THOMAS A. JOSEPH, THOMAS J. JOSEPH, ACUMARK, INC., AND AIRPORT LIMOUSINE AND TAXI SERVICE, INC., Appellants
THE SCRANTON TIMES, L.P., THE TIMES PARTNER, JAMES CONMY, AND EDWARD LEWIS, Appellees
Appeal from the Judgment entered April 23, 2012 In the Court of Common Pleas of Luzerne County Civil Division at No(s): 2002-3816C
BEFORE: MUNDY, J., OLSON, J., AND STRASSBURGER, J.[*]
Thomas A. Joseph (Joseph, Sr.), Thomas J. Joseph (Joseph, Jr.), Acumark, Inc. (Acumark), and Airport Limousine and Taxi Service, Inc. (Airport Limousine) (Appellants, collectively) appeal from the April 23, 2012 judgment entered upon a non-jury verdict against Appellants and in favor of The Scranton Times, L.P. (Scranton Times), The Times Partner, James Conmy (Conmy), and Edward Lewis (Lewis) (Appellees, collectively) in this defamation action. We vacate the judgment; affirm in part and reverse in part the order denying Appellants' post-trial motions; and remand for further proceedings consistent with this opinion.
I. Facts and Procedural History
A prior panel of this Court summarized the facts and history of this case as follows.
The Internal Revenue Service Criminal Investigation Unit and the Pennsylvania State Police (PSP) Bureau of Criminal Investigation Division, Organized Crime Northeast Section, were conducting a joint investigation of William D'Elia, the reputed head of the Bufalino crime family of northeastern Pennsylvania. As part of the investigation, the federal agents and PSP troopers applied for search warrants for the homes and businesses of various associates of Mr. D'Elia. On May 29, 2001, the federal magistrate judge for the United States District Court for the Middle District of Pennsylvania issued search warrants that authorized, inter alia, the searches of the home of [Joseph, Sr.] and … Acumark.1 The search warrants were issued based on the affidavits of probable cause stating that a criminal conspiracy existed among Mr. D'Elia and others. The search warrants issued against Appell[ants] authorized the search and seizure of any documents or materials demonstrating violation of the federal racketeering and racketeer influenced corrupt organization (RICO) statutes, records relating to an illegal sports bookmaking operation, and records relating to the secreting of assets.2
1 [Joseph, Sr.] was the sole shareholder of Appell[ant] Acumark.
2 Specifically, the warrant permitted the search for evidence of interstate transportation in aid of racketeering enterprises (18 U.S.C. § 1952), illegal gambling (18 U.S.C. § 1955), money laundering (18 U.S.C. § 1956 & § 1957), and RICO (18 U.S.C. § 1962).
On May 31, 2001, federal agents and PSP troopers conducted searches of several businesses and individuals' homes pursuant to the search warrants, including the home of [Joseph, Sr.] and the office of … Acumark. At approximately 8:00 a.m., twenty to thirty armed IRS agents and PSP troopers entered [Joseph, Sr.'s] home in suburban Wilkes-Barre. The search lasted until approximately 3:00 p.m., and the seizure consisted of business and bank records of [Joseph, Sr.'s] businesses including … Acumark.
Also on the morning of May 31st, approximately thirty armed federal agents executed the search warrant of … Acumark's office in Wilkes-Barre. The agents seized … Acumark's business records and records that involved [Joseph, Sr.'s] other business ventures.
The IRS agents and PSP troopers also executed search warrants at the homes of Mr. D'Elia and Jean Stanton and the home and office of Mr. Samuel Marranca. In addition, a search warrant was issued for the office of Raymond Zavada, who served as [Joseph, Sr.'s] personal and business accountant. The agents seized all of Mr. Zavada's files that related to [Joseph, Sr.] and his business ventures.
The Newspaper Articles
As a result of the execution of the search warrants on May 31st, the local news media began reporting news stories on June 1, 2001. The Citizens' Voice, a local newspaper in the Wilkes-Barre-Scranton area owned by Appell[ee] The Scranton Times LP, published ten news stories from June 1, 2001, through October 10, 2001, that involved [Joseph, Sr.] or … Acumark. Appell[ee] Lewis, a Citizens' Voice staff writer, wrote or co-wrote the final eight articles. A brief summary of the articles follows.
On June 1, 2001, the Citizens' Voice published an article [authored by Comny] headlined "Feds Raid Business in Pittston." The article reported that approximately thirty federal and state agents executed a federal search warrant at the office of … Acumark. The article did not mention [Joseph, Sr.].
On June 2, 2001, the Citizens' Voice published an article headlined "Home of Acumark Owner Searched by Federal Agents." This article reported that federal agents searched [Joseph, Sr.'s] home. The article also reported that Michael Mey, Esquire, [Joseph, Sr.'s] attorney, confirmed that records were removed from … Acumark's office. The article included Attorney Mey's statement that [Joseph, Sr.] did not know of any reason why a search warrant was served nor of any type of illegal activity at his home or business. Attorney Mey concluded by stating that he made requests to the IRS and Department of Treasury for information regarding the searches.
On June 5, 2001, the Citizens' Voice published an article [authored by Comny and Lewis] headlined "Alleged Money-laundering Scheme Linked to Pittston Raid." The article reported that a source informed that "a money-laundering ring might have been the reason behind the federal search warrants issued last week." The article continued that "the 'three main players' whose residences were searched ... allegedly were laundering money through Acumark … and a limousine/taxi service." The article also reported that an unknown amount of money had been allegedly laundered in the 1990s through The Metro, a then-defunct newspaper, by buying fake advertisement space, and continued through … Acumark after the sale of The Metro. The article reported that the search warrants were executed following months of video surveillance and a federal grand jury investigation. The article repeated that the federal agents searched the homes of Mr. D'Elia, [Joseph, Sr.], Ms. Stanton, and Mr. Marranca and the office of … Acumark. The article also repeated that Attorney Mey confirmed that business records were removed from … Acumark's office but was unsure if records were removed from [Joseph, Sr.'s] home. The article also mentioned that records seized from an office at 1303 Wyoming Avenue, Exeter, involved The Metro. Appell[ees] published a picture of [Joseph, Sr.] with the article.
On August 5, 2001, the Citizens' Voice published an article [authored by Lewis and Comny] headlined "Former Avoca Bar Target of Federal Money Laundering Probe." The article centered on an investigation into alleged prostitution and drug trafficking of Al Carpinet, Jr., at Lavelle's Pub. The article concluded with a recitation of the earlier articles involving the grand jury investigation of [Joseph, Sr.] The Citizens' Voice described the investigation as ongoing and stated that it had learned that federal authorities were focusing on a limousine and taxi service based at the Wilkes-Barre-Scranton and Lehigh Valley international airports as a means to transport money, drugs, prostitutes, and guns from Atlantic City, Philadelphia, and New York City.
Also, on August 5, 2001, the Citizens' Voice published an article [authored by Lewis] headlined "Firearms Dealer Denies Involvement in Alleged Money Laundering Scheme." The article centered on Gus Salazar, a Wyoming County firearms dealer, and stated that the PSP and Bureau of Alcohol, Tobacco, and Firearms, seized his firearms inventory. The article included Salazar's denial that he was involved with [Joseph, Sr.] or the money laundering. The article reported that Attorney Mey represented Salazar and [Joseph, Sr.]. The Citizens' Voice indicated that a "source said both Salazar and Joseph have an interest in the collection of firearms linking the two together to the federal investigation." The article included Attorney Mey's response that [Joseph, Sr.] and Salazar were only connected by their retention of him for legal services.
On August 6, 2001, the Citizens' Voice published an article [authored by Lewis and Comny] headlined "Probe Investigating Pub Clientele." The article reported the investigation into the alleged illegal activity of the patrons of Lavelle's Pub. The article also reported that a federal grand jury began receiving testimony about alleged money laundering at the beginning of the year and that the investigation widened to include prostitution, gun running, and drug trafficking. The article included a comment from a source who explained that IRS involvement began two years prior when the IRS received information that as much as $3 million had been laundered through The Metro, a newspaper formerly owned by [Joseph, Sr.]. The article also reported that several reliable sources stated that limousine services at two airports were being investigated for possibly transporting money, drugs, and firearms in attaché cases in trunks of the vehicles owned by the limousine services. The article continued that according to public records, [Joseph, Sr.] and his son, [Joseph, Jr.], owned and operated limousine and taxi services at the airports.
On August 8, 2001, the Citizens' Voice published an article [authored by Lewis] headlined "Ex-Metro Owner: I Didn't See Joseph Do Anything Wrong." The article included an interview that the Citizens' Voice conducted with Bob Butts, a former employee of [Joseph, Sr.] at The Metro who later purchased the paper from [Joseph, Sr.]. The article included Mr. Butts' praise of [Joseph, Sr.] and another former Metro employee's comment that he had knowledge of The Metro's subscriptions and revenues and was not aware that [Joseph, Sr.] did anything wrong. The article included the previous report of the May 31st searches and that [Joseph, Sr.], Mr. D'Elia, and Mr. Marranca were at the center of a federal grand jury investigation into money laundering. The article also included that Mr. D'Elia was a reputed mob boss of northeastern Pennsylvania. The article also stated that a source indicated that Mr. Marranca leased the office at 1303 Wyoming Avenue, Exeter.
On August 12, 2001, the Citizens' Voice published an article [authored by Lewis] headlined "Report: Judge Barrasse Linked to IRS Investigation." The article reported an allegation of a connection between Judge Barrasse and the investigation into the clientele at Lavelle's Pub. The article indicated that the same grand jury that was investigating drug activity of the patrons at Lavelle's Pub was investigating money laundering allegations. The article continued with an accounting of the drug trafficking at Lavelle's Pub, which was shut down in 1997 following an investigation into drug trafficking that, in turn, led to the arrest of twenty people in 1998, and the investigation of the laundering of the drug proceeds. The article concluded with a summation of its earlier reports on the May 31st searches of … Acumark's office and of the homes of [Joseph, Sr.], Ms. Stanton, Mr. D'Elia, and Mr. Marranca, including the fact that agents seized records pertaining to The Metro from the office at 1303 Wyoming Avenue in Exeter.
On August, 20, 2001, the Citizens' Voice published an article [authored by Lewis] headlined "Federal Probe Expanding to Examine Political Corruption." The article reported the allegations of illegal activity at Lavelle's Pub and on the part of Al Carpinet. The article also mentioned the May 31st searches of … Acumark's office and that a federal grand jury had been receiving testimony regarding alleged money laundering through The Metro and … Acumark.
On October 10, 2001, the Citizens' Voice published an article [authored by Lewis] headlined "3 Witnesses Subpoenaed in Money-laundering Investigation." The article began with a statement that a federal grand jury had subpoenaed three additional witnesses and that eight people had been arrested as the result of a state grand jury investigation into the allegedly illegal activities at Lavelle's Pub. The article recapped its previous reports involving the May 31st searches of and investigation into the alleged money laundering operation through The Metro and … Acumark and noted that government agents found Metro records during the search of the office leased to Mr. Marranca at 1303 Wyoming Avenue, Exeter. The article also reported that a source indicated that the money allegedly laundered through The Metro "came from overfill and the selling of open airspace at several Pennsylvania landfills." The article stated a source said, "This investigation took off since May 31, " which was the date of the searches of Appell[ants].
[The records seized from Appellants were eventually returned to Appellants, with the government's request that Joseph, Sr. release the government from liability. When an indictment ultimately was handed down by the grand jury, neither any of Appellants, nor any of Joseph, Sr.'s other businesses such as The Metro, was mentioned.]
On May 22, 2002, Appell[ants] commenced a defamation action against Appellants pursuant to 42 Pa.C.S.A. §§ 8341-8345 (Uniform Single Publication Act). The complaint asserted various claims for defamation-libel and invasion of privacy based upon ten articles published in the Citizens' Voice.14
14 The plaintiffs originally included [Joseph, Jr.], Airport Limousine …, and Airport Taxi, Limousine and Courier Service of Lehigh Valley, Inc. Prior to trial, Acumark, Airport Limousine …, and Airport Taxi, Limousine and Courier Service of Lehigh Valley, Inc. withdrew their invasion of privacy claims.
The defendants originally included Edward J. Lynett, Jr., George V. Lynett, Cecelia Lynett Haggerty, The Scranton Times, Inc., Shamrock Communications, Inc., ZYXW, Inc., and James Conmy. Prior to trial, the parties stipulated to the dismissal of all claims against these defendants.
Following the conclusion of discovery, Appell[ees] filed a motion for summary judgment. On January 5, 2004, the trial court denied the summary judgment motion. An eight-day non-jury trial commenced on May 16, 2006, and concluded on May 26, 2006. At the close of Appell[ant]s' case-in-chief, Appell[ee]s made a motion for directed verdict. The trial court granted the motion as to all claims made by [Joseph, Jr.] At the conclusion of Appell[ee]s' defense, Appell[ee]s renewed the motion for directed verdict. The trial court denied the motion. On October 27, 2006, the trial court entered its verdict in favor of Appell[ant]s on the defamation action against Appell[ee]s.15 The trial court concluded that eight of the articles (collectively Defamatory Articles) defamed Appell[ant]s by either directly or implicitly indicating that Appell[ant]s were engaged in a broad range of criminal enterprises uncovered by an investigation when in fact the investigation targeted other individuals and businesses. In arriving at this conclusion, the trial court found that Appell[ant]s were private figures, that Appell[ant]s proved that the Defamatory Articles were false, and that Appell[ant]s proved that Appell[ee]s published the Defamatory Articles with want of reasonable care and diligence to ascertain the truth. The trial court awarded to [Joseph, Sr.] compensatory damages in the amount of $2 million and to … Acumark compensatory damages in the amount of $1.5 million.
15 The trial court also entered a verdict in favor of the defendants as to [Joseph, Sr.'s] invasion of privacy claim, as to all [Appellants'] claims for punitive damages, and as to the defamation claims of Airport Limousine…, and Airport Taxi, Limousine and Courier Service of Lehigh Valley, Inc.
Joseph v. Scranton Times L.P., 959 A.2d 322, 328-333 (Pa. Super. 2008) (some footnotes and citations omitted).
Following denial of their post-trial motions, Appellees appealed to this Court, and we affirmed the judgment. Id. However, our Supreme Court vacated the judgment, verdict, and all substantive orders, based upon the appearance of judicial impropriety in the assignment and trial of the case in Luzerne County, and remanded the case for a new trial. Joseph v. Scranton Times L.P., 987 A.2d 633 (Pa. 2009).
Back in the Court of Common Pleas of Luzerne County, the case was assigned to the Honorable Joseph Van Jura. Judge Van Jura entertained motions for summary judgment, which resulted in the dismissal of the false light/invasion of privacy claims of Acumark and Airport Limousine. A non-jury trial on the remaining claims was held in May 2011; Judge Van Jura entered a verdict in favor of Appellees and against Appellants on all remaining claims, and an opinion in support, on December 8, 2011. By order of December 9, 2011, Appellants' deadline for filing post-trial motions was extended to January 9, 2012.
Appellants timely filed post-trial motions, seeking judgment notwithstanding the verdict (JNOV) as to damages, or a new trial as to damages. Meanwhile, Judge Van Jura's term had expired, and the case was re-assigned to the Honorable Lesa S. Gelb. Judge Gelb denied Appellants' post-trial motions by order of March 19, 2012. Notice of the entry of judgment was served on the parties on April 23, 2012, and Appellants filed a timely notice of appeal. Judge Gelb did not order Appellants to file a concise statement of errors complained of on appeal, but filed an opinion on June 1, 2012, indicating that the issues giving rise to the appeal are addressed in Judge Van Jura's opinion of December 8, 2011.
II. Issues on Appeal and Applicable Law
Appellants present the following questions for this Court's consideration, which we have renumbered for ease of disposition.
I. Whether the trial court's stated bases (including credibility determinations) for rejecting an award of general damages to [Appellants] in connection with their claims for defamation misapply the law, are manifestly unreasonable, and capriciously disregard competent evidence resulting in an error of law and/or an abuse of discretion?
II. Whether the trial court erred as a matter of law in concluding that the Citizens' Voice's publications asserting that a taxi and limousine service owned by Joseph, Sr. and Joseph, Jr. was used as a means to transport money, drugs, prostitutes, and guns to and from other locations are not statements "of and concerning" Joseph, Sr. justifying the denial of any award of general damages?
III. Whether the trial court's errors of law and manifestly unreasonable and capricious disregard of [Appellants'] competent evidence of damages vitiates [sic] its failure to substantively consider (a) [Appellants'] claims for punitive damages, and (b) the individual [Appellants'] claims for false light/invasion of privacy?
IV. Whether the trial court's failure to consider that [Appellants] proved actual malice and an entitlement to presumed damages constitutes an error of law?
V. Whether the trial court's failure to award special damages to [Acumark] is against the weight of the evidence and constitutes an abuse of discretion?
Appellants' Brief at 2-3 (trial court answers omitted).
We consider Appellants' questions mindful of the following.
Our appellate role in cases arising from non-jury trial verdicts is to determine whether the findings of the trial court are supported by competent evidence and whether the trial court committed error in any application of the law. The findings of fact of the trial judge must be given the same weight and effect on appeal as the verdict of a jury. We consider the evidence in a light most favorable to the verdict winner. We will reverse the trial court only if its ...