Court Opinion

ID: 4422168
Source: CourtListenerOpinion
Date Created: 2019-08-01 16:48:13.780692+00
Date Added: 2024-06-11T09:37:03.697604
License: Public Domain

J-A16037-19

                            2019 PA Super 234

 KUWAIT & GULF LINK TRANSPORT            :   IN THE SUPERIOR COURT OF
 COMPANY, KGL LOGISTICS, & KGL           :        PENNSYLVANIA
 TRANSPORTATION CO. KSCC                 :
                                         :
                   Appellants            :
                                         :
                                         :
              v.                         :
                                         :   No. 1268 MDA 2018
                                         :
 JOHN DOE (A.K.A. SCOTT WILSON),         :
 AGILITY DGS HOLDINGS, INC.,             :
 AGILITY DEFENSE AND                     :
 GOVERNMENT SERVICES, INC., AND          :
 AGILITY INTERNATIONAL, AND              :
 AGILITY PUBLIC WAREHOUSING CO.          :
 KSC, AGILITY DGS LOGISTICS              :
 SERVICES CO. KSCC, PWC                  :
 TRANSPORT CO. WLL

                Appeal from the Order Entered July 6, 2018
   In the Court of Common Pleas of Cumberland County Civil Division at
                       No(s): 2012-1820 Civil Term

BEFORE:    LAZARUS, J., MURRAY, J., and STEVENS*, P.J.E.

OPINION BY STEVENS, P.J.E.:                       FILED AUGUST 01, 2019

     Kuwait & Gulf Link Transport Co., KGL Logistics, and KGL Transportation

Co. K.S.C.C. (collectively “KGL”) appeal from the July 6, 2018, order entered

in the Court of Common Pleas of Cumberland County granting the motion for

summary judgment in favor of Agility Public Warehousing Co. K.S.C. (“PWC”),

Agility DGS Logistics Services Co. K.S.C.C., PWC Transport Co. WLL., Agility

DGS Holdings, Inc., Agility Defense Government Services, Inc., and Agility

____________________________________
* Former Justice specially assigned to the Superior Court.
J-A16037-19

International, Inc. (collectively “Agility”), and “John Doe” (a/k/a “Scott

Wilson”). After a careful review, we affirm.

      The relevant facts and procedural history have been set forth previously

by this Court, in part, as follows:

             KGL is a family of Kuwaiti-based companies that provides
      shipping, transportation, warehousing, and logistics services to
      the United States Government in Kuwait and Southeast Asia.
      Agility is a family of logistics companies, including three of their
      separate, but wholly owned, subsidiaries that competes with KGL
      for government contracts.
             In February 2011, the United States Government’s Defense
      Logistics Agency (“DLA”) awarded a contract to KGL to operate a
      military storage and distribution depot in Kuwait. On March 10,
      2011, Intermarkets Global (“Intermarkets”), a company not
      related to any party in this matter, protested the award of that
      contract to KGL. KGL alleges that on March 22, 2011[,] and March
      24, 2011, a person under the pseudonym “Scott Wilson” sent two
      letters (“the Wilson Letters”) to contracting officers at the DLA and
      the United States Army Sustainment Command (“USASC”). The
      Wilson Letters informed the DLA and the USASC that KGL had
      violated the Comprehensive Iran Sanctions, Accountability, and
      Divestment Act (“CISADA”) by maintaining business relationships
      with Iranian entities[, namely Valfajr Shipping, an Iranian
      shipping company,] and urged them to investigate this issue. The
      Wilson Letters also contained email chains in support of these
      allegations. [Specifically, the emails purportedly reported KGL
      leased a cargo ship to Valfajr Shipping.]
             KGL alleges that Intermarkets supplemented its protest of
      the above-referenced contract with copies of the Wilson Letters,
      characterizing KGL as an irresponsible contractor. KGL asserts
      that it sustained losses and costs associated with defending this
      protest, but that it was able to get the protest dismissed, and that
      the DLA eventually awarded the contract to KGL. KGL also alleges
      that it competed for a “Heavy Lift 7” contract from the USASC and
      that the Wilson Letters affected the award of this contract because
      the USASC would not give the contract to KGL unless KGL
      addressed the Wilson Letters and proved that it was a responsible
      contractor. KGL again contends that it sustained losses and costs
      associated with addressing the USASC’s concerns, but that it was

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     able to provide the USASC with a satisfactory explanation and that
     it received the “Heavy Lift 7” contract. [Thus, while KGL admits
     that the Wilson Letters did not cause them to lose any contracts
     and they received all contracts on which they bid, KGL alleges that
     it suffered costs associated with defending itself against bid
     protests and addressing concerns of the DLA and the USASC.]
           On March 21, 2012, KGL filed suit against Agility and “John
     Doe” alleging liability for defamation, tortious interference with
     contractual and other business relationships, respondeat superior,
     conspiracy, aiding and abetting, and negligent supervision[,
     arising out of the two Wilson Letters sent to the U.S.
     Government.] KGL further alleged, and PWC admitted, that
     employees of PWC authored the Wilson Letters [using the
     pseudonym “Scott Wilson”] and were acting within the scope of
     their employment [for purposes of respondeat superior liability.
     KGL alleged that the allegations in the Wilson Letters were false.]
           KGL filed an amended complaint on June 14, 2012. On
     August 14, 2012[,] and September 4, 2012, Agility filed
     preliminary objections that the trial court overruled on November
     15, 2012[,] and October 19, 2012, respectively. On September
     14, 2012, KGL served discovery requests on each known
     defendant, including interrogatories, requests for production of
     documents, and requests for admissions, each with the primary
     purpose of identifying “Scott Wilson.” Agility objected to these
     discovery requests based on its First Amendment right to speak
     anonymously and on Pilchesky v. Gatelli, 12 A.3d 430
     (Pa.Super. 2011), which Agility argued requires KGL to satisfy four
     requirements before it could obtain discovery identifying an
     anonymous pseudonymous speaker. On December 4, 2012, KGL
     moved to strike Agility’s objections to discovery requests and to
     compel discovery responses. [On December 5, 2012, Agility filed
     separate answers to the amended complaint. They denied liability
     on several grounds, including that the factual statements in the
     Wilson Letters were substantially true and, in any event, did not
     cause any damage to KGL.]
            On February 20, 2012, the trial court heard argument on
     [the December 4, 2012,] motion. Finally, on May 21, 2013, the
     trial court granted KGL’s motion to strike Agility’s objections to
     discovery requests and to compel discovery responses insofar as
     the objections relate to Pilchesky.
                                    ***

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             [T]he trial court granted KGL’s motion because it found that
      Pilchesky did not apply to the Wilson Letters. The trial court
      ruled that the Wilson Letters were commercial speech, as opposed
      to “literary, religious, or political” speech, and that the First
      Amendment affords less protection to commercial speech.
            Agility…filed [an] appeal.

Kuwait & Gulf Link Transport Co. v. Doe, 92 A.3d 41, 43-44 (Pa.Super.

2014) (citations to record omitted).

      On appeal, Agility argued the trial court erred in ordering discovery

compelling the disclosure of “Scott Wilson’s” identity because the First

Amendment preserves the right to speak anonymously and pseudonymously.

In addressing Agility’s issues, we relevantly held the following:

             [W]e find that the Wilson Letters constitute anonymous or
      pseudonymous political speech, thus receiving extensive
      constitutional protection under the First Amendment.             We
      conclude that the Wilson Letters represent political speech
      because the award of substantial government contracts to
      contractors who are claimed to illegally engage in business with a
      prohibited foreign government directly implicates “the manner in
      which government is operated or should be operated.” We also
      have no problem concluding that the Wilson Letters discuss affairs
      of government which are at the heart of the First Amendment
      protections. “Scott Wilson” wrote the Wilson Letters to the DLA
      and the USASC to inform them that he believed that KGL
      maintained business relationships with Iranian entities in violation
      of CISADA. KGL is a government contractor performing multi-
      million dollar contracts for the United States military. The DLA
      and the USASC are two government agencies responsible for the
      operation of the United States military. Additionally, KGL’s alleged
      misconduct involved its possible connection to Iran businesses,
      misconduct that is a national and newsworthy issue. Thus, at their
      core, the Wilson Letters represent political speech involving the
      operation of the government and the questionable expenditure of
      public funds.      The Wilson Letters directly implicate the
      appropriateness of the relationship between the United States
      Government and some of its contactors and those contractors’

                                       -4-
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       relationships with a foreign government in conflict with the United
       States.
              Furthermore, we note that the Wilson Letters cannot be
       categorized as commercial speech. The Wilson Letters do not
       “propose a commercial transaction,” or propose the sale of a
       specific product at a specific price. Moreover, the Wilson Letters:
       (1) are not an advertisement; (2) they do not reference any
       specific product; and (3) we are unable to determine whether or
       not the author had an economic motivation for making the
       communication.      Although PWC admitted that its employee
       authored the Wilson Letters, there is no evidence indicating
       whether he did so as a concerned citizen or whether he did so to
       advance the interests of Agility. Likewise, even if we knew that
       the author wrote the Wilson Letters with an economic motivation,
       that knowledge alone is insufficient to compel the classification of
       the Wilson Letters as commercial speech. Therefore, given the
       political nature of the Wilson Letters, they are entitled to the
       highest level of protection and not the intermediate level of
       protection that commercial speech receives under the First
       Amendment.
              Accordingly, we find that the Wilson Letters are anonymous
       political speech under the First Amendment subject to
       Pilchesky’s four-part test for disclosure of anonymous or
       pseudonymous speakers.

Id. at 49-50 (quotation, citations, and footnote omitted). Consequently, we

vacated the trial court’s order compelling discovery of the identity of “Scott

Wilson” and remanded the case to the trial court for the proper application of

the Pilchesky test. Upon remand, the trial court applied the Pilchesky test

and, ultimately, denied the motion to compel the disclosure of the identity of

“Scott Wilson.”1

____________________________________________

1 The trial court noted in its opinion that Agility filed a motion for summary
judgment on August 21, 2015, prior to the trial court’s December 9, 2015,
opinion; however, since discovery was not complete, the trial court denied the
motion for summary judgment.

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      Meanwhile, the parties engaged in considerable discovery, at the

completion of which, on June 4, 2018, Agility filed a motion for summary

judgment, as well as a supporting brief. Therein, Agility averred they were

entitled to summary judgment since KGL failed to set forth a prima facie case

for their defamation and tortious interference claims, which in turn foreclosed

KGL from proving its derivative claims of respondeat superior, conspiracy,

aiding and abetting, and negligent supervision.

      On June 8, 2018, KGL filed an answer in opposition to Agility’s motion

for summary judgment.       On June 25, 2018, Agility filed a reply to KGL’s

answer in opposition, and following a hearing on the motion for summary

judgment, by opinion and order entered on July 6, 2018, the trial court

granted Agility’s motion for summary judgment and dismissed KGL’s

complaint.

      Specifically, the trial court concluded that, as a matter of law, the Wilson

Letters involved “a matter of ‘public concern’” and, for purposes of the instant

litigation, KGL is a limited-purpose public figure. Trial Court Opinion, filed

7/6/18, at 4. Consequently, the trial court determined that KGL was required

to set forth a prima facie case that the Wilson Letters contained false

allegations that were made with “actual malice.” See id. However, the trial

court concluded that, as a matter of law, the Wilson Letters contained

opinions, which are not actionable. See id. The trial court further concluded

KGL did not set forth a prima facie case of “actual malice.”

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      Additionally, the trial court held that, assuming the Wilson Letters

contained defamatory statements, “there is no evidence that the letters

caused harm to [KGL].” See id. at 6. In this regard, the trial court concluded

KGL did not set forth any evidence of malice, so there was no evidence upon

which a jury could award presumed damages. See id. Further, as to general

damages, the trial court concluded the “record does not contain the testimony

of a single witness to the effect that the Wilson Letters negatively affected his

or her view of KGL.” See id. at 7. Therefore, the trial court concluded there

was no evidence of reputational harm.       See id.   Moreover, the trial court

concluded there was no evidence of any out-of-pocket loss, which would

establish special damages. See id.

      This timely appeal followed. The trial court did not direct KGL to file a

Pa.R.A.P. 1925(b) statement, and consequently, no such statement was filed.

The trial court filed a brief Pa.R.A.P. 1925(a) statement relying on its

previously filed opinion.

      On appeal, KGL presents the following issues in its “Statement of the

Questions Involved” (verbatim):

      1. The U.S. Supreme Court held in Milkovich v. Lorain Journal
         Co., 497 U.S. 1, 21 (1990), that “imaginative expression” or
         “loose, figurative, or hyperbolic language” are non-actionable
         opinion. Defendant “Scott Wilson” sent two letters (the “Wilson
         Letters”) to the U.S. government, charging KGL with violating
         U.S. law and stating that KGL engaged in “a serious
         misrepresentation and violation of U.S. law,” “violation of the
         Comprehensive       Iran,   Sanctions,   Accountability,    and
         Divestment Act of 2010,” “violation of the Iran Sanctions Act,”
         and “a clear violation of U.S. law.” Were Wilson’s statements

                                      -7-
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        that KGL engaged in illegal conduct actionable statements of
        fact or actionable, “mixed” opinion (as opposed to non-
        actionable opinion)?
     2. In defamation cases, damages may take the form of
        reputational harm (“general damages”) or special damages
        (monetary loss). Reputational harm means “impairment of
        reputation and standing in the community” or a “showing that
        anyone thought the less of” the person. The Wilson Letters
        caused the U.S. government to investigate KGL for violations
        of U.S. law. KGL lost credibility and spent money to mitigate
        the damage. Was KGL’s evidence of damages sufficient to raise
        a genuine issue of material fact?
     3. In defamation cases requiring a showing of “actual malice,” the
        plaintiff must show that the defendant made a defamatory
        statement “with knowledge that it was false or with reckless
        disregard of whether it was false or not.” When Wilson sent
        his Wilson Letters, he knew from contemporaneous documents
        that his charges of KGL violations of U.S. law were in serious
        doubt. He sent them anyway-all in the interest of, and within
        the scope of his employment for, KGL’s government
        contracting competitor, Agility. Was KGL’s evidence of malice
        sufficient to raise a genuine issue of material fact?
     4. Under U.S. and Pennsylvania Supreme Court precedents, a
        defamation plaintiff is entitled to wide latitude in discovering
        evidence of “actual malice,” including discovery into the “state
        of mind” of the defamation defendant. In a series of orders,
        the trial court ruled that KGL could not unmask Wilson, take
        discovery of his state of mind, source material and due
        diligence, or inquire into defendants’ collaboration with Wilson
        to defame KGL.       Were the trial court’s discovery orders
        erroneous, and did they interfere with KGL’s ability to obtain
        additional evidence of malice?
     5. A defamation plaintiff must demonstrate “actual malice” if he
        is a limited-purpose public figure-someone who has voluntarily
        “thrust” himself into a public controversy. KGL is a government
        contractor that defendants dragged into a controversy when
        they sent the Wilson Letters to the U.S. government charging
        KGL with violating U.S. law. Was KGL a private figure (as
        opposed to limited-purpose public figure) such that it need only
        demonstrate negligence (as opposed to “actual malice”).
     6. Under U.S. Supreme Court precedent, a defamation
        defendant’s burden to prove truth shifts to the plaintiff to prove

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          falsity where (1) the plaintiff is a public figure, or (2) the
          defamatory statement involves a matter of public concern and
          the defendant is a member of the news media. Were elements
          (1) or (2) satisfied such that KGL must prove falsity, and must
          KGL do so by clear and convincing evidence (as opposed to
          preponderance of the evidence)?
       7. A party may seek leave of court to amend a pleading at any
          time; provided that, the amendments do not violate the law,
          or surprise or prejudice the other party. Six months before
          trial, while discovery remained open, KGL sought leave to
          amend its complaint to assert new defamation claims against
          the Agility Defendants that were timely under Pennsylvania’s
          discovery rule. Should KGL have been granted leave to
          amend?

KGL’s Brief at 6-9 (trial court answers omitted).2

       Initially, we note the principles we apply in reviewing a summary

judgment order are well-settled.

              Our scope of review of an order granting summary judgment
       is plenary. [W]e apply the same standard as the trial court,
       reviewing all the evidence of record to determine whether there
       exists a genuine issue of material fact. We view the record in the
       light most favorable to the non-moving party, and all doubts as to
       the existence of a genuine issue of material fact must be resolved
       against the moving party. Only where there is no genuine issue
       as to any material fact and it is clear that the moving party is
       entitled to a judgment as a matter of law will summary judgment
       be entered.
              Motions for summary judgment necessarily and directly
       implicate the plaintiff’s proof of the elements of his cause of
       action. Thus, a record that supports summary judgment will
       either (1) show the material facts are undisputed or (2) contain
       insufficient evidence of facts to make out a prima facie cause of
       action or defense and, therefore, there is no issue to be submitted
       to the [fact-finder]. Upon appellate review, we are not bound by
       the trial court’s conclusions of law, but may reach our own
____________________________________________

2 We note KGL’s issues are interrelated, and where appropriate, we have
addressed the issues in such a manner.

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      conclusions. The appellate Court may disturb the trial court’s
      order only upon an error of law or an abuse of discretion.

Coleman v. Ogden Newspapers, Inc., 142 A.3d 898, 904 (Pa.Super. 2016)

(quotation omitted).

      The requirements of a defamation claim are codified as follows:

      (a) Burden of plaintiff.—In an action for defamation, the
      plaintiff has the burden of proving, when the issue is properly
      raised:
      (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.
      (7) Abuse of a conditionally privileged occasion.
      (b) Burden of defendant.—In an action for defamation, the
      defendant has the burden of proving, when the issue is properly
      raised:
      (1) The truth of the defamatory communication.
      (2) The privileged character of the occasion on which it was
      published.
      (3) The character of the subject matter of defamatory comment
      as of public concern.

42 Pa.C.S. § 8343 (bold in original).

      In its first issue, KGL argues the trial court erred in concluding the

statements made in the Wilson Letters indicating KGL violated CISADA are

statements of opinion, which are non-actionable, as opposed to statements of

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fact or statements of “mixed opinion,” which are actionable. See KGL’s Brief

at 21.

         “A communication may be considered defamatory if it tends to harm the

reputation of another so as to lower him or her in the estimation of the

community or to deter third persons from associating or dealing with him or

her.” Bell v. Mayview State Hosp., 853 A.2d 1058, 1062 (Pa.Super. 2004)

(citation omitted). Further, in determining whether a statement is capable of

defamatory meaning, a court must view the statement in context. See id.

“The nature of the audience is a critical factor in determining whether a

statement is capable of defamatory meaning.” Dougherty v. Boyertown

Times, 547 A.2d 778, 783 (Pa.Super. 1988) (some quotation omitted).

               When raised by a public figure concerning statements
         bearing on a matter of public concern,[3] claims for defamation are
____________________________________________

3 As indicated supra, this Court previously held the statements at issue bear
on a matter of public concern. See Kuwait & Gulf Link Transport Co.,
supra. Additionally, we now conclude that KGL is a “limited-purpose public
figure,” and thus, we find meritless KGL’s Issue Five supra. As our Supreme
Court has held:
      [A] “limited-purpose public figure,”…is an individual who
      “voluntarily injects himself or is drawn into a particular public
      controversy and thereby becomes a public figure for a limited
      range of issues.” To determine such status,…it is necessary to
      consider the “nature and extent of an individual’s participation in
      the particular controversy giving rise to the defamation.”
American Future Systems, Inc. v. Better Business Bureau of Eastern
Pennsylvania, 592 Pa. 66, 923 A.2d 389, 401 (2007). A “controversy” may
be created by the individual’s own actions. See id.
      As this Court stated previously, “KGL is a government contractor
performing multimillion-dollar contracts for the United States military.”
Kuwait & Gulf Link Transport Co., 92 A.3d at 49. As such, KGL has

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       subject to an onerous standard of proof, owing to considerations
       of free speech that inhere to any claim that implicates the First
       Amendment. See Milkovich v. Lorain Journal Co., 497 U.S. 1,
       17, 110 S.Ct. 2695, 111 L.Ed.2d 1 (1990) (emphasizing the
       obligation of appellate courts to ensure that judgments entered
       pursuant to state tort law do not intrude on the “field of free
       expression”). Consequently, our Courts’ First Amendment
       jurisprudence makes clear that statements on matters of public
       concern must be provable as false before there can be liability
       under state defamation law….Moreover,…a statement of opinion
       relating to matters of public concern that does not contain a
       provably false connotation will receive full constitutional
       protection.

Krajewski v. Gusoff, 53 A.3d 793, 803 (Pa.Super. 2012) (quotation marks

and quotations omitted) (footnote added).

       In determining whether a statement is capable of defamatory meaning,

the trial court must also ascertain whether the statement constitutes an

opinion. The question of “[w]hether a particular statement constitutes a fact

or an opinion is a question of law for the trial court to determine.” Mathias v.

Carpenter, 587 A.2d 1, 3 (Pa.Super. 1991). Hence,

       In determining whether [a publication is] capable of defamatory
       meaning, a distinct standard is applied [when] the publication is
       of an opinion. Veno v. Meredith, 357 Pa.Super. 85, 515 A.2d
       571, 575 (1986), appeal denied, 532 Pa. 665, 616 A.2d 986
____________________________________________

voluntarily exposed itself to increased risk of injury from defamatory falsehood
and has effectively “assumed the risk of potentially unfair criticism by entering
into the public arena and engaging the public’s attention.” American Future
Systems Inc., supra, 923 A.2d at 402 (quotation and citations omitted).
Accordingly, we agree with the trial court that KGL is a public figure for
purposes of the instant matter, and we reject KGL’s argument to the contrary.
See KGL’s Fifth Issue supra; KGL’s Brief at 49-51.

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      (1992). “A statement in the form of an opinion is actionable only
      if it may reasonably be understood to imply the existence of
      undisclosed defamatory facts justifying the opinion. A simple
      expression of opinion based on disclosed facts is not itself
      sufficient for an action of defamation.” Id. (internal citations
      omitted); see also Neish v. Beaver Newspapers, Inc., 398
      Pa.Super. 588, 581 A.2d 619, 622–24 (1990), appeal denied, 527
      Pa. 648, 593 A.2d 421 (1991) (editorial criticizing the way
      appellant handled his job and suggesting replacing him was an
      opinion not based on undisclosed defamatory facts and, therefore,
      was not actionable. The Court found that while the statements in
      the editorial “might be viewed as annoying and embarrassing,
      they were not tantamount to defamation.”).

Kurowski v. Burroughs, 994 A.2d 611, 618 (Pa.Super. 2010) (emphasis in

original).

      This principle is in conformity with Restatement (Second) of Torts § 566,

Expression of Opinion. See Mathias, supra (applying § 566). That section

provides: “A defamatory communication may consist of a statement in the

form of an opinion, but a statement of this nature is actionable only if it implies

the allegation of undisclosed defamatory facts as the basis for the opinion.”

Restatement (Second) of Torts § 566.

      Thus, generally, only statements of fact, rather than mere expressions

of opinion, are actionable under Pennsylvania’s defamation law. Bell, supra.

In order for an opinion to be deemed capable of defamatory meaning, it must

reasonably be understood to imply the existence of undisclosed defamatory

facts justifying the opinion. Dougherty, supra.

      Here, the trial court concluded there was no genuine issue of material

fact that the factual assertions in the Wilson Letters relating to KGL’s ties with

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Iranian entities were substantially true. Further, the trial court concluded, as

a matter of law, the statements made in the Wilson Letters indicating that

these ties constituted a violation of CISADA constituted non-actionable

opinions.

      Specifically, in addressing this claim, the trial court relevantly indicated

the following:

              With respect to the first issue, we agree with [Agility] that
      the Wilson Letters touch on a matter of “public concern.” (The
      Superior Court has [stated as much in its previous decision].)
      Moreover, we agree with [Agility] that, for purposes of this
      litigation, KGL is a limited-purpose public figure. Accordingly,
      [KGL] must prove the falsity of the Wilson Letters by clear and
      convincing evidence. See Tucker v. Philadelphia Daily News,
      848 A.2d 113, 127-28 (Pa. 2004). The identity and relationship
      of the businesses mentioned in the Wilson Letters are generally
      not in dispute. Notwithstanding, the thrust of [KGL’s] case is that
      any relationship of [KGL] with Iranian entities was not such as
      would allow for the accusation that KGL was in violation of
      CISADA. We agree with [Agility], however, that this accusation
      can best be construed as an opinion.
                                   ***
             It may well be that “Scott Wilson,” as [KGL] contends, got
      it wrong when he requested an investigation based on an
      allegation of a violation of the sanction laws.                 His
      misapprehension, however, with respect to the legal import of the
      business relationships described in the letters is, we conclude, an
      opinion, and therefore, not actionable. [KGL] contends that the
      Wilson Letters do not contain matters of opinion. Instead, [KGL]
      argues that the accusations in the letters suggest the commission
      of a crime, which is actionable “per se.” At the same time,
      however, they argue that the question of whether KGL was in
      violation of CISADA is a legal question and not a factual one. To
      this extent, they belie their own contention.

Trial Court Opinion, filed 7/6/18, at 4 (footnote omitted) (footnote added).

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       We agree with the trial court in this regard. Specifically, we conclude

the statements contained in the Wilson Letters regarding KGL’s violation of

CISADA constituted subjective opinions. See Parano v. O’Connor, 641 A.2d

607 (Pa.Super. 1994).         Moreover, the facts upon which the author of the

Wilson Letters based his or her opinions (i.e., KGL’s ties to Iranian entities)

were disclosed, and therefore, the opinions did not imply undisclosed false

facts. See Dougherty, supra. As the trial court noted, while the author of

the Wilson Letters may have misunderstood the implication of KGL’s ties, the

simple expression of opinion (that KGL violated CISADA because of these ties)

is not itself sufficient for an action of defamation, “no matter how unjustified

and unreasonable the opinion may be or how derogatory it is.” Mathias, 587

A.2d at 363 (quotation omitted).

       In any event, assuming, arguendo, KGL is correct that the challenged

statements regarding KGL’s violation of CISADA constitute statements of fact

or opinions based on undisclosed, defamatory facts, we note:

             Caselaw prescribes additional elements that arise in relation
       to the character of the statement, the role of the defendant as a
       media outlet, or the role of the plaintiff as a public official or public
       figure. If the statement in question bears on a matter of public
       concern, or the defendant is a member of the media, First
       Amendment concerns compel the plaintiff to prove, as an
       additional element, that the alleged defamatory statement is in
       fact false.[4] See Philadelphia Newspapers, Inc. v. Hepps,
____________________________________________

4To the extent KGL argues that, since Agility was not a member of the media,
KGL was not required to prove the statements were false, see KGL’s Issue Six
supra and Brief at 53-56, we disagree. Under the First Amendment to the

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       475 U.S. 767, 777, 106 S.Ct. 1558, 89 L.Ed.2d 783 (1986); see
       also Milkovich v. Lorain Journal Co., 497 U.S. 1, 2, 110 S.Ct.
       2695, 111 L.Ed.2d 1 (1990); Ertel v. Patriot–News Co., 544 Pa.
       93, 674 A.2d 1038, 1041 (1996). If the plaintiff is a public official
       or public figure, she must prove also that the defendant, in
       publishing the offending statement, acted with “actual malice,” i.e.
       “with knowledge that [the statement] was false or with reckless
       disregard of whether it was false or not.” Curran v. Philadelphia
       Newspapers, Inc., 376 Pa.Super. 508, 546 A.2d 639, 642
       (1988).
             “Actual malice” is a fault standard, predicated on the need
       to protect the public discourse under the First Amendment from
       the chill that might be fostered by less vigilant limitations on
       defamation actions brought by public officials.
              [T]he stake of the people in public business and the
              conduct of public officials is so great that neither the
              defense of truth nor the standard of ordinary care
              would protect against self-censorship and thus
              adequately implement First Amendment policies.
              Neither lies nor false communications serve the ends
              of the First Amendment, and no one suggests their
              desirability or further proliferation. But to insure the
              ascertainment and publication of the truth about
              public affairs, it is essential that the First Amendment
              protect some erroneous publications as well as true
              ones.
       Curran, 546 A.2d at 643. Thus, the actual malice standard, by
       design, assures “that public debate will not suffer for lack of
       ‘imaginative expression’ or ‘rhetorical hyperbole’ which has
       traditionally added much to the discourse of this Nation.”
       Milkovich, 497 U.S. at 2, 110 S.Ct. 2695.          “[T]he First
       Amendment requires that we protect some falsehood in order to
       protect speech that matters.”
           Thus, the “actual malice” standard is a constitutionally
       mandated safeguard and, as such, must be proven by clear and
____________________________________________

United States Constitution, a plaintiff asserting defamation concerning a
publication of a matter of “public concern” bears the burden of proving that
the publication was false. Philadelphia Newspapers, Inc. v. Hepps, 475
U.S. 767, 776, 106 S.Ct. 1558, 89 L.Ed.2d 783 (1986). This Court has
previously held the statements at issue bear on a matter of public concern.

                                          - 16 -
J-A16037-19

     convincing evidence, the highest standard of proof for civil claims.
     Moreover, evidence adduced is not adjudged by an objective
     standard; rather, “actual malice” must be proven applying a
     subjective standard by evidence “that the defendant in fact
     entertained serious doubts as to the truth of his publication.” See
     Curran, 546 A.2d at 642. This determination may not be left in
     the realm of the factfinder:
           The question whether the evidence in the record in a
           defamation case is of the convincing clarity required
           to strip the utterance of First Amendment protection
           is not merely a question for the trier of fact. Judges,
           as expositors of the Constitution, must independently
           decide whether the evidence in the record is sufficient
           to cross the constitutional threshold that bars the
           entry of any judgment that is not supported by clear
           and convincing proof of “actual malice”.
     Curran, 546 A.2d at 644. We have recognized accordingly that
     the question of “actual malice” is not purely one of fact, but rather
     may be described as one of “ultimate fact,” a “hybrid of evidential
     fact on the one hand and conclusion of law on the other.” Id.
            Application of these concepts is more difficult than its
     recitation. See Curran, 546 A.2d at 644. “[E]rroneous statement
     is inevitable in free debate, and…must be protected if the
     freedoms of expression are to have the ‘breathing space’ that they
     need to survive.” Id. at 645. To minimize judicial intrusion into
     this “breathing space,” our courts have tended to measure
     actionable conduct by what the defendant did, as opposed to what
     it refrained from doing or might have done but omitted to do.
     Curran, 546 A.2d at 648. Thus, while “actual malice” may be
     shown by circumstantial evidence of events surrounding the
     publication of the offending statement, that evidence must tend
     to establish fabrication, or at least that the publisher had “obvious
     reasons to doubt the veracity of the informant or the veracity of
     his reports.” Because “actual malice” is a fault standard, it is not
     shown by the falsity of the statement in and of itself. See Curran,
     546 A.2d at 642. Similarly, evidence of ill will or a defendant’s
     desire to harm the plaintiff’s reputation, although probative of the
     defendant’s state of mind, without more, does not establish
     “actual malice.” Harte–Hanks Communications, Inc. v.
     Connaughton, 491 U.S. 657, 109 S.Ct. 2678, 105 L.Ed.2d 562
     (1989) (“The phrase ‘actual malice’ is confusing in that it has
     nothing to do with bad motive or ill will.”).

                                    - 17 -
J-A16037-19

Lewis v. Philadelphia Newspapers, Inc., 833 A.2d 185, 191-93 (Pa.Super.

2003) (quotations and citations omitted) (emphasis in original) (footnote

added).

        In the case sub judice, as indicated supra, this Court previously held the

statements contained in the Wilson Letters bear on a matter of public concern,

thus contrary to KGL’s assertion,5 it had the burden to adduce clear and

convincing evidence to allow a jury to find the Wilson Letters were, in fact,

false. See ToDay’s Housing v. Times Shamrock Communications, Inc.,

21 A.3d 1209 (Pa.Super. 2011); Lewis, supra. Moreover, as indicated supra,

since KGL is a limited-purpose public figure, contrary to KGL’s argument, it

had the burden to set forth a prima facie case that Agility published the Wilson

Letters with “actual malice,” i.e., with knowledge that the Wilson Letters were

false or with reckless disregard of whether the Wilson Letters were false.

ToDay’s Housing, supra; Lewis, supra.

        In addressing this issue, the trial court suggested that, to the extent the

Wilson Letters contained false statements, KGL failed to set forth a prima facie

case to establish the presence of “actual malice.” Relevantly, the trial court

noted:

               The various business entities referred to in the Wilson
        Letters do in fact exist and have had or continue to have business
        relationships. A contention that their relationship violated the law
        is based, in no small part, on altered emails. [KGL] admits,
____________________________________________

5   See KGL’s Issue 6 supra and Brief at 56.

                                          - 18 -
J-A16037-19

        however, that the emails emanated from former disgruntled
        employees of KGL. In other words, there is no allegation that
        [Agility] forged or altered the emails[, upon which the author of
        the Wilson Letters relied.]
                                           ***
              “[T]he requirement that the plaintiff be able to show actual
        malice by clear and convincing evidence is initially a matter of
        law.” Joseph v. Scranton Times L.P., 129 A.3d 404, 436 (Pa.
        2015) (citations omitted). In this case, there is simply no
        evidence of malice[.]

Trial Court Opinion, filed 7/6/18, at 6 n.2.

        Upon review of the record, contrary to KGL’s argument,6 we agree with

the trial court that evidence of “actual malice” is substantially lacking. In so

holding, we acknowledge that KGL argues the falsity of the Wilson Letters;

however, the demonstrable falsity of a statement does not establish Agility’s

fault, i.e., “actual malice,” in writing and disseminating the Wilson Letters.

See Lewis, supra.

        Furthermore, KGL argues that the author of the Wilson Letters relied on

a privileged memo, which suggested the veracity of the underlying emails

should be authenticated. KGL argues the author’s failure to investigate the

underlying emails more fully, as well as his or her failure to recite larger

portions of the privileged memo in the Wilson Letters, demonstrates “actual

malice.”

____________________________________________

6   See KGL’s Issue Three supra and Brief at 34-38.

                                          - 19 -
J-A16037-19

        Initially, we note the undisputed evidence shows that representatives of

Agility met with the source of the emails to “satisfy themselves” as to the

“veracity of the emails.”         Videotaped Deposition of Adlai Shalabi, dated

3/16/18, at 517-20.        In any event, the fact that the author of the Wilson

Letters failed to investigate the emails more fully and/or failed to recite larger

portions of the privileged memo does not, in our view, establish that he or she

acted with any level of fault in writing his or her concerns about KGL’s

activities. Rather, this evidence is consistent with simple negligence regarding

a matter of public concern, which remains subject to First Amendment

protection. See Lewis, supra.             Even if a higher degree of responsibility

would have counseled greater care in investigating the emails, “actual malice”

is not established. See Harte–Hanks Communications, Inc., supra.

Consequently, KGL’s evidence is insufficient as a matter of law to demonstrate

“actual malice” and therefore raises no impediment to summary judgment.

Lewis, supra.

        Apparently recognizing the lack of evidence regarding “actual malice,”

KGL also suggests the trial court erred in prohibiting discovery of evidence

that may have established “actual malice.”7 Specifically, KGL argues the trial

court erred in its analysis of the third and fourth prongs of the Pilchesky test

____________________________________________

7   See KGL’s Issue Four supra and Brief at 38-48.

                                          - 20 -
J-A16037-19

and, thus, in denying the motion to compel the discovery of the identity of

“Scott Wilson.”

       As this Court previously recognized in this case:8

              Pilchesky specifically addressed the issue of under what
       circumstances a trial court can compel the disclosure of the
       identity of individuals speaking anonymously or pseudonymously
       in a defamation case. Pilchesky, 12 A.3d at 442.
             In Pilchesky, John Does made allegedly defamatory
       statements about the President of Scranton City Council by
       posting messages on a website under a unique user name or
       pseudonym. Id. at 432–33. The plaintiff petitioned the trial court
       to compel the disclosure of the identity of the John Doe defendants
       and that court granted the petition. Id. at 433–34.
              On appeal, this Court held that the trial court must address
       the following four factors before ordering the disclosure of the
       identity of an anonymous or pseudonymous speaker: first, “[t]he
       reviewing court must ensure that the John Doe defendant receives
       proper notification of a petition to disclose his identity and a
       reasonable opportunity to contest the petition”; second, the party
       seeking disclosure “must present sufficient evidence to establish
       a prima facie case for all elements of a defamation claim, within
       the plaintiff's control, such as would survive a motion for summary
       judgment”; third, “[a] petitioner must submit an affidavit
       asserting that the requested information is sought in good faith,
       is unavailable by other means, is directly related to the claim and
       is fundamentally necessary to secure relief”; and fourth, “[t]he
       court must expressly balance the defendant’s First Amendment
       rights against the strength of the plaintiff’s prima facie case.” Id.
       at 442–45. This Court stated that the four requirements “are
       necessary to ensure the proper balance between a speaker’s right
       to remain anonymous and a defamation plaintiff’s right to seek
       redress.” Id. at 442.

____________________________________________

8 We specifically previously held “the Wilson Letters are anonymous political
speech under the First Amendment subject to Pilchesky’s four-part test for
disclosure of anonymous or pseudonymous speakers.” Kuwait & Gulf Link
Transport Co., 92 A.3d at 50.

                                          - 21 -
J-A16037-19

Kuwait & Gulf Link Transport Co., 92 A.3d at 49 (emphasis omitted).

      In concluding KGL failed to meet the third and fourth prongs of the

Pilchesky test, the trial court relevantly stated the following:

            We next consider the requirement that plaintiff submit an
      affidavit of good faith and necessity. As discussed above, the
      Pilchesky court elaborated that the plaintiff must state that the
      information is “sought in good faith, is unavailable by other
      means, is directly related to the claim and is fundamentally
      necessary to secure relief.” Pilchesky, 12 A.3d at 444-45
      (emphasis added).
             KGL asserts that is submitted an affidavit of good cause as
      required by Pilchesky. KGL argues that it has exhausted all other
      means to obtain the identity of Scott Wilson, and that his identity
      is necessary in order to prove fault[.] Agility counters that while
      KGL has satisfied the technical requirements of submitting an
      affidavit, the information is, in fact, not sought in good faith, is
      available through other means, does not relate to the claim, and
      is not fundamentally necessary to secure relief.
              We agree with KGL that it has satisfied the technical
      requirements of Pilchesky by submitting an affidavit alleging
      good faith, has made substantial efforts to uncover the identity of
      Scott Wilson without success, and that the information sought
      relates to the claim. However, the affidavit notwithstanding, we
      do not agree that the information sought is fundamentally
      necessary to secure relief. In the present case, Agility admits that
      it is responsible for Scott Wilson’s statements under the theory of
      respondeat superior. Moreover, Agility has offered to produce a
      corporate designee pursuant to…Pa.R.C.P. 4007.1(e) (stating that
      a corporation may respond to a subpoena by appointing a
      representative, who “shall testify as to matters known or
      reasonably available to the organization”). KGL’s concerns that a
      corporate designee will “likely involve Pilchesky in an overly-
      broad fashion” to protect Wilson’s identity are purely speculative
      and can be addressed by this court if such an issue arises.
      Consequently, KGL may seek recovery against Agility without
      knowing the identity of Wilson, and as a result, KGL has not
      satisfied the third prong of Pilchesky.
           Finally, we must balance Scott Wilson’s right under the First
      Amendment against the strength of KGL’s prima facie case. The
      Pilchesky court instructed that “the reviewing court should

                                     - 22 -
J-A16037-19

     examine the defamatory nature of the comments, the quantity
     and quality of evidence presented, and whether the comments
     were privileged.” Pilchesky, 12 A.3d at 445. The court also
     should consider the forum where the comments arose. Id.
     Comments on “matters of public importance of those which
     criticize public officials” are entitled to higher protection.
            KGL argues that the equities weigh strongly in favor of
     disclosing Wilson’s identity. Specifically, KGL contends that it has
     established a strong prima facie case, defendants have already
     partially revealed Wilson’s identity by admitting that he was acting
     within the scope of his employment, Wilson’s malicious intent
     undermines his right to anonymity, Wilson’s speech was
     commercially motivated, he was not a legitimate whistleblower,
     and Wilson as a foreign speaker is not entitled to First Amendment
     protection. Despite these various arguments, we agree with
     [Agility] that the case put forward by [KGL] does not outweigh
     Wilson’s First Amendment rights.
            The question of Wilson’s First Amendment rights has been
     laid to rest by the Superior Court. We have been instructed, in no
     uncertain terms, that “given the political nature of the Wilson
     Letters, they are entitled to the highest level of protection…under
     the First Amendment.” We agree with [Agility] that the attempts
     of [KGL] to downplay Wilson’s strong First Amendment rights
     amount to nothing more than an attempt to re-litigate issues
     which were foreclosed by the Superior Court’s [previous] decision.
     These include [KGL’s] assertions that Wilson was speaking in a
     commercial forum, that he has no standing to raise free speech
     rights, and that the United States Constitution may not apply
     because Wilson may not be a United States citizen.
             Of controlling importance is that the strength of [KGL’s]
     evidence simply does not outweigh the necessity for First
     Amendment protections in this case….Without prejudging the
     issue, we readily understand [Agility’s] arguments that a
     defamatory effect can be derived from the Wilson Letters only by
     misconstruing them. We also agree with [Agility] that there is
     little evidence of harm in this case. Notwithstanding allegations
     of adverse media coverage and inquiries from government
     officials, there is no direct evidence that [KGL’s] reputation has
     been damaged in the eye of a specific third party or that KGL
     suffered a loss of its business. Allegations with respect to
     expenditures for attorneys and lobbyists are, at best, imprecise.
     We note, also, Pennsylvania law which provides a defamation
     plaintiff must prove actual impairment of reputation in the

                                    - 23 -
J-A16037-19

       community and that it is not enough that the plaintiff be merely
       embarrassed or annoyed.
             In sum, we believe the quantity and quality of the evidence
       of defamation presented in this case does not outweigh the right
       of pseudonymous speech in this case. Consequently, the motion
       to apply Pilchesky and compel disclosure of John Does’
       [(Wilson’s)] identity will be denied.

Trial Court Opinion, filed 12/9/15, at 3-5 (footnotes, citations, and emphasis

omitted).

       Contrary to KGL’s assertion, we conclude the trial court did not err in its

application of Pilchesky to the instant matter. We specifically reject KGL’s

claim that Pilchesky did not apply in any manner to the instant matter

because the First Amendment anonymity rights were not implicated in this

case. See KGL’s Brief at 40. As indicated supra, this Court previously held

the Pilchesky test was relevant to the within matter and, in fact, we

specifically directed the trial court to undertake an analysis thereunder in

order to determine whether Agility should be compelled to disclose Scott

Wilson’s identity.9

____________________________________________

9 KGL also lists a litany of discovery orders and suggest that, if the trial court
had granted the discovery orders, KGL “may have” been able to discover the
motivation of the person(s) who sent the emails upon which “Scott Wilson”
relied, as well as what additional steps Agility could have taken to authenticate
the veracity of the emails. KGL’s speculative argument aside, we note that
evidence of ill will or the email sender’s desire to harm KGL, without more,
would not establish “actual malice” with regard to “Scott Wilson’s” reliance
upon the emails. See Harte–Hanks Communications, Inc., supra (holding
“actual malice” has nothing to do with bad motive or ill will). Moreover, as
indicated supra, “actual malice” is generally an inquiry into “what the

                                          - 24 -
J-A16037-19

       Finally, we note KGL argues the trial court erred in denying KGL’s

February 9, 2018, motion to file an amended complaint asserting two new

defamation claims related to the following: Agility (as opposed to “Scott

Wilson”) sent the privileged memo underpinning the Wilson Letters to

congressional leaders, and Agility (as opposed to “Scott Wilson”) sent a 2011

email to various people indicating KGL violated CISADA.          See KGL’s Issue

Seven supra; KGL’s Brief at 56-58.

       The right to amend should be liberally granted, absent an error of law

or resulting prejudice to an adverse party. Connor v. Allegheny General

Hospital, 501 Pa. 306, 461 A.2d 600, 602 (1983); Pa.R.C.P. 1033.

       However, the right to amend is not absolute. Where the initial
       pleading reveals that the complaint’s defects are so substantial
       that amendment is not likely to cure them, and that the prima
       facie elements of the claim or claims asserted will not be
       established, the right to amend is properly withheld. See Spain
       v. Vicente, 315 Pa.Super. 135, 461 A.2d 833, 837 (1983); also
       see Behrend v. Yellow Cab Co., 441 Pa. 105, 271 A.2d 241,
       243 (1970). Furthermore, the decision to grant or deny leave to
       amend is within the sound discretion of the trial court, and will not
       be reversed absent a clear abuse of discretion. Junk v. East End
       Fire Dept., 262 Pa.Super. 473, 396 A.2d 1269, 1277 (1978) [(en
       banc)].

Feingold v. Hill, 521 A.2d 33, 39 (Pa.Super. 1987).

       KGL’s new claims were predicated on statements substantially similar to

those found in the Wilson Letters.             Thus, permitting KGL to amend its

____________________________________________

defendant did, as opposed to what it refrained from doing or might have done
but omitted to do.” Curran, 546 A.2d at 648.

                                          - 25 -
J-A16037-19

complaint to add these new defamation claims would have been futile.

Accordingly, we conclude the trial court did not abuse its discretion in denying

KGL permission to amend its complaint.10

       For all of the foregoing reasons, we affirm.

       Affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 8/1/2019

____________________________________________

10 In light of our discussion supra, we need not additionally address KGL’s
Issue Two supra related to damages. However, suffice it to say that we find
no error in the trial court’s analysis thereof. See Trial Court Opinion, filed
7/6/18, at 6-8.

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