Dougherty v. Capitol Cities Communications, Inc.

• Decision Date: 06 February 1986
• Docket Number: No. 81-73981.,81-73981.
• Citation: 631 F. Supp. 1566
• Parties: John C. DOUGHERTY, Plaintiff, v. CAPITOL CITIES COMMUNICATIONS, INC., and WJR Detroit, a division of Capital Cities, Inc., Defendants.
• Court: U.S. District Court — Western District of Michigan

631 F. Supp. 1566

John C. DOUGHERTY, Plaintiff, v. CAPITOL CITIES COMMUNICATIONS, INC., and WJR Detroit, a division of Capital Cities, Inc., Defendants.

No. 81-73981.

United States District Court, E.D. Michigan, S.D.

February 6, 1986.

Charfoos, Christensen, Gilbert & Archer, P.C. by Lawrence S. Charfoos, Detroit, Mich., for plaintiff.

Miller, Canfield, Paddock & Stone by Gregory L. Curtner, Detroit, Mich., for defendants.

OPINION

GILMORE, District Judge.

In a society which takes seriously the principle that government rests upon the consent of the governed, freedom of the press must be the most cherished tenet. It is elementary that a democracy cannot long survive unless the people are provided with the information needed to form judgments on issues that affect their ability to intelligently govern themselves.¹

Defendants' motion for summary judgment and dismissal in this diversity case raises fundamental issues of the right of a free press to report matters of public interest. It is a defamation action arising out of a four-part series of radio broadcasts by radio station WJR of Detroit, through its reporters Ron Hansen and Gene Fogel, dealing with alleged problems and improprieties in the Bankruptcy Court for the Eastern District of Michigan. Nine of the 23 three-minute programs aired between February 23 and July 12, 1981 mentioned the plaintiff, John Dougherty, and are the subject matter of this lawsuit. Portions of the transcripts of these broadcasts referring to the plaintiff are attached to this opinion as Appendix A.²

By early 1981, following an initial investigation by the Administrative Office of the United States Courts, the United States Attorney's Office and the FBI were conducting a criminal investigation of the Bankruptcy Court in Detroit. It is against this backdrop that WJR commenced its own investigation into the court, resulting in the series of 23 broadcasts.

The upheaval in the Bankruptcy Court system did not end with the federal investigation. In May 1981, the Judicial Council of the Sixth Circuit Court of Appeals placed the Bankruptcy Court in receivership under the supervision of Chief Judge John Feikens of this District. Prior to that, in January 1981, the Circuit Executive had appointed a Merit Screening Committee to consider the reappointment of Bankruptcy Judge Harry Hackett. In its report to Chief Judge George Edwards of the Court of Appeals, the Committee commented that the WJR broadcasts "raised many of the same allegations of conduct on the part of Judge Hackett which are raised in the report." The Committee recommended that the Chief Judge find Judge Hackett not qualified to remain in office after the expiration of his term. Shortly after Chief Judge Edwards found Judge Hackett unqualified to remain in office as a bankruptcy judge for the Eastern District of Michigan past the June 1981 expiration of his term, Judge Hackett resigned from office.

In addition, several criminal prosecutions occurred. Irving August, a bankruptcy attorney, and his female companion, Kathy Bogoff, the intake clerk of the Bankruptcy Court, were convicted of obstruction of justice and conspiracy to defraud the United States Government for their roles in manipulating the blind draw system of the Bankruptcy Court. William Harper, the former clerk of the Bankruptcy Court, was convicted of purchasing property from a bankrupt estate while a court officer. WJR reporters Hansen and Fogel testified at Harper's trial.

During this period, plaintiff John Dougherty, pursuant to appointment from the Bankruptcy Court, served as a standing trustee for the Chapter 13 cases in this District, as well as being a member of the Chapter 7 Panel of Trustees. Plaintiff filed this suit in October 1981 alleging libel and slander, disparagement, invasion of privacy, and intentional infliction of emotional distress. Defendants have filed a motion to dismiss or for summary judgment as to all claims.

Initially, defendants contend that, as to most of the broadcasts, plaintiff has failed to present a prima facie case because many of the sections of the broadcast were either undisputedly true or were not of or concerning the plaintiff, and therefore not actionable as defamation.

In addition, defendants claim several privileges of both common law and First Amendment origins protecting the broadcasts. They assert the New York Times v. Sullivan, 376 U.S. 254, 84 S.Ct. 710, 11 L.Ed.2d 686 (1964), qualified privilege, arguing that plaintiff, as a standing Chapter 13 Trustee and a member of the Chapter 7 Panel of Trustees, was a public official. As such, defendants argue, plaintiff must establish a question of material fact with clear and convincing evidence of actual malice in order to defeat defendants' privilege.

Defendants also claim that much of the suspect broadcasts were statements of opinion, not of fact, and therefore enjoy an absolute privilege under Gertz v. Robert Welch, Inc., 418 U.S. 323, 94 S.Ct. 2997, 41 L.Ed.2d 789 (1974). In addition, they claim that any alleged innuendo is just another form of opinion and, therefore, also absolutely privileged. They also claim a Michigan statutory privilege to report on judicial proceedings under M.C.L.A. § 600.2911(3).

Finally, defendants claim a Michigan common law qualified privilege to report on matters of public interest, which can only be overcome by proof of actual malice.

Plaintiff, on the other hand, claims that defamatory statements were made of and concerning him, some of which were defamatory per se because they intended to impute a crime, and others injured him in his profession as an attorney.

Plaintiff also argues that he is not a public official under New York Times v. Sullivan, supra, because he is a private bankruptcy attorney, and, although he served as a trustee, he did not have substantial responsibility for conducting public governmental affairs. He denies that Michigan statutory qualified privilege to report on judicial proceedings is applicable, claiming that that privilege only covers fair and correct reports of the proceedings, and that in many respects the reports were not fair and correct. He further denies the applicability of the Michigan common law qualified privilege to report on matters of public interest because, he claims, these statements were not made on an occasion warranting application of the privilege.

In considering defendants' motion, it is important to keep in mind that, although the Sixth Circuit has rejected the argument that summary procedures are especially favored in defamation cases involving media defendants, Clark v. American Broadcasting Co., Inc., 684 F.2d 1208, 1212 (6th Cir.1982), it is also true that summary disposition is not particularly disfavored in this area. Id. In short, the usual standard from Fed.R.Civ.P. 56(c) applies: summary judgment is proper where there is no genuine issue as to any material fact, and the moving party is entitled to judgment as a matter of law. Bichler v. Union Bank & Trust Co. of Grand Rapids, 745 F.2d 1006, 1013 (6th Cir.1984).

In the interest of avoiding unnecessary constitutional determinations, this Court will first consider defendants' state law arguments. Of course, in so doing, the Court is mindful of the fact that "state laws relating to defamation have been necessarily affected by First Amendment principles, and in some respects have been `subsumed in' constitutional holdings." Schultz v. Newsweek, Inc., 668 F.2d 911, 916 (6th Cir.1982).

An action for defamation does not lie unless, among other factors, the alleged defamatory statements are false and are of and concerning the plaintiff. Hall v. Citizens Insurance Company of America, 141 Mich.App. 676, 685, 368 N.W.2d 250 (1985); Postill v. Booth Newspapers, Inc., 118 Mich.App. 608, 618, 325 N.W.2d 511 (1982). Thus, where there is no question of material fact presented as to the truth of the statements made by the broadcast reporters, or where the reports were not "of and concerning plaintiff", no defamation action lies.

Here, plaintiff has been unable to point to a single specific statement that was "of and concerning him", defamatory, or untrue. Although plaintiff painstakingly presents his version of the story behind each of the broadcasts in his appendix A to his response to defendants' motion, he does not succeed in uncovering any significant statement about him that is false.

Plaintiff's stronger argument is that, although each of the statements, taken alone, is true, it was the overall tone of the broadcasts that is defamatory, and that this is the result of innuendo from that which was not stated in the broadcasts.

Taking plaintiff's argument as true for the purpose of this motion, it raises the question of the applicability of the Michigan common law qualified privilege to report on matters in the public interest, which insulates a defendant from liability absent a showing of actual malice.

Michigan courts have repeatedly held that a qualified privilege exists to report on matters of public interest. See Bacon v. Mich. Central R.R. Co., 66 Mich. 166, 170, 33 N.W. 181 (1887); Bolton v. Walker, 197 Mich. 699, 706-07, 164 N.W. 420 (1917); Lawrence v. Fox, 357 Mich. 134, 137, 97 N.W.2d 719 (1959); Bufalino v. Maxon Bros., 368 Mich. 140, 117 N.W.2d 150 (1962).³

In Bostetter v. Kirsch Co., 319 Mich. 547, 30 N.W.2d 276 (1978), the court held that a qualified privilege extends to all communications made in good faith upon any subject matter in which the party communicating has an interest, or in reference to which he has a duty, to a person having a corresponding interest or duty. It embraces cases where the duty is not a legal one, but is of a moral or social character of imperfect obligation.

In that case, the plaintiff sued to recover damages claimed to have been sustained as a result of the publication by defendant of an allegedly libelous article printed in the Sturgis Daily Journal. The court determined as a...