Labor & Employment Law Daily State treasury official can’t resurrect defamation, related claims after details of firing revealed
Wednesday, August 1, 2018

State treasury official can’t resurrect defamation, related claims after details of firing revealed

By Lisa Milam, J.D.

A former employee of the Arkansas state treasurer’s office failed to resuscitate the defamation, disability discrimination, or whistleblower claims he made in response to his discharge and the subsequent airing of the details underlying his termination. The agency’s chief of staff apparently had prodded a local reporter to make a Freedom of Information Act (FOIA) request for documents regarding his termination. But those documents—most notably, an email outlining concerns about the employee’s performance—were already in the reporter’s hands, and so it was not actionable defamation under Arkansas law. Rejecting the employee’s arguments that the district court erroneously granted summary judgment on several of his claims and, as for those that survived to trial, improperly instructed the jury or excluded evidence, the Eighth Circuit refused to disturb the jury verdict or the lower court’s holdings on summary judgment (Singer v. Harris, July 30, 2018, Shepherd, B.).

Poor performance. The state treasurer’s assistant for legislative affairs and communications was responsible for overseeing social media, but that task was taken away because his work was deemed insufficient. Then he was assigned to outreach duties, but his efforts there were unsatisfactory, too. The treasurer’s chief of staff sent an email to the deputy chief of staff discussing his concerns about the employee’s mental health after the death of his wife, adding that the employee was making female employees uncomfortable and, moreover, he was incompetent. The employee was terminated three weeks later.

FOIA requests. The employee asked a friend to make a FOIA request for his personnel file. Soon thereafter, media outlets followed suit, seeking the employee’s personnel documents and any correspondence relating to his firing. The defendants released the chief of staff’s email in response to these requests. Subsequently, the chief of staff spoke to a reporter for a local TV station and, seeking to combat the employee’s accusations, urged the reporter to make a verbal FOIA request for relevant documents. Upon her request, the chief of staff promptly handed her a folder containing documents about the employee’s discharge, including the email.

Lawsuit. The employee filed suit, alleging that the treasurer and his chief of staff had deprived him of a name-clearing hearing (in violation of the Fourteenth Amendment and the Arkansas Civil Rights Act); had, in their official capacities, violated the Rehab Act and ADA; in their individual capacities, defamed him, presented him in a false light, and invaded his privacy; and violated the Arkansas Whistle-Blower Act. Only his ADA and state-law claims survived summary judgment and, following a trial, a jury found in favor of the defendants on his remaining claims. After the district court denied his motion for a new trial, the employee appealed.

Tort claims. The employee argued the district court erroneously awarded summary judgment to the chief of staff on his defamation, false light, and invasion of privacy claims. But this was a misreading of the holding below, the Eighth Circuit said, rejecting as meritless his initial challenge. In fact, the lower court denied summary judgment on these claims, noting the chief of staff had acted outside the scope of his employment when he sought out a reporter in order to give her the email—conduct which, the court had found, created a genuine fact question as to whether he had acted with malice.

Rehab Act claim. The employee also argued summary judgment was improperly granted to the treasurer on his Rehab Act claim, arguing the treasurer had waived immunity because he receives and distributes federal funds. Importantly, though, the treasurer’s office does not use federal funds for its own operations; the office is merely a depository for other state agencies that utilize federal monies. Nor does the treasurer “distribute” those funds in a manner that would render him liable under the Act. The appeals court interpreted the word “distribute,” as defined by the Rehab Act, as “accepting and allocating federal funds for the department’s own use, not simply dispersing federal funds to departments that have accepted federal financial assistance.” The lower court did not err.

Jury instruction on republication. The employee asserted several objections to the jury instructions at trial. First, he argued the court committed reversible error by telling the jury that it must find the chief of staff did not “publish” the email, for defamation purposes, if the evidence shows the reporter already had the email in her possession. The legal question here was “republication” within the meaning of Arkansas law. Although the state supreme court has not decided whether a plaintiff could recover for unauthorized republication, it has teased it would likely so find, if the republication was “reasonably foreseeable.”

Also instructive is that Arkansas appears to readily adopt the Restatement of Torts on such matters, so it would likely fall in line as well on the question of republication, and the Restatement’s position favors the defendant. Also supporting the lower court’s action was a Fourth Circuit decision (which the Eighth Circuit found persuasive), in which the single publication rule was applied in a factually similar case, where multiple copies of the same letter were distributed within a single organization. All of which is to say that if the reporter had already possessed the email, then it was to be regarded as an aggregate communication, not a republication, and the jury instruction accurately stated the law.

No FOIA jury instruction. Next, the employee claimed the district court should have supplemented its instruction on invasion of privacy by public disclosure of private facts with a FOIA jury instruction. But there was no claim that the chief of staff had violated the FOIA, and the chief of staff had not been involved in the initial decision to release the documents in response to the FOIA requests. So he could not have violated the FOIA restrictions, the FOIA instruction did not inform the invasion of privacy instruction, and there was no judicial abuse of discretion here.

No cat’s paw instruction. The appeals court also rejected the employee’s claim the court erred by failing to give a jury instruction on a joint agency and “cat’s paw” theory with respect to his ADA claims. The employee argued that the chief of staff harbored unlawful animus against him and that he was actually the one behind the treasurer’s decision to fire him. But the evidence indicated the entire executive team communicated to the treasurer during executive meetings that the employee’s performance was subpar, that he was insubordinate, and that he should be terminated. And the treasurer—the ultimate decision-maker here—testified that he made the decision independently to terminate the employee based on his continued failure to produce results, and his constant blaming of other people for that failure. Also, he explicitly testified that he never perceived the employee to be disabled or mentally ill, and any such perceptions did not enter into the decision to discharge him. As such, the “cat’s paw” theory does not fit this case, and no “cat’s paw” instruction was needed.

Whistleblower testimony. Finally, the appeals court rejected his argument that the court erred by excluding evidence that the employee had engaged in whistleblowing activities. But on this point, he flubbed his case procedurally, failing to cite the record as to when he attempted to present such evidence, where the court refused to admit it, and where he made an offer of proof to preserve the challenge on appeal.

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