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No Intra-Corporate Immunity Against Defamation Claims

November 7, 2014,

Workplace defamation actions face a number of obstacles. The one that probably comes up the most is the issue of qualified privilege. Employees often claim that a manager or supervisor defamed them in the course of a termination or negative performance evaluation. These statements are usually protected from defamation claims, as a limited privilege applies to communications made on any subject matter in which the person communicating has an interest, or with reference to which he has a duty, if made to another person having a corresponding interest or duty. In other words, in situations where it is necessary or expected that one employee will make statements concerning the performance of another (such as a performance evaluation), a qualified privilege will apply.

Another defense that is sometimes raised in the employment context is that of "intra-corporate immunity." This is a defense borrowed from the law of conspiracy. Because a conspiracy, by definition, requires at least two legally distinct persons, and because two employees acting within the scope of their employment duties are both acting as agents of their employer, a conspiracy cannot be formed between those two employees due to the unity of interest and absence of a second entity. "A corporation cannot conspire with itself," is the oft-used way of describing the reasoning behind the doctrine.

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One Yelp Review = One Publication

August 29, 2014,

Once upon a time, each separate copy of a defamatory statement was considered a separate publication, giving rise to a separate cause of action for defamation. Back then, if a defamatory article was published in a newspaper and the newspaper printed a million copies, the plaintiff could argue successfully that he had been defamed a million times. That is no longer the law, at least not in Virginia. Take Yelp reviews. If a new cause of action was created each time a consumer clicked a link leading to a defamatory review, the one-year statute of limitations would potentially never expire. Such a rule would likely allow plaintiffs to endlessly harass defendants by filing a new lawsuit with each new click. For reasons like these, Virginia follows the "single publication rule," which treats an online post as a single publication despite the fact that it may be read over and over again by different people all over the world. The number of views may be relevant to assessing the plaintiff's damages, but does not re-start the running of the statute of limitations or create new causes of action.

A Virginia law firm learned this lesson recently in Westlake Legal Group v. Yelp and Christopher Schumacher. Mr. Schumacher hired Westlake attorney Thomas K. Plofchan, Jr., back in 2009 and, according to his Yelp review, was not pleased with the representation he received. His review, posted on July 7, 2009, accused Westlake of "blatant incompetence and lying" and of having "a history of messing up cases." Westlake sued for defamation, not only against Mr. Schumacher, but against Yelp itself. The firm did not file the lawsuit, however, until May 11, 2012, well after the one-year limitations period had expired.

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Defamation Per Se By Former Judge Yields $350,000 in Damages

March 21, 2012,

Earlier this month, the Virginia Supreme Court affirmed the decision of the Williamsburg Circuit Court to uphold a jury verdict against former circuit court judge Verbena Askew in the amount of $350,000 for defamation. Askew had made a comment to The Daily Press that plaintiff Brenda Collins, who had worked in the court over which then-judge Askew presided, "was institutionalized - that's the only way you qualify for family leave." The Daily Press did not actually publish the statement, but the Court found that the defamation occurred when the statement was made to the press.

A private individual claiming defamation must prove by a preponderance of the evidence (1) that the defamatory publication is false and (2) that the defendant "either knew it to be false, or believing it to be true, lacked reasonable grounds for such belief or acted negligently in failing to ascertain the facts on which the publication was based." If the publication amounts to defamation per se, such as defamatory statements that impute an unfitness to perform official duties, the plaintiff is presumptively entitled to compensatory damages.

Askew first argued that she should not have to pay damages because her statement about Collins was never published by The Daily Press and thus did not proximately cause any injury to Collins. The Virginia Supreme Court rejected this argument, holding that theWburgCt.jpg evidence supported the jury's finding that Askew made a defamatory statement to the press either knowing it was false or negligently failing to ascertain the facts. Because the jury found the statement amounted to per se defamation, it was entitled to presume that Collins suffered damages as a result, regardless of whether The Daily Press republished the statement.

The court also rejected Askew's argument that the verdict should be reduced by the amount of a settlement with other defendants. The court pointed out that Section 8.01-35.1(A)(1) of the Virginia Code only provides for such an offset when two or more defendants are liable for the same injury. In this case, Askew was found liable for the injury caused by her own statement, not by any injury caused by her co-defendants.

Defamation Claim Against Virginia Lawyer Goes Forward

November 15, 2010,

Statements made by litigants and their attorneys in judicial proceedings cannot form the basis for a defamation action because they are protected by an absolute privilege. But what if an attorney, desirous of increased media exposure, takes copies of what might otherwise be considered slanderous statements and forwards them to the media? Do statements made in judicial proceedings lose their privileged status when republished to third parties? The answer, according to Norfolk judge Charles E. Poston, is that it depends on whether the attorney acted with malice.

In D'Alfio v. Theuer, a sea captain sued a lawyer who had filed at least one lawsuit against him on behalf of a client claiming employment discrimination. The lawsuit, the sea captain contended, contained numerous false and defamatory allegations, such as that the captain had ordered a seaman on his ship to be handcuffed in retaliation for speaking to a newspaper reporter and that he had threatened to put him in a straightjacket. What the captain found particularly troublesome, however, was that the seaman's lawyer faxed a copy of the lawsuit to the media. He sued the lawyer for defamation.

The lawyer filed a "demurrer" (essentially a motion to dismiss the complaint) on the ground that the allegedly defamatory statements were protected by absolute or qualified privilege. Judge Poston overruled the demurrer and permitted the lawsuit to proceed.

An absolute privilege provides complete immunity from liability, even if the communication is made with malice and knowledge of falsity. Lindeman v. Lesnick, 268 Va. 532, 537 (2004). A qualified ship.jpgprivilege, on the other hand, provides communications a limited privilege that can be defeated upon a showing of malice by clear and convincing evidence. Penick v. Ratcliffe, 149 Va. 618, 636 (1927). The court quickly disposed of the absolute-privilege argument, because the statements, while originally made in the course of a judicial proceeding, had been republished to the media, and it was that republication that formed the basis of the complaint's allegations.

The court found, however, that republication of pleadings does enjoy qualified protection, provided that the pleadings were public records at time they were sent to the media and that they were either copied verbatim, or extracted or summarized in a fair and accurate manner. The court noted Virginia Supreme Court precedent which held that "the publication of public records to which everyone has a right of access is privileged." The question thus became whether the attorney who forwarded the statements to the press did so maliciously.

A plaintiff seeking to overcome a qualified privilege must demonstrate that the defendant acted with actual malice at the time of publication, or with a "sinister or corrupt motive such as hatred, revenge, personal spite, ill will, or desire to injure the plaintiff," or that the defendant acted "with such gross indifference and recklessness as to amount to a wanton or willful disregard of the rights of the plaintiff." Preston v. Land, 220 Va. 118, 120-21 (1979). Because the plaintiff's complaint contained numerous allegations of malice, and because the question of whether a defendant acted with malice sufficient to overcome a privilege is a question of fact to be decided by the jury, the court overruled the demurrer and permitted the action to go forward.

Understanding Defamation

December 21, 2009,

The tort of defamation is widely misunderstood. Social media outlets like Facebook, LinkedIn and Twitter, which allow easy publication and dissemination of information to a wide audience, are leading to a rise in defamation lawsuits in Virginia and around the country. To be insulted by another, especially when it happens in a public forum, can be hurtful and embarrassing. Whether the insult constitutes actionable defamation under Virginia law, however, or whether it is sufficient to satisfy Virginia's "insulting words" statute, can present some complicated issues, often implicating the United States Constitution. Relevant considerations for any lawyer examining a defamation claim include the type and context of the speech, the identity of the speaker, the identity of the plaintiff, and the existence of qualified immunity or other defenses.

In Virginia, defamation includes both libel (written defamation) and slander (spoken defamation). There is no need for clever mnemonic devices to distinguish libel from slander, because Virginia law makes no meaningful distinction between the two and speaks only of the merged tort of defamation. The essence of any defamation claim is that a defendant published a false factual statement that concerns and harms the plaintiff or the plaintiff's reputation. While it is common to recite that "truth is a defense," that is not technically true, as falsity is a required element of the plaintiff's proof.

Proof of several elements is required. The defendant must know that the statement was false or must have lacked a reasonable basis for believing it to be true. Defamatory words that cause prejudice to a person in her profession are actionable as defamation "per se," meaning that it is not necessary to prove actual injury to reputation. Expressions of opinion, however, are constitutionally protected as free speech. Therefore, mere statements of opinion cannot form the basis of a defamation lawsuit.

The "publication" requirement means that the remarks were heard by a third party who understood the remarks as referring to the plaintiff in a defamatory sense. This is a fairly easy standard to meet (assuming a defamatory statement), as even accidental publication will suffice.

The Constitution plays two parts in the defamation analysis. First, it gives higher protection to those who speak on matters of public concern or about public figures. When an ordinary person brings a defamation claim that concerns a statement of no megaphone.jpgpublic concern, he only needs to prove the requisite elements by a preponderance of the evidence. When the plaintiff is a public figure (e.g., a celebrity or public officeholder), or when the statement at issue was one of public concern, then the bar is raised. The plaintiff would then need to prove, by "clear and convincing" evidence, that the defendant acted with actual malice. A defendant acted with actual malice if he knew the statement to be false or recklessly failed to verify the claim. "Clear and convincing" evidence is difficult to define but is a higher level of proof than a mere "preponderance." (You can think of it as requiring 75% certainty rather than 51% certainty, though that is not the legal definition).

The second constitutional requirement is that punitive damages may only be awarded upon the same clear and convincing finding of actual malice regardless of who the plaintiff is or if the statement was one of public concern.

The law of libel and slander is far too complicated to discuss in this small space. Consult an attorney if you have been the subject of defamatory speech, especially if your business or profession is being harmed as a result.

Virginia Employers Not Liable for Defamation on "Self-Publication" Theory

May 23, 2009,

Most Virginia employers these days are careful to avoid using defamatory language when terminating employees. They know that defamation actions (i.e., lawsuits alleging libel and/or slander) are best avoided by responding to inquiries from other employers by identifying an ex-employee's dates of employment and position held, but little else.  Although "truth is a defense" (statements about an employee will not be defamatory if they are true) and an employer usually has a qualified privilege to make statements that arise out of an employment relationship, no employer wants to get sued by a disgruntled ex-employee and employment lawyers are constantly thinking up new theories of employer liability.

One recent theory that has gained a following in certain states is based on the so-called "compelled self-publication" doctrine.  Virginia, however, is not one of those states, according to a memorandum opinion issued on May 6, 2009, by a federal court sitting in Richmond.

Here's how the theory works.  First, to bring a claim for defamation in Virginia as well as in most other states, a plaintiff must allege not only a defamatory statement made with theDefamation.jpg requisite intent, but that the statement was "published" (i.e., made) by the defendant to a third party.  The idea behind "compelled self-publication" is that even if a careful employer does not publish the reasons for an employee's termination to a third party, merely having a false, pretextual justification for the termination in the employee's personnel file should make the employer liable for defamation because it somehow compels the discharged employee to tell prospective employers the reasons he or she was fired.  

In Wynn v. Wachovia Bank, the Eastern District of Virginia held that Virginia law does not recognize such a theory.  Wynn, whom Wachovia had terminated, sued Wachovia for defamation on the ground it stated her termination was for "job abandonment" and that she had taken unauthorized paid time off, reasons she claimed were false.  Wynn did not claim that Wachovia published these statements to a third party; rather, she claimed the reasons offered for her termination put her "in the untenable position of having to defame herself when seeking employment elsewhere."  The court held flatly that regardless of whether Wachovia "forced" the plaintiff to defame herself, Wachovia could not be held liable for defamation without the requisite publication to a third party.