Matherson v. Marchello

Decision Date26 March 1984
Citation100 A.D.2d 233,473 N.Y.S.2d 998
PartiesRobert W. MATHERSON, et al., Appellants, v. Anthony MARCHELLO, et al., Respondents.
CourtNew York Supreme Court — Appellate Division

Patrick Kevin Brosnahan, Jr., Babylon, for appellants.

Allen Wolfsont, Smithtown, for respondents.

Before TITONE, J.P., and THOMPSON, BRACKEN and RUBIN, JJ.

TITONE, Justice Presiding.

In this defamation action, plaintiffs Robert W. Matherson and Carolyn E. Matherson appeal from an order of the Supreme Court, Suffolk County, which, upon a motion made pursuant to CPLR 3211 (subd. [a], par. 7), in effect dismissed their complaint for failure to state a cause of action. Plaintiffs were granted leave to replead, setting forth allegations of special damages. We hold that the statements complained of constitute libel, actionable without proof of special damages, and reverse.

On October 28, 1980, radio station WBAB conducted an interview with the members of a singing group called "The Good Rats". Following a commercial which advertised a Halloween party at an establishment known as "OBI", a discussion ensued in which various members of the group explained that they are no longer permitted to play at OBI South because:

"Good Rat # 1 Well, you know, we had that Law suit with Mr. Matherson.

"A Good Rat And we used to fool around with his wife.

"Good Rat # 1 And we won.

"A Good Rat One of us used to fool around with his wife. He wasn't into that too much.

"D.J. Oh yea.

"Good Rat # 1 (interrupted and joined by another Good Rat) We used to start off our gigs over there with the National Anthem, and he was very upset about that, and now all of a sudden he's very patriotic and he's using it in his commercials.

"A Good Rat I don't think it was his wife that he got so upset about, I think it was when somebody started messing around with his boyfriend that he really freaked out. Really.

(Laughter)

That did it man."

Plaintiffs, who are husband and wife, subsequently commenced this action against "The Good Rats" (as individuals and against their record company), alleging that the words "we used to fool around with his wife" and "I don't think it was his wife that he got upset about, I think it was when somebody started messing around with his boyfriend that he really freaked out", were defamatory. They seek compensatory and punitive damages for humiliation, mental anguish, loss of reputation and injury to their marital relationship as well as for the loss of customers, business opportunities and good will allegedly suffered by Mr. Matherson. Special Term granted defendants' motion to dismiss, finding that the complaint failed to adequately allege special damages. However, it gave plaintiffs leave to replead. Plaintiffs declined the opportunity and have appealed.

Preliminarily, we observe that if special damages are a necessary ingredient of plaintiffs' cause of action, Special Term properly found the allegations of the complaint to be deficient.

Special damages consist of "the loss of something having economic or pecuniary value" (Restatement, Torts 2d, § 575, comment b) which "must flow directly from the injury to reputation caused by the defamation, not from the effects of defamation" (Sack, Libel, Slander and Related Problems, VII 2.2, 345-346; see, also, 1 Harper & James, The Law of Torts, § 5.14) and it is settled law that they must be fully and accurately identified "with sufficient particularity to identify actual losses" (Lincoln First Bank of Rochester v. Siegel, 60 A.D.2d 270, 280, 400 N.Y.S.2d 627). When loss of business is claimed, the persons who ceased to be customers must be named and the losses itemized (Reporters' Assn. of Amer. v. Sun Print. & Pub. Assn., 186 N.Y. 437, 79 N.E. 710; Continental Air Ticketing Agency v. Empire Int. Travel, 51 A.D.2d 104, 108, 380 N.Y.S.2d 369). "Round figures" or a general allegation of a dollar amount as special damages do not suffice (Drug Research Corp. v. Curtis Pub. Co., 7 N.Y.2d 435, 440, 199 N.Y.S.2d 33, 166 N.E.2d 319; Continental Air Ticketing Agency v. Empire Int. Travel, supra, p. 108, 380 N.Y.S.2d 369). Consequently, plaintiffs' nonspecific conclusory allegations do not meet the stringent requirements imposed for pleading special damages (Zausner v. Fotochrome, 18 A.D.2d 649, 235 N.Y.S.2d 698; 9 Fuchsberg, Encyclopedia New York Damages Law, § 243).

We must, therefore, determine whether an allegation of special damages is necessary. In large measure, this turns on which branch of the law of defamation is involved. As a result of historical accident, which, though not sensibly defensible today, is so well settled as to be beyond our ability to uproot it (Ostrowe v. Lee, 256 N.Y. 36, 39, 175 N.E. 505), there is a schism between the law governing slander and the law governing libel (see Restatement, Torts 2d, § 568, comment b; see, also, Gurtler v. Union Parts Mfg. Co., 1 N.Y.2d 5, 150 N.Y.S.2d 4, 132 N.E.2d 889; 2 PJI [1983 Supp., p. 84] ). 1

A plaintiff suing in slander must plead special damages unless the defamation falls into any one of four per se categories (see Prosser, Torts [4th ed.], § 112, pp. 751-760; Restatement, Torts 2d, § 570). Those categories consist of allegations (1) that the plaintiff committed a crime (Privitera v. Town of Phelps, 79 A.D.2d 1, 435 N.Y.S.2d 402; Lander v. Wald, 218 App.Div. 514, 219 N.Y.S.2d 57, affd. 245 N.Y. 590, 157 N.E. 870), (2) that tend to injure the plaintiff in his or her trade, business or profession (Cruikshank v. Gordon, 118 N.Y. 178, 23 N.E. 457; Nadrowski v. Wazeter, 29 A.D.2d 741, 286 N.Y.S.2d 904, affd. 23 N.Y.2d 899, 298 N.Y.S.2d 305, 246 N.E.2d 159), (3) that plaintiff has contracted a loathsome disease (Simpson v. Press Pub. Co., 33 Misc. 228, 67 N.Y.S. 401) and (4) that impute unchastity to a woman (Morrow v. Wiley, 73 A.D.2d 859, 423 N.Y.S.2d 658; Civil Rights Law, § 77). 2 The exceptions were established apparently for no other reason than a recognition that by their nature the accusations encompassed therein would be likely to cause material damage (Prosser, Torts [4th ed], § 112, p 754).

On the other hand, a plaintiff suing in libel need not plead or prove special damages if the defamatory statement " 'tends to expose the plaintiff to public contempt, ridicule, aversion or disgrace, or induce an evil opinion of him in the minds of right-thinking persons, and to deprive him of their friendly intercourse in society' " (Rinaldi v. Holt, Rinehart & Winston, 42 N.Y.2d 369, 379, 397 N.Y.S.2d 943, 366 N.E.2d 1299, quoting from Sydney v. Macfadden Newspaper Pub. Corp., 242 N.Y. 208, 211, 151 N.E. 209; see, also,Tracy v. Newsday, Inc., 5 N.Y.2d 134, 182 N.Y.S.2d 1, 155 N.E.2d 853; Hogan v. Herald Co., 84 A.D.2d 470, 474, 446 N.Y.S.2d 836, affd. 58 N.Y.2d 630, 458 N.Y.S.2d 538, 444 N.E.2d 1002). 3 Thus, unlike the law of slander, in the law of libel the existence of damage is conclusively presumed from the publication itself and a plaintiff may rely on general damages (compare Restatement, Torts 2d, § 569 with § 570; but see Excessiveness or Inadequacy of Damages for Defamation, Ann., 35 A.L.R.2d 218, which suggests, by its scheme of classification, how relatively few cases of libel actually do arise which are not more or less easily referrable to the categories of slander per se).

To be sure, the common-law rule has been tempered by several decisions of the Supreme Court of the United States which preclude recovery of punitive damages absent a showing of malice in the constitutional sense, i.e., knowledge of the falsity of the statement or reckless disregard of the truth, and require a plaintiff to prove actual damages, interdicting recovery of presumed damages (see, e.g., Wolston v. Reader's Digest Assn., 443 U.S. 157, 99 S.Ct. 2701, 61 L.Ed.2d 450; Herbert v. Lando, 441 U.S. 153, 99 S.Ct. 1635, 60 L.Ed.2d 115; Time, Inc. v. Firestone, 424 U.S. 448, 96 S.Ct. 958, 47 L.Ed.2d 154; Gertz v. Robert Welch, Inc., 418 U.S. 323, 350, 94 S.Ct. 2997, 3012, 41 L.Ed.2d 789; New York Times Co. v. Sullivan, 376 U.S. 254, 84 S.Ct. 710, 11 L.Ed.2d 686). Assuming, without deciding, that these limitations govern defamation suits against nonmedia defendants, an issue to be resolved shortly by the Supreme Court (Dun & Bradstreet v. Greenmoss Builders, --- U.S. ----, 104 S.Ct. 389, 78 L.Ed.2d 334, granting petition for writ of cert. to Sup.Ct. of Vermont, 143 Vt. 66, 461 A.2d 414; see 2 PJI [1983 Supp., p. 145], noting the conflict as to the reach of the Gertz case), we find that the cases which require a plaintiff to plead special damages, establish such actual malice, or suffer dismissal of the complaint (e.g., Newsday, Inc. v. Peck Contr., 87 A.D.2d 326, 451 N.Y.S.2d 415, app. dsmd. 57 N.Y.2d 885, 456 N.Y.S.2d 48, 442 N.E.2d 446; France v. St. Clare's Hosp. & Health Center, 82 A.D.2d 1, 441 N.Y.S.2d 79, app. withdrawn 56 N.Y.2d 593; Salomone v. MacMillan Pub. Co., 77 A.D.2d 501, 502, 429 N.Y.S.2d 441), cut far too broadly and their analysis has been rejected by the Court of Appeals.

In Hogan v. Herald Co., 84 A.D.2d 470, 479-480, 446 N.Y.S.2d 836, supra, then Justice SIMONS, writing for a unanimous Appellate Division, Fourth Department, observed that "the Supreme Court did not limit actual damages to out-of-pocket or pecuniary damage: loss of reputation, humiliation and mental anguish are also compensable * * * Thus, contrary to defendants' contention, plaintiff need not establish actual malice or special damages before he may recover". That appeal arose from a determination of a motion for summary judgment and, due to a lack of proof of actual malice, the claim for punitive damages was dismissed (84 A.D.2d at p. 481, 446 N.Y.S.2d 836, supra ). As to compensatory damages, however, allegations of injury to " 'credit and reputation' " and scorn, ridicule and harassment resulting in " 'extreme emotional distress and anguish' " and loss of " 'earnings of approximately $2,000.00, legal fees of $1,500.00, and other...

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