Bratt v. International Business Machines Corp.

• Court: United States State Supreme Judicial Court of Massachusetts
• Writing for the Court: LIACOS
• Citation: 467 N.E.2d 126,392 Mass. 508
• Parties: Robert BRATT et al. 1 v. INTERNATIONAL BUSINESS MACHINES CORPORATION et al. 2
• Decision Date: 16 July 1984

Page 126

467 N.E.2d 126 392 Mass. 508 Robert BRATT et al. ¹
v.
INTERNATIONAL BUSINESS MACHINES CORPORATION et al.
² Supreme Judicial Court of Massachusetts,
Suffolk. Argued Feb. 6, 1984.
Decided July 16, 1984.

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David C. Casey, Boston, for plaintiffs.

Edward P. Leibensperger and Deborah S. Russo, Boston, for defendants.

Before WILKINS, LIACOS, ABRAMS, NOLAN and LYNCH, JJ.

LIACOS, Justice.

The United States Court of Appeals for the First Circuit has certified to us seven questions as to Massachusetts law raised by libel and invasion of privacy claims brought by [392 Mass. 509] the plaintiff Robert Bratt against the defendants. The plaintiffs' action against International Business Machines Corporation (IBM) was commenced in the Superior Court in Middlesex County in February, 1980. ³ IBM filed a petition for removal to the United States District Court, District of Massachusetts, claiming diversity of citizenship, and the case was removed to that court. ⁴

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The defendants moved in Federal court for summary judgment on all counts of Bratt's amended complaint. In November, 1982, a judge of the United States District Court for the District of Massachusetts granted the motions for summary judgment, and Bratt appealed. ⁵ Following oral argument by the parties, the Court of Appeals for the First Circuit certified the questions of law to this court.

We conclude as follows with respect to the libel law questions. For a defendant in a libel case to lose a conditional privilege to publish defamatory material by "unnecessary, unreasonable or excessive publication," Galvin v. New York, N.H. & H.R.R., 341 Mass. 293, 297-298, 168 N.E.2d 262 (1960), the plaintiff must prove that the defendant published the defamatory information recklessly. An employer has a conditional privilege to disclose defamatory information concerning an employee when the publication is reasonably necessary to serve the employer's legitimate interest in the fitness of an employee to perform his or her job. A conditional privilege may be lost by abuse; the same standard for abuse through excessive publication applies when the defamatory material is medical information.

We also conclude, concerning the invasion of privacy claim under G.L. c. 214, § 1B, that the disclosure of private facts [392 Mass. 510] about an employee through an intracorporate communication is sufficient publication to impair an employee's right of privacy. We further conclude that no conditional privilege exists for legitimate business communications under § 1B. However, in evaluating whether an employer's disclosure of personal information concerning an employee constitutes an unreasonable interference with the privacy right, we would balance the employer's legitimate business interest in disseminating the information against the nature and substantiality of the intrusion. Finally, we would use the same balancing test if the information disclosed about an employee is medical information. A physician retained by the employer may disclose to the employer medical information concerning an employee if receipt of the information is reasonably necessary to serve a substantial and valid business interest of the employer.

We summarize the facts as they have been presented to us in the certification memorandum of the Court of Appeals. Bratt has been an employee of IBM since 1970 and is presently employed by the company. Bratt experienced several problems in his employment during the years 1971 through 1978. To seek resolution of these difficulties, Bratt utilized IBM's "open door policy," an internal grievance procedure which enables employees to confront higher management with their complaints should their immediate supervisors fail to resolve the problems. ⁶

Bratt used the open door procedure approximately four times from 1971 through 1978, to complain of not receiving promotions and salary raises that were promised him or that he believed he deserved. Bratt also utilized the open door procedure [392 Mass. 511] to complain about an evaluation of his work, which was less than he thought merited. As a result, he came to deal with the defendant Wesley Liebtag, director of personnel programs for IBM in Armonk, New York. Although Liebtag told Bratt at their first discussion that the offensive work rating

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would be destroyed, this did not occur until Bratt went to see Liebtag a second time.

Bratt again utilized the open door procedure when he discovered that copies of suggestions that he had made for improving certain internal company practices were missing from his files. Bratt was informed that such suggestions had not been implemented. He was troubled that these proposals, as well as his work in general, were not appreciated. Bratt again confronted Liebtag, who told Bratt that any suggestions that he made were part of his job, and he should not be seeking personal recognition for such proposals.

After the unsuccessful meeting with Liebtag, Bratt told his supervisor that he was suffering from "bad nerves," headaches, and an inability to sleep. At the supervisor's suggestion, Bratt consulted with the defendant Dr. Nugent, a general practitioner retained by IBM. Following a routine physical examination, Dr. Nugent called Bratt's supervisor and expressed her opinion that Bratt was paranoid and should see a psychiatrist immediately. Bratt's supervisor relayed this information to her supervisor who, in turn, disclosed this to Liebtag. Liebtag made a memorandum for his file, summarizing the conversation.

Subsequently, Bratt's latest open door grievance was denied. Bratt was so informed. One of his supervisors then called Liebtag to relay Bratt's reaction. Liebtag summarized this conversation with the supervisor and his own impressions of Bratt's behavior in a memorandum which he forwarded to two IBM managerial supervisors. The memorandum stated that Bratt went into his supervisor's office with the letter denying his latest grievance. The supervisor observed that Bratt was distraught and crying. The supervisor made an appointment for Bratt with a psychiatrist. Liebtag wrote that this latest episode indicated that Bratt appeared to have a mental problem that went beyond IBM. He concluded that the corporate medical [392 Mass. 512] director should communicate with Bratt's psychiatrist in order to obtain, within the company, an expert appraisal of Bratt's condition.

Although Liebtag averred in his affidavit that only two managerial supervisors received copies of this memorandum, Bratt contends that approximately sixteen people within IBM learned about his condition. Bratt also disputes the accuracy of his diagnosis as paranoid.

The manager's manual used by IBM provides, in relevant part, that "[p]rior approval of the employee ... will be obtained before either disclosing or seeking confidential medical information, except in an emergency or where such disclosure is required by law." The manual also provides that confidential medical information will not be provided to "managers or Personnel" without an employee's prior consent.

Bratt's libel claim is based on Liebtag's distribution of the memoranda that he made concerning Bratt's mental condition. Bratt's claim for invasion of privacy under G.L. c. 214, § 1B, is premised on two grounds. First, that IBM violated Bratt's right of privacy by disclosing information about his use of the open door policy to personnel who should not have received this information. Second, that there was an improper disclosure of Dr. Nugent's description of Bratt as paranoid.

1. Libel claim. a. Questions 1 and 2 ⁷ (defendants' conditional privilege and the standard for abuse of the privilege).

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Massachusetts courts have recognized that a person may possess a conditional privilege to publish defamatory material if the publication is reasonably necessary to the protection or [392 Mass. 513] furtherance of a legitimate business interest. See Retailers Commercial Agency, Inc., petitioner, 342 Mass. 515, 520, 174 N.E.2d 376 (1961); Galvin v. New York, N.H. & H.R.R., 341 Mass. 293, 296, 168 N.E.2d 262 (1960). ⁸ See also Restatement (Second) of Torts § 594, comment f, at 266 (1977) (conditional privilege in making defamatory statements exists where publisher has lawful pecuniary interest in making the publication); comment e, at 265 (in determining whether an interest not given direct legal protection warrants protection by conditional privilege, courts should weigh publisher's interest in the defamatory matter, should it be true, against harm to plaintiff's reputation by disclosure of false information).

In Galvin v. New York, N.H. & H.R.R., supra, we recognized that an employer has a conditional privilege to use defamatory language to ascertain the identity of a person who allegedly stole goods from the business. We decided, however, that loud and repeated public accusations concerning the plaintiff constituted an abuse of the conditional privilege "by an unnecessary, unreasonable or excessive publication of the defamatory matter." Proof of "actual malice" was not a prerequisite to loss of the privilege. Id. at 297, 298, 168 N.E.2d 262.

We did not specifically state in the Galvin case whether negligence or recklessness was the threshold standard for determining whether a conditional privilege was lost by publication of defamatory matter. However, our description of the misconduct in Galvin as unreasonable or excessive, as well as something less than "actual malice," appears to favor recklessness or "malice in fact" as the standard. See also Doane v. Grew, 220 Mass. 171, 176, 107 N.E. 620 (1915) (conditional privilege in defamation action lost by proof of "malice in fact"; proof of "malice in fact" can be made in a number of ways). ⁹

[392 Mass. 514] Massachusetts case law and the Restatement of Torts support the view that recklessness should be the minimum level of misconduct which results in loss of a conditional...