Handberg v. Goldberg

• Citation: 831 S.E.2d 700
• Decision Date: 22 August 2019
• Docket Number: Record No. 170964
• Court: Supreme Court of Virginia
• Parties: Michael N. HANDBERG v. Felicia GOLDBERG, et al.

831 S.E.2d 700

Michael N. HANDBERG

v.Felicia GOLDBERG, et al.

Record No. 170964

Supreme Court of Virginia.

August 22, 2019

J. Chapman Petersen, Fairfax (Lee E. Berlik ; Jay M. McDannell ; BerlikLaw, Reston; Chap Petersen & Associates, on briefs), for appellant.

James P. Campbell, Leesburg (Campbell Flannery, on brief), for appellees.

PRESENT: All the Justices

OPINION BY ELIZABETH A. McCLANAHAN

Michael N. Handberg appeals a decision of the trial court upholding a jury verdict finding him liable for defamation of Dr. Felicia Goldberg. We agree with Handberg that the trial court erred in its gatekeeping function by failing to properly instruct the jury as to actionable statements of fact versus statements that were merely opinion and thus nonactionable. We reverse and remand.

I. BACKGROUND

Handberg retained Dr. Goldberg to provide educational advocacy services for his son who attended Loudoun County Public Schools ("LCPS"). The Morgan Center, an organization established by Dr. Goldberg, supplemented Dr. Goldberg’s services with testing services. Handberg provided his debit card information to the Morgan Center for billing. Upon each request for payment, Handberg would grant permission for The Morgan Center to charge his debit card for services provided. Billing disagreements subsequently arose, however, between Handberg, Dr. Goldberg, and the Morgan Center. This resulted in Handberg sending an email on June 2, 2015 to Dr. Goldberg and educational professionals at his son’s school informing them that Dr. Goldberg no longer represented his son, stating he was terminating Dr. Goldberg for fraudulent billing, and criticizing the billing practices of Dr. Goldberg and the Morgan Center as unethical.

Dr. Goldberg filed a defamation action based on Handberg’s email. Of the thirty-four statements contained in the email, Dr. Goldberg quoted the following eleven statements in her first amended complaint as allegedly defamatory:

1. "That he terminated Plaintiff’s services for ‘fraudulent billing;’ "

2. "That ‘since [Plaintiff] was able to secure reimbursement for LCPS [Plaintiff] thought she had a blank check to just start dumping hours on my credit card for services not provided;’ "

3. "That Plaintiff would not speak with him ‘unless [he] paid her more money;’ "

4. "That Plaintiff ‘stated it was not my money as LCPS would pay for it, so [Plaintiff] did not understand why I cared;’ "

5. "That ‘the motivation of the Morgan Center was focused on maximizing their billing and not on the best interests of the children they are advocating;’ "

6. "That Plaintiff’s ‘view was that since it was not my money (LCPS) that was paying for their services, I should just go along with excess billing. That is a value system that I don't endorse, or approve;’ "

7. "That Defendant ‘did not want LCPS to reimburse someone through me for services that were not authorized or performed;’ "

8. "That Defendant ‘did not think that [he] could trust the motives of a person that was so opportunistic and aggressive about pursuing money and was not a person that I could trust in advocating services for my son;’ "

9. "That ‘given the change in behavior [he] saw on this case, [he] would not recommend that LCPS agree to reimburse advocacy services in the future, given the advocate’s role in the negotiation and their conflict of interest;’ "

10. "That ‘in the case of the Morgan Center and Dr. Goldberg, they could not resist the temptation to cash in on what they perceive as a windfall;’ " and

11. "That ‘I don’t think this is in the students [sic] interest or LCPS interest.’ "

Handberg demurred to the first amended complaint, arguing that the statements could not sustain a defamation claim. The trial court denied Handberg’s demurrer in part and sustained it in part. The court found that the first eight statements recited above—numbered 1 through 8 (hereinafter the "first eight statements")—were actionable statements of fact, but that the last three statements—numbered 9 through 11 (hereinafter the "last three statements")—were statements of opinion incapable of supporting a defamation claim.

Handberg also filed a counterclaim, alleging conversion against the Morgan Center, fraud against Dr. Goldberg and The Morgan Center, and alleging the Morgan Center violated the Virginia Consumer Protection Act ("VCPA").

The parties proceeded to a jury trial. During her testimony, Dr. Goldberg introduced Handberg’s email into evidence in support of her defamation claim, asserting that the email wrongly accused her of "a felony and of unethical and unprofessional conduct." Dr. Goldberg testified to the work she did for Handberg’s son and how Handberg was informed prior to each of the charges incurred. Dr. Goldberg further testified that she did not encourage Handberg to participate in excess billing with the expectation of a reimbursement from LCPS. Dr. Goldberg also introduced an email in which she terminated Handberg as a client for failure to pay his outstanding bills.

At the close of evidence, Handberg objected to proposed jury instructions 7 and 8. Handberg contended that these instructions erroneously referred generally to the "statements in the June 2, 2015 email," rather than specifically identifying the first eight statements in Handberg’s email that the trial court found to be actionable on demurrer. Accordingly, Handberg asked the court to limit the jury instructions to the statements the jury could consider as a basis for a finding of defamation. Handberg nevertheless agreed that it was appropriate for the entire email (i.e., in unredacted form) to be provided to the jury for "context." The court denied Handberg’s objection, stating that "the collective memory of the jury controls" and "no other instructions are necessary." Thus, the court did not instruct the jury according to the prior demurrer order, but rather generally instructed the jury to determine whether "the statements in the June 2, 2015 email were false."

The jury returned a verdict for Dr. Goldberg on her defamation claim, awarding $90,000 in compensatory damages. The jury found for Handberg on his conversion claim against the Morgan Center, finding The Morgan Center charged Handberg’s debit card $35 without his authorization. The jury awarded Handberg $35 in compensatory damages and $45,000 in punitive damages. The jury also found that the Morgan Center and Dr. Goldberg were not liable for fraud and found that the Morgan Center did not violate the VCPA. The trial court denied all post-trial motions and entered a final order consistent with the jury verdicts. We granted Handberg this appeal challenging Dr. Goldberg’s award of compensatory damages for defamation.

II. ANALYSIS

A. Demurrer as to First Eight Statements

Handberg argues generally that the trial court erred, as a threshold matter, in ruling on his demurrer that the first eight statements in his email were actionable statements of fact rather than mere statements of opinion—which cannot be the basis for a defamation claim. The court then compounded its error, Handberg asserts, by allowing the jury to consider these first eight statements in deciding Dr. Goldberg’s defamation claim against him (as well as erroneously allowing the jury to consider the last three statements that the trial court had concluded were statements of opinion when ruling on the demurrer, as addressed in Part II.B., infra ). We reject this argument, concluding that the first eight statements were actionable statements of fact as a matter of law.

"Generally, under our common law, a private individual asserting a claim of defamation first must show that a defendant has published a false factual statement that concerns and harms the plaintiff or the plaintiff’s reputation." Hyland v. Raytheon Tech. Servs. Co. , 277 Va. 40, 46, 670 S.E.2d 746 (2009) (emphasis added). Relative to this requirement, a trial court, in performing its "gatekeeping function" in a defamation case, "must decide as a threshold matter of law whether a statement is reasonably capable of defamatory meaning before allowing the matter to be presented to a finder of fact." Schaecher v. Bouffault , 290 Va. 83, 94, 772 S.E.2d 589 (2015) (citing Perk v. Vector Res. Group, Ltd ., 253 Va. 310, 316-17, 485 S.E.2d 140 (1997) ); see Webb v. Virginian-Pilot Media Cos. , 287 Va. 84, 90, 752 S.E.2d 808 (2014) ("Ensuring that defamation suits proceed only upon statements which actually may defame a plaintiff, rather than those which merely may inflame a jury to an award of damages, is an essential gatekeeping function of the court.").

First, for a statement to be actionable as defamation, "it must ‘have a provably false factual connotation and thus [be] capable of being proven true or false.’ " Schaecher , 290 Va. at 98, 772 S.E.2d 589 (quoting Cashion v. Smith, 286 Va. 327, 336, 749 S.E.2d 526 (2013) ). In other words, "[t]he verifiability of the statement in question [is] a minimum threshold issue. If the defendant’s words cannot be described as either true or false, they are not actionable." Id . (quoting Potomac Valve & Fitting, Inc. v. Crawford Fitting Co., 829 F.2d 1280, 1288 (4th Cir.1987) ). From a constitutional perspective, there is simply "no constitutional value in false statements of fact." Tharpe v. Saunders , 285 Va. 476, 481, 737 S.E.2d 890 (2013) (quoting Gertz v. Robert Welch, Inc ., 418 U.S. 323, 340, 94 S.Ct. 2997, 41 L.Ed.2d 789 (1974) ).

" ‘[P]ure expressions of opinion,’ " however, "are constitutionally protected and ‘cannot form the basis of a defamation action.’ " Id . (quoting Williams v. Garraghty , 249 Va. 224, 233, 455 S.E.2d 209 (1995) ); see Schaecher , 290 Va. at 102-03, 772 S.E.2d 589 ; Hyland , 277 Va. at 47, 670 S.E.2d 746 ; Raytheon Tech. Servs. Co. v. Hyland , 273 Va. 292, 303, 641 S.E.2d 84 (2007) ; Yeagle v. Collegiate Times , 255 Va. 293, 295, 497 S.E.2d 136 (1998) ; Chaves v. Johnson , 230 Va. 112, 119, 335 S.E.2d 97 (1985).¹ Such speech consists of "[s]tatements that are relative in nature and depend...