Opinion
Case No. 2:04-CV-00451PGC.
August 2, 2005
ORDER DENYING CROSS-MOTIONS FOR SUMMARY JUDGMENT
Plaintiffs Riddle Associates, P.C., and Jesse Riddle (collectively "Riddle Associates") move for partial summary judgment as to defendant Christopher Livingston's liability for defamation per se on account of Livingston's published statement "there is NO compliance at Riddle ASSociates." In response, Mr. Livingston moves for full summary judgment alleging that Riddle Associates are libel-proof, that the statement was subsidiary to a non-defamatory message, that the statement was rhetorical hyperbole not to be taken seriously by a reasonable person, and that Riddle Associates are limited purpose public figures. Because the court finds that a genuine issue of material fact remains in each claim, the court denies both motions.
BACKGROUND
The facts of this matter are set forth sufficiently in the court's prior order denying the defendants' motion to dismiss. Knowledge of those facts is presumed here.DISCUSSION A. Riddle Associates' Motion for Partial Summary Judgment
1. Defamation generally
In Utah, a published statement is defamatory if it tends to "impeach the honesty, integrity, virtue or reputation, or publish the natural defects of one who is alive, and thereby expose him to public hatred, contempt or ridicule." The words are "construed according to their usual, popular, and common acceptation."
UTAH CODE ANN. § 45-2-2 (2005) (cited in Computerized Thermal Imaging, Inc. v. Bloomberg, L.P., No. 1:00 cv 98 K, 2001 U.S. Dist. LEXIS 24905, at *6 (D. Utah Mar. 26, 2001)).
Western States Title Ins. Co. v. Warnock, 415 P.2d 316, 318 (Utah 1966) (citations omitted).
Utah law is particularly sensitive to statements tending to injure a person in his profession, trade, or business. Allegations of fraud or dishonesty with respect to a person's occupation are generally actionable per se without the hurdle of proving damages. For example, one of four categories usually considered defamation per se includes a "charge of conduct that is incompatible with the exercise of a lawful business trade, profession, or office."
Simpson v. Steen, 127 F.Supp. 132, 137 (D. Utah 1954).
Id.
Allred v. Cook, 590 P.2d 318, 320 (Utah 1979).
2. Defamation per se
The Tenth Circuit Court of Appeals recently reaffirmed that defamation per se in Utah occurs "when language is used concerning a person or his affairs which from its nature necessarily must, or presumably will, as its natural and proximate consequence, occasion him pecuniary loss. The presumption of damage inheres to the words of the writing itself." Thus, if a statement is defamatory per se, the plaintiff is not required to allege any special damages. As this court has previously recognized:
Computerized Thermal Imaging, Inc. v. Bloomberg, L.P., 312 F.3d 1292, 1297 (10th Cir. 2002) (emphasis in original).
"The real practical test, by which to determine whether special damage must be alleged and proved in order to make out a cause of action for defamation, is whether the language is such as necessarily must, or naturally and presumably will, occasion pecuniary damage to the person of whom it is spoken."
Simpson, 127 F. Supp. at 137 (quoting NEWELL, SLANDER AND LIBEL at 43).
The question then is whether Mr. Livingston's published statement would necessarily, or naturally and presumably, cause Riddle Associates harm. On the surface, it would seem that a statement alleging that a debt collection agency does not comply with the federal regulations that govern its daily activities would necessarily damage the professional reputation of the business. But in order to make a thorough examination of the issue, "the whole publication must be read and considered together in the sense in which the reader to whom it could be expected to come would ordinarily understand it."
Simpson, 127 F. Supp. at 136.
When Mr. Livingston's statement is examined in its published context, it is clear that the issue of whether it was defamatory per se remains a disputable issue of material fact to be decided by a finder of fact. The statement was published on a seemingly obscure world wide web forum presumably primarily used by consumers concerned about debt collection activity. The statements were published under pseudonyms including "The Avenger" and "begoodorelse," so there is some question whether anyone would take them seriously. There is no indication in the pleadings that creditors who might otherwise send accounts to Riddle Associates would also be accessing this forum. Therefore, the court cannot say conclusively whether the statement necessarily or naturally and presumably would result in pecuniary damage to Riddle Associates. Furthermore, Mr. Livingston argues that the statement was rhetorical hyperbole that no reasonable person would take literally. This argument again presents a question of material fact for a jury, not a matter of law for the court. Because Mr. Livingston's statement could be construed to have a pecuniary effect or no effect at all on Riddle Associates' professional reputation, its impact remains a debatable fact to be determined at trial and not a matter of law to be determined by this court in a motion for summary judgment. Therefore, Riddle Associates' motion for partial summary judgment is DENIED.
B. Mr. Livingston's Motion for Summary Judgment
1. Libel-proof Doctrine
Mr. Livingston contends that he cannot be held liable because Riddle Associates are libel-proof. A libel-proof plaintiff is a person whose reputation for a particular trait is so tarnished that "further statements regarding that trait even if false and made with malice, are not actionable because, as a matter of law, the plaintiff cannot be damaged in his reputation as to that trait." This doctrine has been adopted in narrow measure by some other jurisdictions, but apparently not in Utah. Even assuming Utah courts would adopt the defense, it is not persuasive in this case. Although consumers arguably may hold debt collection agencies in general disrepute, the court recognizes that a consumer's perception of a debt collection agency may be influenced by statements like the one published by Mr. Livingston. In addition, an important component of the libel-proof doctrine is that Riddle Associates' reputation be the result of more than allegations. For example, a criminal history may render a plaintiff libel-proof in certain circumstances. While Defendant in this case points out a few instances where Plaintiffs have been noncompliant, these episodes fall far short of demonstrating that Plaintiffs' business reputation was severely tarnished prior to Defendant's statement. Furthermore, a few civil judgments do not nearly rise to the level of a significant criminal history. The court concludes, therefore, that Riddle Associates are not libel-proof.
Church of Scientology Int'l v. Time Warner, Inc., 932 F.Supp. 589 (S.D.N.Y. 1996) (citing Guccione v. Hustler Magazine, Inc., 800 F.2d 298, 303 (2d Cir. 1986); Cardillo v. Doubleday Co., Inc., 518 F.2d 638, 639-40 (2d Cir. 1975)).
Lamb v. Rizzo, 242 F.Supp.2d 1032, 1037 (D. Kan. 2003); see also Guccione, 800 F.2d at 303.
Ray v. Time, Inc., 452 F.Supp. 618, 622 (W.D.Tenn. 1976); Cardillo, 518 F.2d at 639.
2. Limited Purpose Public Figure Status
Mr. Livingston further contends that Riddle Associates are limited purpose public figures. If true, Riddle Associates would have to show that Mr. Livingston's statements were made with actual malice. In contrast, statements regarding private citizens require a showing of mere negligence to be libelous. It is Mr. Livingston's burden to prove Riddle Associates' public figure status. There are two ways a person can become a public figure:
Carr v. Forbes, Inc., 259 F.3d 273, 278 (4th Cir. 2001).
[1] In some instances an individual may achieve such pervasive fame or notoriety that he becomes a public figure for all purposes and in all contexts. [2] More commonly, an individual voluntarily injects himself or is drawn into a particular public controversy and thereby becomes a public figure for a limited range of issues. In either case such persons assume special prominence in the resolution of public questions.
Gertz v. Robert Welch, Inc., 418 U.S. 323, 351 (1974); see also Russell v. Thomson Newspapers, 842 P.2d 896, 903 (Utah 1992).
Mr. Livingston believes that Riddle Associates fall into the second category — those that voluntarily inject themselves into a "particular public controversy" — because they regularly lecture on the subject of FDCPA compliance.
While there is no dispute over whether plaintiffs are active spokespersons on FDCPA compliance issues, Mr. Livingston has not identified a "public controversy" to which the plaintiffs have thrust themselves to the forefront. A public controversy is "not simply a matter of interest to the public; it must be a real dispute, the outcome of which affects the general public or some segment of it in an appreciable way." While issues of FDCPA compliance may be of great interest to debt collection agencies and of some interest to the public, Mr. Livingston has not identified any particular controversy, nor has Mr. Livingston identified anything Riddle Associates has said or done which has thrust it to the forefront of a public controversy. Riddle Associates simply provide advice concerning FDCPA compliance. If they have thrust themselves to the forefront of a public controversy, one wonders who is on the other side of the controversy? What are the issues involved? What are the proposed resolutions on each side? There may indeed be some controversy surrounding the FDCPA, but Mr. Livingston has failed to identify it. The court, therefore, cannot conclude that Riddle Associates are limited purpose public figures.
Waldbaum v. Fairchild Publications, Inc., 627 F.2d 1287, 1297 (C.A.D.C. 1980) (quoted in Wayment v. Clear Channel Broad., Inc., No. 20030854, 2005 Utah LEXIS 59, at *P35 (Utah Apr. 15, 2005).
3. Motion to Strike Portions of Mr. Livingston's Affidavit
Plaintiffs have also filed a motion to strike certain portions of the defendants affidavit. The court agrees with the plaintiffs that paragraphs 2, 3, 7, 8, 10, 11, 14, 16, 17, 21, 22, 23, 24, 33, 34, 41, 45, 46, 55, 58, 59, 60, 61, and 70 contain legal conclusions which should be stricken.
Rule 56(e) . . . limits the matter to be properly included in an affidavit to facts, and the facts introduced must be alleged on personal knowledge. Thus, ultimate or conclusory facts and conclusions of law, as well as statements made on belief or "on information and belief," cannot be utilized on a summary-judgment motion.
WRIGHT, ET AL., FEDERAL PRACTICE PROCEDURE: CIVIL3d § 2738 (1998).
The court denies the motion to strike paragraphs 28-35, 51-53, and 58 as hearsay. The statements are defined as not hearsay. Instead, they are admissions as defined by Federal Rules of Evidence 801(d)(2).
The court grants the motion to strike Mr. Livingston's characterization in paragraphs 2, 25, 42, 47, 56, 57, and 60 of this lawsuit as a SLAPP action. These statements constitute little more than Mr. Livingston's characterization of the motives of the plaintiffs, which are not facts he knows based upon personal knowledge.
C. A Word of Caution
A word of caution to both sides of this lawsuit. This case appears to be little more than a forum for thin-skinned debt collectors to air their grievances against an overzealous consumer advocate who, in turn, appears more than happy to have a forum to snipe back. Frankly, if the matters goes to trial and the plaintiffs prevail, the court seriously doubts whether a jury would award damages which will come anywhere near covering the costs of this case. But since the case has been filed and both parties appear eager to prosecute it until it is dead, the court cautions both sides to be respectful in the process.
The disrespect began almost immediately in Riddle Associates' complaint, where it was stated that one Mr. Wood told Mr. Livingston during a phone conversation that he was "full of shit." The complaint then sarcastically states, "RA stands by the opinion expressed by Mr. Wood. . . ." The caustic, sarcastic tone in Mr. Livingston's most recent brief is hardly any better. Nary a paragraph goes by without some sardonic quip concerning Riddle Associates. Mr. Livingston, for example, accuses the plaintiffs of "chronic lawbreaking" and states that the terms "`deceptive' . . . `misleading,' `illegal,' and `violation' have been synonymous with the names of Jesse Riddle and any entity associated with him. . . ." Mr. Livingston further accuses the plaintiffs of committing "felonies of dishonesty and moral turpitude . . ." and says that "[t]hese self-described debt collection superheroes badly need an Uncle Ben Parker to admonish them: `With great power comes great responsibility.'"
The Utah Standards of Professionalism and Civility provide:
1. Lawyers shall advance the legitimate interests of their clients without reflecting any ill-will that clients may have for their adversaries, even if called upon to do so by another.
2. Lawyers shall advise their clients that civility, courtesy, and fair dealing are expected. They are tools for effective advocacy and not signs of weakness. Clients have no right to demand that lawyers abuse anyone or engage in any offensive or improper conduct.
3. Lawyers shall not, without an adequate factual basis, attribute to other counsel or the court improper motives, purpose, or conduct. Lawyers should avoid hostile, demeaning, or humiliating words in written and oral communications with adversaries. Neither written submissions nor oral presentations should disparage the integrity, intelligence, morals, ethics, or personal behavior of an adversary unless such matter are directly relevant under controlling substantive law.
Although this is a defamation case which necessarily makes character an issue, both sides are expected to abide by these rules and, of course, Rule 11 of the Federal Rules of Civil Procedure.
CONCLUSION
Because the question of whether Mr. Livingston's statement is defamation per se remains a genuine issue of material fact, Riddle Associates' motion for partial summary judgment is denied. Mr. Livingston's motion for full summary judgment is also denied for the same reason. Furthermore, the court finds that as a matter of law that Riddle Associates are not libel-proof, nor are they limited purpose public figures.