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LEWIS v. ELLIOTT

January 17, 1986

RICHARD LEWIS, Plaintiff,
v.
ROBERT ELLIOTT, et al., Defendants



The opinion of the court was delivered by: OBERDORFER

 I.

 This action involves a claim of defamation by plaintiff Richard Lewis against three defendants: National Capital Systems, Inc., Rehab, Inc., and Robert Elliott. Plaintiff was employed at the Department of Health and Human Services (DHHS) for over nineteen years. At the time of the incident in question, plaintiff was a GS-14 and his title was Chief of the Software Management Branch, Division of Data Processing. Part of his job was to oversee work performed by companies that contracted with DHHS to ensure that the work was being performed according to the scope of work which was prepared for it. On or about August 1983, defendant Robert Elliott was installed by defendant Rehab, a corporation that contracted with DHHS, as its interim project manager. It was part of plaintiff's job to oversee the work done by defendant Rehab and managed by defendant Elliott. Thus plaintiff and defendant Elliott had frequent contact, contact which the evidence at trial indicated was frequently marked by tension between the two.

 The communications at issue in this case arose from DHHS's search for a company to take over Rehab's contract. Rehab's contract with DHHS was to expire on September 30, 1983, and Rehab was not eligible to renew it. DHHS solicited bidders and chose a firm unrelated to Rehab, Capital Systems Inc., to assume the contract. On December 14, 1983, defendant National Capitol Systems, a firm unrelated to either Rehab or Capital Systems and an unsuccessful candidate for the contract recently awarded by DHHS, initiated a bid protest letter to Margaret Heckler, Secretary of DHHS, claiming that plaintiff had violated a provision of the Ethics in Government Act, 18 U.S.C. § 208(a) by considering an offer of employment with Capital Systems, the successful bidder. Attached to the bid protest letter was an affidavit prepared by defendant Elliott stating that Lewis had told him that Capital Systems had made Lewis a very good offer and that it would take a salary of $58,000 per year to top the offer he had received from Capitol Systems. Plaintiff's Exhibit F. National Capitol Systems had heard through Elliott's superior at Rehab that Elliott would be willing to make such a statement about plaintiff. National Capitol Systems also sent a second letter on December 29, 1983, reasserting its claim. An internal investigation ensued after which plaintiff was cleared of any wrong-doing. Plaintiff nevertheless claimed that he suffered physical and psychological duress and loss of future income because of the alleged defamatory publication.

 The case proceeded to trial on October 7, 1985, and on October 10, 1985, went to the jury to decide all issues except plaintiff's prayer for punitive damages which the Court ruled the jury could not award. The jury was given a bifurcated verdict form in which it was first asked to determine whether any statements in the bid protest letter or the attached affidavit were false. The jury answered "Yes." Verdict Form (filed Oct. 10, 1985). The jury was then asked to find whether any of the false statements, read in context, were defamatory. Again the jury found that they were. Id. Finally, the jury was asked to determine by a preponderance of the evidence if any of the defendants had acted with malice, defined as personal ill will, spite, hostility, or a deliberate intent to harm the plaintiff in making the false and defamatory statement or statements. Standardized Civil Jury Instructions for the District of Columbia (D.C. Jury Instructions) 17-13 (rev. ed. 1985). As to defendants Elliott and Rehab, the jury answered "Yes." Id. As to defendant National Capitol Systems, the jury answered "No." Id. Thus the jury exonerated defendant National Capitol Systems and found defendants Elliott and Rehab liable for the alleged defamation. The jury verdict announced against defendants Rehab and Elliott was in the amount of $475,000. Id. This action is now before the Court on defendants Rehab and Elliott's Motions For Judgment Notwithstanding The Verdicts, And, In The Alternative, A New Trial (Defendants' Mem.) (filed October 18, 1985), and plaintiff's opposition thereto (filed Nov. 4, 1985).

 II.

 In moving for a judgment notwithstanding the verdict, the same burden rests with defendants as when they moved for a directed verdict. Vander Zee v. Karabatsos, 191 U.S. App. D.C. 200, 589 F.2d 723, 726 (D.C. Cir. 1978), cert. denied, 441 U.S. 962, 60 L. Ed. 2d 1066, 99 S. Ct. 2407 (1979). That is, a motion notwithstanding the verdict should not be granted unless the evidence, together with all inferences that can reasonably be drawn therefrom is so one-sided that reasonable men could not disagree on the verdict. Id.

 The standards for granting a judgment notwithstanding the verdict and new trial are distinct, the standard for a new trial being less onerous. National Car Rental System, Inc. v. Better Monkey Grip Co., 511 F.2d 724, 725 (5th Cir.), cert. denied, 423 U.S. 894, 46 L. Ed. 2d 126, 96 S. Ct. 193 and 423 U.S. 986, 96 S. Ct. 394, 46 L. Ed. 2d 303 (1975). A trial judge should grant a new trial if the verdict is against the weight of the evidence, damages are excessive, for other reasons the trial was not fair, or substantial errors occurred in the admission or rejection of evidence or the giving or refusal of instructions. 11 C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure § 2805 (1973); Montgomery Ward & Co. v. Duncan, 311 U.S. 243, 251, 85 L. Ed. 147, 61 S. Ct. 189 (1940); Baber v. Buckley, 322 A.2d 265, 266 (D.C. App. 1974).

 In deciding whether to grant a new trial, the court should be mindful of the jury's special function in our legal system and hesitate to disturb its finding. Milos v. Sea-Land Service, Inc., 478 F. Supp. 1019, 1021 (S.D.N.Y. 1979), aff'd. mem., 622 F.2d 574 (2d Cir.), cert. denied, 449 U.S. 954, 101 S. Ct. 360, 66 L. Ed. 2d 219 (1980). Nevertheless, if the court after considering all the evidence and the jury's verdict is left with the "definite and firm conviction" that a mistake has been committed, it should grant a new trial. 11 Wright, Miller & Cooper, supra, at § 2806.

 A.

 Defendants first argue that "there was nothing defamatory in connection with the Lewis case." Defendants' Mem. at 3. A defamatory statement is one "which tends to expose a person to scorn, hatred, contempt or ridicule, thereby discouraging others in the community from having a good opinion of, or from associating or dealing with, that person." D.C. Jury Instruction 17-1; Prosser and Keeton on Torts 773 (5th ed. 1984); Restatement (Second) of Torts § 559 comment e (1965). There was evidence introduced at trial from which a jury could reasonably conclude that defendant Elliott prepared an affidavit stating that he had been told by plaintiff that plaintiff had a job offer from the successful bidder for a DHHS contract, and that defendant knew this affidavit was to be attached to a bid protest letter alleging that plaintiff violated the Ethics in Government Act. Plaintiff's Exhibits F, G. The two communications assert that plaintiff breached an ethical duty imposed by his government job. Thus, when viewed according to all the circumstances surrounding publication there is ample basis for a jury finding that the communications are capable of a defamatory meaning. See Olinger v. American Savings and Loan Assoc., 133 U.S. App. D.C. 107, 409 F.2d 142 (D.C. Cir. 1969). Neither a new trial nor a judgment notwithstanding the verdict is justified on this ground.

 B.

 Defendants next argue that the Court should have held that their conduct was protected by an absolute privilege. Absolute privilege attaches to statements made "preliminary to or in the course of a judicial proceeding" Brown v. Collins, 131 U.S. App. D.C. 68, 402 F.2d 209, 212 (D.C. Cir. 1968) (quoting Restatement (Second) of Torts § 587). The purpose of the privilege is to protect the integrity of judicial proceedings by enabling participants "to state and support their positions without instilling a fear of retaliation, i.e., an action for damages." Sturdivant v. Seaboard Service System, Ltd., 459 A.2d 1058, 1060 (D.C. App. 1983).

 Defendants argue that the bid protest, and derivatively the attached affidavit now at issue, should be viewed as part of a judicial proceeding because the bid protest procedure was "an administrative proceeding within the United States Government which wound its way to a final conclusion." Defendants' Mem. at 3. "Judicial" proceedings can include quasi-judicial proceedings, such as arbitration proceedings, Sturdivant, supra, 459 A.2d at 459, or a hearing before the Hacker's License Appeal Board, Mazanderan v. McGranery, 490 A.2d 180 (D.C. App. 1984).

 Even if the affidavit were viewed as a part of a complaint in a quasi-judicial proceeding, it is the law in the District of Columbia that:

 
the absolute privilege attaches to statements in affidavits filed in judicial proceedings only if it appears that the affiant had probable cause to make the affidavit. . . . The question of whether undisputed facts constitute probable cause is one of law to be decided by the court.

 King v. Hildebrandt, 331 F.2d 476 (2d Cir. 1964); Slater v. Taylor, 31 App. D.C. 100, 104-05 (1908). Although this rule was applied in the context of an affidavit preliminary to a lunacy proceeding, it could by analogy apply as well in the civil context. Here, it cannot be said that undisputed facts establish probable cause since no facts other than defendant Elliott's testimony confirm the alleged conversation or its content. For these reasons, the affidavit at issue should not entitle defendant Elliott to an absolute privilege for his statement. Defendant Elliott's only legitimate interest in making the affidavit at issue was to bring to the government's attention, although indirectly through a third party's bid protest, potentially unethical conduct of a government employee. As such, the affidavit is properly characterized as a petition to the government for redress of a grievance rather than a filing in a quasi-judicial proceeding.

 In the recent Supreme Court case of McDonald v. Smith, 472 U.S. 479, 105 S. Ct. 2787, 86 L. Ed. 2d 384 (1985), an individual wrote to the President as well as other United States government officials questioning the character of an applicant for the position of United States Attorney. The Supreme Court held that when an individual is exercising this right under the Petition Clause of the First Amendment, only a qualified privilege attaches. The Court stated the strong policy reasons behind its holding:

 
an individual, who maliciously, wantonly, and without probable cause, asperses the character of a public officer in a written or printed paper, delivered to those who are invested with the power of removing him from office, is responsible to the party injured in damages, although such paper is masked under the specious cover of investigating the conduct of such officer for the general good. Public policy demands no such sacrifice of the rights of persons in an official capacity, nor will the law endure such a mockery of its justice.

 105 S. Ct. at 2790 (emphasis in original) (quoting Gray v. Pentland, 2 Serg. & R. 23 (1815)).

 In Bradley v. Computer Sciences Corp., 643 F.2d 1029 (4th Cir.), cert. denied, 454 U.S. 940, 70 L. Ed. 2d 248, 102 S. Ct. 476 (1981), plaintiff was an electronic engineer in the federal Defense Communications Agency. Defendant corporation was a government contractor. The individual defendants were employees of that corporation. Defendant corporation wrote a letter to plaintiff's supervisors complaining about improper conduct on the part of plaintiff. The letter served as the basis for an official reprimand received by plaintiff. In plaintiff's subsequent libel suit against defendant corporation and its employees, the court characterized the right exercised by defendants as the "right to petition for redress of grievances," and held defendants' conduct to be protected by a qualified privilege. To recover damages, defendants would have had to have shown that the qualified privilege "was . . . abused." Id. at 1033.

 The court in Stern v. United States Gypsum, Inc., 547 F.2d 1329 (7th Cir.), cert. denied, 434 U.S. 975, 54 L. Ed. 2d 467, 98 S. Ct. 533 (1977) dealt with a complaint by a corporation and some of its officers concerning an internal revenue agent's ...


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