Milsap v. Journal/Sentinel Inc.

• Decision Date: 01 August 1996
• Docket Number: No. 95-3388,95-3388
• Parties: JAMES W. MILSAP, Plaintiff-Appellant, v. JOURNAL/SENTINEL, INC., et al., Defendants-Appellees
• Court: U.S. Court of Appeals — Seventh Circuit

Page 1265

100 F.3d 1265

JAMES W. MILSAP, Plaintiff-Appellant, v. JOURNAL/SENTINEL, INC., et al., Defendants-Appellees.

No. 95-3388

In the United States Court of Appeals,

Seventh Circuit

Submitted August 1, 1996^*

Decided November 15, 1996

Appeal from the United States District Court for the Eastern District of Wisconsin, No. 95 C 86, Terence T. Evans, Chief Judge.

James W. Milsap (submitted), St. Paul, MN, pro se.

John R. Dawson, James L. Huston, and Paul Bragren, Foley & Lardner, Milwaukee, WI, for Defendants-Appellees.

Before RIPPLE, MANION, and ROVNER, Circuit Judges.

PER CURIAM.

James W. Milsap sued the publisher of The Milwaukee Journal and three of the Journal's employees over a column written by defendant Gregory D. Stanford and published in the Journal on May 5, 1993. He asserted a variety of claims, including defamation under Wisconsin law. The district court granted summary judgment on all claims. Milsap v. Journal/Sentinel, Inc., 897 F. Supp. 406 (E.D. Wis. 1995). Milsap appeals, challenging only the decision on his defamation claim. The district court had diversity jurisdiction over the action, 28 U.S.C. sec. 1332, and we have jurisdiction of the appeal, 28 U.S.C. sec. 1291.

In the column in question, published in the "Other Views" section of the Journal and reprinted as an appendix to the district court's opinion, 897 F. Supp. at 413, Stanford reflects on the life and career of a fellow journalist, Carole Malone. The column begins by stating, "A highlight of Carole Malone's journalism career, according to her one-time editor, Walter Jones, was that 'she ran Jim Milsap out of town.' " The column explains that in the late 1960s, Milsap ran a job training program and also opened a facility called Inner City Hall, which (among other services) was to publish a newspaper called The Torch. Stanford, a college student at the time, began to work at The Torch. Meanwhile, Carole Malone was working for another newspaper, The Milwaukee Courier. According to the column, Malone walked into Inner City Hall and started to ask "a host of nagging questions nobody wanted to answer. . . . Inner City Hall officials wanted her to go away, but she stood her ground." The column continued:

[Malone] ran exposes [sic] in The Courier on Milsap. It seems that he was fired from his anti-poverty job, where there may have been financial irregularities. And nobody knew where the money was coming from for the hall or his Cadillac. (No mystery, if my case was typical. He simply reneged on paying people.)

Malone's and other exposes, the column suggests, doomed Inner City Hall and The Torch.

Milsap's argument on appeal is that the statement in the column that "[h]e simply reneged on paying people" was defamatory.¹ The district court indicated that "statements of opinion are protected," and observed that the column appeared on the editorial page and was marked as opinion. 897 F. Supp. at 411. The district court thus suggested that all statements in the column--being statements of opinion--were protected from a defamation action. Yet under Wisconsin law, "communications are not made nondefamatory as a matter of law merely because they are phrased as opinions, suspicions or beliefs." Converters Equipment Corp. v. Condes Corp., 258 N.W.2d 712, 715 & n.10 (Wis. 1977) (citing 50 Am.Jur.2d, Libel and Slander, sec. 15 at 529, 530 (1970); 53 C.J.S., Libel and Slander, sec. 9 at 45-47 (1948); Restatement (Second) of Torts sec. 566 (1977)). Instead, a communication that blends an expression of opinion with an expression of fact is actionable in Wisconsin "if it implies the assertion of undisclosed defamatory facts as a basis of the opinion." Wis. JI--Civil 2500 at 2 (1993) (citing Restatement (Second) of Torts sec. 566 (1977)). Likewise, there is no "wholesale defamation exemption [under the First Amendment] for anything that might be labeled 'opinion,' " because "expressions of 'opinion' may often imply an assertion of objective fact." Milkovich v. Lorain Journal Co., 497 U.S. 1, 18 (1990); see also Pope v. Chronicle Pub. Co., 95 F.3d 607, 614 (7th Cir. 1996); Haynes v. Alfred A. Knopf, Inc., 8 F.3d 1222, 1227 (7th Cir. 1993).

The statement that Milsap "simply reneged on paying people," in the context of the preceding sentence ("No mystery, if my case was typical"), implied that Milsap, in fact, reneged on paying Stanford. Stanford did not indicate that he was in possession of the additional fact that Milsap reneged on paying other people. Stanford merely extrapolated from his own situation, saying in effect that "if my case was typical [, Milsap] simply reneged on paying people." Even assuming arguendo that there are implications in other parts of the column that Milsap was in fact involved in "financial irregularities" and that "nobody knew where the money was coming from,"² these statements do not imply the objective fact that Milsap reneged on paying people other than himself. Accordingly, the only objective fact implied about Milsap's failure to pay anyone is that Milsap reneged on paying Stanford. But to this extent, the statement "[h]e simply reneged on paying people" is actionable.³

Now that we have determined what the actionable aspect of the statement is, we must consider whether a trier of fact might find it defamatory. A statement is defamatory under Wisconsin law " 'if it tends so to harm the reputation of another as to lower him in the estimation of the community or to deter third persons from associating or dealing with him.' " Tatur v. Solsrud, 498 N.W.2d 232, 233-34 (Wis. 1993) (quoting Restatement (Second) of Torts sec. 559 (1977)). A statement of fact that Milsap reneged on paying an employee might hurt Milsap's ability to attract future employees or other business associates. It also could foster a general sense that Milsap is not to be trusted. We conclude that there is a genuine issue of material fact as to whether the statement defamed Milsap.

We must also consider the state of mind of the defendants that Milsap would be required to show to prove liability. If Milsap was a public figure, he must show actual malice. Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974). If Milsap was not a public figure, but instead a private individual, under Wisconsin law he need only show negligence. Denny v. Mertz, 318 N.W.2d 141, 148-51 (Wis.), cert. denied, 459 U.S. 883 (1982).

Milsap contends that the statement "[h]e simply reneged on paying people" was not germane to his role in a public controversy, and that therefore he was not a public figure for purposes of this statement. However, newspaper articles from 1967 to 1968--submitted by the defendants with their motion for summary judgment--show that Milsap put himself into the public eye in Milwaukee at that time, and that the price of his notoriety included reports of financial irresponsibility. In July 1967, Milsap was appointed the first director of the Milwaukee Opportunities Industrialization Center (OIC), an anti-poverty program. Milsap touted OIC as a program that would have an important impact in developing employment and leadership skills. On the inaugural day of classes in October 1967, Milsap addressed the 150 attendees, explaining to them the purpose of OIC. By April 1968, OIC had several hundred trainees. However, the board of OIC fired Milsap for what the chairman of the board called insubordination and lack of fiscal responsibility. A preliminary audit of OIC records found many financial irregularities, including failure to document or substantiate funds disbursed, and thousands of dollars in overdrafts. The audit also found that many persons on OIC's payroll lacked jobs in the approved budget or structure at OIC. We are not in a position to evaluate the truth or falsity of these articles. For our purposes, their significance is not in whether they were accurate, but in their indication that as a prominent figure in 1967 and 1968, Milsap was subject to questions about his organization's financial transactions.

Milsap argues that even if he had once been a public figure, he is no longer one, because his involvement in public controversy ended about twenty-five years prior to the column at issue, and because he has long since moved out of Milwaukee to St. Paul, Minnesota. The Supreme Court has explicitly declined to address the question "whether or when an individual who was once a public figure may lose that status by the passage of time." Wolston v. Reader's Digest Ass'n, Inc., 443 U.S. 157, 166 n. 7 (1979). The circuits addressing the issue have indicated that an individual who was once a public figure with respect to a controversy remains a public figure for latter commentary on that controversy. See Contemporary Mission, Inc. v. New York Times Co., 842 F.2d 612, 619-20 (2d Cir.), cert. denied sub nom. O'Reilly v. New York Times Co., 488 U.S. 856 (1988); Street v. National Broadcasting Co., 645 F.2d 1227, 1235-36 (6th Cir. 1981), cert. granted, 454 U.S. 815, cert. dismissed, 454 U.S. 1095 (1981); Brewer v. Memphis Pub. Co., 626 F.2d 1238, 1256-57 (5th Cir. 1980), cert. denied, 452 U.S. 962, 101 S.Ct 3112, 69 L.Ed.2d 973 (1981); Wolston v. Reader's Digest Ass'n, Inc., 578 F.2d 427, 431 (D.C. Cir. 1978), rev'd on other grounds, 443 U.S. 157 (1979); Time, Inc. v. Johnston, 448 F.2d 378, 381-82 (4th Cir. 1971); see also Partington v. Bugliosi, 56 F.3d 1147, 1152 n.8 (9th Cir. 1995) ("it appears that every court of appeals that has specifically decided this question has concluded that the passage of time does not alter an individual's status as a limited purpose public figure"). A person who injects himself into public controversy assumes the risk of negative public comment on his role in the controversy, both contemporaneously and into the future. See Contemporary Mission, 842 F.2d at 620; Johnston, 448 F.2d at 381-82 (citing, inter alia, Estill v. Hearst Pub. Co., 186 F.2d 1017, 1022 (7th Cir. 1951)). In Milsap's case, the risk includes...