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Parties Involved:
Thomas J. Corcoran
Appellee
Croixland Properties Limited Partnership
Appellant
Larry Kitto
Appellee
Patrick E. O'Donnell
Appellee

Document Text:

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 23, 1999 Decided April 13, 1999

No. 98-7097

Croixland Properties Limited Partnership,

A Wisconsin Limited Partnership,

Appellant

v.

Thomas J. Corcoran, et al.,

Appellees

Appeal from the United States District Court

for the District of Columbia

(No. 97cv02120)

Robert H. Friebert argued the cause for appellant. With

him on the briefs were Robert P. Trout and John Thorpe

Richards, Jr.

Robert M. Adler argued the cause for appellees. With him

on the brief was Gary C. Adler.

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Before: Williams, Randolph and Rogers, Circuit Judges.

Opinion for the Court filed by Circuit Judge Rogers.

Rogers, Circuit Judge: In 1993, Croixland, the owner of a

greyhound dog racing facility in Hudson, Wisconsin, entered

into an agreement with three Indian tribes to sell the track

and thereafter to manage jointly casino operations that the

tribes would own. A precondition to the agreement was the

purchase of the facility land in trust by the Department of

Interior under the Indian Regulatory Act, see 25 U.S.C. s 465

(1994), and approval of gaming activities on that land under

the Indian Gaming Regulatory Act, see 25 U.S.C.

s 2719(b)(1)(A)(1994). The Minnesota Area Director of the

Department recommended approval of the tribes' application

in the fall of 1994, but on July 14, 1995, the Deputy Assistant

Secretary of Indian Affairs denied the application. After

learning in the course of other litigation about actions in

Washington, D.C. taken by lobbyists for Indian tribes opposing the sale, Croixland sued the lobbyists for defamation and

conspiracy to defame.1 The district court dismissed the

complaint for failure to state a cause of action. We reverse.

I.

This court reviews the dismissal of a complaint under

Federal Rules of Civil Procedure 12(b)(6) de novo. See

Chandler v. District of Columbia Dep't of Corrections, 145

F.3d 1355, 1360 (D.C. Cir. 1998). We must accept the allegations of the complaint as true, drawing all inferences in the

plaintiff's favor, and will affirm "only if it is clear that no

relief could be granted under any set of facts that could be

proved consistent with the allegations." Hishon v. King &

Spalding, 467 U.S. 69, 73 (1984); see also Harris v. Ladner,

127 F.3d 1121, 1123 (D.C. Cir. 1997).

To succeed on a defamation claim, the plaintiff must show:

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1 For ease of reference we refer to appellees as "the lobbyists."

Croixland sued Thomas J. Corcoran, Patrick E. O'Donnell, and

Larry Kitto as defendants, but in their complaint refer to conduct

by defendants and "other persons known and unknown." See

Comp. p 20.

(1) that the defendant made a false and defamatory

statement concerning the plaintiff; (2) that the defendant

published the statement without privilege to a third

party; (3) that the defendant's fault in publishing the

statement amounted to at least negligence; and (4) either that the statement was actionable as a matter of law

irrespective of special harm or that its publication caused

the plaintiff special harm.

Crowley v. North Am. Telecomm. Ass'n, 691 A.2d 1169, 1172

n.2 (D.C. 1997) (quotations omitted); see also Restatement

(Second) of Torts s 558 (1976).2

Croixland's complaint alleged that the lobbyists had conspired to convince decisionmakers in Washington, D.C. reUSCA Case #98-7097 Document #428975 Filed: 04/13/1999 Page 2 of 8
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viewing the tribes' application that Croixland had connections

to organized crime. See Compl. p 20. Insofar as is relevant

to this appeal, the complaint alleged that the lobbyists, "by

publishing the defamatory statement that plaintiff [i.e., Croixland] was connected to organized crime, intended to injure

plaintiff in its business reputation and to cause the Department of Interior to deny approval of the proposed Hudson

casino." Id. p 29. To this end, the lobbyists falsely stated,

according to the complaint, that "a company named Delaware

North was the owner of the Hudson greyhound facility, that

Delaware North was connected to organized crime, and that

approval of the Hudson casino would allow organized crime to

be directly involved in Indian gaming." Id. at p 20. To

support their false statements that Croixland was connected

to organized crime, the lobbyists agreed to distribute an

article appearing in the November 17, 1994, edition of the

Wall Street Journal purporting to describe Delaware North's

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2 The lobbyists cite Caudle v. Thomason, 942 F. Supp. 635,

638-39 (D.D.C. 1996), for the proposition that heightened pleading

requirements apply in defamation cases. In fact, as with any

pleading, Croixland's complaint must allege the elements of the

cause of action; the Federal Rules of Civil Procedure impose no

special pleading requirements for defamation as they do for a

specified list of other matters. See, e.g., Fed. R. Civ. P. 9.

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ties to organized crime.3 Id. One of the lobbyists--Scott

Dacey, not one of the defendants--met with and gave the

article to the Deputy Assistant Secretary of Indian Affairs.

Id. p 22. The complaint referred as well to a strategy by the

lobbyists to get a story in the Washington Post about Delaware North's relationship with tracks in Wisconsin. Id. p 21.

The complaint also alleged that a defamatory statement

was made to Senator John McCain during a meeting in June

1995, where the lobbyists stated that "the owners of the

Hudson greyhound facility are connected to organized

crime."4 Id. p 26; see also id. p 23. Senator McCain allegedly told the lobbyists that he intended to ask the Justice

Department to look into the Hudson casino application. Id.

p 26. After the tribes' application was denied, the lobbyists

sent Senator McCain a letter, reminding him of their meeting

"regarding the proposed conversion of a dog track in Hudson,

Wisconsin, to an Indian gaming casino which would bail out

the dog track owner, Delaware North of Buffalo, New York,"

and thanking him for his "help with the Department of

Justice." Id. The letter stated that "[w]ithout your assistance, we do not believe the BIA [Bureau of Indian Affairs]

headquarters would have overturned its Minneapolis area

__________

3 The November 17, 1994 Wall Street Journal article by John

R. Emshwiller, entitled "Sins of the Father? Concession King's

Son Fights Mob Stigma As He Builds Empire; Delaware North's

Businesses Appear Gangster-Free, But Regulators Wonder; Hosting You at Yosemite," describes Delaware North as having "more

than 200 operating units in 39 states and six countries." The article

reported that in 1972 the company (then known as Emprise Corporation) was convicted of conspiracy "to hide its ownership interest

and the interests of two reputed mob figures in the Frontier Casino

in Las Vegas." Since then no such ties had been uncovered, due in

part to the current owner's efforts, including hiring "former top

federal law enforcement officials" to rid the company of any such

ties. The newspaper article noted, however, that state and federal

regulators remained skeptical.

4 At the time of the meeting, Senator McCain was chairman of

the Senate Committee on Indian Affairs. See Congressional Staff

Directory (1995).

office on this matter." Id. In addition, the complaint alleged

that the lobbyists repeated the defamatory statement that the

owner of the Hudson facility was connected to organized

crime. Id. p 38.

In dismissing the complaint, the district court focused on

whether the alleged defamatory statements were "of and

concerning" Croixland. Croixland had alleged that it was

defamed when the lobbyists reported to Department officials

and others that the owner of the Hudson track had connections to organized crime, either directly or through Delaware

North's ownership. The lobbyists responded that they only

made statements about Delaware North, and consequently no

reasonable listener would think they were referring to Croixland. The district court agreed with the lobbyists and ruled

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that because during the meeting with Senator McCain, in the

subsequent letter to him, and in the newspaper article, there

was no mention of Croixland by name and no indication that

any listener understood that the references were to Croixland, the complaint failed to allege defamatory statements "of

and concerning" Croixland.

To satisfy the "of and concerning" element, it suffices that

the statements at issue lead the listener to conclude that the

speaker is referring to the plaintiff by description, even if the

plaintiff is never named or is misnamed. See, e.g., Peck v.

Tribune Co., 214 U.S. 185, 188-90 (1909); Washington Post

Co. v. Kelly, 38 F.2d 151 (D.C. Cir. 1930); Harmon v. Liss,

116 A.2d 693, 695 (D.C. 1955); see also Service Parking Corp.

v. Washington Times Co., 92 F.2d 502, 504-05 (D.C. Cir.

1937); Caudle, 942 F. Supp. at 638; W. Page Keeton et al.,

Prosser and Keeton on the Law of Torts s 111, at 783 (5th ed.

1984); Restatement (Second) of Torts s 564 (1977). The

complaint refers to statements that were not just about

Delaware North as Delaware North but rather were about

Delaware North in its alleged capacity as the owner the

Hudson facility. Insofar as Croixland was the true owner,

even if never named, it could be defamed in its status as the

owner.

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Grisanzio v. Rockford Newspapers, Inc., 477 N.E.2d 805

(Ill. App. Ct. 1985), on which the lobbyists rely, is not to the

contrary. Grisanzio operated a restaurant in a building that

was owned by Zammuto, who was reputed to be part of the

mob. After a newspaper reported Zammuto's mob connections, Grisanzio sued. The court dismissed his complaint

because he was never mentioned by name and a reader of the

article would reasonably perceive the distinction between the

operator of a restaurant and the owner of the building. Id. at

809-10. By contrast, in the instant case, the alleged references to "the owner of the Hudson track" afford no such

distinction for the listener.5 So too, Carlucci v. Poughkeepsie

Newspapers, Inc., 442 N.E.2d 442 (N.Y. 1982), is of no

assistance to the lobbyists. In that case the court rejected

the notion that a reader learning that the 38-year-old owner

of a grocery store had been arrested on gambling charges

would perceive that statement to be "of and concerning" the

corporation that in fact owned store, especially since a corporation cannot be arrested. By contrast, given the conduct at

issue and context of the statements in the instant case, the

substitution of the name of one corporation, Delaware North,

for another, Croixland, as "the owner of the Hudson facility,"

presents the possibility that a listener could perceive that the

true owner is connected to organized crime.

Consequently, there are two ways that Croixland's complaint sufficiently pled the "of and concerning" element.

First, the complaint alleged that the lobbyists linked Croixland to Delaware North and Delaware North to organized

crime. Even if the lobbyists misidentified the owner of the

facility, it did not remove the taint to the true owner. This is

due in part to the fact that Delaware North managed and

operated gambling enterprises in a number of states, see

supra n.3, and assertions of its ownership did not rule out

that it had a management agreement or affiliate relationship

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5 Furthermore, Illinois employs the rule of innocent construction, see Grisanzio, at 809, and the District of Columbia does not,

see Ollman v. Evans, 750 F.2d 970, 980 n.18 (D.C. Cir. 1984) (in

banc).

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with Croixland that was consistent with Croixland's ownership of the Hudson facility. In any event, the assertion that

"the owner" had mob connections sufficed to place in jeopardy Croixland's opportunity with the tribes inasmuch as mob

connections would doom the tribes' application pending in the

Interior Department.

Second, the complaint alleged that Croixland was defamed

because statements were made about "the owner of the

track" having connections to organized crime without reference to Delaware North. It is undisputed, for purposes of

the motion to dismiss, that Croixland is the owner of the

Hudson track. Compl. p 7. Viewing the inferences most

favorably to Croixland, a reference to "the owner of the

track" could reasonably be understood to mean Croixland

even if the listener did not know Croixland by name. See

Harmon v. Liss, 116 A.2d 693, 695 (D.C. 1955). The defamation would arise from the inference that the owner of the

track is connected to organized crime where there is no

ambiguity that a particular entity owns the track. Drawing

favorable inferences for the non-moving party, see Chandler,

145 F.3d at 1360, and viewing the alleged remarks from the

perspective of the listeners, see Kelly, 38 F.2d at 151, Caudle,

942 F. Supp. at 638, it follows that, in the context of discussions about a pending tribal application at the Interior Department for the sale of Croixland's track, the lobbyists'

defamatory statements could lead listeners such as Department officials or the Chairman of the Senate Committee on

Indian Affairs to believe that Croixland was connected in

some manner to Delaware North or at least that whoever

owned the Hudson track was connected to organized crime.

Furthermore, even assuming that references to Delaware

North as the owner of the Hudson track were not "of or

concerning" Croixland, the complaint still was not properly

dismissed. Under Federal Rule of Civil Procedure 8(e), a

complaint may contain alternative theories, and if one of the

theories can survive a Rule 12(b)(6) motion, the district court

cannot dismiss the complaint.6 Croixland's complaint includ-

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6 "A party may set forth two or more statements of a claim....

[and] [w]hen two or more statements are made in the alternative

ed an alternative theory, namely that defamatory statements

were made directly about Croixland without reference to

Delaware North. This appears in paragraph 26 of the complaint, referencing the meeting with Senator McCain, paragraph 29, regarding the lobbyists' intent to injure Croixland's

business reputation and cause the Department to deny approval of the proposed Hudson casino, and paragraph 38,

concerning conspiracy, in which Croixland alleges numerous

publications of the defamatory statement by the lobbyists

that the owner of the Hudson facility had connections to

organized crime.

Accordingly, we reverse the order dismissing the complaint

and remand the case for further proceedings.

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and one of them if made independently would be sufficient, the

pleading is not made insufficient by the insufficiency of one or more

of the alternative statements." Fed. R. Civ. P. 8(e).

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