FOUNTAIN VIEW MANOR v. SHEWARD

FOUNTAIN VIEW MANOR v. SHEWARD
2019 OK CIV APP 77
Case Number: 116693
Decided: 04/05/2019
Mandate Issued: 12/11/2019
DIVISION I
THE COURT OF CIVIL APPEALS OF THE STATE OF OKLAHOMA, DIVISION I

FOUNTAIN VIEW MANOR, INC., an Oklahoma Corporation, Plaintiff/Appellant,
v.
HOWARD SHEWARD, Jr., Defendant/Appellee.

APPEAL FROM THE DISTRICT COURT OF
OKMULGEE COUNTY, OKLAHOMA

HONORABLE KEN ADAIR, JUDGE

AFFIRMED

Joel L. Wohlgemuth, Barrett L. Powers, Tulsa, Oklahoma, for Appellant,

Thomas Mortensen, James Sicking and Katrina Lucas, Tulsa, Oklahoma, for Appellee.

Larry Joplin, Presiding Judge:

¶1 Appellant/Plaintiff, Fountain View Manor, Inc. (FVM), seeks review of the district court's order granting summary judgment in favor of the Appellee/Defendant, Howard Sheward, Jr., upon Appellant/Plaintiff's remaining claims for defamation relating to written materials Sheward disseminated about alleged improper use of city resources to correct sewage issues at Fountain View Manor, a private property in Henryetta, Oklahoma.

¶2 Appellant/FVM filed a motion for partial summary judgment on March 3, 2017. Appellee/Sheward filed a motion for summary judgment on July 24, 2017. A hearing on the competing motions was held on November 29, 2017, at the conclusion of which the district court ruled in favor of Sheward's motion for summary judgment on the remaining libel and damages claims of FVM/Appellant.1 FVM/Appellant's partial motion for summary judgment was denied.

¶3 In December 2014, after becoming concerned with raw sewage leaking into the street from under a manhole cover and observing the continued presence of city trucks at FVM's property, Sheward sent an open records request to the city clerk in an effort to obtain information about the use of the city resources at FVM. Sheward said his open records request was ignored.

¶4 In 2015, FVM began work to repair a sewer main line under part of the FVM building facility. According to both parties the repair was costly, in excess of $100,000. Sheward, who lived across the street from FVM, testified the project took approximately a month to complete and city vehicles were constantly at the FVM site, using vacuum trucks to vacuum sewage during the course of the sewer line repair. Sheward believed FVM was wrongly taking advantage of city vacuum trucks and other resources in order to repair the sewer line on the private property. Sheward believed the Mayor of Henryetta, who was also the administrator of FVM, used her connections with the city to improperly procure the use of city resources, costing the taxpayers significantly for work the public should not be responsible for, given that FVM is a privately owned entity on privately owned property.

¶5 FVM's petition2 alleges Sheward went onto FVM property on a number of occasions, taking photos, speaking with FVM employees and with employees of the plumbing company hired to do the sewer line work. FVM was granted a Temporary Restraining Order (TRO) in October 2015, ordering Sheward to refrain from entering the FVM property, taking photos or videos or communicating with FVM employees. In late 2015 to early 2016, an agreement was reached between FVM and Sheward wherein Sheward would agree to cease his activities criticizing FVM and FVM would dismiss its then-pending action against Sheward and vacate the TRO. Sheward agreed and the action was dismissed without prejudice in January 2016. The TRO was vacated. FVM alleged Sheward violated the agreement when he continued his critical commentary and contacted the paper and distributed materials (flyers and emails) saying FVM had sued him for a million dollars in an effort to cover up the misuse of city resources. At the end of January 2016, FVM sent Sheward a letter demanding he cease his actions in violation of the agreement; no response from Sheward was forthcoming. FVM filed another libel and slander petition on February 10, 2016 and an amended petition on June 13, 2016.

¶6 FVM filed a notice of tort claim against the City of Henryetta stating that a "city sewer main running under part of our building...collapsed" and claimed $102,953.96 was spent to fix the sewer line issue. At a September 2015 city counsel meeting, FVM co-owner asked the city to pay $39,500 toward the cost of the repair. At the city counsel meeting, the co-owner described the damage as a "break" in the line, not a collapse. After the city counsel meeting, Sheward prepared a flyer addressed to the taxpayers and voters and called upon them to contact city hall and ask the city officials to vote against FVM's tort notice payment request.

¶7 On November 29, 2017, a summary judgment hearing was scheduled to address Sheward's request to dismiss the libel claims made by FVM, the slander claims having already been dismissed by FVM prior to the hearing.

Libel is a false or malicious unprivileged publication by writing, printing, picture, or effigy or other fixed representation to the eye, which exposes any person to public hatred, contempt, ridicule or obloquy, or which tends to deprive him of public confidence, or to injure him in his occupation, or any malicious publication as aforesaid, designed to blacken or vilify the memory of one who is dead, and tending to scandalize his surviving relatives or friends.

12 O.S. 2011 §1441. "A writing is libelous per se 'when the language used therein is susceptible of but one meaning, and that an opprobrious one, and the publication on its face shows that the derogatory statements, taken as a whole, refer to the plaintiff.' Fite v. Oklahoma Pub. Co., 146 Okla. 150, 293 P. 1073 (1930) (syllabus by the court)." Sturgeon v. Retherford Publ'ns, Inc., 1999 OK CIV APP 78, 987 P.2d 1218, 1223.

¶8 Sheward's various attempts to distribute and gather information concerning FVM, the mayor and the misuse of city resources included the following. First, Sheward sent an open records request to the city clerk on December 23, 2014 asking for information regarding city services provided to address sewer and sanitation efforts at FVM. On March 1, 2015, Sheward sent an email to the city manager and others complaining that city services responding to FVM and assisting in the sewer repair or cleanup were i mproper; and Sheward indicated he had photos and other information regarding possible misuse of the city's resources. On May 11, 2015, Sheward sent an email to the mayor and others regarding the mayor's improper use of city resources in aid of FVM, and accusing the mayor of "struggling with censorship of your illegal activities." On August 2, 2015, Sheward made another open records act request, seeking information about the city services provided to assist FVM with its sewage cleanup issue. Shortly after a September 18, 2015 city counsel meeting at which FVM requested reimbursement from the city for part of the sewer repair costs, Sheward distributed a flyer among the "taxpayers and registered voters" of Henryetta, informing the public of the raw sewage problems, the use of city resources and the high cost of the repair. In the flyer, Sheward asked the citizens to contact their councilmen and stop FVM's effort to force the city to pay for any part of the repair and ask the city to instead file suit against FVM for recovery of funds used in the past to maintain the line, as well as demand removal of the portion of the building that was improperly built over the city easement where the sewer line was located. On October 1, 2015, Sheward sent another email to the mayor, city manager and others regarding a complaint and EPA investigation of the sewage matter. Sheward also said FVM made improper threats against the city, Sheward represented that FVM claimed it would file a tort claim against the city if the city did not help pay for the repair. In the October 1, 2015 email, Sheward said the city attorney "should be filing a civil and criminal law suit against the owners of Fountain View Manor." On January 27, 2016, Sheward sent an email to the local paper asking to be given "an equal voice on a Free Lance editorial [ ] of a September 2015 city council topic." Sheward also said FVM had sought a million dollar suit against him in order to keep him quiet about his concerns with the mayor's abuse of city resources. Shortly thereafter, on February 10, 2016, FVM filed its petition marking a second suit against Sheward due to his failure to honor the earlier agreement to keep quiet about his allegations of misuse of city resources.

¶9 Sheward's motion for summary judgment was premised on his assertion that he had the right to seek and disseminate information regarding his allegations of misuse of city resources for the benefit of a private business with which the mayor had a close relationship.3 Sheward asserted FVM engaged in a SLAPP litigation lawsuit in an effort to silence him from exposing the mayor's wrongdoing and the city's misuse of labor, trucks, supplies and other resources for the benefit of FVM, a facility for which the mayor was administrator.4

¶10 The appealed from order of the district court granted Sheward's summary judgment motion. First the court granted Sheward's summary judgment motion with respect to claims Nos. 1, 2, 6, and 8. In its findings of fact and conclusions of law the court stated Sheward,

...presented substantial evidence that Plaintiff [FVM] engaged in "Strategic Litigation Against Public Participation" - or "SLAPP" litigation - when it filed this lawsuit, which is prohibited under Oklahoma law,...Plaintiff [FVM] filed the above-captioned matter primarily as its purpose to silence the Defendant [Sheward] from being critical of "public figures" about "matters of public concern." Plaintiff's alleged injuries, if any, were the result of Defendant's [Sheward] privileged communications involving the "right to petition" and/or "right to free speech" that are protected by the First Amendment to the United States Constitution[.]

The court further found Sheward's alleged defamatory remarks were directed at a "public figure" about a "matter of public concern" and were not actually directed at the corporate entity (FVM). The court found Sheward's statements were "core political speech" protected by the First Amendment and that the remarks were Sheward's "opinions," for which Sheward was not required to use the word "opinion" or provide a disclaimer in order to benefit from the protections of the First Amendment or the anti-SLAPP statute. The court also found the alleged defamatory remarks were "fair comments," immune from lawsuit.5

¶11 Summary judgment is proper where there is no issue of material fact in dispute and the party moving for summary judgment is entitled to judgment as a matter of law. Wathor v. Mutual Assurance Adm'rs, Inc., 2004 OK 2, ¶4, 87 P.3d 559, 561;

Trice v. Burress, 2006 OK CIV APP 79, ¶9, 137 P.3d 1253, 1257. A summary judgment decision involves purely legal determinations by the court and the appellate court's standard of review is de novo. Trice v. Burress, 2006 OK CIV APP 79, ¶9, 137 P.3d at 1257.

¶12 The district court found FVM engaged in litigation primarily for the purpose of silencing Sheward from criticizing a "public figure" on a "matter of public concern." In considering whether Sheward's communications were privileged, 12 O.S. Supp.2014 §1431 provides definitions for several terms under the Oklahoma Citizens Participation Act.6
Krimball, 2018 OK CIV APP 37, ¶34, 417 P.3d at 1249. Using the statutory language as a guide, it is apparent Sheward's flyer and correspondence communications addressed a matter of public concern, for which he had a right to exercise free speech. Sheward's effort to gather information and provide information to the citizens and city taxpayers about the sewage leaking into the street, the use of city resources on the private property of FVM a business with which the mayor was closely related, FVM's request for reimbursement of its sewage repair from the city, and FVM's possible role in damaging the sewer line in the first place, having built part of its facility over the city easement that held the sewer line, are all matters of public concern about which Sheward was trying to inform the public. The raw sewage leaking into the street could impact both public health and environmental well being; the mayor's possible role in securing city services to help with the sewer repair (requesting money and use of vacuum trucks) implicated economic and community well being, a public official and local government in general, including government finances. As a result, Sheward's communication endeavors were aimed at legitimate matters of public concern for which he had the right to petition in the exercise of his free speech, under the terms of 12 O.S. §1431 and the First Amendment, as stated in the appealed from order.

¶13 Sheward also successfully demonstrated FVM brought suit against him in an effort to keep him from publicly criticizing the mayor and questioning the use of city finances. This is evident in the January 2016 agreement between Sheward and FVM to drop the lawsuit if Sheward stopped his public campaign attempts to expose the mayor's influence and spending. The mayor's own deposition testimony indicates Sheward's silence was the objective of the lawsuit as well; the mayor said the following when asked about the agreement to drop the original suit against Sheward in early 2016:

Q: Okay. And around November 2, 2015, were you aware that conversations about dismissing this lawsuit had already taken place? A: Yes. ...
A: If he would stop his actions against Fountain View Manor, then we would drop the suit. Q: Okay. And his actions are communicating with other individuals, talking, oral statements and written statements; right? A: Yes. Q: Okay. So if Mr. Sheward were to just be silent about it, you would dismiss the lawsuit? A: Yes.

The original lawsuit was dismissed in January 2016 and a second was refiled shortly thereafter (February 10, 2016) when Sheward contacted the editor of the paper and the dismissal agreement was effectively abandoned.

¶14 The district court found Sheward's pleadings were such that he was able to demonstrate FVM "confessed" the alleged defamatory remarks in claims Nos. 10, 11, 12, 14, 15, and 16 were "substantially true," so that the statements were not false and were, in fact, privileged. The district court also found Sheward was not required to insert a "disclaimer" or use the word "opinion" in his texts in order to "avail himself of this qualified privilege[,]" because Sheward was a layperson not required to use such precise language.

As a general rule, statements which are opinionative and not factual in nature, which cannot be verified as true or false, are not actionable as slander or libel under Oklahoma law. However, if an opinion is stated as or "is in the form of a factual imperative," or if an opinion is expressed without disclosing the underlying factual basis for the opinion, the opinion is actionable under Oklahoma law if the opinion implies or creates a reasonable inference that the opinion is justified by the existence of undisclosed defamatory and false facts.

Bird Constr. Co., Inc. v. Oklahoma City Housing Auth., 2005 OK CIV APP 12, ¶10, 110 P.3d 560, 564 (citing Metcalf v. KFOR-TV, Inc., 828 F. Supp. 1515, 1529 (W.D.Okla.1992)). Sheward expressed his opinions and included the disclosure of the underlying factual basis on which he formed the opinions. As a result, Sheward's narratives were either confessed by FVM as true or were accompanied by the underlying explanations, neither kind of statement is actionable under the rationale of Bird Construction and anti-SLAPP legislation.

¶15 Based on the record provided, we do not find error in the district court's grant of Sheward's summary judgment motion. His communications were an effort to alert the public to a matter of public concern, about a public official, who had a close relationship to a private entity and Sheward believed the mayor was abusing her public office by funneling public resources and requests for reimbursement to the private entity. The summary judgment order of the district court is AFFIRMED.

GOREE, C.J., and BUETTNER, J., concur.

FOOTNOTES

1 FVM had previously dismissed claims for slander and a requested injunction (First Amended Petition claims 5, 7, 9, 13 and 19). The remaining claims for which the hearing was held related to FVM's allegations of libel and claims for damages.

2 First Amended Petition filed June 13, 2016.

3 Sheward addressed FVM's libel claims in his motion for summary judgment as follows, the slander claims having been dismissed prior to the November 29, 2017 hearing: a) FVM claim I libel per se for October 1, 2015 email to the mayor and others, alleging Sheward made a false statement accusing FVM owners of embezzlement of taxpayer funds; b) FVM claim II libel per se for the flyer distributed to third parties, "taxpayers and registered voters"; c) claim III libel per se FVM alleged was contained in the March 1, 2015 email in which FVM alleged Sheward made a false statement of embezzlement of taxpayer resources; d) claim IV libel per se for allegations Sheward made in the May 11, 2015 email in which FVM said Sheward made a false statement that FVM was guilty of felony embezzlement; e) claim VI libel per se for alleged false statements made in his October 8, 2015 letter to the city attorney; f) claim VIII libel per se regarding Sheward's October 1, 2015 email in which FVM claimed Sheward made a false statement regarding blackmail; g) claim X libel per se for statements made by Sheward in the flyer, in which Sheward explained the cause of the sewer trouble was due to the improper actions of FVM; h) claim XI libel per se for statements made in the October 8, 2015 letter to the city attorney regarding the cause of the sewer break, which Sheward alleged was the fault of FVM building over the sewer line; i) claim XII libel per se again for statements Sheward made in the October 8, 2015 letter to the city attorney about the cause of the sewer line issue, which Sheward said was the fault of FVM; j) claim XIV libel per se for Sheward making what FVM said were false statements about the first cause of action FVM brought against Sheward in statements Sheward made in his January 27, 2016 email to the journalist at the Free Lance, in which Sheward said FVM filed a "million dollar lawsuit" against him; k) claim XV libel per se for Sheward making false statements about a "cover up" in the same January 27, 2016 email to the journalist; l) claim XVI libel per se again for January 27, 2016 email in which FVM said Sheward made a statement indicating a "cover up" occurred with regard to the use of the city resources. Sheward addressed claim XVIII in his motion regarding FVM's requested damages.

4 SLAPP litigation (Strategic Lawsuit Against Public Participation) is "the result of an increasing tendency by parties with substantial resources to file meritless lawsuits against legitimate critics, with the intent to silence those critics by burdening them with the time, stress, and cost of a legal action." Krimbill v. Talarico, 2018 OK CIV APP 37, ¶7, 417 P.3d 1240, 1245. The Oklahoma Legislature enacted the Oklahoma Citizens Participation Act (OCPA) "to encourage and safeguard the constitutional rights of persons to petition, speak freely, associate freely, and otherwise participate in government to the maximum extent permitted by law and, at the same time, protect the rights of [persons] to file meritorious lawsuits for demonstrable injury." 12 O.S. Supp. 2014 § 1430." Krimbill, 2018 OK CIV APP 37, ¶6, 417 P.3d at 1245. The district court in this case commented that it agreed Sheward's motion for summary judgment was premised on the principles of anti-SLAPP protections for citizens, but noted the instant suit against Sheward was at the summary judgment stage and the anti-SLAPP statute, §1430, was intended to address these abusive suits earlier in the process, even before the summary judgment phase.

5 The district court adopted the reasoning provided for the grant of summary judgment as to claims Nos. 1, 2, 6 and 8 and incorporated the same reasoning and rationale for the grant of Sheward's summary judgment with respect to claims Nos. 3, 4, 10, 11, 12, 14, 15 and 16. The district court also found claims Nos. 3 and 4 were time-barred as being outside the statute of limitations. With regard to claims Nos. 10, 11, 12, 14, 15, and 16, the district court found Plaintiff/Appellee [FVM] confessed the alleged defamatory remarks were "substantially true." Plaintiff/Appellee claims Nos. 17 and 18 requested compensatory and punitive damages and were rendered moot.

6 12 O.S. Supp.2014 §1431 (emphasis added):

As used in the Oklahoma Citizens Participation Act:

1. "Communication" means the making or submitting of a statement or document in any form or medium, including oral, visual, written, audiovisual or electronic;

2. "Exercise of the right of association" means a communication between individuals who join together to collectively express, promote, pursue or defend common interests;

3. "Exercise of the right of free speech" means a communication made in connection with a matter of public concern;

4. "Exercise of the right to petition" means any of the following:

a. a communication in or pertaining to:

(1) a judicial proceeding,

(2) an official proceeding, other than a judicial proceeding, to administer the law,

(3) an executive or other proceeding before a department or agency of the state or federal government or a political subdivision of the state or federal government,

(4) a legislative proceeding, including a proceeding of a legislative committee,

(5) a proceeding before an entity that requires by rule that public notice be given before proceedings of that entity,

(6) a proceeding in or before a managing board of an educational or eleemosynary institution supported directly or indirectly from public revenue,

(7) a proceeding of the governing body of any political subdivision of this state,

(8) a report of or debate and statements made in a proceeding described by division (3), (4), (5), (6) or (7) of this subparagraph, or

(9) a public meeting dealing with a public purpose, including statements and discussions at the meeting or other matters of public concern occurring at the meeting,

b. a communication in connection with an issue under consideration or review by a legislative, executive, judicial or other governmental body or in another governmental or official proceeding,

c. a communication that is reasonably likely to encourage consideration or review of an issue by a legislative, executive, judicial or other governmental body or in another governmental or official proceeding,

d. a communication reasonably likely to enlist public participation in an effort to effect consideration of an issue by a legislative, executive, judicial or other governmental body or in another governmental or official proceeding, and

e. any other communication that falls within the protection of the right to petition government under the Constitution of the United States or the Oklahoma Constitution;

5. "Governmental proceeding" means a proceeding, other than a judicial proceeding, by an officer, official or body of this state or a political subdivision of this state, including an agency, board or commission, or by an officer, official or body of the federal government;

6. "Legal action" means a lawsuit, cause of action, petition, complaint, cross-claim, counterclaim or any other judicial pleading or filing that requests legal or equitable relief;

7. "Matter of public concern" means an issue related to:

a. health or safety,

b. environmental, economic or community well-being,

c. the government,

d. a public official or public figure, or

e. a good, product or service in the marketplace;

8. "Official proceeding" means any type of administrative, executive, legislative or judicial proceeding that may be conducted before a public servant; and

9. "Public servant" means a person elected, selected, appointed, employed or otherwise designated as one of the following, even if the person has not yet qualified for office or assumed the person's duties:

a. an officer, employee or agent of government,

b. a juror,

c. an arbitrator, referee or other person who is authorized by law or private written agreement to hear or determine a cause or controversy,

d. an attorney or notary public when participating in the performance of a governmental function, or

e. a person who is performing a governmental function under a claim of right but is not legally qualified to do so.