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Issue Spotter: Say Good Things About a Good Employee?
If company policy is no letters (other than to verify periods of employment), then do not violate
company policy by writing a letter even if favorable. If company policy is unclear, so you think
you have authority to write a letter, it still poses possible problems (unless there is a state statute
that protects such communication). If you write a letter for one former employee to a company
but not for another to the same company, then failure to write a letter can be taken as a negative
signal and be possible grounds for suit (this has happened). Even if you write a letter for Jeff that
is positive, if he does not get the job, it is possible that he could still sue for defamation because
the letter was not positive enough (this has happened). Such litigation has reduced the flow of
information that could be help good people.
Add. Case: Gray v. AT&T (8th Cir., 2004)--Gray was fired from AT&T for falsifying reasons for
absences. A consultant company handled such matters for AT&T, including refuting her claim
that she was due unemployment compensation. She sued AT&T for defamation because the
matter of her dismissal was told to a third party, the consultant. The district court dismissed.
Gray appealed.
Decision: Affirmed. To show defamation in Missouri she must show 1) publication 2) of a
defamatory statement 3) that identifies her 4) that is false 5) that is published with fault and 6)
Add. Case: Frank B. Hall & Co. v. Buck (Ct. App., Tx., 1984)--Buck, a successful insurance
salesman, was hired by Hall and appeared to be successful again. He was fired by Hall’s
manager, who then told several people, including prospective employers, that Buck was a
miserable person in all respects; Buck could not get another job. He sued and won. Hall
appealed.
Decision: The $1.9 million in damages for defamation was upheld. The statements by Buck’s
former manager were intended to be taken seriously, they were libelous or slanderous, they were
Add. Case: Crump v. P&C Food Markets (Sup. Ct., Vt., 1990)--Crump, an 18 year employee,
received food deliveries at a grocery store. Two cartons of food were damaged; the driver told
Crump to keep them. Company policy was to put damaged good in a salvage area for
distribution to employees, but Crump took the cartons home and was fired. Crump said the
cartons were gifts from the truck driver, so he was not a thief. Managers told outsiders that
Crump was a thief and a “problem employee.” He sued for defamation and was awarded
$19,000 damages and $25,000 punitive damages. P&C appealed.
Decision: Defamation requires: 1) false and defamatory statement; 2) negligence, or more, in
publishing the statement; 3) to at least one third party; 4) lack of privilege in publication; 5)
damages; and 6) actual harm. P&C had a privilege to communicate the matter internally;
Add. Case: Simon v. Shearson Lehman (11th Cir., 1990)--Actor Burt Reynolds hired Simon to
be his business manager. Simon used Shearson to handle investments. A Shearson broker stole
funds from Reynolds’ account. When Simon figured that out and began fighting with Shearson,
Reynolds fired Simon. A Shearson supervisor told Reynolds and his attorney that Simon was a
part of the theft that occurred. Simon sued Shearson and won at trial. Shearson appealed.
Decision: The statements made by Shearson’s supervisors were slander per se—“a statement is
slander per se if it charges a person with crime or directly injures a person's professional
Add. Case: Williams v. Garraghty (Sup. Ct., Va., 1995)--Garraghty was a prison warden;
Williams was under his supervision. She accused him of sexual harassment. After an
investigation, Garraghty was demoted. He sued Williams for defamation, claiming the charges
were false. The jury awarded him $152,600 damages, the estimated value of his loss of career
earnings due to the demotion. He was also awarded punitive damages.
Decision: Affirmed. The “jury found by clear and convincing evidence that Williams had made
the statements [claiming harassment] with actual malice.” The review of the record supported
Add. Info: Liability Waivers: In many states, if an employee signs a waiver authorizing their
employer to give out information related to job performance, that serves as a bar against
defamation. In Cox v. Nasche (70 F.3d 1030) the 9th Circuit held that under Alaska law, which is
similar to statutes in other states, such waivers provide absolute privilege to the employer, even
if comments about the employee are claimed to have been made maliciously.
Add. Info: The National Conference of Commissioners on Uniform State Laws issued the
Uniform Correction or Clarification of Defamation Act in 1993. The purpose is to make libel
laws uniform in the states (there is currently a wide variety of rules) with respect to libel by news
organizations. National news organizations especially would like consistency in the laws. The
model law would require a potential plaintiff to request a correction or clarification within 90
days of the alleged libel before suit could be filed. The news organization would then have 45
days to respond. If there was no response, plaintiffs could proceed, asking for a full range of
damages, including emotional distress, and would also be awarded attorney’s fees if they won.
Cyberlaw: Tort Liability for Internet Servers
In general, if defamatory material is sent Internet, the sender is liable, but the server, such as aol,
is not. Similarly, infringement of copyrighted or trademarked material on the net is the
responsibility of the sender; the server is responsible only if notified of the infringement and fails
to act.
Defenses—Truth is the best defense; in some states it is an absolute defense. Various forms of
this include absolute privilege (such as debate in Congress and statements in court), conditional
privilege (good faith publication of defamatory statement), and constitutional privilege (opinions
in the press that lack actual malice).
CASE: Chambers v. Travelers Companies (8th Cir., 2012)—Chambers worked for Travelers for
20 years when employees under her supervision began to complain. Investigation of the matter
supported the employees. While under pressure for management style, she lied about taking her
daughter with her on a business trip. Fired; she sued for defamation and lost. She appealed.
Decision: Affirmed. Defamation must be communicated to others, be false, and be intended to
Questions: 1. Could Chambers have sued employees under her supervision for giving negative
feedback about her?
Sure, but that would have not gone anywhere. The employees had the right, by company policy,
2. Do you think Chambers had adequate opportunity to respond to the negative aspects of the
information provided about her?
There is no indication that company process was not fair. Chambers’ wanted to grill each
employee under her and respond one-by-one. But the supervisors found common complaints
Add. Case: Noel v. River Hills Wilsons (Ct. App., Calif., 2003)—Noel worked as a temp for
GTE. On his background application, he minimized his criminal background, claiming he got
parole as a youth. In fact he had multiple felony convictions. That was uncovered by CP, a
background check firm. CP also contacted a manager at Wilsons, where Noel had worked
before. There was nothing negative in the file, but a manager accidentally pulled the wrong file
and gave a negative report on Noel to CP. That information was included in the report to GTE
also. Noel sued Wilsons and the manager for defamation. Trial court granted summary judgment
to defendants on grounds of privilege. Noel appealed.
Decision: There is a conditional privilege against defamatory statements made without malice
on subjects of mutual interest—such as employment background. Wilsons had the right to
Add. Case: Riddle v. Perry (Sup. Ct., Utah, 2002)--When testifying about proposed legislation
before a committee of the Utah House, Perry implied that Riddle had bribed a member of the
legislature who sponsored the bill in question. Riddle sued Perry for defamation. The trial court
dismissed the suit, holding that Perry was protected by absolute privilege. Riddle appealed.
Decision: Affirmed. The statements made by Perry about Riddle were defamatory. However, a
legislative witness has absolute privilege against defamation actions. Since Perry was testifying
Add. Case: Yeagle v. Collegiate Times (Sup. Ct., Va., 1998)--Student newspaper at Virginia
Tech published an article that called the vice president for student affairs as the “Director of
Butt Licking.” He sued the paper for defamation. The trial court dismissed the suit; He
appealed.
Decision: Affirmed. The phrase at issue could not reasonably be considered as conveying factual
information and so cannot be the basis for as suit for defamation. The phrase was “rhetorical
Add. Case: Dilworth v. Dudley (7th Cir., 1996)--The Mathematical Assn. of America published a
book by math prof. Dudley of DePauw University entitled “Mathematical Cranks.” Dudley’s
book was about math works he thought were particularly foolish. One article cited was by an
engineer named Dilworth, who published an article Dudley attacked: “His article reads as if it
is by someone convinced, and whose mind is not going to be changed by anything. It is, in two
words, a crank....” Dudley said that the cranks attacked in the book ran from being trivial cases
to those who were convinced they had uncovered a brilliant idea that everyone else, in a
conspiracy, refused to recognize. Dilworth sued for defamation; the trial court dismissed.
Dilworth appealed.
Decision: Affirmed. “The word ‘crank’ is incapable of being defamatory; it is mere ‘rhetorical
hyperbole.’ This is a well-recognized category of, as it were, privileged defamation.... An
example of a math crank would be someone who spent his time trying to square the circle. To
Add. Info: Disparagement: The good name of a person in business, or the good name of a
product in business may be damaged by disparagement, which is much like defamation. The
following cases provide examples of both:
Add. Case: Menefee v. CBS (Sup. Ct., Pa., 1974)--Menefee did radio shows in Philadelphia.
His talk show was cancelled by CBS, which owned the station. The director told the media that
Menefee was fired because of poor ratings and that he could not draw an audience. Menefee
sued for disparagement, claiming that these statements about his professional ability were false
and caused him economic hardship. Trial court dismissed the case; plaintiff appealed to the high
court of Pennsylvania.
Decision: Menefee “had an intangible property interest in his broadcasting personality ... a
statement that his program could no longer attract satisfactory ratings would tend to disparage
Add. Case: Eagle Traffic Control v. Addco (E.D. Pa., 1995)--Eagle provides safety equipment
to highway worksites. Eagle bought flip disk boards (diesel and battery powered signs that
display warnings to motorists) and a light emitting diode (LED) board (which flashes
programmed messages to motorists) from Addco. The equipment took more power to operate
than Addco claimed and misfunctioned, so Eagle’s highway contractors were unhappy. Eagle
sued Addco for disparagement. Addco moved to have the count dismissed.
Decision: Under the Restatement, “a disparagement cause of action arises when one publishes a
statement with the intent to cast doubt upon the existence, extent, or quality of another's land,
chattels, or intangible things, and the statement is so understood by its recipient.” Trade
International Perspectives: Libel in Foreign Courts
Media in many countries is not given the high level of protection against libel suits they have in
the U.S. The U.K. is much more generous in its notions of libel, so it is not uncommon for a
party libeled in the press to sue for publication of the story in the U.K., but not bother to sue in
the U.S., where it is nearly impossible to win a judgment against the media for printing false,
damaging information. In the U.K., unless the statements can be shown to be true, if they
damaged reputation, there is a solid suit; actual malice need not be shown.
Add. Info: Malicious Prosecution—Parties who are sued for a tort, and win, may then have a
tort action for malicious prosecution, it can be shown that the former plaintiff acted with malice,
using the legal system as a weapon with no justification for the action that was brought. A claim
of malicious prosecution cannot be filed until all preceding litigation is exhausted, including any
appeals.
Add. Case: Fust v. Francois (Ct. App., Mo., 1995)--Francois owned land next to Fust. He
lobbied to get his land rezoned for commercial development. The Fusts opposed the rezoning.
Francois offered to buy the Fusts’ property; they refused. There were years of nasty exchanges.
Francois sued the Fusts for trespass, mental anguish, and defamation. His suit was dismissed
but he threatened further legal action. Fusts sued for malicious prosecution. Jury awarded $2.75
million in compensatory and punitive damages; the judge reduced the total to $1 million.
Francois appealed.
Decision: Affirmed. Fusts showed: 1) an earlier lawsuit against them; 2) by the defendant; 3)
termination of that suit in Fusts' favor; 4) lack of probable cause for that suit; 5) malice by
Discussion Question
Accidents and injuries caused by another party’s actions are likely to be covered by the tort
system. When we inflict injuries on ourselves due to our own carelessness, there is no fault by
another. To handle these cases we purchase insurance. But when we suffer an injury due to the
intentional or negligent actions of another, they will be held responsible. Under strict liability,
even if there is no negligence, so long as the other person has placed into the chain of events the
thing that causes or contributes to any injury, they may be held responsible. The standards of tort
law change through time and vary according to the jurisdiction in which one resides.
Case Questions
1. Reversed and remanded. Commercial speech is expression that predominantly relates to the
economic interest of the speaker. Negligence, not actual malice, is the common law standard in
defamation actions such as this one involving commercial speech. Olympic broadcast that
2. (answer on Internet for students) No. “False imprisonment is the intentional restraint or
detention of another without just cause.” Plaintiff voluntarily went to her manager’s office. No
3. The NY high court held that res ipsa loquitur applies. Her arm was fine before surgery,
damaged afterwards. The problem must have been with the anesthesia used, the way her arm was
4. (answer on Internet for students) The Supreme Court of Nevada upheld a jury award of
punitive damages, even though there were no compensatory damages, for the torts of assault,
battery, and intentional infliction of emotional distress. It did not find there to be false
5. The appellate court found that the editorial referring to Katz as a “liar” was libelous per se
and the evidence established actual malice. The plaintiff must prove that the defamatory
publication was made with actual malice—that is, with knowledge that it was false or with
reckless disregard for whether it was false or not. The reckless disregard for the truth that is
6. (answer on Internet for students) There is no invasion of privacy claim. The Florida high court
noted that sexual advances and touching that was claimed did not fit the four categories. The one
7. South Carolina does not recognize the tort of negligent enablement of imposter fraud. The
banks and credit card companies had no direct relationship with Huggins that would create a
8. (answer on Internet for students) Yes, the Washington State Supreme Court said (answering a
question from the 9th Circuit). The Supreme Court held that damages for emotional distress were
9. Reversed and remanded. The Ski Area Safety Act states that “each person who participates in
the sport of skiing accepts the dangers that inhere in that sport insofar as the dangers are obvious
10. The actions of the defendant were not extreme or outrageous and there was no intent to cause
Ethics Question
From the standpoint of the firms under attack, the tactic is responsible. If a firm is hurt by rumors
or improperly stated claims about its behavior, it has the right to be aggressive. Litigators are
using strong tactics when they sue for huge amounts, which give the defendant pause to consider
Essay Questions from Cases:
A mother and her son were killed when an American Airlines plane hit their house in New York.
The father and surviving children, who were not home at the time of the accident, sued for
mental distress. The airline moved to dismiss the claim. Will dismissal most likely be granted?
Why? [Lawler v. American Airlines, 450 F.Supp.2d 432, S.D. NY (2006)]
Answer: Motion granted. Under New York law, the surviving family members cannot recover
damages for alleged mental injuries. They did not observe the accident, they were not physically
A person stole a car from a car rental agency. The police spotted the car and gave chase. The
thief hit another car, seriously injuring that driver. The person who stole the car fled and was not
caught. The injured person sued the rental agency for negligence for not keeping tighter control
of their vehicles. Is there likely to be a case? What issues arise? [Phillips v. Budget Rent-a-Car
Systems, 864 N.E.2c 709, Ct. App., Ill. (2007)]
Answer: The question of security over the vehicles was reviewed at trial. Security was quite tight
and there were few thefts, so there was no negligence. Further, proximate cause was lacking. The
Internet Assignment
Law. Com: www.law.com/jsp/law/index.jsp
The ‘Lectric Law Library: www.lectlaw.com/
American Bar Association: www.abanet.org/
Look at these general law websites for useful information ranging from specific definitions of
legal terms (see the Legal Dictionary on www.law.com) to discussions of general topics to details
about recent developments in tort law and other areas.
