Opinion
00-CV-0668E(Sc)
December 4, 2002
MEMORANDUM ORDER
This decision may be cited in whole or in any part.
Plaintiff Daniels commenced this action against defendant Provident asserting four causes of action for defamation arising from several communications published by Provident. Defendant filed a motion to dismiss plaintiff's Complaint pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure ("FRCvP"). Such motion is presently before this Court for disposition.
Familiarity with the facts of this case is presumed. In June 2000 plaintiff commenced an action against defendant in the New York State Supreme Court, Erie County, asserting seven causes of action. Defendant removed that case to this Court August 2, 2000 and filed a motion to dismiss plaintiff's complaint pursuant to FRCvP 12(b)(6) on September 7, 2000. Plaintiff filed a cross-motion October 13, 2000 seeking, inter alia, leave to file an Amended Complaint. By a July 25, 2001 Memorandum and Order, this Court granted defendant's motion with respect to all but two of plaintiff's claims. See Daniels at *9. Defendant's motion to dismiss plaintiff's defamation claims was denied and plaintiff's motion to Amend his Complaint with respect to such claims was granted. Plaintiff filed an Amended Complaint October 22, 2001 asserting four causes of action for defamation. Defendant filed a motion to dismiss the Amended Complaint pursuant to FRCvP 12(b)(6) on November 14, 2001.
A more detailed recitation of the facts and procedural history in this case is set out in this Court's July 25, 2001 Memorandum and Order. See Daniels v. Provident Life and Cas. Ins. Co., 2001 WL 877329 (W.D.N.Y. 2001).
When ruling on a FRCvP 12(b)(6) motion, this Court must "accept the material facts alleged in the complaint as true and construe all reasonable inferences in the plaintiff's favor." Hernandez v. Coughlin, 18 F.3d 133, 136 (2d Cir.), cert. denied, 513 U.S. 836 (1994). In addition, this Court cannot dismiss the complaint unless "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Id. (citations and quotation marks omitted). Accordingly, this Court must not assess whether plaintiff's claims will ultimately prevail; rather, this Court should merely "assess the legal feasibility" of plaintiff's complaint. Cooper v. Parsky, 140 F.3d 433, 440 (2d Cir. 1998).
Plaintiff bases his first cause of action for defamation on a February 4, 1999 letter which was sent from Provident's counsel, R. Anthony Rupp III, Esq., to Thomas Franz of the New York State Department of Education's Office of Professional Discipline ("OPD"). Rupp's letter to Franz reads as follows:
"This office represents Provident Life and Casualty Insurance Company (`Provident') in connection with an action commenced by Errol S. Daniels, O.D. seeking the proceeds of a disability policy. For over 12 years, beginning in March 1986, Dr. Daniels received monthly disability benefits from Provident, based on his claim that he was totally disabled and unable to perform the `duties of an optometrist.'
"Notwithstanding that he was collecting total disability benefits from Provident during this entire period, Dr. Daniels continued to treat patients on a full-time basis at the Council Eye Care location at the Transitown Plaza in Williamsville, New York. Despite his claimed total disability and his professed inability to perform the duties of an optometrist, Dr. Daniels has maintained his license to practice and has periodically re-registered with the Division of Professional Licensing Services. Dr. Daniels has never notified the Division of his alleged disability and his purported inability to practice optometry.
"Most recently, Dr. Daniels has applied for further benefits under the Provident disability policy, claiming that he has suffered the `entire and irrevocable' loss of the use of both of his hands. Despite this claim, Dr. Daniels continues to treat patients on a full-time basis, and he has not yet notified the Division of his alleged disability or his inability to practice optometry.
"With this letter, we ask that the Office of Professional Discipline commence an investigation of Dr. Daniels and his optometry practice. If Dr. Daniels is truly disabled and unable to perform the duties of an optometrist as he has claimed to Provident, then we are concerned about the level of care his patients are receiving, and whether Dr. Daniels should continue to be licensed to practice optometry in the State of New York. If Dr. Daniels is not truly disabled and is in fact able to continue the practice of optometry, then we are concerned about the contrary statements he has made to Provident over the last 12 years.
"We are prepared to assist the Office in its inquiry by providing access to the investigation materials in our file. These materials consist of dozens of claim forms submitted to Provident by Dr. Daniels stating that he is unable to perform `the duties of an optometrist'; a surveillance tape depicting Dr. Daniels continuing to treat patients; the sworn testimony of Dr. Daniels, wherein he admits that he is continuing to practice but states that he is `not employable as an optometrist'; and a variety of other documents, sworn statements, and pieces of evidence that we believe would be of assistance to your Office." Am. Compl., Ex. A ("February 4 letter").
Plaintiff asserts that such letter was defamatory because it contained allegations that Daniels either fraudulently made claims for disability benefits or, in the alternative, that Daniels was endangering patients. Am. Compl. ¶¶ 8-9.
Plaintiff's second cause of action is based on an April 21, 1999 letter from Bruce Jones, a Senior Investigator for Provident, to Ed Silvestrini, an investigator with the New York State Frauds Bureau of the Attorney General's Office. Jones' letter to Silvestrini reads as follows, in pertinent part:
"I had conducted a cursory review of this file prior to filing the New York State referral form mailed to New York. I am currently in the process of a more in-depth evaluation of this file and will be putting together an SIU case file and package. When this is complete I will arrange a time when I can meet with you and make a presentation of this case including issues we feel justify a criminal prosecution of Dr. Daniels." Am. Compl., Ex. B ("April 21 letter").
Plaintiff alleges that such communication was defamatory to him because defendant intended that such letter would subject plaintiff to "baseless prosecution, ridicule and humiliation." Am. Compl. ¶ 13.
Plaintiff's third cause of action for defamation alleges that defendant "uttered false defamatory written materials" during a May 12, 1999 meeting among Jones, Silvestrini and Peggy Judge, a Senior Investigator for OPD. Such written materials included an Investigative Summary and Case Profile conducted by defendant and contained the following relevant provisions:
"In summary, it appears as if Errol Daniels, although suffering to a certain degree with a neurogenic affection of the hands, was working at his profession as an optometrist full time, at the same time he was reporting to Provident that he was unable to perform the duties of an optometrist and was therefore collecting total disability benefits.
"This `fraud' analysis and review affirms suspected false statements by Errol Daniels with the intent to receive insurance benefits from Provident Life and Casualty Insurance Company. Therefore, this matter will be referred to appropriate criminal investigation and prosecution authorities for consideration of warranted legal action. In addition, this case will continue to be pursued by our legal counsel for civil action against Dr. Daniels." Am. Compl., Ex. D ("Investigative Summary").
Plaintiff asserts that such communication was "intended, not for any legitimate purposes, but rather to embarrass, harass, annoy and injure plaintiff in his profession." Am. Compl. ¶ 17.
Plaintiff's fourth and final cause of action for defamation is based on a July 6, 1999 letter from Jones to Judge. The complete text of the letter is as follows:
Attached to such letter was a document entitled "Response to Notice to Admit," which contained Daniels' sworn admissions or denials to three questions posed by defendant. Am. Compl., Ex. E.
"As we discussed in our recent telephone conversation, please find attached a copy of Dr. Daniels' Response to Notice to Admit. This is in response to the original Notice along with the surveillance videotape of Dr. Daniels performing employment-related activities at the Council Eye Care establishment that he owns and operates. As you can see from his responses, Dr. Daniels has acknowledged that it is him depicted in the videotape, performing aspects of Council Eye Care's `standard eye Examination.'
"Please let me know if you need anything else." Am Compl., Ex. E ("July 6 letter").
Plaintiff alleges that this letter is defamatory to plaintiff because it falsely alleges that Daniels made fraudulent statements concerning his ability to perform his professional duties. Am. Compl. ¶ 20.
Defendant argues in support of its motion to dismiss plaintiff's complaint that none of the statements upon which plaintiff bases his claims is defamatory and that the alleged defamatory statements constitute non-actionable opinion. "Under New York law, a plaintiff must establish five elements to recover in libel: (1) a written defamatory statement of fact concerning the plaintiff, (2) publication to a third party, (3) fault (either negligence or actual malice depending on the status of the libeled party), (4) falsity of the defamatory statement, and (5) special damages or per se actionability (defamatory on its face)." Celle v. Filipino Reporter Enterprises Inc., 209 F.3d 163, 176 (2d Cir. 2000).
This Court must initially determine whether the defendant's statements, included in plaintiff's complaint, "are reasonably susceptible of a defamatory connotation." Armstrong v. Simon Schuster, Inc., 85 N.Y.2d 373, 380 (1985); see also Celle, at 177 (holding that the issue of whether particular words are defamatory is a legal question to be initially resolved by the Court). The New York Court of Appeals has developed guidelines for determining whether a statement or publication is defamatory. First, this Court "`must give the disputed language a fair reading in the context of the publication as a whole.'" Celle, at 177 (quoting Armstrong at 380). The language at issue must not be "read in isolation but must be perused as the average reader would against the `whole apparent scope and intent' of the writing." Ibid. (quoting November v. Time Inc., 13 N.Y.2d 175, 178-179 (1963)). Second, this Court must read the challenged statements fairly by not toiling to interpret such language in its "mildest and most inoffensive sense" as to find it nonlibelous. Ibid. Lastly, "`the words are to be construed not with the close precision expected from lawyers and judges but as they would be read and understood by the public to which they are addressed.' It is the meaning reasonably attributable to the intended reader that controls." Celle, at 177-178.
A defamatory statement is one that injures an individual's reputation and that "exposes an individual `to public hatred, shame, obloquy, contumely, odium, contempt, ridicule, aversion, ostracism, degradation, or disgrace, or *** induce[s] an evil opinion of one in the minds of right-thinking persons, and *** deprives one of *** confidence and friendly intercourse in society.'" Celle at 177 (quoting Kimmerle v. New York Evening Journal, 262 N.Y. 99, 102 (1933)).
The February 4, 1999 letter from Rupp to Franz, the April 21, 1999 letter from Jones to Silvestrini and the May 12, 1999 Investigative Summary are all reasonably susceptible of a defamatory interpretation. The letters contain allegations of fraud and professional misconduct. Such allegations would tend to injure plaintiff's reputation and, if proven false, could be found by a jury to be defamatory. The July 6, 1999 letter however is not susceptible to such an interpretation. It is simply a cover letter that explains the contents of the attached document. Nothing within such letter is reasonably capable of a defamatory reading. Plaintiff's fourth cause of action will therefore be dismissed.
This Court must also determine whether, as a matter of law, the challenged statements are opinion. See Celle, at 178. If such statements are construed as expressions of "pure opinion," then they are not actionable. Ibid. ("Unlike the Federal Constitution, the New York Constitution provides for absolute protection of opinions."); see also Steinhilber v. Alphonse, 68 N.Y.2d 283, 289 (1986) ("An expression of pure opinion is not actionable."). "A `pure opinion' is a statement of opinion which is accompanied by a recitation of the facts upon which it is based. An opinion not accompanied by such a factual recitation may, nevertheless, be `pure opinion' if it does not imply that it is based upon undisclosed facts." Steinhilber, at 289. The "essential task is to decide whether the words complained of, considered in the context of the entire communication and of the circumstances in which they were *** written, may be reasonably understood as implying the assertion of undisclosed facts justifying the opinion." Steinhilber, at 290. "If the statement reasonably would be understood as implying undisclosed facts then it is not protected opinion under New York's constitution." Celle, at 178.
"The New York Court of Appeals has suggested a four factor test for differentiating statements of protected opinion from those asserting or implying actionable facts. These are:
"(1) `an assessment of whether the specific language in issue has a precise meaning which is readily understood or whether it is indefinite and ambiguous;
"(2) `a determination of whether the statement is capable of being objectively characterized as true or false;
"(3) `an examination of the full context of the communication in which the statement appears;
"(4) `a consideration of the broader social context or setting surrounding the communication including the existence of any applicable customs or conventions which might signal to readers or listeners that what is being read or heard is likely to be opinion, not fact.'" Ibid. (quoting Steinhilber, at 292).
With the foregoing principles of New York law in mind and for the reasons set forth hereinbelow, this Court finds that defendant's statements, which form the basis of plaintiff's first and third causes of action, are not pure opinion but that defendant's statements relied on for plaintiff's second cause of action are non-actionable opinion.
The February 4, 1999 letter essentially implies that Daniels has either fraudulently misrepresented that he was disabled and unable to work or that his patients were receiving substandard care. To support that assertion, Rupp cites, as fact, that Daniels had received disability payments, purportedly due to a "total disability," while he simultaneously practiced as an optometrist. The May 12, 1999 Investigative Summary, which includes a cover letter from Jones to Silvestrini, describes the facts and circumstances surrounding Provident's investigation of Daniels' suspected fraudulent insurance claims. The Investigative Summary contained detailed accounts of Daniels' activities and concluded with the following passage: "This `fraud' analysis and review affirms suspected false statements by Errol Daniels with the intent to receive insurance benefits from Provident Life and Casualty Insurance Company." Am. Compl. ¶ 16, Ex. D. Both publications contain numerous factual assertions; explicit assertions that form the basis of Provident's allegations levied against Daniels.
The central and most relevant factual assertion being that Daniels received insurance payments from defendant pursuant to a claimed disability while simultaneously practicing as an optometrist. See A. Compl. ¶¶ 8, 16, Ex. A, D.
This Court need not linger on the issue of whether such statements and allegations constitute non-actionable opinion because defendant has admitted that the statements include factual assertions. While this Court agrees with defendant that such recitation of disclosed facts normally renders a statement of opinion non-actionable — see Steinhilber, at 289 ("A pure opinion is a statement of opinion which is accompanied by a recitation of the facts upon which it is based.") —, when a "plaintiff alleges that both the opinions and the facts are false, a motion to dismiss should not be granted, and the plaintiff may proceed against both the statements of fact and opinion." Jewell v. NYP Holdings, 23 F. Supp.2d 348, 377 (S.D.N.Y. 1998) (citing New York's Court of Appeals in Silsdorf v. Levine, 59 N.Y.2d 8 (1983)); see also Cantrill v. Harold Co., 1992 WL 119135, *14 (N.D.N.Y. 1992); H R Indus., Inc. v. Kirshner, 899 F. Supp. 995, 1010-1011 (E.D.N.Y. 1995); Coliniatis v. Dimas, 848 F. Supp. 462, 469 (S.D.N.Y. 1994). Daniels alleges that defendant's entire communications are false. Because defendant has filed a motion to dismiss for failure to state a claim, this Court must assume the truth of such allegation. Inasmuch as plaintiff has alleged that defendant's statements — which include defendant's opinions as well as the facts upon which those opinions are based — are false, this court cannot dismiss plaintiff's first and third causes of action on the ground that the statements contained therein are protected opinion.
Defendant acknowledges such in its Reply Brief. "Because each letter `disclosed the facts on which it was based' and `did not imply the existence of undisclosed facts' . . . the letters constituted non-actionable `pure opinion.' Def.'s Reply Brief, p. 6-7.
This Court notes that plaintiff does not articulate which particular statements published by Provident are false. Nowhere in plaintiff's Amended Complaint does Daniels allege that any of defendant's statements is false. The Complaint cites the letters at issue in their entirety and plaintiff alleges in a conclusory fashion that the statements are defamatory. The only explicit allegation of falsehood is found in the Affirmation of Daniels' attorney, Andrea Schillaci, Esq. Schillaci simply avers in a wholesale fashion that defendants' statements are false and defamatory. See Schillaci Dec. 6, 2001 Aff. ¶ 20. Such generality of allegations has made it difficult for this Court to determine exactly which statements communicated by defendant are alleged by plaintiff to be false and defamatory.
The April 21, 1999 letter from Jones to Silvestrini however is not actionable because it contains no statements of fact that are capable of being proven false. The only language within such letter that could possibly be considered defamatory is defendant's statement that, "[I] will arrange a time when I can meet with you and make a presentation of this case including issues we feel justify a criminal prosecution of Dr. Daniels." The author is simply informing the reader, Silvestrini, that he intends to show him that Daniels has acted in a way that, in the opinion of Jones, justifies a criminal prosecution.
There is simply no way that the challenged statement can be objectively characterized as true or false. The plaintiff cannot disprove the veracity of defendant's opinion that Daniels has acted in a way that justifies a criminal prosecution. Thus, plaintiff's second cause of action will be dismissed because he can "prove no set of facts in support of his claim which would entitle him to relief." Hernandez at 136.
Plaintiff also alleges that defendant's statements constitute defamation per se. See Pl.'s Mem. of Law in Opp'n to Def.'s Mot. to Dismiss, p. 2. In New York, statements alleging that an individual has committed a serious crime, or statements which tend to injure an individual in his or her trade, business or profession are considered to be defamatory per se. Liberman v. Gelstein, 590 N.Y.S.2d 857, 860 (1992). However, it is important to note that "the mere fact that a plaintiff is accused of a crime does not, per se, make out a defamation claim; rather, the test is whether, in the particular context, the words convey as a fact that the plaintiff undertook a criminal act." Huggins v. Moore, 689 N.Y.S.2d 21, 29 (App.Div. 1st Dep't), rev'd on other grounds, 94 N.Y.2d 296 (1999). Thus, even when a plaintiff alleges defamation per se, whether the challenged statements concern an accusation of criminality or professional incompetence, this Court must still determine whether the reasonable reader would likely understand such statement as an assertion of provable fact. Gross v. N.Y. Times Co., 82 N.Y.2d 146, 155 (1993). It has already been determined that defendant's statements, contained within plaintiff's second cause of action, are non-actionable opinion. Thus, whether or not such statements constitute defamation per se is immaterial and plaintiff's argument to that effect is insufficient to overcome this Court's threshold determination that such statements are non-actionable opinion.
In New York, if a plaintiff can show that a defendant's statements were defamatory per se the plaintiff does not have to plead or prove special damages as damages are presumed. See Celle, at 179.
Accordingly, this Court declines to address whether defendant's statements contained within plaintiff's first and third causes of action are defamatory per se because this Court has initially determined that such statements convey facts that are capable of being proven false. There is no need at this point in the proceedings to determine whether such statements constitute defamation per se.
Accordingly, it is hereby ORDERED that defendant's motion to dismiss will be granted in part and denied in part, that plaintiff's second and fourth causes of action are dismissed and that defendant's motion to dismiss plaintiff's first and third causes of action is denied.