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Menkowitz v. Peerless Publications, Inc.

Supreme Court of Pennsylvania

July 17, 2019

ELLIOT MENKOWITZ, M.D., Appellant
v.
PEERLESS PUBLICATIONS, INC. AND ERIC ENGQUIST, Appellees

          ARGUED: March 6, 2019

          Appeal from the Order of the Superior Court at Nos. 2048 & 2096 EDA 2014 dated December 15, 2017 Vacating the Judgment Entered July 23, 2014 in Montgomery County Court of Common Pleas, Civil Division, at No. 1998-07291 and remanding

          SAYLOR, C.J., BAER, TODD, DONOHUE, DOUGHERTY, WECHT, MUNDY, JJ.

          OPINION

          DONOHUE JUSTICE

         A jury awarded Appellant, Elliot Menkowitz, M.D. ("Dr. Menkowitz"), $1, 000, 000 in compensatory damages in his defamation suit against Appellees, Peerless Publications, Inc. ("Peerless") and Eric Engquist ("Engquist"). The Superior Court found that the trial court erred in failing to enter judgment non obstante verdicto ("JNOV") in Appellees' favor and vacated the award of compensatory damages. We granted allocatur to consider whether in so doing, the Superior Court failed to exercise appropriate deference to the fact-finder when reviewing a JNOV ruling, as explained in this Court's ruling in Joseph v. Scranton Times, L.P., 129 A.3d 404 (Pa. 2015) ("Joseph III"). For the reasons set forth herein, we vacate the order of the Superior Court and remand the case to that court for further proceedings.

         Dr. Menkowitz began his employment as an orthopedic surgeon at Pottstown Memorial Medical Center ("PMMC") in the early 1970s. At PMMC, Dr. Menkowitz was accused of verbally abusing colleagues and staff and engaging in other inappropriate behavior in front of patients. In April 1996, Dr. Menkowitz was informed that due to his inappropriate conduct, PMMC's Medical Executive Committee and the Medical Committee of the Board had voted to suspend him or allow him to take a voluntary leave to address his behavioral problems. Dr. Menkowitz then disclosed that he had recently been diagnosed with ADHD and suggested that he might be protected under the Americans with Disabilities Act.[1] In light of this information, PMMC did not suspend Dr. Menkowitz or require him to take a leave of absence, but issued a written warning explaining that should Dr. Menkowitz's misbehavior continue, PMMC would summarily suspend all of his clinical privileges. Less than a year later, on March 25, 1997, based upon continuing behavioral issues, PMMC suspended Dr. Menkowitz for six months. The suspension did not last for the full six months, however, as PMMC lifted it approximately one month later when Dr. Menkowitz filed suit against PMMC in federal court for violation of the Americans with Disabilities Act and section 504 of the Rehabilitation Act.[2]

         On April 18, 1997, the Mercury, a local Pottstown newspaper, ran a front-page article about Dr. Menkowitz (hereinafter "the Article"). The Mercury is published by Peerless and the Article was written by Engquist. Under the headline "PMMC Suspends Physician," the Article reported that Dr. Menkowitz had been suspended from PMMC. Of particular relevance to this appeal, the Article further stated, that "[Dr. Menkowitz's] sudden absence from the hospital has spawned rampant rumors of professional misconduct regarding his treatment of an older female patient." This statement (hereinafter, "the Statement") forms the heart of this litigation. On April 26, 1997, the Mercury ran an editorial feature called "Cheers and Jeers," which mentioned Dr. Menkowitz's clash with PMMC and "jeered" the manner in which the parties handled the incident, noting the suspension, the federal civil action filed by Dr. Menkowitz, and PMMC's subsequent decision to lift the suspension.[3]

         Upon opening his newspaper on April 18, 1997, Dr. Menkowitz discovered the Article. He quickly fell into a severe depression. Dr. Menkowitz's treatment for this depression included multiple medications that caused fasciculations (tremors) in his arms and hands, impairing Dr. Menkowitz's ability to perform surgery.

         In April 1998, Dr. Menkowitz filed the underlying action in Montgomery County, raising claims of defamation, invasion of privacy - false light, intentional interference with existing and prospective relationships, and intentional infliction of emotional distress related to these publications.[4] In particular, Dr. Menkowitz alleged that the Statement, which referenced misconduct in connection with an elderly female patient, gave rise to defamatory implications or innuendo. Complaint, 4/14/1998, ¶ 19. Dr. Menkowitz sought punitive damages, which required him to prove that Appellees acted with malice in publishing the Article. See New York Times Co. v. Sullivan, 376 U.S. 254 (1964).[5] Dr. Menkowitz also sought compensatory damages for his mental and emotional pain. To be entitled to compensatory damages, Dr. Menkowitz did not have to prove malice, but did have to prove that the alleged defamatory innuendo was published negligently and that Dr. Menkowitz suffered reputational injury therefrom.[6] See Joseph, 129 A.3d at 428-29; American Future Sys., Inc. v. Better Bus. Bureau of E. Pennsylvania, 923 A.2d 389, 400 (Pa. 2007).

         Trial did not commence until 2014. In an attempt to prove malice in connection with his claim for punitive damages, Dr. Menkowitz presented testimony from an expert witness to establish that Appellees published the Article with a high awareness of its probable falsity or serious doubts as to its truthfulness. Appellees defended against this accusation with testimony from Engquist regarding his sources for the Article and his belief as to the truth of its representations. Appellees also called an expert witness, who opined that publication of the Article did not violate journalistic standards.

         With regard to compensatory damages, Dr. Menkowitz testified to the depression he suffered following the publication of the Article and the physical consequences of the medicines used to alleviate the depression. He also testified that after publication of the Article, additional hospitals terminated his privileges and attorneys ceased using him as an expert witness. Dr. Menkowitz's wife and son testified regarding the effect that reading the Article had on him. Dr. Menkowitz's treating psychologist, who testified as to the depth and severity of Dr. Menkowitz's depression, opined that it was triggered by the publication of the Article. Dr. Menkowitz also presented the testimony of a practicing attorney, Jeffrey A. Krawitz, Esquire ("Attorney Krawitz"), who indicated that he had written a letter to opposing counsel who was planning to use Dr. Menkowitz as an expert in a particular case. In this letter, Attorney Krawitz informed opposing counsel that he had learned that Dr. Menkowitz had been indicted on charges relating to improper sexual conduct with patients.

         The jury returned a verdict in Dr. Menkowitz's favor, awarding both compensatory and punitive damages. In compensatory damages, the jury awarded $200, 000 for harm to reputation and $800, 000 for past wage loss and future earning capacity. Appellees filed post-trial motions, seeking, among other relief, JNOV, and a remittitur or vacation of the punitive damage award. After entertaining argument, the trial court vacated the punitive damage award, concluding that Dr. Menkowitz had failed to establish that Appellees acted with malice. The trial court denied all other relief, including Appellees' request for entry of JNOV.

         Both parties appealed. Appellees raised eight issues of trial court error, asserting claims that the trial court erred in denying their post-trial request for JNOV; denying their post-trial request for remittitur of the compensatory damage award; failing to issue particular jury instructions; and making certain evidentiary rulings. See Trial Court Opinion, 9/19/2014, at 5-6. Dr. Menkowitz challenged only the trial court's decision to vacate the punitive damage award. Id. at 5. The trial court issued a lengthy opinion pursuant to Rule 1925(a) of the Pennsylvania Rules of Appellate Procedure. With regard to Appellees' challenge to the denial of their motion for JNOV, the trial court rejected Appellees' contention that Dr. Menkowitz had failed to prove that the Article contained a material falsity. The trial court noted that the Superior Court has recognized the tort of defamation by implication, pursuant to which the "literal accuracy of separate statements will not render a communication 'true' where … the implication of the communication as a whole was false." Id. at 13 (quoting Dunlap v. Philadelphia Newspapers, Inc., 448 A.2d 6, 15 (Pa. Super. 1982)). Reviewing the testimony of Dr. Menkowitz, his son, his wife and Attorney Krawitz, each of whom indicated that the Statement's reference to "professional misconduct" in connection with an "older female patient" implied that Dr. Menkowitz was guilty of sexual improprieties, the trial court concluded that the jury had sufficient evidence to conclude that the Statement was defamatory by implication, and thus it was not error to submit the issue of defamatory meaning to the jury for resolution. Id. at 14-16.

         Next, the trial court supported its decision to vacate the jury's award of punitive damages, concluding that Dr. Menkowitz had failed to produce sufficient evidence that Appellees either knew that the Article was false or had a "high degree of awareness of … probable falsity." Id. at 12 (quoting Harte-Hanks Commc'ns., Inc. v. Connaughton, 491 U.S. 657, 688 (1989)). Finally, based upon the testimony of Dr. Menkowitz, his treating psychologist, and Attorney Krawitz, the trial court determined that Dr. Menkowitz had presented sufficient evidence to support the jury's award of compensatory damages for harm to reputation, past wage loss and impairment of future income, and that as a result JNOV had been properly denied. Id. at 27-29.

         On appeal, the Superior Court acknowledged that in cases such as this, with a private figure as plaintiff, a media defendant, and an issue of public concern, the plaintiff must prove falsity of the communication at issue, negligence in its publication, and actual damage to the plaintiff's reputation caused by the defamatory communication for an award of compensatory damages. Menkowitz v. Peerless Publ'ns, Inc., 176 A.3d 968, 978 (Pa. Super. 2017), appeal granted in part, 190 A.3d 594 (Pa. 2018). Concerning falsity, the court explained that although Dr. Menkowitz conceded that the component of the Article that reported on his suspension was true, his argument focused on the Statement and alleged that it was capable of defamatory implications or innuendo that were false. Id. at 982. The Superior Court recognized that the test to determine whether a statement is capable of defaming a subject by innuendo asks whether the statement can reasonably be construed to imply the defamatory meaning alleged. Id. (citing Sarkees v. Warner-West Corp., 37 A.2d 544, 546 (Pa. 1944)). The alleged innuendo must be adequately supported by the challenged language and cannot be the product of a forced construction of the natural meaning of the words. Id. The trial court, in the first instance, must assess whether the objected-to language is capable of defamatory implication; if the court determines that the language does not support the alleged innuendo, the case should not be sent to the jury. Id. When the language is capable of both innocent and defamatory interpretations, it is for a jury to decide if the recipient understood the defamatory implications. Id. (quoting Pelagatti v. Cohen, 536 A.2d 1337, 1345 (Pa. Super. 1987)).

         The Superior Court found that Dr. Menkowitz adequately established that the Statement is capable of defamation by implication. In reaching this conclusion, the Superior Court parsed the Statement's phrases and discussed their plausible implications at length. See id. at 983-87. For instance, it reasoned that a jury could find that the phrase "professional misconduct" suggests an array of misconduct to lay persons, including sexual impropriety. Id. at 984. The Superior Court found the inclusion of the patient's gender supportive of the innuendo of sexual impropriety, as there would be no reason to identify the patient as female "if nothing sexual is to be inferred." Id. at 984. It further noted that the sexual innuendo from "professional misconduct" is plausible because the State Board of Medicine's regulations provide that sexual behavior with a patient is "unprofessional conduct." Id. The Court also focused on the use of the phrase "sudden absence," which, in its view, could reasonably suggest that Dr. Menkowitz had to act with urgency and was fleeing PMMC. Id.

         The Superior Court then turned its attention to whether Dr. Menkowitz met the threshold requirements to be entitled to either punitive or compensatory damages. It first considered the trial court's conclusion that Dr. Menkowitz failed to establish malice in connection with the punitive damage award. The Superior Court found that the evidence of record supported the trial court's conclusion, citing to Engquist's testimony and Appellees' expert's opinion that there was no deviation from journalistic standards so as to permit a finding of malice. Id. at 988.

         Turning to the propriety of the compensatory damage award, the Superior Court considered whether Dr. Menkowitz established that he suffered damage to his reputation attributable to the Statement's defamatory innuendo, as opposed to his suspension from PMMC. It concluded that Dr. Menkowitz had presented no evidence to confirm that the alleged injury to reputation was caused by the contents of the Article as opposed to his suspension. The Superior Court explained that

[n]ot one witness testified that his or her view of the physician changed as a result of this communication. Furthermore, even [Dr. Menkowitz] conceded that the harshness of suspension alone after twenty-five years would lead one to believe that he had done something horrible. N.T.[], 3/17/[20]14, at 260. He recounted a conversation with an elderly gentleman who recognized his name "because he remembered I was the doctor who was 'kicked out of the hospital.'" Id. at 262. [Dr. Menkowitz's] expert also acknowledged that the public disclosure of the suspension alone was damaging to the physician's reputation. Mr. Eveslage conceded, "If I am reading that a surgeon in a hospital in my town has been banned from seeing patients at the hospital, that clearly is going to be damaging to his reputation." N.T.[], 3/18/[20]14, at 440.
[Dr. Menkowitz's] testimony that other hospitals with which he was associated read the article and stopped using him is similarly deficient as it failed to distinguish whether the alleged injury to reputation was caused by the suspension or the article. Absent is the causal connection required by Joseph between the alleged defamatory innuendos and the harm to reputation, as distinguished from the suspension itself. All of the foregoing proof tends to confirm that any damage to [Dr. Menkowitz's] reputation flowed from the suspension itself, not any implication of sexual or physical abuse. Thus, even if we were to find a basis for liability, the record contained insufficient proof that the defamatory statement or innuendos, rather than the fact of suspension, caused damage to reputation that would have supported a compensatory damage award. [Dr. Menkowitz's] failure to prove damages to his reputation resulting from the defamatory innuendo is fatal to his claim.

Id. at 989. The Superior Court vacated the award of compensatory damages and remanded for the entry of JNOV in Appellee's favor without reaching the ...


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