Menkowitz v. Peerless Publications, Inc.

211 A.3d 797

Elliot MENKOWITZ, M.D., Appellant

v.PEERLESS PUBLICATIONS, INC. and Eric Engquist, Appellees

No. 40 MAP 2018

Supreme Court of Pennsylvania.

Argued: March 6, 2019

Decided: July 17, 2019

Michael E. Baughman, Esq., Eli Mordecai Segal, Esq., Pepper Hamilton LLP, for Amicus Curiae Pennsylvania NewsMedia Association.

Jennifer Myers Chalal, Esq., Alan B. Epstein, Esq., Spector Gadon & Rosen, P.C., for Appellant Elliot Menkowitz.

Michael Louis Berry, Esq., Paul Joseph Safier, Esq., Ballard Spahr LLP, for Appellee Peerless Publications, Inc. & Eric Engquist.

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

OPINION

JUSTICE DONOHUE

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. , 634 Pa. 35, 129 A.3d 404 (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, 84 S.Ct. 710, 11 L.Ed.2d 686 (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 , 592 Pa. 66, 923 A.2d 389, 400 (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 ., 301 Pa.Super. 475, 448 A.2d 6, 15 (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, 109 S.Ct. 2678, 105 L.Ed.2d 562 (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...