Articles Posted in Workplace Defamation

The statute of limitations for defamation actions in Virginia is one year. This means that if somebody libels you on the Internet, you have just one year from the date of the defamatory post in which to file a lawsuit. A question I get asked a lot is, “what if someone defamed my character several years ago but I just found out about it last week?” Here in Virginia, the answer (I’m sorry to say) is: it doesn’t matter. The statute of limitations begins to run when the injury occurs, not when you discover you’ve been injured, and courts have held that when someone defames your character, your reputation suffers even if you don’t know about it. Although it’s certainly true that you won’t become emotionally upset or embarrassed about false statements made about you behind your back, the fact remains that emotional distress is not a necessary element of a cause of action for defamation, and statues of limitation begin to run once the elements of the claim have been met. When a person’s reputation is unfairly attacked with false statements, the injury is immediate: people who know you and who read the statement and believe it will think less of you as a person, regardless of whether you know about it and regardless of whether you have suffered any emotional distress because of it.

Certain causes of action in Virginia–like fraud–are subject to a “discovery rule,” meaning that the cause of action will not accrue, and the statute of limitations will not begin to run, until the alleged misconduct is either discovered, or, by the exercise of due diligence, reasonably should have been discovered. Defamation claims, however, do not enjoy the benefit of the discovery rule, so the limitations period begins to run as soon as an actionable statement is published with the requisite intent. (See, e.g., Jordan v. Shands, 500 S.E.2d 215, 218 (Va. 1998) (holding that “when an injury is sustained in consequence of the wrongful or negligent act of another and the law affords a remedy, the statute of limitations immediately attaches.”)). Illustrating this point is the case of Robert L. Matthews v. Tracy M. Gee, decided March 9, 2017, by the Eastern District of Virginia.

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When suing for libel or slander in Virginia, it helps if you can make out a claim for that form of defamation known as defamation per se. If the judge agrees that your claim qualifies, he or she will instruct the jury to presume general damages and authorize it to award punitive damages even in the absence of compensatory damages. However, too often, plaintiffs place unneeded emphasis on trying to characterize their claim as defamation per se and overlook regular garden-variety defamation, known as defamation per quod. Defamation per quod can give rise to fairly substantial liability, as Rolling Stone found out when a former University of Virginia won $3 million based on a false portrayal of her in an article about rape on campus.

Defamatory words fall into the “per se” category if they: (1) impute to a person the commission of some criminal offense involving moral turpitude for which the party, if the charge is true, may be indicted and punished; (2) impute that a person is infected with some contagious disease, where if the charge is true, it would exclude the party from society; (3) impute to a person unfitness to perform the duties of an office or employment of profit, or want of integrity in the discharge of the duties of such an office or employment; or (4) prejudice the plaintiff in his or her profession or trade. (See Carwile v. Richmond Newspapers, 196 Va. 1, 7 (1954)).

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In an opinion published earlier this week by a federal court in Alexandria, the court analyzed a defamation claim brought by a sales representative against her former employer, manufacturer of the Mammotome breast biopsy system. Her former supervisor, after terminating her employment, had met with her largest customer to introduce her replacement to them, and when asked about her whereabouts, the supervisor responded that the employee had “up and left” and added that she was “not a closer.” The customer was not pleased, as they had held the employee in very high regard, and when they heard the news that she had parted ways with the manufacturer, they reached out to her and helped her land a job with another medical device company. The employee was also not pleased when she heard this, and she sued her old boss for defamation. The court denied her claim and entered summary judgment in favor of her former employer.

The case is Jasna Kuhar v. Devicor Products, Inc. The first statement at issue was that of Ms. Kuhar’s former supervisor, Joseph Baia, who told the customer that Ms. Kuhar had left Devicor voluntarily, without giving prior notice (which is how the court interpreted the “up and left” statement). As a preliminary matter, the court noted that this was a statement of fact, capable of being proven true or false (which is a prerequisite for defamation liability). The court disagreed, however, with Ms. Kuhar’s argument that the statement was “per se” defamatory in that it disparaged her qualifications as a sales representative. Ms. Kuhar presented no evidence to suggest that immediate resignation was frowned upon in the sales profession. (And at-will employees have the right to resign without giving advance notice). Here, Ms. Kuhar’s offer letter stated expressly that “Your relationship with the Company will therefore be at-will, which means you or the company may terminate your employment at any time, with or without cause or notice.” The court also noted that the undisputed evidence not only showed that the statement had not prejudiced her in her profession or trade, but that she had not, in fact, suffered any damage. Her customers testified that they continued to hold her in high regard, and even helped her find another job.

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As a general proposition, libel and slander liability requires a defamatory statement of fact; expressions of opinion are not actionable. Distinguishing assertions of fact from expressions of opinion, however, is not always an easy task. Factual statements are generally those that contain—expressly or impliedly—a provably false factual connotation. “Mr. Smith drank ten shots of tequila last night” is a statement of fact; either he drank ten shots or he didn’t. Expressions of opinion, on the other hand, are relative in nature and depend largely upon the speaker’s personal viewpoint. They tend to consist of evaluative statements reflecting the speaker’s own political, moral, or aesthetic views. “I think Mr. Smith drinks more tequila than he really should” would likely be deemed an expression of opinion by most courts. But consider the statement “I think Mr. Smith must be an alcoholic.” Fact or opinion?

Statements that appear at first to be opinions but which could fairly be interpreted as implying the existence of facts not disclosed by the speaker are treated by Virginia courts as opinions “laden with factual content,” which is a sufficient predicate upon which to base a defamation action. (See Richmond Newspapers, Inc. v. Lipscomb, 234 Va. 277, 298 n.8 (1987)). Ultimately, whether a statement of apparent opinion will be deemed sufficiently laden with factual content to support a defamation action will depend on a number of factors that would influence how a reasonable reader or listener would most likely interpret the statement. Considerations include the following:

Most Virginia litigators probably associate the Supreme Court’s decisions in Bell Atlantic v. Twombly and Ashcroft v. Iqbal with an increased pleading burden in federal court, requiring that lawsuits allege “plausible” claims rather than just remote possibilities. In the limited context of pleading defamation claims, however, the plausibility standard applicable in federal court appears to be making it easier to survive preliminary dismissal motions in federal court than in Virginia state court.

Earlier this year, I wrote about Potter v. Associated Press, in which a federal court allowed a defamation claim to go forward despite the absence of facts sufficient to show defamatory meaning, reasoning that it was plausible the claim was valid. Last month, in the latest example of this phenomenon, the Eastern District of Virginia held that unlike in state court, defamation claims can survive even if they do not allege the exact words used. Why? Because all that is needed to survive a motion to dismiss in federal court is a “short and plain” statement of the claim demonstrating a plausible right to relief. A complaint may be plausible on its face even if it fails to set forth the exact words allegedly used by the defendant.

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Last month, the Supreme Court of Virginia held in Pendleton v. Newsome that where defamatory meaning is not apparent from the face of a statement claimed to be defamatory, a plaintiff may introduce evidence to show that the statement was made in a context that would reasonably cause the statement to be interpreted in a defamatory sense. Allegations that the circumstances surrounding the making and publication of the statement were such as would convey a defamatory meaning, together with an explanation of meaning allegedly conveyed, “will suffice to survive demurrer if the court, in the exercise of its gatekeeping function, deems the alleged meaning to be defamatory.”

This language certainly seems to suggest that a court might properly dismiss a defamation claim if the full context of the statement is not pled in the complaint. In Potter v. Associated Press, however, the Eastern District of Virginia denied a motion to dismiss and allowed a defamation claim to go forward after expressly recognizing that the complaint omitted the full context of the statement and that the context was necessary to determine whether the statement could reasonably be interpreted to have defamatory meaning.
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As a general rule, both the United States and the Commonwealth of Virginia enjoy sovereign immunity, which shields the government entities and their agencies from defamation lawsuits as well as most other types of litigation. The law becomes trickier when applied to the employees of those governments. Federal employees are immune from defamation claims based on things they said while acting within the scope of their employment. Those who work for the Commonwealth of Virginia, on the other hand, or one of its counties, cities, or towns, don’t have it so easy. Virginia employees do enjoy some degree of sovereign immunity for their actions, but–with limited exceptions–the protection they are afforded is less than the absolute protection federal employees receive. Like federal employees, state and local employees must be acting within the scope of their employment to be potentially entitled to claim immunity, but state employees need to meet additional criteria before they will be granted immunity.

The Virginia Supreme Court has described sovereign immunity as “a rule of social policy, which protects the state from burdensome interference with the performance of its governmental functions and preserves its control over state funds, property, and instrumentalities.” This rule of social policy is essentially based on the following goals: (1) to protect the “public purse” (i.e., to preserve tax dollars), (2) to address the concern that officials might be unwilling to carry out their public duties if they lived in constant fear of being sued, (3) to encourage citizens to take public jobs, and (4) to permit the orderly administration of government by discouraging improper influence through vexatious litigation. (See Messina v. Burden, 228 Va. 301, 308 (1984)). Consideration of these policies is what guided the Virginia courts to develop a rule affording immunity to some state and local employees but not others.
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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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As a business owner, you can’t control everything your employees will do or say. What if one of them defames the character of another employee while on the job? Can the business be held responsible? If the employee uttered the defamatory words while performing the employer’s business and acting within the scope of his or her employment, then yes, the employer can be held liable for defamation. How does one determine whether an employee’s statements were made with the “scope of employment”? In Virginia, an act will be considered within the scope of employment if it was (1) expressly or impliedly directed by the employer, or is naturally incident to the business, and (2) performed with the intent to further the employer’s interest, or from some impulse or emotion that was the natural consequence of an attempt to do the employer’s business, and did not arise wholly from some external, independent, and personal motive on the part of the employee to do the act upon his own account. (See Kensington Assocs. v. West, 234 Va. 430, 432 (1987)). If a plaintiff alleges the existence of an employment relationship, it becomes the employer’s burden to prove that the statement was not made within the scope of employment. Absent such proof, the employer is on the hook.

Last week, a defamation case against Bio-Medical Applications of Virginia, Inc. (doing business as Fresenius Medical Care Dominion) was allowed to go forward. The Amended Complaint filed in the case alleges that a Fresenius employee emailed to coworkers various false statements suggesting that the plaintiff (a registered nurse) had a complete disregard for patient welfare. For example, the alleged emails attributed to the plaintiff statements such as “[the patient] just needs a little bleach in his lines” and, in reference to another patient, “all she needs is a good shot of air. That’ll take care of her.” Another email accused the plaintiff of saying, “Well isn’t it about time?” after another patient had died. Fresenius Medical Care filed a motion to dismiss the case, arguing that the complaint failed to plead sufficient facts to hold the employer liable for the statements of its employees, and that the elements of defamation had not been satisfied. The court disagreed on both counts and denied the motion.
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Extortion is a crime. Statements that falsely accuse another of committing a crime often constitute defamation per se in Virginia, particularly where the crime is one involving “moral turpitude.” Does it follow, then, that false accusations of extortion will automatically qualify as defamation per se? The answer, which will undoubtedly surprise many of you, is no. The reason lies in the importance of context in defamation actions.

A good illustration comes from the Tenth Circuit, which issued its decision in Hogan v. Winder a few days ago. Chris Hogan worked as a consultant for the Utah Telecommunications Open Infrastructure Agency (“UTOPIA”), a state agency charged with upgrading high-speed Internet access. In the spring of 2011, Hogan began to suspect that UTOPIA’s executive director unfairly favored a bid for a contract from the company where the director’s brother worked, and he expressed his suspicions to UTOPIA’s plant manager. He was terminated shortly thereafter. Believing that his termination was retaliatory, he hired a lawyer and sent UTOPIA a draft complaint along with certain settlement demands, pointing out that the public scrutiny that would result from filing the lawsuit would essentially destroy the company. In a response, UTOPIA’s attorney characterized Hogan’s demands as “extortion” and “blackmail.”
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