Pulvermann v. AS Abell Company, Civ. No. 6967

• Decision Date: 02 May 1955
• Docket Number: 6968.,Civ. No. 6967
• Citation: 131 F. Supp. 617
• Parties: Heinz PULVERMANN v. A. S. ABELL COMPANY. Lawrence WESTBROOK v. A. S. ABELL COMPANY.
• Court: U.S. District Court — District of Maryland

131 F. Supp. 617

Heinz PULVERMANN v. A. S. ABELL COMPANY. Lawrence WESTBROOK v. A. S. ABELL COMPANY.

Civ. Nos. 6967, 6968.

United States District Court D. Maryland.

May 2, 1955.

Hal C. B. Clagett, Upper Marlboro, Md., and Warren E. Magee, Washington, D. C., for plaintiffs.

Venable, Baetjer & Howard, J. Crossan Cooper, Jr., and Francis D. Murnaghan, Jr., Baltimore, Md., for defendant.

COLEMAN, Chief Judge.

These are two libel suits, both against the same defendant, the A. S. Abell Company, a Maryland corporation, publishers of the Baltimore Sun, one suit by Lawrence Westbrook, a citizen of the State of Arkansas, and the other by Heinz Pulvermann, a citizen of the State of New York. There are the necessary allegations in each complaint as to the amount in controversy which, with the diversity of citizenship of the opposing parties, satisfy the jurisdictional prerequisites.

Both suits are before the Court on motions of the defendant for summary judgment, with supporting affidavits. The alleged basis for these motions is that there is no genuine issue as to any material fact respecting the publication by the defendant of the newspaper article on which both complaints are based; that the facts, as admitted by the plaintiffs, establish that the circumstances surrounding the publication render it privileged; and that the publication was made without malice.

The two complaints are virtually identical. Count 1 of each complaint alleges publication by the defendant on the morning of October 31, 1952, of a certain article in the Sun to be libelous per se. Count 2 of each complaint incorporates by reference the allegations of count 1, and alleges the publication of this article to be libelous when read in connection with the allegations of count 1. Under count 2 special damages are claimed, based on the innuendo ascribed to plaintiffs' contractual relations, each with the other, and the retarding or preventing of the reinstatement of a certain contract between the Companhia Atlantica, of Portugal, and the United States Government, in which each plaintiff had a 2½ per cent commission interest or fee of approximately $200,000. Plaintiffs ask for a judgment in each case in the sum of $500,000. The article, in full, is as follows:

"Larson Asks Metal Deal Probe Says He Was Unaware Of Fee "Revenue Chief Dunlap Ignores Subpoena ............... Page 4

"Washington, Oct. 30 (AO) — Jess Larson, chief buyer of critical materials for the Government, said today someone under his supervision failed to notify him that a $9,000,000 tungsten contract called for a fee to Col. Lawrence Westbrook, fired last night as a Democratic National Committee official.

"Larson said thus far he has found no evidence of `wrongdoing or influence' in his agencies in connection with the contract. But he said he has ordered a `full-scale top to bottom investigation.' Will publicly disclose all findings and, if there is evidence of wrong-doing, will refer it to the Justice Department.

"Denies Political Influence

"Westbrook was dismissed by Stephen A. Mitchell, Democratic national chairman, shortly after the New York Herald-Tribune published a copyrighted story terming the case `the biggest five per-center deal ever exposed in Washington.'

"In Dallas, Westbrook denied today that he had used or attempted to use his Democratic National Committee position to influence the awarding of the contract.

"`My services to the company were not in any manner of the so-called "five per center" variety.' Westbrook said in a written statement issued today from his room at the Adolphus Hotel.

"He refused comment beyond that included in his statement and would not answer reporters' questions.

"Westbrook's Statement

"`At the time I joined the national committee, all essential details of the company's contract had already been agreed to by the Federal Government,' Westbrook's statement said.

"He added: `However, I realize that under the pressure of the final week of the campaign, Mr. Mitchell's responsibilities may have compelled him to take action without the opportunity of thoroughly checking the facts'.

"Westbrook said, `The most distressing aspect of the whole matter so far as I am concerned is the feeling that misrepresentation of my position might result in injury to the cause of the Democratic party.'

"He said he was withdrawing from the campaign in Texas, where he has been helping Sam Rayburn, Speaker of the House, on behalf of Adlai Stevenson.

"Larson said he personally will head an investigation to determine whether there was any fraudulent conduct or wrongdoing, or any evidence of the use of influence.

"Heads Both Agencies

"At present, he said, `I know of no wrongdoing and have no knowledge of influence having been exercised on any member of any of the organizations which I head.'

"Larson said one thing he wants cleared up is why he was not given an unsigned letter-contract dated August 22, 1951, which disclosed that the tungsten deal involved a 5 per cent fee to Westbrook and another man, Heinz Pulvermann, of Rye, N. Y.

"The fee plan had been disclosed in a letter to the Emergency Procurement Service, but was not forwarded along with other papers in the case when that type of federal buying was taken over by the Defense Materials Procurement Agency, Larson said. He heads both agencies.

"Larson Signed Contract

"`If I find that someone in this agency deliberately detached the letter', Larson said, `I will dismiss him from public service and try to find out what his motive was.'

"Larson signed the contract, as head of the Defense Materials Agency, and Westbrook signed on behalf of a Portuguese company which agreed to supply the Government with tungsten, a metal vital in the production of steel.

"Larson said the missing letter telling of the fee arrangement was replaced later on by a new letter, dated February 29 of this year. Larson said he did not know of it at the time he signed the contract and did not know any fee was involved until a Herald Tribune reporter told him so yesterday.

"Had he known any fee was involved, he said, he would not have signed the contract.

"Meanwhile, the contract had already been canceled before any deliveries were made. The contract, Larson said, called for initial deliveries at $57 a ton, but the market price has since dropped to about $55.

"Contract Violation Charged

"Larson said he had learned that the company for which Westbrook acted was undertaking to buy tungsten at the lower figure and sell it to the Government at the higher price provided in the contract. He said this violated a contract provision that the company was to provide tungsten from mines it controlled.

"Gen. Dwight D. Eisenhower, in a speech in New York City today referred to the case as the `sort of crookedness (that) goes on and on in Washington.' Of Westbrook, he said, `they had to fire him because someone caught up with him.'

"Westbrook could not be reached after a telephone conversation with the Herald Tribune, in which he said he had done nothing wrong. In his statement last night, Mitchell said `there is no information before me that Colonel Westbrook sought to bring improper influence to bear on any agency or to make improper use of his position with the Democratic National Committee.'

"But Mitchell said he dismissed Westbrook because `I do not think any exception can be made to the policy that an employee of the committee must not engage in business with the Government.'

"Westbrook, a former army man who is a research and development engineer, has been acting since last January 5 as a liaison man between the Democratic committee and members of Congress. More recently he has been working on the Texas State campaign for the Democratic national ticket.

"Sam Rayburn, Speaker of the House, in charge of that campaign, said in Dallas that Westbrook's dismissal has `no bearing on the campaign in Texas.'

"Whatever Colonel Westbrook's other activities may be they have no bearing on the campaign in Texas,' Rayburn said. `Our campaign is a fight against the efforts of the Republicans and their oil-rich friends in Texas to take over our State and bring a halt to the economic progress that has been made during the past twenty years.

"`Regardless of other political developments, actual and contrived, I firmly believe we will be successful next Tuesday in resisting those efforts.'

"Directing Texas Drive

"Rayburn has been directing the drive to hold Texas in the Democratic column despite the switch to Eisenhower by Gov. Allan Shivers and the bulk of the State Democratic organization.

"The contract between the Government and the company for which Westbrook signed took effect September 11. It was canceled on Monday. The announced reason was that the company, Companhia Atlantica, had violated contract terms by going into the open market for tungsten to sell to the United States instead of keeping a pledge to supply the metal from mines it claimed to control.

"Larson said that even if it had not been canceled on that ground, `we may have canceled the contract anyway had we known' that a Democratic committee aide was connected with it."

The contention of each plaintiff is based primarily upon (1) characterization of him as a "five percenter" in his connection with the Government contract referred to in the article; and (2) a reference in the article to a speech in New York City by the President, — then General and candidate for the Presidency, — Dwight D. Eisenhower, in which he referred to the contract under which the plaintiffs were to get a five per cent fee as "the sort of crookedness that goes on and on in Washington". In other words, plaintiffs object to the characterization of them as being crooked, plaintiff Westbrook being referred to in a further quotation from General Eisenhower's speech appearing in the Sun article, as follows: "They had to fire him because someone caught up with him".

Following this Court's refusal...