Opinion ID: 47625
Heading Depth: 2
Heading Rank: 2

Heading: FSI’s Motion for Judgment as a Matter of Law

Text: FSI also appeals the district court’s denial of judgment as a matter of law, arguing that the evidence upon which the jury’s defamation verdict was based could not be considered as substantive evidence of defamation. FSI further contends that even if the evidence is considered substantively, it was insufficient to support a claim of defamation per se. 6 FSI has also failed to show any other irreparable harm that would result from a failure to grant an injunction. To obtain an injunction, FSI must establish “(1) success on the merits; (2) that a failure to grant the injunction will result in irreparable injury; (3) that said injury outweighs any damage that the injunction will cause the opposing party; and (4) that the injunction will not disserve the public interest.” VRC LLC v. City of Dallas, 460 F.3d 607, 611 (5th Cir. 2006). 14 We review a district court’s ruling on a motion for judgment as a matter of law de novo. Delano-Pyle v. Victoria County, 302 F.3d 567, 572 (5th Cir. 2002). Under this standard, all evidence is viewed “in the light and with all reasonable inferences most favorable to the party opposed to the motion.” Id. (quoting Resolution Trust Corp. v. Cramer, 6 F.3d 1102, 1109 (5th Cir. 1993)). This court will not reverse the district court’s denial of the motion “unless a party has been fully heard on an issue and there is no legally sufficient evidentiary basis for a reasonable jury to find for that party on that issue.” Id. (quoting Ellis v. Weasler Eng’g, Inc., 258 F.3d 326, 337 (5th Cir. 2001)).
Under the Federal Rules of Civil Procedure, depositions may be used to “contradict[] or impeach[] the testimony of deponent as a witness, or for any other purpose permitted by the Federal Rules of Evidence.” FED. R. CIV. P. 32(a)(1). One of these other purposes is the use of a witness’s prior inconsistent statements from a deposition as substantive evidence. FED. R. EVID. 801(d)(1)(A); Gower v. Cohn, 643 F.2d 1146, 1153 n.11 (5th Cir. May 1981). Conceding that Michael Roehrs’s video deposition was admissible under these rules for both substantive and impeachment purposes, FSI contends that the defendants only actually used the deposition to impeach Michael Roehrs during cross-examination, 15 not as substantive evidence. According to FSI, this rendered the jury unable to consider the deposition as evidence of defamation under Gower v. Cohn, 643 F.2d at 1153 n.11. Gower recognized that “materials once admitted for impeachment [do not necessarily] also become substantive evidence” and held that the deposition evidence of prior inconsistent statements in that case was only offered to impeach. Id. at 1153 n.11. However, Gower involved a situation in which both the district judge and the offering party clearly believed that the evidence was being used only to impeach, and in which the relevant jury charge “only instructed the jury that [the] statements could be used as impeachment tools.” Id. Unlike Gower, the district judge in this case believed that “defendants used the prior inconsistent statements not merely to impeach, but also to prove that FSI had in fact defamed them,” and the jury instructions provided that “[i]n determining whether any fact has been proved . . . [the jury] may, unless otherwise instructed, consider the testimony of all witnesses,” which includes a witness’s video deposition testimony.7 7 This instruction was not tempered, as FSI claims, by a subsequent provision in the jury instructions that, “[i]n determining the weight to give to the testimony of a witness,” the jury should consider “whether there was evidence that at some other time the witness said or did something . . . that was different from the testimony the witness gave” during trial. This latter instruction merely provides that the jury may consider prior inconsistent statements for the purpose of impeachment, not that the jury may consider such statements only for that purpose. In contrast, the instruction in Gower “only 16 Because the deposition testimony was accepted as both impeachment and substantive evidence by the district judge and submitted to the jury for both purposes, FSI can only challenge the propriety of that decision. Yet, as discussed above, the testimony was admissible as substantive evidence under Rule 801(d)(1)(A). Further, FSI failed to object to the jury instructions or request an instruction limiting the jury’s consideration of the testimony to impeachment purposes. FSI had the burden of requesting such an instruction, and its undisputed failure to do so renders the jury instructions susceptible only to a challenge for plain error. See FED. R. EVID. 105; Savoie v. Otto Candies, Inc., 692 F.2d 363, 370 (5th Cir. 1982); United States v. Booty, 621 F.2d 1291, 1298-99 (5th Cir. 1980). As the deposition testimony was actually admissible for substantive use, no plain error exists. See Booty, 621 F.2d at 1299; United States v. Leslie, 542 F.2d 285, 289 (5th Cir. 1976).
Defamation is a false statement about a person, published to a third party, without legal excuse, which damages the person’s reputation. Moore v. Waldrop, 166 S.W.3d 380, 384 (Tex. App.-- instructed the jury that [prior inconsistent] statements could be used as impeachment tools,” preventing the consideration of those statements as substantive evidence. Gower, 643 F.2d at 1153 n.11. Gower’s reliance on United States v. Dennis, 625 F.2d 782, 796 n.7 (8th Cir. 1980), which denied substantive status for statements that jury instructions deemed “were to be used for impeachment only,” confirms that Gower’s holding on this point was based on a more limited instruction than is present here. 17 Waco 2005, no pet.). In a claim for defamation per se, “[t]he words are so obviously hurtful that they require no proof that they caused injury in order for them to be actionable.”8 Columbia Valley Reg’l Med. Ctr. v. Bannert, 112 S.W.3d 193, 199 (Tex. App.--Corpus Christi 2003, no pet.). “For a defamatory oral statement to constitute slander per se, it must fall within one of four categories: (1) imputation of a crime, (2) imputation of a loathsome disease, (3) injury to a person’s office, business, profession, or calling, and (4) imputation of sexual misconduct.” Gray v. HEB Food Store No. 4, 941 S.W.2d 327, 329 (Tex. App.--Corpus Christi 1997, writ denied). The first category, which is at issue here, is met by a statement that “unambiguously and falsely imputes criminal conduct to” a party. Id. FSI argues that its allegedly defamatory statements did not unambiguously impute criminal conduct and were not false. The evidence of FSI’s defamatory remarks was provided by the testimony of Michael Roehrs, who spoke of statements that he made on FSI’s behalf to Neil Wilkin at Optical Cable Corporation and statements that FSI employee Mike Dabrowski made to Lockheed Martin. On cross-examination, after Michael Roehrs was asked whether he had told Neil Wilkin that the defendants were thieves or had stolen property, Roehrs answered that he told Neil Wilkin “that there has been misappropriation . . . of intellectual 8 In contrast, a claim for defamation per quod requires proof of actual damages. Moore, 166 S.W.3d at 384. 18 property” but denied calling them thieves. Defendants’ counsel then played the following video deposition testimony from Michael Roehrs: Q. Any other customers or vendors you know of that Fiber Systems has said to them the defendants [are] thieves or have stolen property? A. Ne[i]l Wilkin with Optical Cable Corporation. Q. All right. Who told him that? A. I did. Also, after Michael Roehrs denied that Mike Dabrowski told a Lockheed Martin employee that defendants were thieves, defendants’ counsel played the following video deposition testimony from Roehrs: Q. Has FSI told anybody at Lockheed Martin that the defendants are thieves? A. I think Mike Dabrowski, moreover, has let them know that there has been a misappropriation of intellectual property. Q. By these defendants? A. Yes. . . . . Q. And he was authorized to make these comments by Fiber Systems? A. Absolutely. FSI first argues that this testimony does not show statements that are defamatory per se because they do not impute a crime. FSI acknowledges the extensive precedent holding that a 19 false accusation of theft is defamatory per se, but argues that the recent Texas Court of Appeals decision in Moore v. Waldrop establishes that statements like those made here are nondefamatory because they merely involve terms of general disparagement. Moore dealt with the defamatory nature of the statement, “You don’t want to hire him, he’s a crook.” 166 S.W.3d at 383. The court held that standing alone, the word “crook” was merely a term of general disparagement, and did not impute a specific crime. Id. at 384; see also Billington v. Houston Fire & Cas. Ins. Co., 226 S.W.2d 494, 496 (Tex. Civ. App.--Fort Worth 1950, no writ)) (holding that the use of the words “liar” and “crook” were nondefamatory because they were used only as opprobrious terms). The district court here distinguished Moore by observing that the word “crook” differs from “thief” because the latter “much more directly imputes a crime than the word ‘crook,’” and the court illustrated the point by quoting multiple, nondefamatory dictionary definitions for the word “crook.” FSI challenges this conclusion by pointing to an alternative definition of “crook” as “a person who steals or cheats, swindler or thief,” WEBSTER’S NEW WORLD DICTIONARY 330 (3d college ed. 1991), and by quoting several arcane, nondefamatory definitions of the word “thief,” including its meanings as a “kind of wild bee said to rob hives” and an “excrescence in the snuff of a candle.” See 17 THE OXFORD ENGLISH DICTIONARY 934-35 (J.A. Simpson & E.S.C. Weiner 20 eds., 2d ed. 1989). Accordingly, FSI argues that the word “crook” is no different than the word “thief,” and the outcome here should be the same as in Moore. We need not resolve a battle of dictionary definitions in this appeal. Texas case law firmly establishes that falsely accusing someone of stealing or calling someone a “thief” constitutes defamation per se. See, e.g., Bennett v. Computer Assocs. Int’l, Inc., 932 S.W.2d 197, 200 (Tex. App.--Amarillo 1996, writ denied) (“One who falsely imputes to another the crime of theft commits slander per se. . . . Falsely calling someone a ‘crook’ or ‘thief’ or falsely accusing him of stealing property falls within the parameters of slander per se . . . .”); see also Glenn v. Gidel, 496 S.W.2d 692, 697-98 (Tex. Civ. App.--Amarillo 1973, no writ); Anderson v. Alcus, 42 S.W.2d 294, 296 (Tex. Civ. App.--Beaumont 1931, no writ). In contrast, as recognized in Moore, Texas courts have determined that the term “crook” does not inherently have the same defamatory content. See, e.g., Moore, 166 S.W.3d at 384; Billington, 226 S.W.2d at 496; Arant v. Jaffe, 436 S.W.2d 169, 177-78 (Tex. Civ. App.--Dallas 1968, no writ). But when the word “crook” is used in a context imputing theft, it is also defamatory per se. See Bennett, 932 S.W.2d at 200 (holding that “[f]alsely calling someone a ‘crook’” was defamatory per se where the defendant called the plaintiff “a ‘thief’ and a ‘crook’ who had stolen . . . computer software”). While it is similarly possible that a false allegation of 21 theft could be made in a context that renders it nondefamatory, such a situation is not presented here. To affirm the district court’s decision, it is sufficient that “the words used [were] reasonably capable of a defamatory meaning.” Musser v. Smith Protective Servs., Inc., 723 S.W.2d 653, 654-55 (Tex. 1987). “In answering this question, the court must construe [each] statement as a whole in light of surrounding circumstances based upon how a person of ordinary intelligence would perceive the entire statement.”9 Gray, 941 S.W.2d at 329. “The surrounding circumstances are the setting in which the alleged slanderous statement is spoken, consisting of the context of the statement and the common meaning attached to the statement.” Moore, 166 S.W.3d at 386. “Only when the court determines the language is ambiguous or of doubtful import should the jury then determine the statement’s meaning and the effect the statement’s 9 Although FSI agrees that courts must look to the surrounding circumstances in determining whether a statement is defamatory per se, FSI also argues that courts cannot look to the factual context of statements without turning such a claim into one for defamation per quod, which requires proof of actual damages, because courts cannot consider innuendo in a defamation per se claim. Innuendo refers to “extrinsic evidence used to prove a statement’s defamatory nature” and “includes the aid of inducements, colloquialisms, and explanatory circumstances.” Moore, 166 S.W.3d at 385. However, Moore also points out that “[c]onsidering the surrounding circumstances does not necessarily require the use of extrinsic evidence,” as courts must consider the context in which the statement was made and the common meaning of the statement. Id. As discussed above, FSI’s statements were defamatory per se under these considerations, and extrinsic evidence need not be considered. 22 publication has on an ordinary reader.” Musser, 723 S.W.2d at 655. Here, deposition evidence showed that Michael Roehrs told Neil Wilkin that defendants were thieves or had stolen property,10 which directly imputes specific crimes under Texas law.11 See TEX. PEN. CODE ANN. § 31.03 (Vernon 2005) (punishing theft of property); Id. § 31.05 (Vernon 2005) (punishing theft of trade secrets); see also Gray, 941 S.W.2d at 329 (determining that an accusation of shoplifting was slanderous per se because shoplifting was punishable under the Texas Penal Code). As the defamation cases discussed above illustrate, the common meaning of FSI’s statements imputed the crime of theft. And the surrounding circumstances present no factors that would alter the meaning of the statements, particularly considering the evidence in the light most favorable to the defendants. In fact, Michael Roehrs described in his live testimony that the statement to Neil Wilkin was made in the context of a discussion about the 10 FSI contends that Michael Roehrs’s deposition statement was insufficient evidence of defamation because he responded to the ambiguous question of whether FSI had communicated that “defendants [are] thieves or have stolen property.” However, both alternatives are equally defamatory, in that they both impute the commission of the crime of theft. 11 FSI’s briefs only focus on whether the word “thief” is defamatory after Moore, leaving unaddressed whether Mike Dabrowski’s statement that defendants “misappropriat[ed] . . . intellectual property” constituted defamation. We note, however, that Texas law defines a thief as, in part, someone who “unlawfully appropriates property.” TEX. PEN. CODE ANN § 31.03 (Vernon 2005). 23 misappropriation of FSI’s property by defendants, which supports the conclusion that the accusation of theft imputed that crime. Nonetheless, FSI argues that from the context of the ongoing, heated controversy between FSI and the defendants, no person of ordinary intelligence could believe that FSI’s statements were anything more than rhetorical outbursts of an angry and frustrated business owner, much less a real accusation of theft. FSI relies on the Supreme Court’s opinion in Greenbelt Co-Op Publishing Association v. Bresler, 398 U.S. 6, 13-14 (1970), which held that an accusation of blackmail during a heated city council debate was mere rhetorical hyperbole because the word, in context, clearly referred to the unreasonableness of legal negotiating proposals discussed at the debate rather than the actual crime of blackmail.12 But unlike Greenbelt, the circumstances here only bolster the conclusion that Michael 12 FSI also cites state court cases from California, Georgia, and Connecticut to support this argument, but all involved a context that made the theft accusation nondefamatory. See Rosenauer v. Scherer, 88 Cal. App. 4th 260, 280 (Cal. App. 3d Dist. 2001) (involving a context that showed that the defendant was criticizing the plaintiff’s political position rather than accusing the plaintiff of the crime of theft); Mathis v. Cannon, 573 S.E.2d 376, 382-83 (Ga. 2002) (holding that a theft accusation, in context, referred only to the “ongoing debate about [a] garbage disposal dispute,” rather than an actual criminal act); Yakavicke v. Valentukevicius, 80 A. 94, 96 (Conn. 1911) (holding from the context of the theft accusation that the statement would be interpreted as conveying “that the plaintiff had cheated the club,” not that the plaintiff had actually stolen from the club). Unlike these cases, the context of FSI’s theft allegations does not reveal anything from which a person of ordinary intelligence would derive a noncriminal implication. 24 Roehrs was referring to the commission of a crime. The accusation of theft, in context, did not refer to activities readily identifiable to the listener as innocuous, as in Greenbelt, but instead referred to the defendants’ alleged misappropriation of FSI’s intellectual property. The mere fact that an accusation arose from a heated controversy does not strip the statement of its defamatory content where a person of ordinary intelligence would nonetheless interpret the statement to impute a crime. Finally, FSI argues that the statements made by FSI were true. “The truth of a statement is a defense to a claim for defamation.” Gustafson v. City of Austin, 110 S.W.3d 652, 656 (Tex. App.--Austin 2003, pet. denied). This defense “does not require proof that the alleged defamatory statement is literally true in every detail; substantial truth is sufficient.” Id. FSI argues that its statements were substantially true because the jury found that three of the defendants violated 18 U.S.C. § 1030(a)(4) and that FSI’s report to the Allen Police Department was made without actual malice. However, the jury specifically found that FSI’s theft allegations were not substantially true. At most, the jury findings would be inconsistent, requiring a new trial. Willard v. The John Hayward, 577 F.2d 1009, 1011 (5th Cir. 1978). Thus, FSI’s argument is properly addressed in connection with its argument that the district court should have granted a new trial 25 based on inconsistent jury findings, which is discussed later in this opinion. For purposes of the district court’s denial of FSI’s motion for judgment as a matter of law, the only question is whether the jury had a legally sufficient basis for finding that the allegations were not substantially true, and we are satisfied that defendants’ testimony provided such a basis.