Dolcefino v. Randolph

• Decision Date: 08 June 2000
• Citation: 19 S.W.3d 906
• Parties: <!--19 S.W.3d 906 (Tex.App.-Houston 2000) WAYNE DOLCEFINO, KTRK TELEVISION, INC., CC TEXAS HOLDING CO., INC., CAPITAL CITIES/ABC, INC., HENRY FLORSHEIM, AND DAVID GWIZDOWSKI, Appellants v. CYNTHIA EVERETT RANDOLPH AND LLOYD E. KELLEY, Appellees NO. 14-99-00026-CV In The Fourteenth Court of Appeals
• Court: Texas Court of Appeals

Page 906

19 S.W.3d 906 (Tex.App.-Houston [14th Dist.] 2000)

WAYNE DOLCEFINO, KTRK TELEVISION, INC., CC TEXAS HOLDING CO., INC., CAPITAL CITIES/ABC, INC., HENRY FLORSHEIM, AND DAVID GWIZDOWSKI, Appellants v CYNTHIA EVERETT RANDOLPH AND LLOYD E. KELLEY, Appellees

NO. 14-99-00026-CV

In The Fourteenth Court of Appeals

June 8, 2000

On Appeal from the 55th District Court Harris County, Texas Trial Court Cause No. 97-45492

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[Copyrighted Material Omitted] Panel consists of Justices Yates, Fowler and Frost.

OPINION ON REHEARING

Kem Thompson Frost, Justice

Appellees' motion for rehearing is overruled. This court's opinion issued on February 10, 2000, is withdrawn, and this opinion is substituted in its place.

This is a defamation suit in which appellants, Wayne Dolcefino, KTRK Television, Inc., CC Texas Holding Co., Inc., Capital Cities/ABC, Inc., Henry Florsheim, and David Gwizdowski, all media defendants in the court below, challenge the denial of their motion for summary judgment.¹ In twenty-four points of error, they contend the trial court erred in refusing to render summary judgment that Cynthia Everett Randolph and Lloyd E. Kelley, appellees and plaintiffs in the court below, take nothing on their defamation claims. We reverse the trial court's judgment and render judgment in favor of appellants.

I. Factual Background

Elected as the City of Houston Controller in 1996, Lloyd Kelley took office in January, 1997. While Kelley was in office, the City awarded the accounting firm of Mir, Fox & Rodriguez ("MFR") a contract to resolve "Y2K" matters, i.e., issues associated with computer problems expected to arise at the beginning of the year 2000. On Kelley's recommendation, MFR subcontracted the Y2K work to Steven C. Plumb, who had served as Kelley's campaign treasurer in his bid to be elected City Controller. In subcontracting the Y2K work to Plumb, MFR neither kept any portion of the payments the City made to Plumb under the subcontract nor retained any supervisory control over Plumb's work for the City.

Wayne Dolcefino, an investigative reporter for KTRK Television, Channel 13, learned of the Plumb subcontract from Larry Homan, an employee in the City Controller's office.² Once alerted to this information, Dolcefino began investigating the Plumb subcontract as well as Kelley's work habits as City Controller. In the course of the investigation, Dolcefino's television news team chronicled how the City Controller spent his work days. While making surveillance videotapes of Kelley at various public places, the film crew captured Kelley attending to personal matters during business hours. One surveillance videotape showed Kelley at his home on a summer day installing a sprinkler system in his front yard. A second tape showed Kelley on a shopping trip to a local bookstore during work hours. A third surveillance tape showed Kelley spending a workday afternoon at SplashTown, a local water park, with Cynthia Randolph, a member of his executive staff. Accompanying Kelley and Randolph on the SplashTown outing were Kelley's two children and another child.

In furtherance of his investigation, Dolcefino sought and obtained hundreds of pages of public documents from the City through requests he made under the Texas Public Information Act, including records from the Controller's office and City Finance and Administration Department. Among these documents were the City payroll records on Randolph, which showed that she worked the day of her SplashTown outing with Kelley. These payroll records were later changed by the filing of an "exception" to reflect Randolph's afternoon at the water park as vacation time. The change, made in accordance with the City's policies and procedures, was entered four days after KTRK-Channel 13 requested the records, and more than two weeks after the SplashTown outing. In television broadcasts aired on KTRK-Channel 13, Dolcefino reported the SplashTown trip, noting both the original omission of any entry in Randolph's payroll records showing the time she took off to accompany Kelley to the water park and the fact that these records were later changed to reflect the time off as vacation time.

A. Statements to the Public Integrity Review Group

As Dolcefino investigated the Plumb subcontract, he spoke to Officers B.A. Fletcher and S.R. Jett of the Houston Police Department, who were on a task force known as the Public Integrity Review Group or "PIRG." Dolcefino told the officers that there may not have been any work product from Plumb relating to the Y2K subcontract and that the money Plumb received as compensation for his services may have been directed to Kelley's campaign fund. Dolcefino asked the officers to do nothing until after July 16, 1997, the date Plumb's report from his Y2K work was due to be submitted to the City. Nevertheless, the PIRG began an investigation of the matter. Appellants learned of the PIRG's investigation on July 15, 1997, the day before the Plumb report was to issue.

B. The July 16th Broadcast

On the day Plumb was to submit his report to the City (July 16, 1997), appellants³ broadcast a story on the subcontract, reporting that KTRK-Channel 13 had learned that the PIRG was asking questions about Kelley. In the broadcast, appellants reported that Plumb began benefitting from government contracts a few months after Kelley became the City Controller and that Plumb had prepared only a three-page report detailing his Y2K work, despite being paid $26,000 for his services.⁴ Dolcefino reported that Kelley had helped steer contract money to Plumb, and that MFR had performed no Y2K services under its contract with the City, but instead had passed the Y2K work and all the money to Plumb. During the broadcast, appellants showed excerpts of a taped interview with Gaspar Mir, a principal of MFR, during which Mir stated that MFR had no idea what the City was getting for its money in connection with the Plumb subcontract.

C. The July 21st Broadcast

Appellants followed up on the July 16th broadcast with another television report on the Plumb subcontract. The story aired on July 21, 1997, the same day Kelley held a press conference. In the broadcast, appellants showed videotaped footage of Kelley at the press conference explaining that Plumb had not been involved in the financial aspects of Kelley's campaign and that there was no wrongdoing in connection with the subcontract. Dolcefino reported that Kelley could not recall if he suggested Plumb for the subcontract. He also reported that Kelley could not identify Plumb's qualifications. In addition, Dolcefino reiterated the assertion from the July 16th broadcast that Plumb had received $26,000 and had produced only a three-page report. At the end of the July 21st broadcast, Dolcefino noted that Kelley claimed the police had cleared him of wrongdoing, but Dolcefino remarked that Kelley's statement was inaccurate as the district attorney's office had merely declined to press charges. According to Dolcefino, this action was "[n]ot exactly a clearing of any wrongdoing." Dolcefino also reported that neither the City Attorney nor the City's Finance and Administration Department had responded to Kelley's claims that those groups had conducted an audit and found no wrongdoing.

D. The July 22nd Broadcast

Most of the broadcast report aired on July 22, 1997, repeated the information from the story aired the previous day. The report stated that Kelley denied wrongdoing, could not recall whether he suggested Plumb for the subcontract, and could not identify Plumb's qualifications. The July 22nd broadcast also repeated that the City had paid Plumb $26,000, that Plumb had produced only a three-page report, that Kelley had asked MFR to hire Plumb, and that MFR had passed the contract money to Plumb without reviewing Plumb's work. Appellants closed the broadcast report by noting that although Kelley had been cleared of criminal charges, "the ethics of the matter are still under investigation."

E. The August 12th Broadcast

The broadcast appellants aired on August 12, 1997, focused on the surveillance and investigation of Kelley's work habits as City Controller. Appellants described Kelley's SplashTown outing with Randolph, his workday installation of a sprinkler system at his home, and his workday visit to a local bookstore with other City employees. The report primarily centered on the SplashTown outing, describing how Randolph, a member of Kelley's executive staff, had accompanied him to the water park and that, although she had filled out the appropriate paperwork indicating her vacation time, her paycheck did not reflect the vacation time until over two weeks after the incident. Dolcefino called this record keeping "entirely legal," but noted that the payroll records of every executive with Kelley's office whose records appellants had requested were changed after appellants made the requests. Dolcefino also quoted Randolph as saying that she had never babysat Kelley's children, to which Dolcefino commented: "Apparently, she chose to spend her personal vacation time with the City official who hired her and his children." Dolcefino also stated in the broadcast that he had asked to review Kelley's appointment calendars and schedule books but was told that they were routinely destroyed.

F. Statements to Newspaper Reporters and City Officials

Dolcefino spoke with Tim Fleck, a reporter for The Houston Press, sometime prior to July 24, 1997. An article in that weekly newspaper reported Dolcefino as stating that the airing of Channel 13's malfeasance investigation on Kelley was imminent. Kelley accuses Dolcefino of making similar statements to Houston Chronicle reporter Julie Mason, and then Mayor Bob Lanier. He also alleges Dolcefino defamed him in oral communications to the Mayor's Chief...