Campone v. Kline

Francis Campone and Sai Temple of Spiritual Healing, Inc., Appellants v. Steven Kline and Phaedra Kline, Appellees

NO. 03-19-00908-CV

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

December 22, 2020

ON MOTION FOR REHEARING

FROM THE 98TH DISTRICT COURT OF TRAVIS COUNTY

NO. D-1-GN-15-004361, THE HONORABLE MAYA GUERRA GAMBLE, JUDGE PRESIDING

MEMORANDUM OPINION

After considering appellants' motion for rehearing and appellees' response, we grant rehearing, withdraw our previous opinion and judgment issued on August 13, 2020, and substitute the following opinion and judgment in their place.

Francis Campone and Sai Temple of Spiritual Healing, Inc., sued Steven and Phaedra Kline for defamation. The trial court granted the Klines' motion for summary judgment, and Campone and Sai Temple appeal. For the reasons explained below, we will affirm the summary judgment as to Sai Temple's claim but reverse the summary judgment as to Campone's claim and remand for further proceedings.

BACKGROUND

Campone, a spiritualist minister and healer, started Sai Temple in 2006 and is its president and chief executive officer. The Klines were members of the Sai Temple community, and Steven served as Sai Temple's main volunteer and volunteer coordinator for about five years and was Campone's "right hand man." In 2013, Steven resigned from Sai Temple and ceased his association with it.

In September 2015, Campone filed the underlying lawsuit upon hearing that Steven was telling people that Campone was having "inappropriate sexual relationships with women." The Klines filed a motion to dismiss under the Texas Citizens Participation Act (TCPA), which the trial court granted. On appeal, this Court affirmed the dismissal order except for Campone's and Sai Temple's claims against Steven related to one conversation that Steven allegedly had with Charlotte Michelson, which claims we remanded for further proceedings because the TCPA motion was untimely as to them. See Campone v. Kline, No. 03-16-00854-CV, 2018 WL 3652231, at *1 (Tex. App.—Austin Aug. 2, 2018, no pet.) (mem. op.). Steven's allegedly defamatory statement to Michelson was that Campone had or was having an affair with a particular married woman.¹

On remand, the Klines filed a traditional and no-evidence motion for summary judgment. The trial court granted the motion without specifying the grounds on which its determination was based, and Sai Temple and Campone appeal.

DISCUSSION

Sai Temple and Campone challenge each of the grounds that the Klines asserted in their summary-judgment motion: (1) that Sai Temple cannot provide any admissible evidence to support three of the requisite four elements of its remaining defamation claim against Steven, and that Campone cannot provide any admissible evidence to support two of the requisite elements; (2) that Sai Temple's and Campone's claims against Steven are barred by the statute of limitations and that the discovery rule does not apply; (3) that Steven's statement to Michelson (the Michelson statement) was protected by the common-law qualified privilege; and (4) that the Klines are entitled to attorney's fees for the non-Michelson-related claims that were dismissed under the TCPA, which dismissal was affirmed on appeal.

Whether no-evidence summary judgment was proper

A party is entitled to no-evidence summary judgment when, after adequate time for discovery, there is no evidence of one or more essential elements of a claim or defense on which an adverse party would have the burden of proof at trial. Tex. R. Civ. P. 166a(i). When reviewing a no-evidence summary judgment, we review the evidence presented by the motion and response in the light most favorable to the party against whom the summary judgment was rendered, crediting evidence favorable to that party if reasonable jurors could, and disregarding contrary evidence unless reasonable jurors could not. Timpte Indus., Inc. v. Gish, 286 S.W.3d 306, 310 (Tex. 2009). The trial court must grant the motion unless the respondent produces summary- judgment evidence raising a genuine issue of material fact on the challenged elements. Tex. R. Civ. P. 166a(i). To raise a genuine issue of material fact, the nonmovant must set forth more than a scintilla of probative evidence as to the challenged essential elements of itsclaim on which it would have the burden of proof at trial. Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706, 711 (Tex. 1997). More than a scintilla of evidence exists if the evidence supporting a finding rises to a level that would enable reasonable and fair-minded persons to differ in their conclusions. Id.

The elements of a defamation claim are: (1) the publication by the defendant of a false statement of fact to a third party, (2) that was defamatory concerning the plaintiff, (3) with the requisite degree of fault, and (4) that proximately caused damages. Anderson v. Durant, 550 S.W.3d 605, 617-18 (Tex. 2018). In their motion, the Klines contended that Sai Temple could not produce any evidence of the second, third, and fourth elements and that Campone could not produce any evidence of the third and fourth elements, with the requisite degree of fault being actual malice because Campone is a public figure. Campone and Sai Temple argue that Campone is not a public figure and must only prove that Steven acted negligently but that there is more than a scintilla of evidence to support the third element under either fault standard.

Challenged elements as to Sai Temple's claim

Steven contended that Sai Temple could produce no evidence of the second element of defamation—that the Michelson statement was defamatory as to Sai Temple itself—because there is no evidence that Steven "even mentioned Sai Temple" in his alleged statement to Michelson. We agree that Sai Temple has not met its burden to create a genuine issue of material fact on this element. While it is true that an organization has a reputation that can be defamed, see General Motors Acceptance Corporation v. Howard, 487 S.W.2d 708, 712 (Tex. 1972); De Mankowski v. Ship Channel Development Company, 300 S.W. 118, 122 (Tex. App.—Galveston 1927, no writ), Sai Temple has identified no evidence in the record demonstratingthat Steven's alleged statement to Michelson was defamatory concerning Sai Temple. See De Mankowski, 300 S.W. at 122 ("It goes without saying that a corporation cannot recover for damages for slander of its president which affects only his reputation."). The only evidence of any defamatory content in the Michelson statement concerned Campone personally, not Sai Temple. Accordingly, the trial court properly granted no-evidence summary judgment on Sai Temple's claim, and we need not determine whether the evidence created a fact issue on the other challenged elements of Sai Temple's claim or address its other issues on appeal.

Challenged elements as to Campone's claim

As to the third element, the requisite degree of fault, the defendant must act with actual malice if the plaintiff is a public figure or official or must act negligently if the plaintiff is a private individual. See Rodriguez v. Gonzales, 566 S.W.3d 844, 851 (Tex. App.—Houston [14th Dist.] 2018, pet. denied). Campone argues that there is more than a scintilla of evidence to support this element under either the negligence or actual-malice standard. Accordingly, we will assess whether Steven acted with actual malice when making the alleged defamatory statement, and we express no opinion on the issue of whether Campone qualifies as a public figure. "To establish actual malice, a public figure must prove that the defendant made the statement 'with knowledge that it was false or with reckless disregard of whether it was false or not.'" Turner v. KTRK TV, Inc., 38 S.W.3d 103, 120 (Tex. 2000) (quoting New York Times Co. v. Sullivan, 376 U.S. 254, 279-80 (1964)). In this context, "reckless disregard" means that the defendant "entertained serious doubts as to the truth of his publication." Id. Although actual malice focuses on the defendant's state of mind, a plaintiff can prove it through objective evidence about the publication's circumstances. Id.; see Bentley v. Bunton, 94 S.W.3d 561, 596 (Tex.2002) ("The defendant's state of mind can—indeed, must usually—be proved by circumstantial evidence."). Actual malice may be inferred from "the relation of the parties, the circumstances attending the publication, the terms of the publication itself, and from the defendant's words or acts before, at, or after the time of the communication." Dolcefino v. Turner, 987 S.W.2d 100, 111-12 (Tex. App.—Houston [14th Dist.] 1998), aff'd sub nom. Turner, 38 S.W.3d 103.

The alleged defamatory statement at issue is Steven's representation to Michelson that Campone was having an affair with a particular named woman. Evidence in the form of Michelson's affidavit and deposition transcript, Steven's deposition transcript, and the affidavit of Rupal Campone, wife of Francis Campone, supports this allegation. In his deposition, Steven testified that a woman identified as an "angel reader" in the temple community had told him that "three separate women [had] come to see her for sessions" and told her about Campone's alleged sexual impropriety with them. Specifically, Steven testified that the angel reader told him the following: one of the three women had "inferred [sic] very strongly that she had an ongoing sexual relationship" with Campone and the other two had told the angel reader that Campone was hoping for them to "be his [new] mate" because he believed that "Rupal [wa]s soon going to die." Notably, however, Steven testified that the angel reader did not tell him the names of the three women, and he repeatedly denied ever knowing the names of any women with whom Campone was allegedly having inappropriate sexual relations. He testified that he and other temple members had heard rumors about Campone's inappropriate sexual relations but that it was "pure speculation" as to who the women...