Cahill v. Hawaiian Paradise Park Corp.

• Decision Date: 16 December 1975
• Docket Number: No. 5612,5612
• Citation: 543 P.2d 1356,56 Haw. 522
• Parties: Emmett CAHILL et al., Plaintiffs-Appellants, v. HAWAIIAN PARADISE PARK CORPORATION, a Hawaiian Corporation, Individually and as Licensee Owner and/or Operator of KTRG Radio and dba KTRG Radio and dba Watumull Broadcasting System, et al., Defendants-Appellees.
• Court: Hawaii Supreme Court

Page 1356

543 P.2d 1356

56 Haw. 522

Emmett CAHILL et al., Plaintiffs-Appellants, v. HAWAIIAN PARADISE PARK CORPORATION, a Hawaiian Corporation Individually and as Licensee Owner and/or Operator of KTRG Radio and dba KTRG Radio and dba Watumull Broadcasting System, et al., Defendants-Appellees.

No. 5612.

Supreme Court of Hawai'i.

Dec. 16, 1975.

Syllabus by the Court

1. Officers, directors or shareholders of a corporation are not personally liable for the tortious conduct of the corporation or its other agents, unless there can be found some active or passive participation in such wrongful conduct by such persons.

2. Where record failed to show defendant was involved in an allegedly defamatory broadcast otherwise than as shareholder and president of the corporation which owned and operated the radio station responsible for the publication, he could not be held personally liable for any damages arising out of such publication.

3. The publication by a broadcaster of a false statement that a private individual is a Communist or a Communist sympathizer constitutes defamation which would be libelous per se in absence of First Amendment protections.

4. The protections afforded by the First Amendment, as extended to the states by the Fourteenth Amendment, do not protect a publisher or broadcaster from liability under state law for negligent publication of a falsehood defamatory of a private individual.

5. The test of liability to be applied in actions by private individuals for publication of defamatory falsehoods by the news media is that of negligence.

6. In an action for libel where a broadcast complained of is susceptible of both an innocent and a defamatory meaning, it is for the jury to determine the sense in which it was understood after considering the broadcast as a whole.

7. Where an individual was not mentioned by name in a broadcast which was reasonably susceptible of a meaning which attributed to each member of his family agreement with Communist and anarchistic objectives, the broadcast was reasonably susceptible of a defamatory meaning which included the unnamed individual as well as the members of the family mentioned by name in the broadcast.

8. Where the evidence in support of the defendants' motion for summary judgment did not disclose that the defendants had reasonable grounds to believe that the charges in an allegedly false defamatory statement were true, an issue of fact existed with respect to the defendants' negligence in publishing the statement.

9. Where affidavits in support of a motion for summary judgment stated only that certain newspaper reports referring to plaintiffs had been published and failed to state that such newspaper accounts were true of affiant's own knowledge, such affidavits were not in compliance with Rule 56(e), H.R.C.P., with respect to the facts stated in the newspaper accounts.

10. Affidavits in support of a motion for summary judgment shall be disregarded to the extent not in compliance with Rule 56(e), H.R.C.P., requiring that such affidavits must be made on personal knowledge, must set forth such facts as would be admissible in evidence, and must show affirmatively that the affiant is competent to testify to the matter stated therein.

Joseph A. Ryan, Honolulu (Ryan & Ryan, Honolulu, of counsel), for appellants.

Edward R. Bendet, Honolulu (Whitfield, Bendet & Fidell, Honolulu, of counsel), for appellees.

Before RICHARDSON, C. J., and KOBAYASHI, OGATA, MENOR and KIDWELL, JJ.

KIDWELL, Justice.

Emmett Cahill, his wife and his three children brought this action against Hawaiian Paradise Park Corporation, the owner and operator of radio station KTRG, David Watumull, its president, and Donald P. Dickinson, its manager, claiming defamation by certain radio broadcasts. The circuit court granted summary judgment for the defendants, under the First Amendment of the United States, Constitution and Article I, Section 3 of the Constitution of the State of Hawaii, upon finding 'that there is no evidence that any of the statements in issue were uttered either with knowledge of any possible falsity or with reckless disregard of their truth or falsity'. Plaintiffs appealed. We reverse the summary judgment as to the corporation and defendant Dickinson.

Radio station KTRG is located in Honolulu. The broadcast of which plaintiffs complain occurred on May 24, 1970. It is admitted that defendant Dickinson, then employed as station manager and talk show moderator on KTRG, read the allegedly defamatory statement in the course of a broadcast on that date dealing with a speech made on May 21, 1970 by the Mayor of Honolulu deploring light sentences for convicted criminals and also dealing with an alleged public statement by plaintiff Emmett Cahill on May 22, 1970 disagreeing with the policies advocated by the Mayor. ¹

The complaint allege that by this statement defendants published that each of the plaintiffs was a person who associated only with Communists and conveyed the idea that each of them was disloyal to his country, and was a Communist or a Communist sympathizer. It is also alleged that in a continuance of the broadcast, on the same date, the defendants used innuendo, suggestion of guilt by association and 'express and implied language' to convince the radio audience that all of the plaintiffs were Communists and subversives who were engaged in subversive activities aimed at the overthrow of the Government of the United States. The text of the continuance of the broadcast is contained in defendant's affidavits and is not controverted. In it further descriptive material pertaining to the 'Rankin brigade' is set forth, including allegations that 'well-known identified Communists' were among its sponsors both on the mainland and in Hawaii. In his concluding statement defendant Dickinson said: 'That ladies and gentlemen is the Emmett Cahill matter as it stands to date.'

I

We first consider the issue of defendant David Watumull's liability separately from the liability of the other defendants. Defendant Watumull was not shown to be involved in the broadcast otherwise than as might be implied from his status as a shareholder and president of defendant Hawaiian Paradise Park Corporation. The law is firmly established that officers, directors or shareholders of a corporation are not personally liable for the tortious conduct of the corporation or its other agents, unless there can be found some active or passive participation in such wrongful conduct by such persons. Rohauer v. Killiam Shows, Inc., 379 F.Supp. 723, 729 (S.D.N.Y.1974); Hagemeyer Chemical Co. v. Insect-O-Lite Co., 291 F.2d 696 (6th Cir. 1961); 46 A.L.R.3d 428, Disregarding Corporate Entity; 18 Am.Jur.2d, Corporations, §§ 13, 14; 19 Am.Jur.2d, Corporations, §§ 713, 714. We find no evidence in the record from which a finding could be made that defendant Watumull participated in the broadcast complained of. There is nothing to suggest that this is a case in which the corporate entity should be disregarded because of circumstances that reveal that the shareholders treated and regarded the corporation as their alter ego. Cf., Kahili, Inc. v. Yamamoto, 54 Haw. 267, 506 P.2d 9 (1973). Accordingly, the summary judgment in favor of defendant Watumull is affirmed.

II

The remainder of this opinion concerns itself with the liability of defendant Hawaiian Paradise Park Corporation, which is the owner and operator of KTRG radio station, and of defendant Dickinson, who was the station manager and the moderator who read the allegedly defamatory Statement. The circuit court rested its decision solely upon the existence of constitutional protections against the claims of all of the plaintiffs. We will first view the case without regard to defendants' constitutional protections, and then consider how far the constitutional protections are applicable.

Defendants assert that the case may be disposed of without reaching the constitutional issue, contending that there was no actionable defamation in the broadcast complained of. They contend that, while certain persons were referred to as Communists and certain organizations were stated to be Communist, anarchist or Communist-penetrated or dominated, none of the plaintiffs were referred to directly as Communists, Communist sympathizers, or otherwise characterized except as leaning 'far to the left'. They argue that the words used were not capable of a defamatory interpretation.

Plaintiffs seek by innuendo to place upon the broadcast the meaning that plaintiffs are Communists or Communist sympathizers. Where the statement is not constitutionally protected it is generally held, and we agree, that publication of a false charge that an individual is a Communist or a Communist sympathizer is libelous per se. MacLeod v. Tribune Publishing Co., 52 Cal.2d 536, 343 P.2d 36 (1959); Seisberger v. Condon, 6 Miss.2d 176, 161 N.Y.S.2d 448 (1957); Grant v. Reader's Digest Ass'n, 151 F.2d 733 (2d Cir. 1945), Cert. den., 326 U.S. 797, 66 S.Ct. 492, 90 L.Ed. 485; Matson v. Margivotti, 371 Pa. 188, 88 A.2d 892 (1952); Burrell v. Moran, Ohio Com.Pl., 38 Ohio Op. 185, 82 N.E.2d 334 (1948); Phoenix Newspapers, Inc. v. Church, 103 Ariz. 582, 447 P.2d 840 (1968), cert. den., 394 U.S. 959, 89 S.Ct. 1307, 22 L.Ed.2d 560; Spanel v. pegler, 70 F.Supp. 926 (D.C.Conn.1946); Mosler v. Whelan, 28 N.J. 397, 147 A.2d 7 (1958); Spanel v. Pegler, 160 F.2d 619 (7th Cir. 1947); Utah State Farm Bureau F. v. National Farmers Union Service Corp., 198 F.2d 20 (10th Cir. 1952); and Gertz v. Robert Welch, Inc., 306 F.Supp. 310 (N.D.Ill.1969). Also see: Sas Jaworsky v. Padfield, 211 So.2d 122 (La.App.1968).

The broadcast must be considered as a whole in determining whether it would convey to the ordinary listener the defamatory meaning which plaintiffs, by innuendo, seek to place upon it. Cabrinha v. Hilo Trib. Herald, 36 Haw. 355 (1943). If it is susceptible of both an innocent and a defamatory...