Hollander v. Pan American World Airways, Inc.

• Decision Date: 07 March 1974
• Docket Number: Civ. A. No. 71-1043-M.
• Citation: 382 F. Supp. 96
• Parties: Ronald B. HOLLANDER t/a King George Motel v. PAN AMERICAN WORLD AIRWAYS, INC., a corporation.
• Court: U.S. District Court — District of Maryland

382 F. Supp. 96

Ronald B. HOLLANDER t/a King George Motel v. PAN AMERICAN WORLD AIRWAYS, INC., a corporation.

Civ. A. No. 71-1043-M.

United States District Court, D. Maryland.

September 25, 1973.

Supplemental Opinion March 7, 1974.

COPYRIGHT MATERIAL OMITTED

Milton M. Burke, Silver Spring, Md., and Jack H. Olender, Oxon Hill, Md., for plaintiff.

John H. Mudd and H. Thomas Howell and Semmes, Bowen & Semmes, Baltimore, Md., for defendant.

Memorandum Opinion and Order

JAMES R. MILLER, Jr., District Judge.

This is a suit for libel and slander brought by Ronald B. Hollander, trading as the King George Motel in Annapolis, Maryland, against Pan American World Airways, Inc. (Pan Am). Jurisdiction is asserted on the basis of diversity of citizenship. The suit is based upon a letter written by one Morton Young, senior manager of Pan Am's public relations department at the time, to the motel and to "King George's College" and to the Annapolis Chamber of Commerce, complaining about the treatment his wife received when she and a companion attempted to register at the motel. The text of the letter, which was written on Pan Am stationery, is as follows:

"Gentlemen:

"I am writing on behalf of my wife concerning her treatment at the King George Motel on April 22

"She was a participant in the Northeast Regional Conference of English in the Two Year Colleges, hosted by King George's College, at the Annapolis Hilton Inn. The Hilton was filled and I made a reservation for her and a colleague for a room at the King George Motel, Apr. 22-24. The motel requested a deposit of $14.50 plus 60¢ tax, the rate for one night. Perfectly reasonable, and I sent a check.

"When my wife and her colleague arrived the evening of April 22, the desk clerk refused to allow them to register unless they paid in advance for the next night. Now, both of us have done extensive travelling in this country and abroad. Never have we encountered such treatment — no matter what price the accommodations. They rightly refused to pay for the next night, losing the deposit for the first night.

"Fortunately, the Hilton had a lastminute cancellation and they stayed there. The service and accommodations were superb, my wife tells me.

"As you can see, I am sending copies of these letters to the motel and to the college. To the latter as a precaution, should there be a need in the future to divert some potential unfortunate to the King George Motel. And to the motel to stress that I think it is a blot upon an otherwise pleasant and friendly city.

"For myself, I will know better than to send visitors from overseas anywhere near the motel and will recommend to press groups — which Pan Am hosts on visits to the U.S.A. from time to time — that they stay at the Hilton; adding, under no conditions are they to risk a rebuff or mar their stay by booking rooms of a motel that does not understand what they are in business for. Although, judging from the description of the motel by my wife and her colleague, the motel management may be more accustomed to booking rooms by the hour than by the night.

"Regretfully "Morton Young Senior Manager Public Relations"

Plaintiff claims that the letter is slanderous per se in that it allegedly imputes an illegal act to him (renting rooms for immoral purposes) and also that it asserts a lack of qualification on the part of plaintiff to conduct the business of operating a motel. See oral opinion of May 5, 1972, Paper No. 17, at 4-5. In a hearing on defendant's motion to dismiss on May 5, 1972, the court held that the former did not constitute libel per se while the latter did. Id.

Defendant has now filed a motion for summary judgment, pursuant to Rule 56, F.R.Civ.P., based upon two grounds: (1) That the alleged libel and slander was neither authorized nor ratified by defendant and was not published by an agent of defendant acting within the scope of his employment, and (2) that the alleged libel was a privileged communication under the common law of Maryland and the First Amendment to the United States Constitution.

The law in this circuit concerning summary judgment was set out in Phoenix Savings and Loan, Inc. v. Aetna Casualty and Surety Co., 381 F.2d 245, 249 (4th Cir. 1967), as follows:

"It is well settled that summary judgment should not be granted unless the entire record shows a right to judgment with such clarity as to leave no room for controversy and establishes affirmatively that the adverse party cannot prevail under any circumstances. Neither should summary judgment be granted if the evidence is such that conflicting inferences may be drawn therefrom, or if reasonable men might reach different conclusions. 3 Barron & Holtzoff, Federal Practice & Procedure § 1234 (Rules ed. 1958). Burden is upon party moving for summary judgment to demonstrate clearly that there is no genuine issue of fact, and any doubt as to the existence of such an issue is resolved against him. 3 Barron and Holtzoff, Federal Practice & Procedure, § 1235 (Rules ed. 1958).

"In Kirkpatrick v. Consolidated Underwriters, 227 F.2d 228 (4th Cir. 1955), the court repeated its holding in Pierce v. Ford Motor Co., 190 F.2d 910 (4th Cir. 1951), that summary judgment under Rule 56 should be granted only where it is perfectly clear that no issue of fact is involved and inquiry into the facts is not desirable to clarify the application of the law. This is true even where there is no dispute as to the evidentiary facts but only as to the conclusions or inferences to be drawn therefrom, and the `party opposing a motion for summary judgment is entitled to all favorable inferences which can be drawn from the evidence.' Cram v. Sun Ins. Office, Ltd., 375 F.2d 670, 674 (4th Cir. 1967).

"As we stated in American Fid. & Cas. Co. v. London & Edinburgh Ins. Co., 354 F.2d 214, 216 (4th Cir. 1965):

`Not merely must the historic facts be free of controversy but also there must be no controversy as to the inferences to be drawn from them. It is often the case that although the basic facts are not in dispute, the parties nevertheless disagree as to the inferences which may properly be drawn. Under such circumstances the case is not one to be decided on a motion for summary judgment.'"

I. Scope of Employment

The first ground in support of the motion was previously raised by defendant in a motion to dismiss which was denied by this court on May 5, 1972. The court stated at that time that while it may later appear that there was no authority for Young to act as he did, the court did not reach such a factual determination for purposes of deciding the motion to dismiss. Since then the defendant has filed affidavits in support of its motion for summary judgment. Defendant specifically points to the affidavit of Anthony Lutz, Mr. Young's superviser at Pan Am, as conclusive evidence that Young was acting outside the scope of his duties in writing the letter. In the affidavit Lutz lists Young's duties at the time as senior manager of public relations for Pan Am and states affirmatively that Young had no authority to "blacklist" any hotel or to dissuade overseas visitors from patronizing any hotel. The affiant also states that the letter was prepared without the knowledge, consent, approval, or authority of Pan Am or any officer or agent thereof and that there is no copy of the letter in Pan Am's files.

The Maryland law on the scope of employment test in defamation cases is set out in Lewis v. Accelerated Transport-Pony Express, Inc., 219 Md. 252, 148 A.2d 783 (1959), as follows:

"In Hopkins C. Co. v. Read Drug & C. Co., 124 Md. 210, 92 A. 478, 479, this Court stated that a corporation is liable for the slanderous words of its employees if such words were acts within the scope of the employee's employment. In that case, the Court, quoting with approval from the case of Sawyer v. Railroad, 142 N.C. 1, 54 S.E. 793, said: `The simple test is whether they were acts within the scope of his employment; not whether they were done while prosecuting the master's business, but whether they were done by the servant in furtherance thereof, and were such as may fairly be said to have been authorized by him. By "authorized" is not meant authority expressly conferred, but whether the act was such as was incident to the performance of the duties entrusted to him by the master, even though in opposition to his express and positive orders.'

"In the later case of West v. F. W. Woolworth Co., 215 N.C. 211, 1 S.E.2d 546, 548 (N.C.1939), the rule was stated thus:

`An act is within the scope of the servant's employment where necessary to accomplish the purpose of his employment and intended for that purpose, although in excess of the powers actually conferred upon the servant by the master. That the act was committed while the servant was on duty performing the functions of his employment and it was committed for the purpose of furthering the business of the master, rather than its method of performance, is the test of employment. When a wrong is committed by an employee in performing or attempting to perform the duties and functions of his employment it is immaterial whether the injury was a result of negligence or willful and wanton conduct; nor is it necessary that the master should have known that the particular act was to be done. * * * The question of liability does not depend on the quality of the act, but rather upon the question whether it has been performed in the line of duty and within the scope of the authority conferred by the master.'

And this is the law generally. See Anno. 150 A.L.R. 1346." 219 Md. at 255-256, 148 A.2d at 785.

The Maryland Court of Appeals has more recently added that for an intentional tort by a servant to be within the scope of his employment, it must be "an expectable act done in furtherance of his employment." LePore v. Gulf Oil Corp., 237 Md. 591, 600, 207 A.2d 451, 456 (1965) (emphasis added).

The first issue for purposes of this motion is whether the letter...