Medical Laboratory Management v. American Broad.

• Decision Date: 22 December 1998
• Docket Number: No. Civ 95-02494-PHX-ROS.,Civ 95-02494-PHX-ROS.
• Citation: 30 F.Supp.2d 1182
• Parties: MEDICAL LABORATORY MANAGEMENT CONSULTANTS d/b/a Consultants Medical Lab, et al., Plaintiffs, v. AMERICAN BROADCASTING COMPANIES, INC., et al., Defendants.
• Court: U.S. District Court — District of Arizona

30 F.Supp.2d 1182

MEDICAL LABORATORY MANAGEMENT CONSULTANTS d/b/a Consultants Medical Lab, et al., Plaintiffs, v. AMERICAN BROADCASTING COMPANIES, INC., et al., Defendants.

No. Civ 95-02494-PHX-ROS.

United States District Court, D. Arizona.

December 22, 1998

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Neville Lawrence Johnson, Neville L. Johnson & Associates, Los Angeles, CA, Brian A. Rishwain, Law Offices of Brian A. Rishwain, Los Angeles, CA, for Medical Laboratory Management Consultants, John Devaraj, Carolyn Devaraj.

Andrew D. Hurwitz, Diane M. Johnsen, Osborn Maledon PA, Phoenix, AZ, for Diane Sawyer, Ira Rosen, Robbie Gordon, Mark Lukazsiewicz, Executive Producer Defendant No. 1, Program and Practices Defendant No. 2, Hidden Camera Defendants 3-6, David Shapinsky, Phyllis E. McGrady, Richard C. Wald, Jeff Cooke.

AMENDED ORDER

SILVER, District Judge.

FACTUAL BACKGROUND

This action arises from a broadcast on American Broadcasting Companies ("ABC")'s television program Prime Time Live about faulty pap smear testing. On or about February 10, 1994, Defendant Robbie Gordon, an employee of Defendant ABC, telephoned Plaintiff John Devaraj, a co-owner with his wife, Carolyn Devaraj, of Medical Laboratory Consultants (d/b/a Consultants Medical Lab) (hereinafter "Medical Lab"). Ms. Gordon, who had no prior contact with Mr. Devaraj, told him that she was a cytotechnologist¹ from Georgia interested in starting a pap smear laboratory in that state and "wanted to find out more details on the costs involved ... and the financial end of running such a lab." (Pls.['] Resp. to Defs.['] First Set of Interrogs., No.1, attached to Defs['] Statement of Facts ("DSOF") as Exh. A.) She informed Mr. Devaraj that she would be in Phoenix visiting friends or relatives and asked if she could visit his laboratory to learn more about the industry. (Id.) Mr. Devaraj claims that he asked Ms. Gordon "a few questions such as `Who are you?' [and] `Do you have enough funds available?'" (Devaraj Dep. at 91, attached to DSOF as Exh. B.) Mr. Devaraj agreed to schedule a meeting with Ms. Gordon at Medical Lab because it "appeared to be that she would be willing to bring some business to [his] laboratory." (Id. at 92.) In fact, Ms. Gordon was not a cytotechnologist and her only interest in Medical Lab was as a possible source of information for an upcoming episode of Prime Time Live concerning error rates in pap smear testing conducted by medical laboratories.

The meeting took place at Medical Lab on March 18, 1994. Ms. Gordon was accompanied by Jeff Cooke — who claimed he was a computer expert but was an undercover camera specialist — and another individual whose name has not been revealed. (Id. at 212.) Ms. Gordon and Mr. Cooke entered the laboratory through an unlocked door leading into a reception room. (Id. at 213, 215.) Mr. Devaraj met them there and escorted them to a conference room adjoining the reception area. (Id. at 215.) The conference room had windowed French doors and was visible by an accounting clerk who was working on the other side of the door. (Id. at 216.)

During roughly two hours, they spoke generally about the laboratory industry, about Medical Lab in particular, and about Ms. Gordon's fictitious plans to open a laboratory. Mr. Devaraj told them that Medical Lab tried to compete with larger labs by offering a "better turnaround time." (Id. at 214; DSOF at ¶ 4.) In addition, Mr. Devaraj invited Ms. Gordon and Mr. Cook on a tour of the laboratory, an invitation he occasionally made to prospective customers, physicians, and others who had "proper identification." (Id. at 212, 220.) At one point during the tour, Ms. Gordon appeared to be heading into Mr. Devaraj's office and was asked not to go there. (Id. at 221.) This was the only occasion during the visit when Ms. Gordon or Mr. Cooke were told not to enter a particular area. (Id.) Medical Lab employees were present for portions of the conversation during the tour. (Gordon Dep. at 14, attached to DSOF as Exh. C; Cooke Dep. at 45, attached to DSOF as Exh. E; Tiffany Splittorff Dep. at 37, attached to DSOF as Exh. G.) At no point during the interview did Mr. Devaraj ask that they keep any of the information discussed confidential. (Tr. of 3/18/94 Interview, attached to DSOF as Exh. D.) As many as 20 or more patients visited Medical Lab each day for blood work and other laboratory tests, but the conference room where the interview took place was located in an adjoining suite used for administrative purposes. (Hermosillo Dep. at 15-16, attached to DSOF as Exh. L; Devaraj Dep. at 213, attached to DSOF as Exh. B.)

Unbeknownst to Plaintiffs, Mr. Cooke filmed the entire episode with hidden cameras located in his wig. (Cooke Dep. at 14-15, attached to DSOF as Exh. E.) ABC featured footage from the interview on a broadcast designed to highlight what it perceived were frequent errors in pap smear testing at medical laboratories. Also as part of preparation for the broadcast, Defendants sent pretested pap smear slides to Medical Lab for testing, claiming the slides were from patients at a fictitious clinic called the Huron Women's Health Collective. When the program, which was titled Rush to Read, aired on May 19, 1994, it was reported that Medical Lab mistakenly failed to identify cervical cancer on several of the slides. Rush to Read did not identify Mr. Devaraj and Medical Lab by name but a picture of his face was published during the broadcast.

John and Carolyn Devaraj and Medical Lab ("Plaintiffs")² sued ABC, KTVK-TV (ABC's then-affiliate in Phoenix) and other individuals ("Defendants") allegedly involved in the production of Rush to Read after it aired. In an Order dated April 25, 1996, the Court dismissed all of Plaintiffs' claims against KTVK-TV and the public disclosure of private facts, intentional infliction of emotional distress, unfair practices, trade libel, negligent infliction of emotional distress, and conspiracy claims against the remaining Defendants.³ Defendants now move for summary judgment on the remaining claims of intrusion, fraud, interference with contractual relations, trespass, eavesdropping, and punitive damages. Defendants Lorri Garcia-Cottrell and Rhondi Charleston independently move for summary judgment on all the claims against them. In addition, Plaintiffs have filed a Motion for an Order Granting Leave to File a Second Amended Complaint to Add Claims for Defamation & False Light to Conform to Proof. The motion for summary judgment raises a panoply of issues which have conflicted many courts for two reasons. First, it requires grappling with and finding a balance between two fervently protected fundamental rights in competition: the right of the individual to be left alone and the right of society to access information of public interest. Second, it involves a difficult analysis of common law causes of action enshrouded by the First Amendment.

LEGAL DISCUSSION

Fed.R.Civ.P. 56(c) authorizes the granting of summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file together with the affidavits, if any, show there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Judgment for the moving party must be entered "if, under the governing law, there can be but one reasonable conclusion as to the verdict." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). "If reasonable minds could differ as to the import of the evidence," judgment should not be entered in favor of the moving party. Id. at 250-251, 106 S.Ct. 2505.

The moving party bears the initial burden of identifying the elements of the claim in the pleadings, depositions, answers to the interrogatories, affidavits, and other evidence which the moving party "believes demonstrates the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). "A material issue of fact is one that affects the outcome of the litigation and requires a trial to resolve the parties' differing versions of the truth." S.E.C. v. Seaboard Corp., 677 F.2d 1301, 1305-06 (9th Cir.1982). The burden then shifts to the non-moving party to establish that there is a genuine issue for trial. Celotex, 477 U.S. at 324, 106 S.Ct. 2548. More than a "metaphysical doubt" is required to establish a genuine issue of material fact. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). The parties bear the same substantive burdens of proof as would apply at a trial on the merits. Anderson, 477 U.S. at 252, 106 S.Ct. 2505. In a summary judgment motion, the Court does not weigh the evidence or the credibility of witnesses, rather "the nonmovant's version of any disputed issue of fact is presumed correct." Eastman Kodak Co. v. Image Technical Serv., Inc., 504 U.S. 451, 458, 112 S.Ct. 2072, 119 L.Ed.2d 265 (1992).

I. Intrusion

Plaintiffs' first claim for relief is that Defendants invaded Mr. Devaraj's privacy by using false pretenses to gain entrance to Medical Lab and by secretly videotaping the conversation.⁴ Arizona recognizes the four branches of the tort of invasion of privacy outlined in the Restatement: 1) intrusion on seclusion; 2) commercial appropriation; 3) publication of private facts; and 4) false light.⁵ Rest. (Second) of Torts § 652A (1977); Godbehere v. Phoenix Newspapers, Inc., 162 Ariz. 335, 783 P.2d 781, 784 (Ariz. 1989) (citing Rest. § 652A-I); Hart v. Seven Resorts Inc., 190 Ariz. 272, 947 P.2d 846, 853 (Ariz.App.1997); Mary Jo Rudd, Note, Is Invasion of Privacy A Viable Action in Arizona?: Rethinking the Standard, 30 Ariz. L.Rev. 322-24 (1988). The Restatement describes the tort of intrusion upon seclusion as follows: "One who intentionally intrudes, physically or otherwise, upon the solitude or seclusion of another or his private affairs...