Connor Grp., Firm, LLC v. Raney

• Decision Date: 13 May 2016
• Docket Number: C.A. CASE NO. 26653
• Citation: 2016 Ohio 2959
• Parties: CONNOR GROUP, A REAL ESTATE INVESTMENT FIRM, LLC, et al. Plaintiffs-Appellees v. JAMES J. RANEY Defendant-Appellant
• Court: Ohio Court of Appeals

2016 Ohio 2959

CONNOR GROUP, A REAL ESTATE INVESTMENT FIRM, LLC, et al. Plaintiffs-Appellees v. JAMES J. RANEY Defendant-Appellant

C.A. CASE NO. 26653

COURT OF APPEALS OF OHIO SECOND APPELLATE DISTRICT MONTGOMERY COUNTY

May 13, 2016

T.C. NO. 13CV5706

(Civil Appeal from Common Pleas Court)

OPINION

STEPHEN A. WATRING, Atty. Reg. No. 0007761 and MATTHEW J. BAKOTA, Atty. Reg. No. 0079830, 110 N. Main Street, Suite 1000, Dayton, Ohio 45402 Attorneys for Plaintiffs-Appellees

JEFFREY M. NYE, Atty. Reg. No. 0082247, 2623 Erie Avenue, Cincinnati, Ohio 45208 Attorney for Defendant-Appellant

FROELICH, J.

{¶ 1} James J. Raney appeals from a judgment of the Montgomery County Court of Common Pleas, which granted Connor Group a preliminary injunction against him while litigation over Raney's alleged defamation and interference with Connor Group's contractual and business relationships continued. Although the issuance of a preliminary injunction by a trial court generally is not viewed as a final appealable order, we ruled earlier in this case that a preliminary injunction that constitutes a prior restraint on speech requires immediate appellate review. See Decision and Entry, July 29, 2015, citing Internatl. Diamond Exchange Jewelers, Inc. v. U.S. Diamond & Gold Jewelers, Inc., 70 Ohio App.3d 667, 591 N.E.2d 881 (2d Dist.1991) and Natl. Socialist Party of America v. Skokie, 432 U.S. 43, 44, 97 S.Ct. 2205, 53 L.Ed.2d 96 (1977).

{¶ 2} For the following reasons, the judgment of the trial court will be reversed.

{¶ 3} The Connor Group, LLC, a real estate investment firm based in Montgomery County, Ohio, manages numerous apartment complexes around the country. Meridian Apartment Manager, LLC, owns Meridian Apartments in Franklin County, Ohio, which is managed by Connor Group. The precise nature of the plaintiff-companies' affiliation is unclear; they will be referred to collectively as "Connor Group." Raney is a former tenant of the Meridian apartment complex.

{¶ 4} In September 2013, Connor Group filed a complaint against Raney for defamation, alleging that, beginning in September 2012, Raney "undertook a campaign to publicly disparage them and to damage their business, trade, and reputation." Raney had allegedly engaged in disseminating disparaging statements about Connor Group to its tenants, prospective tenants, and other business associates. Connor Group claimed that Raney's statements were untrue and/or misleading, that the statements were made with malice and with the intent to damage Connor Group's business and trade, and that the statements had, in fact, damaged its business. In January 2014, Connor Group filed an Amended Complaint, which added a claim for tortious interference with its contractual and business relationships. Raney filed an answer to the amended complaint denying the new allegations.

{¶ 5} In July 2014, Raney filed a motion for judgment on the pleadings, on the ground that his statements which formed the basis of Connor Group's claims were either true or not defamatory. Raney's motion relied on documents attached to his Amended Answer. Connor Group opposed the motion for judgment on the pleadings. On August 21, 2014, the trial court found that Raney had "utterly failed to comply" with Connor Group's discovery requests, and it granted Connor Group's motion to compel discovery. The trial court also ordered Raney to "cause a forensic image to be made of his computer" within seven days, to prevent the spoliation of evidence.

{¶ 6} On August 27, 2014, while the motion for judgment on the pleadings was still pending, Raney filed a notice of removal to the U.S. District Court for the Southern District of Ohio, based on diversity and the amount in controversy. Pursuant to 28 U.S.C. § 1446(B), a case must be removed to federal court within 30 days of receipt of a complaint or other documents from which a defendant may ascertain that the case is removable. Raney, who sought removal several months after the complaint and amended complaint were filed, claimed that he had just become aware, through responses to interrogatories, that the amount in controversy was over $100,000. Connor Group responded that Raney had been aware of and acknowledged the amount in controversy for many months and was using the removal to delay proceedings in the common pleas court.¹ The district court found that, by his own admissions, Raney had demonstrated actual knowledge of the amount in controversy "long before" the notice of removal was filed, and that his notice of removal was untimely. The district court remanded the case to the common pleas court on March 2, 2015.

{¶ 7} On March 3, 2015, Connor Group filed a Motion for Temporary Restraining Order and Preliminary Injunction, asking that the court prohibit Raney from directly contacting its employees, tenants, and business associates. It asserted that it was likely to succeed on its claims and that it had no adequate remedy at law for the damage Raney was causing to its business. Raney opposed the motion, arguing that any prior restraint of his speech would violate the First Amendment and that Connor Group was unlikely to succeed on the merits of its claims.

{¶ 8} The trial court scheduled a hearing on the temporary restraining order for March 16, 2015, and a hearing for the preliminary injunction on May 11, 2015. The trial court did not take any action prior to its March 16 hearing to restrain Raney's conduct. The trial court's judgment states that Connor Group provided testimony at the March 16 hearing as to some of Raney's objectionable actions and his motivation, but no transcript of this hearing has been filed. On March 20, the trial court sustained the motion for "temporary restraining order and preliminary injunction"; the trial court's order placedseveral specific restrictions on Raney's conduct during the pendency of the case, which are discussed in more detail below. It is this judgment from which Raney now appeals.

{¶ 9} We note that a temporary restraining order is issued ex parte, without notice to the other party, and lasts only until a hearing can be held. Ohio Service Group, Inc., v. Integrated & Open Systems, L.L.C., 10th Dist. Franklin No. 06AP-433, 2006-Ohio-6738, ¶ 13, fn. 2, citing Board of Edn. Ironton City Schools v. Ohio Dept. of Edn., 4th Dist. Lawrence No. CA92-39, 1993 WL 256320, * 2 (June 29, 1993). No temporary restraining order was filed in this case. A preliminary injunction is issued after notice and a hearing; it maintains the status quo until a full trial on the merits can be conducted. A permanent injunction is issued after a full trial on the merits. Id. The trial court held a hearing and, in the absence of a transcript of that proceedings, we presume that both parties were permitted to provide evidence at that hearing. Thus, the action taken by the trial court in this case is properly characterized as a preliminary injunction.

{¶ 10} Raney filed a timely appeal from the trial court's preliminary injunction.

{¶ 11} The assignments of error state:

The trial court issued an unconstitutional prior restraint when it issued an injunction against defendant-appellant Jim Raney's future speech.

Even if not for the constitutional prohibition against prior restraints, the trial court would have abused its discretion by issuing a preliminary injunction on the facts of this case.

{¶ 12} Although there are two "assignments of Error" and eight "Statements of Related Issues," Raney's central assertion is that the trial court erred in granting a preliminary injunction under the facts presented, especially insofar as it restrained his right to free speech. Therefore, we will address the assignments and "issues" together.

Connor Group's Allegations

{¶ 13} Connor Group's complaint and its motion for a preliminary injunction alleged that Raney was making direct, targeted and harmful contacts with its tenants, investors, and business associates, that these contacts were ongoing and unrelenting, that Raney's statements about Connor Group were untrue or made with reckless disregard for their truthfulness, and that these contacts were causing "disruption and interference with its contractual and business relationships." These allegations were supported by an affidavit from Connor Group's corporate counsel, Samuel E. Dowse, and various exhibits. By way of example, Dowse stated that Raney² had done the following:

• Posted signs at Connor Group properties stating "DO NOT RENT HERE";

• Sent postcards picturing scantily-clad female strippers in provocative positions to Connor Group employees at 46 apartment complexes around the country. The postcards stated: "What is the difference between a stripper and an employee of The Connor Group[?] You want the stripper to lie to you for a dollar." The postcards also contained an Internet address with a name similar to Plaintiff's, a website operated by Raney. Raney subsequently acknowledged his responsibility for these postcards on his blog. Connor Group also asserted that the majority of its employees are women and that many employees were "concerned and offended" by themailing.

• Interfered with Connor Group's contractual relationship with its own chief executive officer, Larry Connor, by sending a lengthy and disparaging email to the "the entire Homeowners' Association Board" for the community to which Connor and his family recently moved;

• Caused, at least in part, the resignation of an employee of Connor Group in February 2015; the employee reported that Raney's "unrelenting harassment of and malicious comments toward him" played a part in his decision to resign;

• Interfered with Connor Group's business relationship with other employees. For example, one female employee at a Georgia property reported a "scary and super creepy" unwelcome encounter with Raney by email, in which he referenced her child, questioned whether she was being a good role model for the child, and questioned the effect her work with Connor Group was having on other

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