the IND was not filed on time, plaintiff has failed to provide any evidence of damage. Rather, the evidence indicates that plaintiff's relationship with RCT has not been threatened in any manner, especially because RCT granted plaintiff another extension even after it missed the first deadline.
Plaintiff attempts to defeat defendant's motion by stating that its complaint is not limited to its relationship with RCT but with various contractors in the field with whom its prospective relationships may have been damaged as a result of defendant's actions. It further argues that it intends to introduce evidence that its reputation and ability to obtain additional work from these contractors have been damaged at trial.
These arguments are insufficient to avoid a motion for summary judgment however. First, nowhere in plaintiff's complaint is it stated that plaintiff's future relationships with outside contractors were affected by defendant's actions. The complaint clearly states that plaintiff "believes and therefore avers that Defendant's actions were taken with deliberate intent to disrupt and harm [plaintiff's] relationship with RCT" and that defendant's conduct "[has] adversely affected [plaintiff's] relationship with its licensor, RCT." Complaint, §§ 44, 45. Plaintiff cannot now expand its claim beyond its pleadings simply to avoid a motion for summary judgment. See Ige v. City of Philadelphia School District, 647 F. Supp. 641, 644 (E.D. Pa. 1986)(court will not review allegations of § 1983 claim in response to a motion for summary judgment where such claim was never plead in the complaint). Further, as previously stated, defendant presents undisputed evidence regarding the lack of damage. Plaintiff's claim that it intends to show evidence of such damage at trial does not survive a motion for summary judgment. See Fed.R.Civ.P. 56(e). As such, summary judgment on Count III of plaintiff's complaint is granted in defendant's favor.
F. Defendant's claim of libel and slander
Defendant alleges claims of libel and slander against plaintiff and Kirk Pendleton, stating that they have published and communicated to others that defendant wrongfully converted plaintiff's property to his own use, and that the IND was not filed because of defendant's professional inaptitude. Both plaintiff and Kirk Pendleton now seek summary judgment on the basis that defendant has failed to identify any specific statement allegedly made by them in order to show defamation. Second, they argue that any allegations of incompetence and that defendant committed conversion are covered by a qualified business privilege. Finally, they argue that the alleged statement regarding conversion is an opinion and therefore not defamatory.
On the contrary, defendant asserts that he has sufficiently identified the defamatory statements. He also asserts that there is no business privilege in this situation because the statements were communicated to other persons than those merely affiliated with the project. He further argues that the statements were not true and were maliciously made. Finally, he states that the statement that one is a thief is actionable per se.
A defamatory statement under Pennsylvania law is one that tends to harm another's reputation by lowering him in the eyes of the community or by deterring third persons from dealing or associating with him. U.S. Healthcare v. Blue Cross, 898 F.2d 914, 923 (3rd Cir. 1990), cert. denied, 498 U.S. 816, 111 S. Ct. 58, 112 L. Ed. 2d 33 (1990) (citations omitted). Whether or not a statement has defamatory meaning is a preliminary question for the court. Id. ; Burns v. Supermarkets Gen. Corp., 615 F. Supp. 154, 157 (E.D. Pa. 1985). If the statement is capable of defamatory meaning, then it is for the jury to decide whether the reader or listener understood it to be defamatory. U.S. Healthcare, 898 F.2d at 923; Burns, 615 F. Supp. at 157. However, the defendant can defend against allegations of defamation by proving the truth of the statement, or by asserting that the statement was privileged. Id. Whether or not the privilege applies is a question of law. Krochalis v. Insurance Co., 629 F. Supp. 1360, 1367 (E.D. Pa. 1985); Medico v. Time, Inc., 509 F. Supp. 268, 272 (E.D. Pa. 1980), cert. denied, 454 U.S. 836, 102 S. Ct. 139, 70 L. Ed. 2d 116 (1981). Once defendant raises the defense of privilege, it is for the plaintiff to show that the privilege has been abused. U.S. Healthcare, 898 F.2d at 923. Whether or not the privilege has been abused is a question of fact for the jury. Krochalis, 629 F. Supp. at 1367.
Additionally, an opinion can be defamatory if there are certain undisclosed facts justifying the opinion that are understood to be defamatory. Habe v. Fort Cherry School Dist., 786 F. Supp. 1216, 1219 (W.D. Pa. 1992). As was explained by the Third Circuit:
Although there may be no such thing as a false opinion, an opinion which is unfounded reveals its lack of merit when the opinion-holder discloses the factual basis for the idea. If the disclosed facts are true and the opinion is defamatory, a listener may choose to accept or reject it on the basis of an independent evaluation of the facts. However, if an opinion is stated in a manner that implies that it draws upon unstated facts for its basis, the listener is unable to make an evaluation of the soundness of the opinion. In such circumstances, if the underlying facts are false, the Constitution does not protect the opinion.
Burns v. Supermarkets Gen. Corp., 615 F. Supp. 154, 158 (E.D. Pa. 1985) (quoting Redco Corp. v. CBS, Inc., 758 F.2d 970, 972 (3rd Cir. 1985), cert. denied, 474 U.S. 843, 106 S. Ct. 131, 88 L. Ed. 2d 107 (1985)).
In the present case, Abe Bavley testified that at one point, Kirk Pendleton made a statement to him and Dr. Schwartz which implied that defendant had not performed on the project as he thought would be proper under the circumstances. Deposition of Abe Bavley, pp. 113-14. Defendant also testified that Kirk Pendleton told various people including certain contractors, and parties at RCT and Temple University that he was incompetent in his performance and that he took documents for his own use. Defendant's deposition, pp. 204-07. He also claims that someone from plaintiff made the same statements to a reporter from the Philadelphia Business Journal, which featured an article about this lawsuit. Id. at 204-05. There is also a letter from Kirk Pendleton to both Dr. Schwartz and Dr. Bavley stating that defendant was terminated because of failing to attend a critical meeting and for "what may amount to theft of [plaintiff's] critical documents." Both Dr. Schwartz and Dr. Bavley then submit affidavits which state the letter is the basis for their claims that Kirk Pendleton stated defendant was incompetent, and that defendant stole documents. Another affidavit submitted by Marvin Lewbart, a contractor with whom defendant dealt, also states that Kirk Pendleton informed him why plaintiff was having problems getting the IND filed and that defendant's name was used in connection with these difficulties. He further states that Kirk Pendleton told him that defendant had retained plaintiff's documents. In an affidavit from Kirk Pendleton, he admits to advising shareholders that defendant was terminated for failing to meet his deadlines. However, he denies that anyone from plaintiff ever spoke to a reporter from the Philadelphia Business Journal. Finally, in defendant's answers to interrogatories he states that Kirk Pendleton defamed him by stating in conversations to six persons that he converted plaintiff's property to his own use.
From the evidence, it is clear that we are dealing with two alleged defamatory statements, 1) that defendant was incompetent and 2) that defendant converted documents. We need not deal with the statement concerning the conversion of the documents, however, because we have found that plaintiff is entitled to summary judgment on this claim, and as such, truth is an absolute defense to such statements. See Krochalis v. Insurance Co., 629 F. Supp. 1360, 1367 (E.D. Pa. 1985). However, the issue remains as to whether plaintiff and Kirk Pendleton defamed defendant by stating to others that he was incompetent, or some statement that had the implication that he was incompetent.
We must first determine whether the statements at issue have any defamatory meaning. Given the definition of defamatory meaning, we hold that the alleged statements could be defamatory if others were told that defendant was performing incompetently when in fact he was not. If in fact defendant was actually performing well, (as Abe Bavley and Arthur Schwartz both testify) but others in the field were told that defendant was not performing well, then it is possible that defendant's reputation in this field and his chances for another job could also be damaged. See e.g. Frymire v. Painewebber, Inc., 87 Bankr. 856, 860 (Bankr. E.D. Pa. 1988) (holding that employer's statements that employee did not produce satisfactorily on the job could be construed as being defamatory).
However, plaintiff and Kirk Pendleton have raised the defense of business privilege, and it is clear that when an employer makes remarks to its employees with respect to matters of common concern relative to the operation of the business, then those remarks are covered by a qualified privilege. Krochalis v. Insurance Co., 629 F. Supp. 1360, 1367 (E.D. Pa. 1985). See also Burns, 615 F. Supp. at 158 (stating conditional privilege attached where "some interest of the person to whom the matter is published or some other third person is involved."). If, in fact, Kirk Pendleton told persons affiliated with the project why defendant was terminated, then that would be covered by this privilege.
In the present case, however, defendant alleges that Kirk Pendleton abused his privilege by excessive publication of the statement, in other words, stating the remark to others who were outside the privilege. Indeed, defendant states in his deposition that the remark was made to Gary Munsinger (an employee at RCT), Hanni Ellis, Antonio Gonzales (a representative at Temple University), as well as an attorney at Temple University. Further, Kirk Pendleton admits to making remarks to various shareholders. Whether these persons were within the privilege is a question for the factfinder. See Krochalis, 629 F. Supp. at 1367 (summary judgment denied because it was a jury question as to whether certain employees who heard the remark came within the realm of the privilege).
As such, plaintiff's motion for summary judgment on the libel and slander claim fails.
G. Fraudulent and negligent misrepresentation
Plaintiff and Kirk Pendleton seek summary judgment on defendant's claims of fraudulent and negligent misrepresentation. However, during the pendency of this motion, we granted defendant leave to amend his counterclaims in order to add a paragraph to both of these claims. The paragraph essentially alleges an additional misrepresentation by plaintiff and Kirk Pendleton. As a result, this part of plaintiff and Kirk Pendleton's motion has been rendered moot and therefore, their motion shall be denied. However, we note that this decision does not preclude them from filing an additional dispositive motion with respect to these two claims once defendant has filed the amended counterclaim, should they feel it is warranted.
In sum, there exists genuine issues of material fact as to whether there has been a breach of contract by both parties, and as such, both plaintiff's and defendant's motions are denied with respect to those claims. However, because Kirk Pendleton cannot be held personally liable for a breach of contract by the corporation, he is entitled to summary judgment on defendant's claim. There are also genuine issues with respect to the claims for negligent performance of professional services and libel and slander.
With regard to plaintiff's claim for conversion, there is no genuine issue of material fact, and summary judgment is granted in its favor. Likewise, there is no genuine issue with respect to plaintiff's claim for intentional interference with prospective business advantage, and summary judgment is entered in defendant's favor. Finally, the claims of summary judgment by plaintiff and Kirk Pendleton with regard to the negligent and fraudulent misrepresentation claims are denied as moot. An appropriate Order follows.
AND NOW, this 9th day of March, 1994, upon consideration of the cross-motions of the parties for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure, and all responses thereto, it is hereby ORDERED:
1) that defendant's motion for summary judgment is GRANTED IN PART with respect to Count III of plaintiff's complaint (intentional interference with prospective business advantage); and
2) that defendant's motion for summary judgment is DENIED IN PART with respect to all other counts of the complaint;
3) that plaintiff and Kirk Pendleton's motion for summary judgment is GRANTED IN PART with respect to Count IV (conversion) of the complaint; and
4) that Kirk Pendleton's motion for summary judgment is GRANTED IN PART with respect to Count IV of defendant's counterclaim (breach of contract);
5) that plaintiff and Kirk Pendleton's motion for summary judgment is DENIED AS MOOT with respect to Counts I and II of defendant's counterclaim (fraudulent and negligent misrepresentation); and
6) that plaintiff and Kirk Pendleton's motion for summary judgment is DENIED IN PART with respect to the other outstanding claims.
7) It is further ORDERED that Kirk Pendleton and plaintiff shall have thirty (30) days from the date that defendant files his amended counterclaim in which to file any dispositive motions pertaining to the claims of negligent and fraudulent misrepresentation.
BY THE COURT:
J. Curtis Joyner, J.