Palmtag v. Republican Party of Neb.

• Court: Nebraska Supreme Court
• Writing for the Court: Freudenberg, J.
• Citation: Palmtag v. Republican Party of Neb., 315 Neb. 679, 999 N.W.2d 573 (Neb. 2024)
• Docket Number: S-22-967
• Decision Date: 12 January 2024
• Parties: Janet PALMTAG, appellant and cross-appellee, v. The REPUBLICAN PARTY OF NEBRASKA, also known as The Nebraska Republican Party, appellee and cross-appellant.
• topic: Constitutional Law,Civil Procedure

999 N.W.2d 573

315 Neb. 679

Janet PALMTAG, appellant and cross-appellee,

v.The REPUBLICAN PARTY OF NEBRASKA, also known as The Nebraska Republican Party, appellee and cross-appellant.

No. S-22-967.

Supreme Court of Nebraska.

Filed January 12, 2024

Syllabus by the Court

1. Summary Judgment: Appeal and Error. An appellate court reviews the district court’s grant of summary judgment de novo, viewing the record in the light most favorable to the nonmoving party and drawing all reasonable inferences in that party’s favor.

2. Libel and Slander: Negligence. A claim of defamation requires (1) a false and defamatory statement concerning the plaintiff, (2) an unprivileged publication to a third party, (3) fault amounting to at least negligence on the part of the publisher, and (4) either actionability of the statement irrespective of special harm or the existence of special ham caused by the publication.

3. Libel and Slander: Words and Phrases. Libel is defamation where the defamatory words are written or printed; slander is defamation where the defamatory words are spoken.

4. Constitutional Law: Libel and Slander. When the plaintiff is a public official or public figure and the speech is a matter of public concern, the First Amendment requires the plaintiff to surmount certain higher barriers than those raised by common-law libel.

5. Constitutional Law: Libel and Slander. There is no constitutional right to espouse false assertions of facts, even against a public figure in the course of public discourse.

6. Libel and Slander: Negligence. The principal higher barrier a public libel plaintiff must surpass is that actual malice, not simple negligence, is part of the scienter element of the plaintiff’s prima facie case.

7. Libel and Slander: Proof. The plaintiff in a public libel action must establish actual malice by clear and convincing evidence.

8. Summary Judgment: Libel and Slander. The same general summary judgment standards applicable to any action apply to a public libel action; however, the existence of a genuine issue of material fact is dependent upon the particular elements and standards of proof of the underlying action.

9. Summary Judgment. Summary judgment is proper only when the pleadings, depositions, admissions, stipulations, and affidavits in the record disclose that there is no genuine issue as to any material fact or as to the ultimate inferences that may be drawn from those facts and that the moving party is entitled to judgment as a matter of law.

10. Actions: Proof. Successful suits are not limited to those cases in which there is direct proof by a party’s admission of the ultimate fact.

11. Libel and Slander: Words and Phrases. Actual malice means knowledge of falsity or reckless disregard for the truth.

12. Libel and Slander: Proof. Mere proof of failure to investigate, without more, cannot establish reckless disregard for the truth in a defamation claim.

13. Libel and Slander: Proof. Standing alone, proof of a defendant’s ill will toward a public figure plaintiff is insufficient to establish knowledge of falsity or reckless disregard for the truth for purposes of a defamation claim.

14. Libel and Slander: Evidence. Motive and negligence, including a failure to investigate, are factors in the totality of the evidence that may be considered in making reasonable inferences as to the defendant’s state of mind in a public libel action.

15. Libel and Slander: Evidence: Proof. A plaintiff in a public libel action is entitled to prove the defendant’s state of mind through circumstantial evidence.

16. Libel and Slander. Relevant to actual malice is the ambiguity of any source material consulted by the defendant and the reasonableness or lack thereof in interpreting that material in a way that led to the false statement forming the basis of the plaintiffs claim.

17. Libel and Slander: Words and Phrases. A "critical issue" is whether a source relied upon in making the false and defamatory statement was reasonably susceptible of the interpretation given it by the defendant.

18. Libel and Slander. An inference of actual malice can be drawn when a defendant publishes a defamatory statement that contradicts information known to him or her, even though the defendant testifies that he or she believed that the statement was not defamatory and was consistent with the facts within the defendant’s knowledge.

19. Libel and Slander. A publisher cannot feign ignorance or profess good faith when there are clear indications present which bring into question the truth or falsity of defamatory statements.

20. Corporations. Generally, a corporation is viewed as a complete and separate entity from its shareholders and officers.

21. Corporations: Fraud. A court will disregard a corporation’s identity only where the corporation has been used to commit fraud, violate a legal duty, or perpetrate a dishonest or unjust act in contravention of the rights of another.

22. Libel and Slander: Damages. In general, the damages under common law that may be recovered for defamation are (1) general damages for harm to reputation; (2) special damages; (3) damages for mental suffering; and (4) if none of these are proved, nominal damages.

23. Damages. Special damages is a subset of actual harm, as actual harm is supported by evidence of injury, but the injury need not be pecuniary loss.

24. Constitutional Law: Libel and Slander: Pleadings: Proof: Damages. Pleading and proving special damages is not one of the higher barriers the U.S. Supreme Court has held the public libel plaintiff must surmount to protect the First Amendment right to public debate.

25. Libel and Slander: Pleadings: Proof: Damages. A plaintiff in a per se public libel action is not required to plead and prove special damages to state a claim.

Appeal from the District Court for Lancaster County: Andrew R. Jacobsen, Judge. Reversed and remanded for further proceedings.

David A. Domina, of Domina Law Group, P.C., L.L.O., Omaha, for appellant.

Kamron T.M. Hasan and Sydney L. Hayes, Omaha, of Husch Blackwell, L.L.P., for appellee.

Heavican, C.J., Miller-Lerman, Cassel, Stacy, Papik, and Freudenberg, JJ., and Moore, Judge.

Freudenberg, J.

I. INTRODUCTION

A general candidate for the Nebraska Legislature sued The Republican Party of Nebraska (the Party) for public libel stemming from political mailers stating that the candidate, a real estate agent, had been disciplined by the Iowa Real Estate Commission (Commission) for breaking the law and had lost her Iowa real estate license. The candidate appeals from a summary judgment against her, in which the court found a genuine issue that the statements were false but no genuine issue that the Party acted with actual malice. The Party cross-appeals the district court’s conclusion that because the candidate stated a per se defamation action, she did not have to plead and prove special damages and she had, in any event, proved special damages. We reverse the order of summary judgment on the grounds that when the facts presented by the candidate are viewed in a light most favorable to the candidate, as the nonmoving party, those facts are sufficient that a jury could find by clear and convincing evidence that the Party acted with actual malice. We find no merit to the Party’s cross-appeal.

II. BACKGROUND

Janet Palmtag has active real estate licenses in Nebraska and Missouri and an inactive license in Iowa. Her license in Iowa became inactive in January 2020. She testified that she chose to make her license inactive because she was not doing much business there.

Palmtag owns 100 percent of the common voting stock of J. J. Palmtag, Inc. (J.J.), a real estate brokerage firm organized and registered as a corporation. J.J. has three employees, including Palmtag, and has 15 independent contractor agents, including Palmtag. Palmtag receives a salary from J.J. rather than receiving income directly through her commissions.

J.J., as a corporate entity, has brokerage licenses in Nebraska and Missouri and previously had a license in Iowa. Palmtag’s individual brokerage license is the managing license for J.J.

1. Consent Order

In August 2018, J.J. entered into a "Combined Statement of Charges, Informal Settlement Agreement, and Consent Order in a Disciplinary Case" (consent order) with the Commission. It was captioned as "IN RE: J.J. Palmtag, Inc. Firm … RESPONDENT" and referred to a case number (disciplinary case).

Palmtag is referred to in the consent order "both as the designated broker in charge and a licensed real estate broker officer for the Respondent real estate brokerage firm."

The consent order describes the "STATEMENT OF CHARGES" against J.J.:

Respondent is charged with engaging in improper trust account procedures in violation of Iowa Code sections 543B.29(1)(k), 543B.34(1), 543B.46 (2017) by disbursing earnest money funds from an Iowa real estate trust account prior to closing and without the informed written consent of all the parties to a transaction. See 193E Iowa Administrative Code sections 13.1, 13.1(1), 13.1(7), 18.14(5)(f)(2).

Under "CIRCUMSTANCES," the consent order states in part:

In a random sampling of transaction files, the auditor discovered one (1) real estate transaction for a property located in Fremont County, Iowa where the Respondent transferred trust funds from J.J. Palmtag Inc. Iowa Trust Account to Nebraska Title Trust Account without the informed written consent of all the parties to this respective transaction.

Under "SETTLEMENT AGREEMENT," the consent order provides that "[w]ithout admission of wrongdoing or guilt, the Respondent does not contest the violations alleged in the above-stated Statement of Charges" and that "[t]his Order constitutes discipline against the Respondent, and is the final agency order in this contested case pursuant to Iowa Code section 17A.10 and 193 Iowa Administrative Code 7.4."

Under "CIVIL PENALTY," the consent order states, "The Respondent shall pay a civil penalty to the Commission in...