1999 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

6-28-1999

Beverly Entr Inc v. Trump

Precedential or Non-Precedential:

Docket 98-3222

Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_1999

This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova

University School of Law Digital Repository. It has been accepted for inclusion in 1999 Decisions by an authorized administrator of Villanova

University School of Law Digital Repository. For more information, please contact Benjamin.Carlson@law.villanova.edu.

Recommended Citation

"Beverly Entr Inc v. Trump" (1999). 1999 Decisions. Paper 173.

http://digitalcommons.law.villanova.edu/thirdcircuit_1999/173
Filed June 28, 1999 

UNITED STATES COURT OF APPEALS 

FOR THE THIRD CIRCUIT 

NO. 98-3222 

BEVERLY ENTERPRISES, INC.; 

DONALD L. DOTSON 

 Appellants 

v. 

ROSEMARY TRUMP; 

SERVICE EMPLOYEES INTERNATIONAL UNION 

LOCAL 585 

On Appeal From the United States District Court 

For the Western District of Pennsylvania 

(D.C. Civil Action No. 97-cv-01490) 

District Judge: Honorable Gary L. Lancaster 

Argued December 11, 1998 

BEFORE: BECKER, Chief Judge, and STAPLETON, 

Circuit Judges, and HARRIS,* District Judge 

(Opinion Filed June 28, 1999) 

 Michael T. McMenamin (Argued) 

 Walter & Haverfield 

 50 Public Square 

 1300 Terminal Tower 

 Cleveland, OH 44113 

 Attorney for Appellants 

_________________________________________________________________ 

*Honorable Stanley S. Harris, United States District Judge for the 

District of Columbia, sitting by designation. 
 Claudia Davidson 

 Healey, Davidson & Hornack 

 Law & Finance Building, 5th Floor 

 Pittsburgh, PA 15219 

 and 

 Harold C. Becker (Argued) 

 Associate General Counsel 

 Service Employees International 

 Union 

 14 West Erie Street 

 Chicago, IL 60610 

 Attorneys for Appellees 

 Geraldine R. Gennet 

 General Counsel 

 Kerry W. Kircher 

 Deputy General Counsel 

 Office of General Counsel 

 U.S. House of Representatives 

 219 Cannon House Office Building 

 Washington, D.C. 20515-6601 

 Attorneys for Amicus Curiae 

 Bipartisan Legal Advisory Group of 

 the United States House of 

 Representatives 

OPINION OF THE COURT 

STAPLETON, Circuit Judge: 

This diversity-based defamation action arises from 

statements allegedly made by a union representative about 

a company official during two separate incidents, one at a 

political rally and another at a "Town Hall meeting." The 

District Court dismissed the plaintiffs' complaint after 

finding the comments at the rally incapable of defamatory 

meaning and the Town Hall meeting comment protected

under the doctrine of absolute testimonial immunity. 

Although for somewhat different reasons, we will affirm. 

I. 

There is a long-standing and acrimonious relationship 

between Beverly Enterprises, a national provider of nursing 

 2 
home care, and the Service Employees International Union 

("SEIU"), whose local affiliates represent a substantial 

number of Beverly's employees. Plaintiffs are Beverly 

Enterprises and Donald L. Dotson, Beverly's Senior Vice 

President for Labor and Employment. Before joining Beverly 

Enterprises, Dotson had a prestigious career in labor 

relations, serving as Chairman of the National Labor 

Relations Board and as Assistant Secretary for LaborManagement Relations at the U.S. Department of Labor. 

This suit arises from two incidents in which Rosemary 

Trump, President of Local 585 of the SEIU, allegedly made 

false and defamatory statements about Dotson and Beverly. 

Plaintiffs allege that, as a result of the statements uttered 

by Trump, Dotson and Beverly have suffered damage to 

their reputations. A district court's order dismissing a 

complaint is subject to plenary review. Pension Benefit 

Guar. Corp. v. White Consol. Indus. Inc., 998 F.2d 1192, 

1997 (3d Cir. 1993). We accept as true all well-pleaded 

factual allegations in the plaintiffs' complaint and all 

reasonable inferences therefrom. Independent Enterprises v. 

Pittsburgh Water, 103 F.3d 1165, 1168 (3d Cir. 1997). The 

parties agree that Pennsylvania law governs this dispute. 

II. 

The first set of allegedly defamatory statements were 

made in August, 1996, at a political rally in Pittsburgh, 

Pennsylvania, sponsored by the Dole/Kemp presidential 

campaign. Plaintiffs allege that Trump approached Dotson 

in the midst of a large crowd, ascertained his identity as a 

Beverly official, and asked him whether he knew who she 

was. When Dotson said he did not, Trump became visibly 

upset, told Dotson he should know her, identified herself, 

and then began to berate Dotson in a loud and angry voice. 

Specifically, Trump accused Dotson of being a "criminal" 

and said that "you people at Beverly are all criminals." 

When Dotson tried to respond, Trump cut him off and

angrily accused him of "devoting [his] entire career to 

busting unions." Despite Dotson's efforts at reasoned 

discourse, Trump continued berating Dotson, finally

shouting at him: "I know your kind. You're just part of that 

World War II generation that danced on the graves of Jews." 

 3 
Plaintiffs allege that these statements were false and 

defamatory as to both Dotson and Beverly Enterprises. 

Moreover, they allege that Trump uttered the statements 

with actual malice, and that, as a result of these 

statements, Dotson suffered damage to his reputation. The 

District Court concluded that each of the three statements 

at the rally were incapable of defamatory meaning because 

they constituted mere hyperbole and insulting rhetoric, all 

too common in labor disputes. 

We begin by addressing Trump's alleged statements 

accusing Dotson of "union-busting" and referring to Dotson 

and others at Beverly as "criminals." By statute in

Pennsylvania, a plaintiff in a defamation action has the 

burden of proving: 

 (1) the defamatory character of the communication, (2) 

 its publication by the defendant, (3) its application to 

 the plaintiff; (4) the understanding by the recipient of 

 its defamatory meaning; (5) the understanding by the 

 recipient of it as intended to be applied to the plaintiff; 

 (6) special harm resulting to the plaintiff from its 

 publication, and (7) abuse of any conditional privilege. 

42 Pa. C. S. S 8343(a) (West 1999). 

The Pennsylvania Supreme Court has held that "[i]n an 

action for defamation, it is the court's duty to determine if 

the publication is capable of the defamatory meaning 

ascribed to it by the party bringing suit." MacElree v. 

Philadelphia Newspapers, Inc., 674 A.2d 1050, 1053 (Pa. 

1996). "A communication is defamatory if it tends so to 

harm the reputation of another as to lower him in the 

estimation of the community or deter third persons from 

associating or dealing with him." Id. at 1055 (quoting 

Thomas Merton Center v. Rockwell Int'l Corp., 442 A.2d 213, 

215 (Pa. 1981)). 

Appellants contend that Trump's references to "criminals" 

and "union busting" were defamatory per se because they 

imputed criminal conduct to both Dotson and Beverly. 1 

_________________________________________________________________ 

1. Insofar as plaintiffs' allegations can be construed as alleging slander 

per se, plaintiffs are excepted from the requirement that they must also 

allege special damages. Baird v. Dun & Bradstreet, 285 A.2d 166, 171 

(Pa. 1971); Clemente v. Espinosa, 749 F. Supp. 672, 677 (E.D. Pa. 1990) 

(construing Pennsylvania law). 

 4 
Moreover, they argue that other attendees at the 

Dole/Kemp rally within earshot could reasonably have 

interpreted Trump's statements as alleging actual facts 

about Dotson and Beverly. 

We disagree. Although Trump's statements were 

undoubtedly offensive and distasteful, the law of 

defamation does not extend to mere insult. Courts in 

Pennsylvania and elsewhere have long recognized a 

distinction between actionable defamation and mere 

obscenities, insults, and other verbal abuse. "[S]tatements 

which are merely annoying or embarrassing or no more 

than rhetorical hyperbole or a vigorous epithet are not 

defamatory." Kryeski v. Schott Glass Techn., Inc., 626 A.2d 

595, 601 (Pa. Super. 1993) (quoting Redding v. Carlton, 296 

A.2d 880, 881 (Pa. Super. 1972)); see also Greenbelt 

Cooperative Publishing Assoc. v. Bresler, 398 U.S. 6, 14 

(1970) (finding that a statement that was "no more than 

rhetorical hyperbole, a vigorous epithet" was not slander). 

As the Restatement (Second) of Torts explains: 

 A certain amount of vulgar name-calling is frequently 

 resorted to by angry people without any real intent to 

 make a defamatory assertion, and it is properly 

 understood by reasonable listeners to amount to 

 nothing more. This is true particularly when it is 

 obvious that the speaker has lost his temper and is 

 merely giving vent to insult. Thus when, in the course 

 of an altercation, the defendant loudly and angrily calls 

 the plaintiff a bastard in the presence of others, he is 

 ordinarily not reasonably to be understood as asserting 

 the fact that the plaintiff is of illegitimate birth but only 

 to be abusing him to his face. No action for defamation 

 will lie in this case. 

Restatement (Second) of Torts S 566, comment e (1977). 

Similarly here, Trump's exclamation that "you people at 

Beverly are all criminals" is reasonably understood as a 

vigorous and hyperbolic rebuke, but not a specific 

allegation of criminal wrongdoing. Trump's accusation that 

Dotson "devot[ed] [his] entire career to busting unions" is 

equally incapable of a defamatory construction. Appellants 

describe these statements as "mean-spirited . . . 

 5 
accusations of illegal and immoral conduct." First, it is 

doubtful at best that an accusation of "union-busting" 

amounts to an insinuation of criminal activity. Even if it 

were so understood, however, the reasonable listener would 

recognize this statement as merely a vituperative outburst 

which, although undoubtedly offensive, it is not actionable 

in defamation. On this basis, we conclude that these two 

statements are incapable of defamatory meaning and thus 

cannot support an action in tort. 

Plaintiffs' claim based on the third comment Trump 

allegedly made at the rally -- that Dotson was "part of that 

World War II generation that danced on the graves of Jews" 

-- fails for a different reason. As a rule, except as to 

allegations of slander per se, plaintiffs in slander actions 

must allege special damages beyond an injury to 

reputation. 42 Pa. C. S. S 8343(a)(6); Baird, 285 A.2d at 171 

("[i]t is a general rule that defamatory words are not 

actionable, absent proof of special damage"); Solosko v. 

Paxton, 119 A.2d 230, 232 (Pa. 1956) ("[g]enerally speaking, 

damages for defamatory words when spoken are not 

recoverable in the absence of proof of special damages"); 

Altoona Clay Prod. Inc., v. Dun & Bradstreet, Inc., 246 F. 

Supp. 419, 422 (W.D. Pa. 1965), rev'd on other grounds, 

367 F.2d 625 (3d Cir. 1966) ("The Pennsylvania cases 

require both the allegation and proof of [a] specific item of 

damage to support the recovery."); Restatement (Second) of 

Torts, S 558(d). Whereas the aforementioned comments 

arguably impute criminal conduct to the plaintiff, and thus 

constitute allegations of slander per se, this accusation of 

bigotry does not fall within the narrowly defined categories 

of per se defamation. Clemente, 749 F. Supp. at 677 (citing 

the four categories of slander per se as words imputing the 

commission of a criminal offense, a loathsome disease, 

business misconduct, or serious sexual misconduct).

Consequently, as to the alleged statement imputing antiSemitism, to survive a motion to dismiss, the plaintiff must 

go beyond a claim of injury to reputation and allege special 

damages. Typically considered as a pecuniary loss, special 

damages are "actual and concrete damages capable of being 

estimated in money, established by specific instances such 

as actual loss due to withdrawal of trade of particular 

 6 
customers, or actual loss due to refusal of credit by specific 

persons, all expressed in figures." Altoona, 246 F. Supp. at 

422; Restatement (Second) of Torts, S 575, comment b 

(special harm is "the loss of something having economic or 

pecuniary value"). Because plaintiffs have only alleged 

damage to their reputation, they have failed to meet this 

requirement.2 

III. 

The second incident in which plaintiffs allege that Trump 

made a defamatory statement was in May, 1997, at a "Town 

Hall meeting." According to the plaintiffs' complaint, the 

SEIU persuaded several members of Congress to convene 

the meeting in the Allegheny County Courthouse to discuss 

an item of federal legislation then pending in Congress. The 

bill, entitled the "Federal Procurement and Assistance 

Integrity Act," was designed to preclude businesses that are 

in violation of certain federal labor standards from 

obtaining federal contracts. Plaintiffs allege that the "true 

purpose" of the meeting was to provide a forum for 

disparaging Beverly Enterprises and, to that end, members 

of Congress were importuned to ask speakers about the 

adverse effects that the pending legislation would have on 

Beverly. Trump, an invited speaker, allegedly made the 

following statement in response to a question from 

Congressman Klink: 

_________________________________________________________________ 

2. Beverly also argues that it need not allege or prove special damages 

because Trump acted with actual malice. But Beverly confuses the 

requirements of special damages and actual damages. Under 

Pennsylvania law, where a defendant acts with actual malice, there is no 

need to prove actual damages. See Frisk v. News Co., 523 A.2d 347, 354 

(Pa. Super. Ct. 1986) (citing Gertz v. Robert Welch, Inc., 418 U.S. 323 

(1974)); Agriss v. Roadway Express, Inc., 483 A.2d 456, 467-68 (Pa. 

Super. Ct. 1985). This rule requires that, in the absence of actual 

malice, even if the plaintiff need only prove general damage to 

reputation, as in a defamation per se case, he or she cannot rely on a 

presumption of damages; he or she must offer actual specific evidence of 

such general damages. This is different from the principle of special 

damages (proof of which is excused in defamation per se cases, see 

Agriss, 483 A.2d at 468-75.) 

 7 
 CONGRESSMAN KLINK: Thank you. To Ms. Trump and 

 Ms. Ford, just to clear up in my mind, why have we 

 seen this problem exacerbated so much in 

 Pennsylvania and we haven't seen it at the other 

 Beverly locations across the country? What transpired 

 in Pennsylvania to make the situation here much 

 worse? 

 MS. TRUMP: Well, this is one of the most unionized, 

 heavily unionized Beverly states, if not the most 

 unionized Beverly state. They operate approximately 42 

 facilities in Pennsylvania, 20 of which are organized 

 and we have had a history of bargaining that went very 

 well. But quite frankly when President Clinton was 

 elected and a new Chairman of the National Labor 

 Relations [Board] was appointed, the former Chairman, 

 Don Dotson, walked out of his federal government job 

 and knocked on evidently the Beverly door and said, 

 who knows more about all of your unfair labor practice 

 cases in Beverly 1 and 2 than me since I have been 

 supervising them on behalf of the government and 

 besides which, I could really -- really this is conjecture 

 on my part, but I can only assume that because they 

 went out and recruited the former general counsel for 

 the National Right to Work Committee. They decided 

 that you're the largest chain of Beverly facilities, if 

 we're able to break unionism in the Beverly chain, 

 then, of course, it will have a ripple effect in the entire 

 industry and the whole industry will operate nonunion. 

Plaintiffs allege that the italicized statement by Trump is 

defamatory because it accuses Dotson of criminal violation 

of the Ethics in Government Act, 18 U.S.C. #8E8E # 201 et seq. 

("EGA"). Specifically, plaintiffs allege that the "gist or sting" 

of Trump's statement is that Dotson (1) may have 

negotiated for employment with Beverly while Chairman of 

the NLRB, and (2) eventually represented Beverly in matters 

that were pending before the NLRB during his 

Chairmanship, both in criminal violation of federal

government ethics laws. Further, plaintiffs allege that 

Trump's statement also implicates Beverly as a participant 

in a criminal conspiracy with Dotson toward these same 

ends. According to plaintiffs, these statements are false, 

 8 
defamatory, and slanderous per se, as accusations of 

criminal conduct. On the basis of this statement, Dotson 

and Beverly claim to have sustained damage to their

reputations. 

The District Court dismissed this claim after concluding 

that Trump enjoyed absolute testimonial immunity for her 

statement. Like absolute judicial immunity, the common 

law testimonial immunity provides that: 

 A witness is absolutely privileged to publish defamatory 

 matter as part of a legislative proceeding in which he is 

 testifying or in communications preliminary to the 

 proceeding, if the matter has some relation to the 

 proceeding. 

See Jennings v. Cronin, 389 A.2d 1183, 1185 (Pa. Super. 

Ct. 1978) (quoting and adopting S 590A of the Restatement 

(Second) of Torts). After considering the scope, purpose, 

and format of the meeting, the District Court concluded 

that the meeting constituted a "legislative proceeding" for 

purposes of testimonial immunity. Moreover, because

Trump was an invited speaker and made the allegedly

defamatory statement in response to a question posed by a 

panel member, the District Court concluded that the

statement was "part of " the legislative proceeding. Finding 

Trump's statement absolutely privileged, therefore, the 

Court dismissed plaintiffs' claim. 

We see no need to consider the contours of absolute

testimonial immunity in this case, however, because we 

find Trump's statement at the Town Hall meeting incapable 

of either of the defamatory constructions plaintiffs allege.3 

_________________________________________________________________ 

3. Plaintiffs contend that the District Court erred by considering matters 

outside the pleadings without converting defendants' motion into one for 

summary judgment. See Fed.R.Civ.P. 12(b). Specifically, plaintiffs 

contend the District Court erroneously considered a videotape of the 

meeting and a copy of the pending legislation at issue. Plaintiffs thus 

assert that "Dotson and Beverly must be provided the opportunity to 

rebut the extrinsic materials relied on by the District Court, and 

discover 

Rule 56 evidence in support of their claims." Appellant's Brief at 23. 

It is well-settled that in deciding a motion to dismiss, courts generally 

may consider only the allegations contained in the complaint, exhibits 

 9 
Whether a reasonable listener could have construed 

Trump's statements as defamatory is a question of law to 

be determined by the court. Pierce v. Capital Cities 

Communications, Inc., 576 F.2d 495, 502 (3d Cir. 1978); 

Thomas Merton Ctr., 442 A.2d at 215-16; Restatement

(Second) of Torts, S 614. 

Plaintiffs allege that Trump's statement implicates Dotson 

and Beverly in violation of two separate provisions of the 

Ethics in Government Act. Construing the allegations in the 

complaint in the plaintiff 's favor, as we must, we

nonetheless find neither of these interpretations 

reasonable. First, the act prohibits an executive branch 

officer from "personally and substantially" participating in a 

quasi-judicial proceeding if the officer is also negotiating 

prospective employment with an organization that has a 

financial interest in that proceeding. See 18 U.S.C. S 208. 

Plaintiffs' complaint alleges that Trump's statement asserts 

_________________________________________________________________ 

attached thereto, and matters of public record. Pension Benefit Guar. 

Corp. v. White Consol. Indus. Inc., 998 F.2d 1192, 1196 (3d Cir. 1993). 

As the federal bill is a matter of public record, the District Court did 

not 

err in considering it before deciding defendants' motion to dismiss. 

However, the District Court's opinion also reflects the Court's reliance 

on the videotape of the meeting, which was relevant to determining 

whether the meeting constituted a "legislative proceeding." For example, 

the District Court noted the relevance of several details only obtained 

from the videotape, such as one Congressman's opening words at the 

meeting, his reference to the meeting as a "field hearing," and the 

number of other members of Congress present as well as their 

relationship to the bill. Although "a court may consider an undisputedly 

authentic document that the defendant attaches as an exhibit to a 

motion to dismiss if the plaintiff's claims are based on the document," 

such exception does not apply here. See id. This exception prevents "a 

plaintiff with a legally deficient claim [from surviving] a motion to 

dismiss 

simply by failing to attach a dispositive document on which it relied." 

Id. 

In this case, however, defendants offered the videotape (and the District 

Court considered it) in support of their affirmative defense of 

testimonial 

immunity. Because the plaintiff was not given an adequate opportunity 

for discovery or to submit rebuttal evidence, we will treat the District 

Court's decision as a 12(b)(6) dismissal and will disregard the videotape 

of the meeting in conducting our plenary review of that decision. See 

Indep. Enterprises, 103 F.3d at 1168 n.2. 

 10 
a violation of this provision insofar as she said that "when 

President Clinton was elected and a new Chairman of the 

National Labor Relations [Board] was appointed, the former 

chairman, Don Dotson, walked out of his federal 

government job and knocked on evidently the Beverly door 

. . . ." We find this interpretation of Trump's statement 

unreasonable. Not only is there nothing in Trump's 

statement to suggest that Dotson simultaneously sought 

employment from Beverly and supervised cases involving 

Beverly, but Trump's statement suggests to us just the 

opposite: that Dotson did not approach Beverly until after 

he left his government job. 

Second, the Ethics in Government Act restricts former 

federal officers from representing another individual or 

entity in a matter formerly under the officer's supervision. 

See 18 U.S.C. S 207. Plaintiffs contend that Trump accused 

Dotson of violating this provision when she said,"Don 

Dotson, walked out of his federal government job and 

knocked on evidently the Beverly door and said, who knows 

more about all of your unfair labor practice cases in Beverly 

. . . than me since I have been supervising them on behalf 

of the government . . . ." Trump's statement, according to 

plaintiffs, amounts to an accusation that Dotson violated 

S 207 of the EGA "by representing Beverly in matters that 

had been pending before the NLRB during his 

Chairmanship." Again, we fail to see how a reasonable 

hearer of the statement Trump allegedly made could 

interpret it as plaintiffs suggest. 

Trump's statement undeniably implies that Dotson 

sought to capitalize on his knowledge of the NLRB's

prosecutions of Beverly in an effort to obtain employment 

with Beverly. Moreover, given that Dotson was a Beverly 

Vice President at the time of the alleged statement, Trump's 

statement implies that Dotson successfully secured his job 

at Beverly on the basis of his knowledge of their ongoing 

litigation with the NLRB. However, none of these 

implications amounts to a violation of federal law-- civil or 

criminal. Trump's comment simply does not state or imply 

that Dotson has done that which the EGA prohibits: 

making, with an intent to influence, a communication to or 

appearance before any department, agency, or court in 

 11 
connection with matters he previously supervised. See 18 

U.S.C. S 207(a)(2). 

Unless Trump's statement is reasonably susceptible of a 

defamatory meaning, plaintiffs have failed to state a claim 

with respect to the Town Hall meeting. See Sarkees v. 

Warner-West Corp., 37 A.2d 544, 546 (Pa. 1944) ("If the 

words are not susceptible of the meaning ascribed to them 

by the plaintiff, and do not sustain the innuendo, the case 

should not be sent to a jury."); McAndrew v. Scranton 

Republican Pub. Co., 72 A.2d 780, 783 (1950). We conclude 

that Trump's statement is incapable of conveying either of 

the defamatory meanings plaintiffs advance. Moreover, to 

the extent the statement is susceptible of another 

defamatory interpretation that does not constitute an 

accusation of criminal wrongdoing, such interpretation 

would not constitute slander per se and, as a result 

plaintiff 's complaint would be insufficient for failure to 

allege special damages. 

IV. 

Accordingly, we will affirm the order of the District Court 

dismissing the plaintiffs' complaint for failure to state a 

claim. 

A True Copy: 

Teste: 

 Clerk of the United States Court of Appeals 

 for the Third Circuit 

 12