Peavy v. Harman, Civ.A. 3:96CV1506-R.

CourtUnited States District Courts. 5th Circuit. United States District Courts. 5th Circuit. Northern District of Texas
Citation37 F.Supp.2d 495
Docket NumberNo. 3:96-CV-2945-R.,No. Civ.A. 3:96CV1506-R.,Civ.A. 3:96CV1506-R.,3:96-CV-2945-R.
PartiesCarver Dan PEAVY, et al., Plaintiffs, v. Charles James HARMAN, Sr., et al., Defendants. Carver Dan Peavy, et al., Plaintiffs, v. WFAA-TV, Inc., et al., Defendants.
Decision Date18 February 1999

Michael J. Quilling, Quilling Selander Cummiskey Clutts & Lownds, Dallas, Texas, for plaintiffs.

Frank H. Jackson, Law Office of Frank Jackson, Dallas, Texas, for defendants.

Thomas S. Leatherbury, William D. Sims, Vinson & Elkins, Dallas, TX, for WFAA-TV and Robert Riggs.

ORDER

BUCHMEYER, Chief Judge.

This Court has made an independent review of the Findings and Recommendation ("Findings and Recommendation") of the United States Magistrate Judge, rendered on October 15, 1998, as well as the Objections to the Findings and Recommendation, and the relevant portions of pleadings, files, and records in this case. The Court concludes that the Findings and Recommendation of the Magistrate Judge are correct and they are adopted as the Findings and Conclusions of this Court.

In Civil Action No. 3:96-CV-1506-R, the parties' motions for summary judgment are GRANTED IN PART AND DENIED IN PART. Defendants' are entitled to judgment as a matter of law on Plaintiffs' common law claims for public disclosure of private facts, intentional infliction of emotional distress, tortious interference with contractual relations, and civil conspiracy. Plaintiffs are entitled to judgment as a matter of law on their claims against the Harmans for violations of 18 U.S.C. § 2510 ("Title III"), the Texas Wiretap Act, Tex. Civ.Prac. & Rem.Code Ann. § 123.001, and for invasion of privacy by intrusion. This action will proceed to trial on the issue of damages and whether the Defendants intentionally disclosed the contents of the "Race Tape" in violation of Title III and the Texas Wiretap Act.

In Civil Action No. 3:96-CV-2945-R, Defendants' Motion for Summary Judgment is GRANTED, and Plaintiffs' Motion for Summary Judgment is DENIED. All claims against the Defendants are dismissed with prejudice.

It is so ORDERED.

FINAL JUDGMENT

For the reasons stated in the Findings and Recommendation of the United States Magistrate Judge and this Court's Order adopting the Findings and Recommendation as the Findings and Conclusions of this Court, and pursuant to Rule 58 of the Federal Rules of Civil Procedure,

IT IS HEREBY ORDERED that judgment be entered in favor of Defendants. All claims of Plaintiffs against Defendants are hereby DISMISSED WITH PREJUDICE. Costs are awarded to Defendants.

It is so ORDERED.

FINDINGS AND RECOMMENDATION OF THE UNITED STATES MAGISTRATE JUDGE

KAPLAN, United States Magistrate Judge.

These cases have been consolidated for pretrial purposes and are before the Court on cross-motions for summary judgment. The motions have been referred to United States Magistrate Judge Jeff Kaplan for recommendation pursuant to 28 U.S.C. § 636(b).

I. BACKGROUND

This case started with the breakdown of common civility between neighbors. It led to a public scandal that resulted in a highly publicized criminal trial and spawned at least thirteen different civil lawsuits.1 The facts are relatively simple and straightforward. Succinctly stated, plaintiffs got caught with their hands in the "cookie jar" and are upset that the media exposed their misdeeds. However, this case also presents a unique opportunity to further define the parameters of the federal wiretap statute. This legal issue is at the heart of the pending summary judgment motions.

The saga began in December 1994 when Charles Harman purchased a police scanner to monitor criminal activity in his neighborhood. The first time Harman used the scanner he intercepted a signal from a cordless telephone being used by his next-door neighbor, Dan Peavy. Harman overheard Peavy talking to another neighbor about filing a class-action lawsuit against him and his wife.2 This piqued Harman's interest and he continued to monitor Peavy's phone calls. Later that same day, Harman heard Peavy tell an unidentified party "how much money [he] was making off the insurance policies at DISD." (WFAA Exh. M at 168). Harman thought this conversation was significant since Peavy was a trustee of the Dallas Independent School District.

Harman consulted the scanner manual to determine whether it was legal to tape the intercepted phone calls. The manual suggested that any such inquiries be directed to local law enforcement authorities. Harman decided to contact the Dallas County District Attorney's office. He spoke to Assistant District Attorney Bill Geyer and asked if it was legal to listen to the cordless telephone conversations. Geyer responded, "Absolutely." (C. Harman Aff. ¶ 8). Harman then inquired whether he could record the telephone calls. Geyer said, "Go ahead. Anything over the air is free." (C. Harman Aff. ¶ 8). Based on these assurances, Harman began to make the infamous "Peavy tapes."

Peavy continued to plot with his neighbors against Harman. On one occasion, Peavy offered to put up "$10,000 to make sure [a lawsuit] was filed." (C. Harman Aff. ¶ 9). Harman perceived this statement as a threat against his family. He reported this conversation to Geyer who referred him to the Dallas Police Department. Harman spoke with several police officers but was not satisfied with their response. He then called District Attorney John Vance. Harman told Vance about the threats against his family and possible improprieties related to DISD insurance. Vance agreed to meet with Harman after the first of the year.3 Until then, he instructed Harman to "keep taping." (C. Harman Aff. ¶ 16). Harman believed that he was getting the "run around" from the authorities. His frustrations eventually led him to contact the media.

Harman called WFAA-TV on December 8, 1994. He spoke to P.J. Ward, a field producer and former director of a consumer hot-line known as "Contact 8." Harman said that he had information concerning possible corruption of an unnamed public official. Ward questioned Harman about his allegations and determined that the official was Dan Peavy.4 The information was passed on to senior reporter Robert Riggs for further investigation. Riggs called Harman later that day. Harman said he had proof that Peavy had threatened to harm him and was involved in an insurance kickback scheme. However, he only wanted to discuss these matters in person at his home.

Riggs met with Harman and his wife on December 9, 1994. Harman played portions of a tape recorded conversation between Peavy and another party wherein they discussed a plan to split commissions on cancer insurance sold to Mary Kay Cosmetics. Riggs was stunned to hear these remarks from a public official. Harman indicated that he planned to record future telephone calls and asked Riggs if he wanted copies of the tapes. Riggs said that he did. However, he instructed Harman to leave the recorder running throughout the entire conversation and not to edit the tapes so their authenticity could not be questioned. Riggs also asked Harman whether it was legal to record these conversations. Harman assured him that his actions had been approved by the Dallas County District Attorney and the Dallas Police Department.

Riggs returned to the television station and played portions of the tape for Ward and News Director John Miller. All agreed that there was credible evidence of public corruption that should be investigated. However, they first contacted their attorney to determine whether it was legal to use the tape recordings. Paul Walter told Miller that he could accept and broadcast the tapes. This advice was confirmed in a written legal memorandum dated January 4, 1995.

Thereafter, Harman provided WFAA with 18 tapes containing 188 telephone conversations between Peavy and others. Ward listened to the tapes, took notes, and attempted to transcribe the conversations. However, some of the tapes were of poor quality and difficult to understand. Ward selected relevant portions of the tapes and had them transcribed by a professional court reporter. Copies of the transcripts were furnished to Riggs, Miller, and Watler in February 1995.

Several weeks later, Riggs was informed by a law enforcement source about a recent amendment to the federal wiretap statute. Riggs contacted Watler to determine whether the interception of cordless telephone calls was prohibited under the new law. Walter researched the issue and learned that an October 1994 amendment made it unlawful to intercept the radio portion of a cordless telephone call. He immediately advised WFAA not to accept any additional tapes from Harman, not to broadcast the tapes already in its possession, and not to confront individuals about conversations on the tapes. Riggs returned the original tapes to Harman on or about March 1, 1995. Copies of the tapes and all related documents were delivered to Walter for safekeeping.

Harman also learned that it was illegal to tape these telephone conversations. FBI Agent Mark Chapman met with Harman on March 14, 1995 and showed him a copy of the new law. Harman mistakenly believed that he could still listen to the phone calls as long as he did not tell law enforcement officials what he heard. Nevertheless, Harman recorded at least one other conversation. He pled guilty to federal wiretap violations and paid a $5,000 fine in connection with this recording.

Meanwhile, WFAA continued to investigate Peavy. Riggs learned that Peavy had been appointed by the president of the school board to solicit new bids on group term life and disability insurance for DISD employees. Peavy designated Eugene Oliver as the exclusive insurance agent to obtain these bids. The contracts were ultimately awarded to two companies represented by Oliver. Thereafter, Oliver split...

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