Kelley v. Wren

415 S.C. 379

782 S.E.2d 406

Mark KELLEY, Respondent,

v.David WREN and Sun Publishing Company Inc., d/b/a The Sun News, Appellants.

Appellate Case No. 2014–001249.

No. 5375.

Court of Appeals of South Carolina.

Heard Dec. 9, 2015.

Decided Jan. 13, 2016.

Rehearing Denied March 4, 2016.

Jerry Jay Bender, Baker Ravenel & Bender, LLP, of Columbia, for appellants.

James P. Stevens, Jr. and Natalie Shawn Stevens–Graziani, Stevens Law Firm, PC, of Loris, for respondent.

FEW, C.J.

David Wren and Sun Publishing Company, Inc. appeal from a jury verdict awarding $400,000 in actual damages and $250,000 in punitive damages to Mark Kelley on Kelley's claims he was libeled by a series of articles Wren wrote for The Sun News of Myrtle Beach. We affirm.

I. Facts and Procedural History

In 2010, David Wren, an investigative reporter for The Sun News, obtained information that South Carolina Republican gubernatorial candidate Gresham Barrett,¹ four Myrtle Beach City Council incumbents, and seven state legislators received significant campaign contributions from multiple limited liability companies (LLCs), many of which had few assets and no revenue. In the process of investigating the contributions, Wren learned about a 2009 lunch meeting involving Barrett, lobbyist Mark Kelley, and Myrtle Beach Area Chamber of Commerce president Brad Dean. At the meeting, Dean delivered to Barrett approximately $84,000 in campaign contributions.

Wren wrote three articles for The Sun News discussing various aspects of Myrtle Beach-area campaign contributions that he believed appeared unethical. Primarily, Wren's articles suggested the LLCs' contributions to Barrett and other local politicians were actually donations from the chamber of commerce, which passed the funds through the LLCs. Wren also discussed the lunch meeting involving Barrett, Dean, and Kelley in the articles. In the first article—published May 21, 2010—Wren wrote,

Mark Kelley, a lobbyist for the chamber of commerce, also attended that meeting, according to Barrett....

There are strict rules that forbid lobbyists from facilitating campaign donations for statewide candidates; however, a spokeswoman for the S.C. Ethics Commission said it does not appear any laws were violated in this case.

"Just being in the same room is not a violation, it happens all the time," said ... the commission's general counsel. "He [Kelley] is not supposed to touch the envelope or hand over the envelope."

In a second article—published May 23, 2010—Wren again mentioned the meeting and wrote, "Dean, along with chamber lobbyist Mark Kelley, delivered about $84,000 of those contributions to Barrett in June." On May 25, 2010, the newspaper published a third article authored by Wren that included a quote from the president of a Myrtle Beach-area interest group: " ‘In the past, the chamber has denied any involvement in this scandal, but now Brad Dean admits he set up the lunch with [chamber] lobbyist Mark Kelley and he handed Mr. Barrett the envelope full of checks,’ said Robert Kelley, who is not related to the lobbyist." Each of the articles contains at least one statement that the contributions were—or "appear to have been"—legal.

On May 30, 2010, the newspaper published an editorial in which it admitted it had little evidence to support its allegations that the chamber of commerce made illegal campaign contributions. However, it defended itself by arguing the contributions had an appearance of impropriety:

The darkest accusation in this affair is that the money in question came directly from the Myrtle Beach Area Chamber of Commerce as a kickback for passing the 1 percent sales tax for tourism advertising, passed out to City Council members and state representatives who helped make it happen—and, inexplicably, Gresham Barrett in his bid for governor.

There is virtually no evidence to prove this allegation, but there's a host of circumstance to make it plausible. As we now know based on David Wren's reporting, it was Myrtle Beach Area Chamber of Commerce President Brad Dean who personally handed the $84,000 in checks to Barrett, with lobbyist Mark Kelley sitting by his side. (If Kelley handed the money over, the transaction would have been explicitly illegal—effectively forcing Barrett to say Kelley had no involvement and pinioning the donations on Dean no matter what the unprovable truth is.)

The chamber's defense all along has been that the checks came not from the chamber, but from the companies under whose name the donations were made. Dean says now that he simply collected and delivered them. Again, there is no evidence disproving this statement, but the circumstances make it difficult to believe.

Approximately two years after the newspaper published the articles and editorial, Kelley filed a lawsuit asserting libel claims against Wren and Sun Publishing—the publisher of The Sun News. Kelley claimed Wren and Sun Publishing falsely accused him in the articles and editorial of violating state ethics laws by delivering campaign contributions to Barrett. The trial court found Kelley—a former member of the State House of Representatives—to be a public figure,² and a jury awarded Kelley $400,000 in actual damages and $250,000 in punitive damages.³

II. Law and Analysis

Wren and Sun Publishing raise five arguments on appeal: (1) the trial court erred in denying their motions for a directed verdict and judgment notwithstanding the verdict (JNOV) because Kelley presented no evidence Wren or Sun Publishing made a false and defamatory statement of fact, (2) the trial court erred in denying their motions for a directed verdict and JNOV because Kelley failed to present clear and convincing evidence Wren wrote the articles with actual malice, (3) the trial court erred in admitting expert testimony about the standards of professional journalism, (4) the trial court erred in ruling the damages awards were not so grossly excessive as to warrant a new trial absolute, and (5) the punitive damages award violates the free press guarantees of the First and Fourteenth Amendments.

A. Falsity

Wren and Sun Publishing argue the trial court erred in denying their motions for a directed verdict and JNOV because Kelley presented no evidence they made a false and defamatory statement of fact. See Erickson v. Jones St. Publishers, LLC, 368 S.C. 444, 465, 629 S.E.2d 653, 664 (2006) (stating a plaintiff in a defamation case must prove the defendant made a false and defamatory statement). In ruling on motions for a directed verdict and JNOV on the question of falsity, the trial court must view the evidence and all reasonable inferences in the light most favorable to the nonmoving party. See 368 S.C. at 463, 629 S.E.2d at 663 (reciting the standard for a directed verdict); see also RFT Mgmt. Co. v. Tinsley & Adams L.L.P., 399 S.C. 322, 331, 732 S.E.2d 166, 171 (2012) ("A motion for a JNOV is merely a renewal of the directed verdict motion."). The trial court should deny the motions where "the evidence is susceptible to more than one reasonable inference." Erickson, 368 S.C. at 463, 629 S.E.2d at 663. "When considering directed verdict motions, neither the trial court nor the appellate court has authority to decide credibility issues or to resolve conflicts in the testimony or evidence." Id.

We find the trial court properly submitted the question of falsity to the jury. First, there is ample, unrefuted evidence in the record Kelley did not deliver campaign contributions to Barrett. At trial, Kelley testified he believed Wren and Sun Publishing accused him of delivering campaign contributions to a gubernatorial candidate, which is a crime under subsection 2–17–80(A) of the South Carolina Code (2005).⁴ Kelley insisted he did not deliver the contributions, and Barrett testified Kelley never gave him campaign contributions or organized a campaign contribution meeting. Drea Byars—Barrett's aide who also attended the lunch meeting—testified Kelley did not deliver or touch the money Barrett received. Byars also stated Kelley did not know prior to the meeting that Dean planned to deliver the contributions. Moreover, Wren admitted at trial he had "[n]o evidence that [the money] came from Mark Kelley." Accordingly, any statement accusing Kelley of delivering contributions to Barrett is false.

Second, reading the articles in the light most favorable to Kelley, a reasonable jury could determine the articles—particularly the statement in the May 23 article that "Dean, along with chamber lobbyist Mark Kelley, delivered about $84,000 of those contributions to Barrett"—accused Kelley of "delivering" campaign contributions and thus accused him of committing a crime. Kelley testified he believed the statement meant both he and Dean delivered contributions to Barrett. Kelley also presented several witnesses—including Barrett and State House of Representatives members Alan Clemmons, Nelson Hardwick, and George Hearn—who testified they believed Wren accused Kelley of committing a crime by delivering campaign contributions. Although Wren argues the phrase "along with" merely meant Kelley was present when Dean delivered the contributions, we find the statement in the May 23 article can reasonably be interpreted to mean Dean and Kelley delivered campaign contributions to Barrett. In fact, we believe a person reading the May 23 article would be far more likely to interpret the statement as an allegation of illegal conduct by Kelley than a mere statement he was present. Therefore, the issue of whether Wren accused Kelley of committing a crime by delivering contributions was a question of fact for the jury, and the trial court did not err in denying Wren's and Sun Publishing's motions for a directed verdict and JNOV.

B. Actual Malice

Wren and Sun Publishing also argue the trial court erred in denying their motions for a directed verdict and JNOV because Kelley did not present clear and convincing evidence Wren wrote the articles with actual malice.

A public figure seeking damages for...