2005 D e c i sion s O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit 9-16-2005 

# C ap o zzi v . L uc a s P r e c e de nt i al or N on-P r e c e de nt i al : N on-P r e c e de nt i al D ocke t N o . 04-3468

F o llow thi s and a dd it ion al work s at : http://d i git alc ommon s .l a w . vi ll anova . e du/thir dc ir c uit_2005

Thi s de c i sion i s br ou ght t o you for f r e e and ope n a c c e s s b y the O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit at V i ll anova U nive r sity S choo l of L a

w Di git al Reposit ory

. It h as be e n a c c ept e d for inclusion in 2005 D e c i sion s b y an authori z e d a dmini s tr at or of V i ll anova U nive r sity S choo l of L a

w Di git al Reposit ory

. F or mor e inform at ion, p le as e c ont a ct Be n j amin . C arl s on@l a

w . vi ll anova . e du . Re c omme nde d C it at ion " C apo z z i v . Lucas " (2005). 2005 D e cisio n s . P ape r 539. http://d i git alc ommon s .l a

w . vi ll anova . e du/thir dc ir c uit_2005/5391

NOT P RE CE DE NT I AL

I N TH E UN I TED STATES CO UR T OF A PP EALS

F O R T H E T H IR D C IR C U IT Case No: 04-3468 LO U IS J . C AP O Z Z I; CAPOZZ IAND A SSO CIAT ES, P.C.

v. CH RI STO PHE R S. L

UC AS; LAW O F F I CES OF CH RI STO PHE R S. LUC AS A

ND ASS OC IAT ES, Appe lla

nts

________________ O n ap p ea l from the U n it ed S tat es D istri ct C o u rt f o r th e M id d le D istric t o f P e n n sy lv a n ia D i s tr i ctC our tN o. : 03- C V - 00811 D istri ct Ju d g e: T h e H o n o rab le Jo h n E . Jo n es III

________________ Subm i t t ed pur s uantt o T hi r d C i r cui tL A R 34. 1( a)

Sept ember15, 2005 B e f o re : S L O V IT E R , B A R R Y , a n d S M IT H , C i r cui tJudges

( Fi l ed: Sept ember16, 2005)

_____________________ OPI NI ON O F THE COURT

_____________________Capozz i’s complaint included a L anham Ac t claim arisingunder 15 U .S.C. § 1 1125(a) (1)( B) . This claim was dismissed at the closeof Capozzi ’s ca se-in-c hief. TheDistrict Court e xerc ise d s upplemental juri sdic tio n o ver C a po zzi’ s Penn sylva

nia de fa matio n c laim pursuant to 28 U.S.C. § 1367. W e haveappellatejurisdiction under 28 U.S.C. § 1291. 2 S M IT H , C i r cui tJudge . C h risto p h e r S . L u c a s a p p e a ls a f in a l ju d g m e n t o f

th e D istric t C o u rt e n ter e d in f a v o r o f L o u is J . C a p o z z i f

o llo w in g a b e n c h trial. T h e D istric t C o u rt e n ter e d ju d g m e n t in f a v o r o f C a p o z z i in c o n n e c tio n w ith C a p o z z i’ s s ta te la w d e f a m a tio n c la im a g a in s t L u c a s . L u ca s ch all en g es th e D istri ct C o u rt ’s de cisi o n , arg u ing that the a ll eg ed lyd ef am atory sta tem e n ts c o n tain e d in a lette r d ra f ted b yL u c a s a n d c irc u late d to p ro sp e c tiv e c lien ts c a n n o t f o rm th e b a sis f

o r a su c c e ss f

u l d e f a m a tio n c laim b e c a u se th e yw e re “ su b sta n tially true. ” Lucas al s o chal l enges cert ai n of the D i s tr i ctC our t ’ s evi dent i aryrul i ngs , as w el l as the D i s tr i ctC our t ’ s deci s i on t o aw ar d damages t o C apozz i . W e w i l l aff i r m the j udgm ent o f th e D istric t C o u rt. 1 B eca us e w e w r i t e onl yforthe part i es , w e r es tr i ctourdi s cus s i on t o the fa ct s and lega l pri n ciples n ec essa ryto reso lve th is ap p ea l. T h e p arti es a re c o m p eti n g law y ers w h o se p rac ti ce s fo cu s p ri m aril yu p o n p rov iding rep rese n tat ion to P en n sy lvan ia l o n g -t erm c a re p ro v id e rs s u c h a s n u rsin g h o m e s. B o th f irm s a d v ise th e ir c lien ts o n iss u e s re latin g to the re ce ipt of

reim b u rsem en ts from P en n sy lvan ia’s D ep artm en t of P u b li c W elfa re (“D P W ”), i n clud ing ap p ea ls from rate-sett ing d ec isi o n s m ad e u n d er D P W ’s r ei m bur s ements y s t em, appea l s fr om D PW audi tfi ndi ngs , and the pot ent i al s ett l ementof s u c h a p p e a l s th r o u g h DP W’ s “ I n t e r g o v e rn me n t a l T r a n s f e r ” ( “ I GT ” ) p r o g r a m. T h e I GT3

p ro g ra m re f

e rs to a p ro c e ss in w h ich P e n n sy lv a n ia c o u n ties m a ytra n sf e r f u n d s to D P W to be us ed i n s ett l i ng cl ai m s fi l ed byl ong- t erm car e pr ovi der s . T r ans ferof s uch funds fr om a c o u n ty to D P W e n a b le s D P W to c o lle c t m a tc h in g f u n d s f ro m th e f e d e ra l g o v e rn m e n t. D o c u m e n ts th a t m e m o ria lize th is p ro c e ss o f tra n sf e r-m a tch in g -re im b u rse m e n t in p a rt ic u la r c a s e s a re k n o w n a s IG T A g re e m e n ts . O n A ugus t28, 2000, C apozz i fi l ed a l aw s ui t , s ty l ed as a “Cl as s A ct i on, ” i n the Penns y l vani a B oar d of C l ai m s . T hi s l aw s ui tw as fi l ed on beha l f of a gr oup of nur s i ng hom e cha i ns thatw i s hed t o chal l enge c ert ai n as pect s of D PW ’ s r ei m bur s ement p ro c e d u re s a n d p ra c tice s. T h e g ro u p o f e n tit ies th a t au th o riz e d th e f ili n g o f th e law su it o rga n ized it self u n d er the b an n er o f “ C P R fo r Q u ali tyC are . ” T h e C P R fo r Q u ali tyC are O r gani zi ng A gr eementauthor i zed a cont i ngencypaym entt o couns el ( C apozz i ) of “10% of anyi ncr eas es i n paym entr es ul t i ng fr om the C l as s A ct i on, i ncl udi ng anyi ncr eas es resu lt ing fro m a se tt lem en t of the C lass A cti o n , fro m a se tt lem en t of an yrelated m att ers i nvol vi ng M ember s , orfr om anydi s tr i but i ons t o the M ember s occurr i ng aft erA ugus t1, 2000 as m ayr es ul tfr om an I nt er governm ent al T r ans ferA gr eementr equi r i ng a s ett l ement o f a n yre late d m a tters in v o lv in g th e M e m b e rs.” P rio r to a n d in d e p e n d e n t o f th is O rg a n izin g A g re e m e n t, C a p o z z i h a d n e g o tiate d h o u rlya n d c o n tin g e n t f e e a rra n g e m e n ts w ith c e rta in p re e x istin g c lien ts w h o m h e re p re se n ted in c o n n e c tio n w ith D P W ra te a p p e a ls. A n u m b e r o f

th e se p re -e x istin g c lien ts jo in e d th e C P R f o r Q u a lityC a re law su it a f ter it w a s f

iled . S o m e e lec ted to m a in tain th e ir e a rlier , se p a ra te f e e a rra n g e m e n ts w ith4

C ap o zz i, w h il e a n u m b er o p ted in stead to b ind them selv es to the O rga n izi n g A g ree m en t’ s 1 0 % c o n tin g e n c yf

e e p ro v is io n . Fol l ow i ng C apozz i ’ s fi l i ng of the C PR forQ ual i tyC ar e l aw s ui tw i th the Penns y l vani a B oar d of C l ai m s , s ett l ementoffe r s w er e made byD PW i n connec t i on w i th a s er i es of I G T A gr eement s thatpr opos ed t o ut i l i ze c ountyand mat chi ng funds t o r es ol ve pendi ng nur s i ng fac i l i tyr at e appe al s . A n O ct ober13, 2000 I G T A gr eementm ade avai l abl e $152, 861, 823 t o r es ol ve pendi ng nur s i ng fac i l i tyr at e appe al s . M os tof the n u r s i n g f a c i l i t i e s r e p r e s e n t e d b yCa p o z z i a c c e p t e d th e f u n d s o f f e r e d i n th i s I GT A gr eement , agr eei ng i n r eturn t o w i thdr aw pendi ng r at e appe al s and w ai ve anyfur ther part i ci pat i on i n t he C l as s A ct i on fi l ed byC apozz i . T he C l as s A ct i on pr ocee ded w i th the r emai ni ng nur s i ng fac i l i t i es thatw er e among t he named pl ai nt i ffs , butul t i m at el yw as d i s mi s s e d b yth e Co mmo n we a l th Co u r tb a s e d o n a f i n d i n g th a tth e Bo a r d o f Cl a i ms la c k e d ju ri s d ic tio n o v e r t h e c a s e . A s a r es ul tof thes e pr ocee di ngs , C apozz i s entbi l l s t o var i ous nur s i ng fac i l i t i es t hat had r ece i ved funds i n connec t i on w i th the O ct ober13, 2000 I G T A gr eement , i ncl udi ng fac i l i t i es thatw er e part i es t o t he C PR forQ ual i tyC ar e O r gani zi ng A gr eementcont ai ni ng th e c o n tin g e n t f

e e p ro v isio n q u o ted a b o v e . It ap p e a rs f ro m th e re c o rd th a t ce rta in fac i l i t i es r ece i vi ng thes e bi l l s t ook the pos i t i on thattheyhad notacc eded t o the O r gani zi ng A gr eement ’ s cont i ngentfee pr ovi s i on, i ns t ead r et ai ni ng an i ndepende ntfee a rr a n g e m e n t w ith C a p o z z i th a t a rg u a b ly d id n o t r e q u ir e p a ym e n t o f th e m o n ie s s o u g h t.5

W hen thes e ent i t i es r efus ed t o pay , C apozz i i ni t i at ed fe e l i t i gat i on agai ns tthem. A s of A pr i l 2003, L ucas and hi s fi r m r epr es ent ed fi ve s uch fa ci l i t i es i n connec t i on w i th thi s fee l i t i gat i on. O n A pr i l 23, 2003, i n w hatw as appar ent l yan ef for tt o obt ai n addi t i onal cl i ent s , L ucas faxe d a l ett ert o appr oxi m at el y700 r eci pi ent s . I n thi s l ett er , he des cr i bed the exi s t ence of cont i ngentfee arr angement s betw een Capozzi and var i ous ent i t i es that h a d a c c e p ted se ttl e m e n t f u n d s p u rsu a n t to th e O c to b e r 1 3 , 2 0 0 0 IG T A g re e m e n t. T h is l ett ernot ed thats om e fa ci l i t i es thatpai d C apozz i di d s o bas ed on the as s um pt i on thatt he r ece i ptof I G T funds w as w i thi n t he cont i ngencys pel l ed outi n an appl i cabl e fe e agr eement , “and/ orbeca us e theybel i eved Capozzi ’ s w or k contr i but ed t o the es t abl i s hm entand/ oraggr egat i on of the I G T fund. ” T he l ett erdi d notdi s t i ngui s h betw een e nt i t i es thathad pr eexi s t i ng cont i ngencyfee arr angement s w i th C apozz i i n connec t i on w i th C apozz i ’ s w or k on r at e appe al s , and ent i t i es w hos e onl ycont i ngentfee arr angementw i th C apozz i ar os e underthe O r gani zi ng A gr eement . N ordi d t he l ett erdi s t i ngui s h betw een pr e- exi s t i ng C apozz i cl i ent s thathad a b a n d o n e d th e ir e a rlier f e e a rra n g e m e n ts w ith C a p o z z i u p o n jo in in g th e C P R f o r Q u a lity C ar e l aw s ui t , and thos e thathad r et ai ned s uch arr angement s i n l i eu of the O r gani zi ng A gr eement ’ s 10% cont i ngencyfee pr ovi s i on. T he l ett erdes cr i bed Lucas ’ s w or k on behal f of hi s cl i ent s ( the “Fac i l i t i es ”) , and s t at ed, “[W ] e bel i eve thati f the courtfi nds t hat th e re c e ip t o f

th e IG T f

u n d s b yth e se F a c ili ties is n o t w ith in th e c o n tin g e n c yse t f o rth in th e C a p o z z i co n tin g e n t f e e a g re e m e n ts, o th e r F a c ili ties th a t h a v e a lre a d yp a id C a p o z z i aAfter faxing the le tter to 700 rec ipients, Lucas later plac ed an advertisement c ontaining 2 sim ila r te xt in a tra depu bli c atio n. Hea lso po ste d a link toan e le c tron icc op y of thele tter o n h is firm’s website. 6 per cent age of

thei rI G T funds w oul d be ent i t l ed t o a r efund. ” The l ett erconcl uded by u rg in g re c ip ien ts to c o n tac t L u c a s p ro m p tly , in o rd e r to a v o id th e e x p ira tio n o f th e sta tu te o f lim ita tio n s . N ei therpartydi s put es the D i s tr i ctC our t ’ s fac tual fi ndi ng thatthe “s cope of cont i ngency ” ar gum entout l i ned i n L ucas ’ s l ett erhad no appl i cat i on w hat s oevert o the vas tm aj or i tyof the 700 r eci pi ent s of the l ett er . I ndeed, m anyof thes e r eci pi ent s i ncl uded per s ons and ent i t i es thathad neve rbeen Capozzi ’ s cl i ent s , ent i t i es thatw er e notnur s i ng fac i l i t i es , ent i t i es thathad no conne ct i on t o the r ei m bur s ements y s t em t hatw as the s ubj ect of the C PR forQ ual i tyC ar e l aw s ui t , and ent i t i es that , w hi l e r epr es ent ed byC apozz i , had neverent er ed i nt o anys or tof cont i ngentfee agr eementw i th hi m , w hetheri n connec t i on w i th the O r gani zi ng A gr eementorotherw i s e. M or e i m por t ant l y , L ucas conce des thatt he

“ sc o p e o f

c o n tin g e n c y ” a rg u m e n t h a d n o v a lid ityw ith re sp e c t to re c ip ien ts w h o se o n ly re latio n sh ip w ith C a p o z z i ar o se f ro m p a rticip a tio n in th e C P R f o r Q u a lityC a re law su it, and w ho w er e s ubj ectt o t he 10% cont i ngencyfee pr ovi s i on cont ai ned i n the O r gani zi ng A gr eement . I n s um , L ucas does notdi s put e thatthe “s cope of cont i ngency ” ar gum ent pot ent i al l yappl i ed, atm os t , t o betw een thr ee a nd fi ve of the l ett er ’ s 700 i ni t i al add res sees. 2 B ase d o n thes e f

ac ts, the D istri ct C o u rth eld th at L u ca s’s l ett er w as d ef am atory7

u n d e r P e n n sy lv a n ia la w , in th a t itf a lse lyim p lied th a t re c ip ien ts w h o h a d p a id f e e s to C apozz i had bee n i m pr oper l ybi l l ed form att er s out s i de the s cope of thei row n cont i ngent f e e a rra n g e m e n ts. L u c a s c h a llen g e s th is h o ld in g , arg u in g th a t th e sta tem e n ts c o n tain e d in th e lette r w e re “ su b sta n tiallytru e ,” a n d th u s n o t d e f a m a to ry . H o w e v e r, L u c a s’s tru th defe ns e i s pr edi cat ed ent i r el yon the pot ent i al exi s t ence of otheru n p ro v e n d e f e n se s to paym entand/ ortheor i es of r ei m bur s ementthatm ayhave be en ava i l abl e t o ent i t i es that h a d p a i d f

u n d s t o Ca p o z z i a f

t e rr e c e i v i n g f

u n d s p u r s u a n tt o th e Oc t o b e r1 3 , 2 0 0 0 I GT A g re e m e n t. In th is s e n se , L u c a s’s su b sta n tiv e c h a llen g e to th e D istric t C o u rt’s d e c isio n is intertw ined w ith h is ev iden ti arych all en g es, i n w h ich h e a sserts th at th e D istri ct C o u rt i m pr oper l ybarr ed hi m fr om i ntr oduci ng evi dence conce rni ng var i ous w ay s i n w hi ch C a p o z z i m a yh a v e a lleg e d lye n g a g e d in im p ro p e r o r u n a u th o riz e d b ill in g w ith re sp e c t to c lie n ts w h o re c e iv e d th e L u c a s le tte r. I n an appe al fol l ow i ng a benc h tr i al , a di s tr i ctcourt ’ s fi ndi ngs of fa ct“s hal l notbe s etas i de unl es s cl ear l yerr oneous . ” N ew ark Branch, N

A A C P v. C i t y of B ayonne , 134 F. 3d 113, 119 ( 3d C i r . 1998) . A di s tr i ctcourt ’ s evi dent i aryrul i ngs ar e r evi ew ed foran a b u s e o f d is c re tio n . See I

n r e Mer r i t tLogan, I

nc. v. F l em i ng C om

pani es , 901 F. 2d 349, 3 5 9 (3 d C ir . 1 9 9 0 ). A d is tr ic t c o u rt ’s le g a l c o n c lu s io n s a re s u b je c t to p le n a ry re v ie w . See Fotta v. T

rust ees of

U nited Mi ne W

orkers 319 F. 3d 612, 615- 16 ( 3d C i r . 2003) . “A c o m m u n ica tio n is d e f

a m a to ryif

it t e n d s to h a rm th e re p u tatio n o f a n o th e r a s to lo w e r h im i n the es t i m at i on of the comm uni tyort o det erthi r d per s ons fr om as s oci at i ng ordeal i ng8

w i th hi m . A comm uni cat i on i s al s o defa m at oryi f i tas cr i bes t o anotherconduct , char act er ora condi t i on thatw oul d adver s el yaff ecthi s fi tnes s forthe pr operconductof hi s pr oper bus i nes s , tr ade, orpr ofes s i on. ” R us h v. P hi ladel phi a N ew s papers , I nc. , 732 A . 2d 648, 652 ( Pa. Super . 1999) . W hi l e truth i s a def ens e t o a cl ai m of def

amat i on, a s t at ement m us tbe cons i der ed i n cont ext , and the l i t er al truth of i s ol at ed s ent ence s does notpr ecl ude a f in d in g o f f a ls ity b a s e d o n th e e x is te n c e o f a m is le a d in g im p lic a tio n . See D avis v. R es our ces f

orH um an D eve l opm ent , 7 7 0 A .2 d 3 5 3 , 3 5 7 (P a . S u p e r. 2 0 0 1 ); Lars en v. P hi ladel phi a N ew s papers , I nc. , 5 4 3 A .2 d 1 1 8 1 , 1 1 8 9 (P a . S u p e r. 1 9 8 8 ) (“ T h e f a lsityw ith w hich w e are concerned ari ses fr om the inference deri ved from pu bli shed st at em ents , w h e th e r t h o s e s ta te m e n ts a re a c tu a lly tru e o r n o t.” ). T he D i s tr i ctC our t ’ s hol di ng w i th r es pectt o the def amat orynatur e of Lucas ’ s l ett er w as pr oper , and the D i s tr i ctC our tdi d notabus e i t s di s cr et i on i n excl udi ng the evi dence thatL ucas s oughtt o i ntr oduce. E ven i f the fe e l i t i gat i on i ni t i at ed byC apozz i had bee n fa v o rab lyreso lved in f

av o r of L u ca s’s cli en ts pu rsua n t t o the th eo ryo u tl ined in L u ca s’s l ett er , thi s fac tal one w oul d nothave pr ovi ded a ba s i s forconcl udi ng thatC apozz i had bi l l ed the l ett er ’ s r eci pi ent s i n a mannernotcont empl at ed bythe cont i ngentfee pr ovi s i on c o n ta in e d in th e O rg a n iz in g A g re e m e n t to w h ic h m a n yo f th e re c ip ie n ts w e re p a rt ie s . L ucas ’ s l ett erfal s el yi m pl i ed thats uch a di r ectcorr el at i on exi s t ed, and thi s i m pl i cat i on of contr actual l y - unauthor i zed bi l l i ng byC apozz i t ended t o harm C apozz i ’ s r eput at i on among t hos e w ho vi ew ed the l ett er . T he s w eepi ng natur e of Lucas ’ s as s ert i on, w hi ch9

fai l ed t o acknow l edge the exi s t ence of the var i ous fee arr angement s C apozz i had n eg o ti ated w ith h is cl ients, h ad a ten d en cyto b e p arti cu larl yh arm fu l t o C ap o zz i’ s re p u tatio n a m o n g st c lien ts w h o w e re su b jec t to th e O rg a n izin g A g re e m e n t an d h a d p a id to C a p o z z i a p o rtio n o f

th e f u n d s re c e iv e d u n d e r th e O c to b e r 1 3 , 2 0 0 0 IG T A g re e m e n t, notw i ths t andi ng thatthe part i cul artheoryof i m pr operbi l l i ng des cr i bed i n the l ett erw as i na pp l i c a bl e t o a nys uc h c l i e ntw ho s e i nv ol ve mentw i th Cap oz z i w a s l i mi t e d t o the CPR f o r Q u a lity C a re “ C la s s A c tio n .” G i ven the natur e of Capozzi ’ s cl ai m , L ucas cannots eek t o defe nd the fa l s i tyof the i m pl i cat i ons conce r ni ng C apozz i ’ s contr actual l y - unauthor i zed bi l l i ng byi ntr oduci ng e v id e n c e c o n c e rn in g o th e r th e o rie s o f a lleg e d im p ro p e r b ill in g th a t w e re n o t re f e re n c e d in hi s l ett er . L ucas ’ s ar gum ent s conce rni ng the truth defe ns e, and hi s chal l enges t o the D i s tr i ctC our t ’ s evi dent i aryrul i ngs , i m pr oper l yconfl at e the r el at i vel ynarr ow s cope of t he fal s e i m pl i cat i on ar i s i ng fr om L ucas ’ s l ett erw i th the br eadth of the gene r al l anguage us ed b yth e c o u rt s in d e s c ri b in g th e re p u ta tio n a l h a rm in f lic te d b ya d e f

a m a to ry st a te m e n t. T h is a p p ro a c h is c o n tra ryto th e m a n n e r in w h ich th e tru th d e f e n se is a p p lied in Penns y l vani a court s , beca us e, w hi l e “i ti s perm i s s i bl e t o s how thatone cl ai m i ng damages f o r i n ju ry to h is re p u ta tio n h a s a b a d re p u ta tio n , pr oof of s epar at e act

s of bad conduct

or g u ilto f c rim in a l o f

f e n se s is n o t ad m iss ib le o n a n iss u e o f g e n e ra l re p u tatio n , n o t ev e n to m i t i gat e damages . ” See Fris k v. N ew s C om pany , 523 A . 2d 347, 351- 52 ( Pa. Super . 1986) ( quot i ng B aus ew i ne v. N or r is t ow n Her ald, I

nc. , 4 1 A .2 d 7 3 6 , 7 4 2 (P a . 1 9 4 5 ) (e m p h a sisApplying this rule, the Frisk court re jected attempts by

a def endant to introduce 3 newspa per a rticles containing accusations of misconduct ag ainst the plaintiffs, noting that the subject matter of

these other

article s was not re lated to the contents of the alleg edly defa matory statements that g ave rise to the plaintiff’s c laim. Se eFrisk , 523 A.2d at 352. 10 added) ) . T hus , L ucas ’ s att empt t o es t abl i s h a truth defe ns e fors t at ement s conce rni ng t he

3 s cope of C apozz i ’ s cont i ngentfee arr angementw i th hi s cl i ent s byi ntr oduci ng unr el at ed e v id e n c e c o n c e rn in g se p a ra te c h a llen g e s to C a p o z z i’s b ill in g p ra c tice s w a s p ro p e rly re jec ted b yth e D istric t C o u rt. T h e f a c t th a t L u c a s’s lette r o u tli n e d a th e o ryo f f e e re c o v e ryth a t w a s p o ten tially appl i cabl e t o a s m al l num berof the r eci pi ent s does notchange the r es ul t . “Publ i cat i on” o f a d e f a m a to ry st a te m e n t o c c u rs w h e n it is c ir c u la te d to th ir d p a rt ie s , D a v is , 770 A . 2d at 3 5 8 , b u t a s tate m e n t circ u late d to th ird p a rties m a yn o n e th e les s b e “ c o n d iti o n a lly pr i vi l eged” i f i tw as m ade on a pr operocca s i on, fr om a pr operm ot i ve, i n a pr oper m a n n e r, a n d b a s e d u p o n re a s o n a b le c a u s e . See Beckm an v. D unn , 419 A . 2d 583, 587 ( Pa. Super . 1980) ( ci t i ng B ai r d v. D un & Brads tr eet , I nc. , 2 8 5 A . 2 d 1 6 6 , 1 7 1 ( P a . 1 9 7 1 ) ) . We n e e d n o t d e c id e w h e th e r L u c a s ’s le tte r w a s “ c o n d itio n a lly p ri v ile g e d ” in th e f ir s t in s ta n c e . I ti s w el l s ett l ed thata condi t i onal pr i vi l ege maybe l os ti f the publ i s herexce eds the s cope o f th e p riv ileg e b yp u b lish in g th e d e f a m a tio n to u n a u th o riz e d p a rties w h o lac k a v a lid in te re s t in th e u n d e rl y in g s u b je c t m a tte r. See Mi ket i c v. B ar on , 675 A . 2d 324, 329 ( Pa. S u p e r. 1 9 9 6 ); A gr is s v. R oadw ay Expre s s , I nc. , 4 8 3 A .2 d 4 5 6 , 4 6 3 -6 4 (P a . S u p e r. 1 9 8 4 ). A c o n c lu sio n th a t a c o n d iti o n a l p riv ileg e h a s b e e n a b u se d is a f in d in g o f f a c t su b jec t to re v ie w f o r c le a r e rr o r. See A griss , 483 A . 2d at463 ( ci t i ng Mont gom er y v. C i t y of11

P h ila d e lp h ia , 140 A . 2d 100, 102- 03 & n. 4 ( Pa. 1958) ) . G i ven the fa ct s of thi s cas e as f o u n d b yth e D istric t C o u rt, w e h o ld th a t th e D istric t C o u rt d id n o t co m m it cle a r e rro r in concl udi ng thatanycondi t i onal pr i vi l ege thatm i ghtappl yw as l os tbyvi r tue of Lucas havi ng ci r cul at ed hi s l ett ert o over700 r eci pi ent s , the vas tm aj or i tyof w hom w er e i n no p o s i t i o n t o c h a l l e n g e C a p o z z i ’ s p r i o rb i l l i n g s b a s e d u p o n th e “ s c o p e o f c o n t i n g e n c y” th e o ry o u tlin e d b yL u c a s . I n addi t i on t o t he i s s ues di s cus s ed above , L ucas al s o chal l enges the D i s tr i ct C our t ’ s aw ar d of damages t o C apozz i and C apozz i ’ s fi r m . L ucas i s corr ecti n s t at i ng t hat as a m at t er of l aw , a plai nti ff’s “actual” orcom pen sat orydam ages i n a d efam at i on case m u s t b e e s ta b lis h e d th ro u g h c o m p e te n t p ro o f. See G er t zv. R ober tW

elch, I nc. , 41 8 U. S. 323, 350 ( 1974) . Penns y l vani a l aw r ecogni zes var i ous types of damages i n connec t i on w i th d efam at i on cl ai m s. R el evan there are “general dam ages, ” w hich r efer t o those compensa t orydamages thattypi cal l yfl ow fr om defa m at i on, s uch as i m pai r m entof re p u ta tio n , p e rs o n a l h u m ilia tio n , a n d m e n ta l a n g u is h a n d s u f f e ri n g . See M

ar cone v . P enthous e I

nt ’ lM agaz i ne , 7 5 4 F .2 d 1 0 7 2 , 1 0 7 7 (3 d C ir. 1 9 8 5 ) (a p p ly in g P e n n sy lv a n ia law ); S p ra g u e v . A m . B a r A ss’n , 276 F. Supp. 2d 365, 368 ( E . D . Pa. 2003) ( appl y i ng Penns y l vani a l aw , and ci t i ng W alkerv. G r and C entr alSani tat i on, I nc. , 634 A . 2d 237, 243 ( Pa. Super . 1993) ) . C apozz i i ntr oduced s uffi ci entevi dence attr i al fr om w hi ch a r eas onabl e fa ct fi ndercoul d i nferthe exi s t ence of s uch damages , and thus the D i s tr i ct C o u rt d id n o t er r in a w a rd in g c o m p e n sa to ryd a m a g e s o f $ 5 0 0 to C a p o z z i an d $ 1 5 0 0 to12

C a p o z z i’ s la w f

ir m . W e have cons i der ed Lucas ’ s otherar gum ent s i n addi t i on t o thos e di s cus s ed above , a n d f in d th e m to b e w ith o u t m e ri t. T h e ju d g m e n t o f th e D is tr ic t C o u rt is a f

f ir m e d .