Hullick v. Gib. Private Bank & Trust Co.

• Decision Date: 18 September 2019
• Docket Number: No. 3D18-0203,3D18-0203
• Citation: 279 So.3d 809
• Parties: Jonathan HULLICK, Appellant, v. GIBRALTAR PRIVATE BANK & TRUST COMPANY, and Steven D. Hayworth, Appellees.
• Court: Florida District Court of Appeals

279 So.3d 809

Jonathan HULLICK, Appellant,

v.GIBRALTAR PRIVATE BANK & TRUST COMPANY, and Steven D. Hayworth, Appellees.

No. 3D18-0203

District Court of Appeal of Florida, Third District.

Opinion filed September 18, 2019.

Weil Snyder Schweikert & Ravindran, P.A., and Ronald P. Weil, and Iva U. Ravindran ; Joel S. Perwin, P.A., and Joel S. Perwin, for appellant.

Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A., and Jose G. Sepulveda, Carlos J. Canino, and Julie Fishman Berkowitz ; Wicker Smith O'Hara McCoy & Ford, P.A., and Dennis M. O'Hara, Alyssa M. Reiter, Lindsey A. Hicks, and Brandon J. Hechtman, for appellees.

Before SALTER, LOGUE, and LINDSEY, JJ.

LINDSEY, J.

Appellant Jonathan Hullick (Plaintiff below) appeals an order entering final summary judgment in favor of Appellee Steven Hayworth (Defendant below) on two counts of defamation per se. Hullick alleged that Hayworth, as Chief Executive Officer of Gibraltar Private Bank and Trust Company, made defamatory statements in front of Gibraltar's Board of Directors. Because Hullick failed to establish the essential element of publication to a third party, we affirm.

I. BACKGROUND¹

In May 2007, Hayworth, former CEO, Executive President, and Chairman of Gibraltar's Board of Directors, hired Hullick to fill the recently-vacated Chief Operating Officer ("COO") position. Hullick's time with Gibraltar was, however, short-lived. In July 2007, Hullick wrote a memo in which he expressed concern over irregularities and other suspicious activity in a client's accounts. Over the next 15 months, Hullick reported his ongoing concerns to Hayworth, the Board of Directors, the Senior Managing Director, the Audit Committee, the Chief Risk Officer, the Bank Secrecy Act/Anti-Money Laundering Officer, and the Chief Credit Officer. In addition, Hullick reported his concerns regarding Senior Vice President John Harris, the Regional Market Manager at Gibraltar's Ft. Lauderdale branch, where the client's accounts were maintained. Hullick believed that Harris was aware of fraudulent activity in the accounts and was permitting it to continue. Conflict arose between Harris and Hullick, and Hullick was eventually terminated from his position as Gibraltar's COO.

Approximately two years later, Hullick filed the underlying action, alleging, inter alia, that Hayworth made multiple defamatory statements about him post-termination that destroyed his reputation in the banking community, making it difficult for him to find employment. Hullick further alleged Hayworth made these statements to the other members of Gibraltar's Board of Directors during a Board meeting. After numerous motions and orders from three different trial court judges, Hullick's twenty-count operative complaint was whittled down to just five counts: one count against Gibraltar for breach of contract and two counts each against Gibraltar and Hayworth for defamation per se.

Gibraltar and Hayworth filed motions for summary judgment, arguing that the element of publication was not established by the allegations in the Complaint based on this Court's holding in American Airlines, Inc. v. Geddes, 960 So. 2d 830 (Fla. 3d DCA 2007).² The prior trial court judge disagreed and denied the motions, allowing the case to go forward.³ Thereafter, Gibraltar and Hayworth renewed their motions for summary judgment with the successor trial judge, asserting the same grounds as previously argued. The trial court agreed and granted summary judgment in favor of Hayworth on both defamation counts (Counts XII and XVI) because Hullick had failed to establish the necessary element of publication to a third party.

This timely appeal followed.⁴

II. STANDARD OF REVIEW

When there are no disputed factual issues, the granting of summary judgment presents a pure question of law and is subject to the de novo standard of review. Bosem v. Musa Holdings, Inc., 46 So. 3d 42, 44 (Fla. 2010) ("Because this is a pure question of law, our standard of review is de novo."); So. Baptist Hosp. of Fla., Inc. v. Welker, 908 So. 2d 317, 319 (Fla. 2005) ; Siegel v. Tower Hill Signature Ins. Co., 225 So. 3d 974 (Fla. 3d DCA 2017).

III. ANALYSIS

The issue before us is whether publication to a third party occurred when Hayworth allegedly made defamatory statements as the CEO and Chairman of Gibraltar's Board of Directors to other members of the Board. It is undisputed that an essential element of a defamation claim is publication to a third party.⁵ See Advantage Pers. Agency, Inc. v. Hicks & Grayson, Inc., 447 So. 2d 330, 331 (Fla. 3d DCA 1984). "A defamatory statement does not become actionable ... until it is published or communicated to a third person; statements made to the person alleging the defamation do not qualify." Geddes, 960 So. 2d at 833 (Fla. 3d DCA 2007) (citing American Ideal Mgmt., Inc. v. Dale Village, Inc., 567 So. 2d 497, 498 (Fla. 4th DCA 1990) ; Granda–Centeno v. Lara, 489 So. 2d 142, 143 (Fla. 3d DCA 1986) ).

In Geddes, this Court explained that, with respect to corporations, "statements made to corporate executive or managerial employees of that entity are, in effect, being made to the corporation itself, and thus lack the essential element of publication." 960 So. 2d at 833 ; see also Lopez v. Ingram Micro, Inc., 10 Fla. L. Weekly D635, 1997 WL 401585 (S.D. Fla. Mar. 18, 1997) ("[S]tatements ‘made to a corporate executive or managerial employee ... are, in effect, being made ... to the corporation itself ....’ " (quoting Hicks & Grayson, Inc., 447 So. 2d at 331 )).

Gibraltar is a Federal Savings Association ("FSA"). As such, federal regulations require that "[a] majority of the directors must not be salaried officers or employees of the savings association or of any subsidiary thereof." 12 C.F.R. § 163.33(a)(1)(i). Hullick argues that because Gibraltar's Board of Directors is comprised of a majority of non-employee directors, Geddes does not apply. We disagree.

In Hoch v. Loren, 273 So. 3d 56, 57 (Fla. 4th DCA 2019), the Fourth District explained the rationale behind treating certain intra-corporate communications, even though apparently made to third persons, as not published for the purposes of a defamation claim: "To reach this conclusion, courts have employed the legal fiction that the party hearing or seeing the purported defamation is so closely connected with the potential defamation plaintiff or defendant that they merge into a single entity, so there is no publication to a ‘third person’ necessary to the cause of action."

Here, although Gibraltar's Board includes a majority of non-employee directors, these directors and Hayworth, the former CEO, were undoubtedly so closely connected with Gibraltar that communications among the Board and Hayworth were tantamount to the "corporation talking to itself." See Geddes, 960 So. 2d at 834. This conclusion is supported by the federal regulations governing FSAs, which require non-employee directors to form an integral part of the FSA corporate structure. See 12 C.F.R. § 163.33(a)(1)(i).

Further, Florida law has long considered a board of directors to be a corporation's management and has provided that the acts of a corporation's board of directors are the acts of the corporation itself. See, e.g., Mease v. Warm Mineral Springs, Inc., 128 So. 2d 174, 179 (Fla. 2d DCA 1961) ("The board of directors of a...