies on a car or a villa, if that had been the case. The fact that the funds were allegedly used for a more provocative purpose does not make the threatened disclosure of that purpose during litigation extortion."
The judge also observed that the extortion law in California says, "the threatened disclosure of a secret affecting a third party, who is neither a relative nor family member, does not constitute extortion."
The appeals court observed that litigation privilege provided immunity for certain acts and statements made in connection with litigation and that "the 'secret' that would allegedly expose him (Malin) and others to disgrace was inextricably tied to Arazm's pending complaint."
Hence the claim of extortion against Singer did not survive. However, other claims regarding illegal hacking and wiretapping activities to access Malin's communications are separate as such acts are not protected activities.