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Defamation Claims Remain Disfavored Under New Jersey Law

By:  Kenneth L. Moskowitz, Esq. and Steven R. Rowland, Esq.

In Petro-Lubricant Testing Laboratories v. Adelman, 233 N.J. 236 (2018), the New Jersey Supreme Court issued a significant opinion addressing two basic issues of defamation law:  first, when does the one-year statute of limitations commence on internet defamation?   And, second, is a fair and accurate report of litigation pleadings actionable as defamation where the allegations are disputed?

By way of background, Petro-Lubricant (“Company”) sued Adelman — who ran a website called “eBossWatch.com” — the publisher of an article which described a lawsuit against the Company brought by a former Company employee.  The original article summarized and quoted the lawsuit’s allegations and was published in December 2010.  After the one-year statute of limitations period expired, the attorney informed the website operator, Adelman, that the case had been settled, and that the suit had been baseless.  The Company’s attorney demanded that the article be removed from the website.  In response, Adelman made certain changes to the underlying article — quoting even more extensively from the Complaint that had been filed in Court and making it even clearer that the article was based only on the allegations of the former employee’s filed Complaint.  The article, as modified, remained on the website notwithstanding the Company’s assertion that the lawsuit was baseless.

The trial court and Appellate Division agreed that the statute of limitations barred the claims, reasoning that both the original and the revised articles were essentially the same, and that the edited article did not revive the limitations period.  In particular, under the “single publication rule,” the “first edition” of a defamatory writing commences the one-year limitations period.  However, under that somewhat murky rule, a subsequent publication of the same defamatory statement in a later issue would constitute a separate publication subject to a separate/new limitations period.  Likewise, an article or book that was substantially modified was classified as a republication subject to a separate limitations period.  In the case of an internet publication, the Supreme Court determined that “a republication occurs to an online publication if an author makes a material and substantive change to the original defamatory article.”

Interestingly, the justices split — 4 to 3 — on whether the changes made to the article were “material and substantive” enough to trigger a new limitations period, with the majority finding a new, separate publication.  While the single publication rule will bar a claim in the absence of any change to an internet article, whether the subject changes are “material and substantive” — resulting in a new limitations period — is to be determined on a case-by-case basis.  That the Supreme Court so closely split, 4 to 3, suggests the muddled nature of the boundary between what is immaterial and non-substantive — and therefore time-barred — and a later publication that is different enough to warrant the commencement of its own new, separate limitations period.

Second, the Supreme Court also described and delineated the “fair report” privilege.  That privilege recognizes that a fair and accurate report of a pleading — a “substantially” accurate report– is not actionable defamation.  As to the later article which was not time-barred,  the Court held:  “[T]he modified article is protected by the fair report privilege because the article [represented] a full, fair, and accurate report of [the] civil complaint … which alleged, at great length, gender discrimination, workforce harassment, and retaliation.”  That is, so long as a reasonable reader would understand that the article was reporting the allegations of a civil lawsuit, its publication was privileged.  Since the article was clearly reporting on the allegations of the Company’s former employee’s Complaint, the Supreme Court affirmed the dismissal of the employer’s subsequent defamation Complaint.

In summary, the New Jersey Supreme Court continues to view defamation lawsuits unfavorably, and rules that protect publishers — the “single publication rule” and the “fair report privilege” — are employed by our courts to defeat “overreaching” defamation claims.  “[O]ur common law provides special safeguards to protect speech from unwarranted attacks through the legal process.”

©Copyright 2018, Brown Moskowitz & Kallen, P.C.  All rights reserved.  This article is for informational purposes only and is not intended to constitute, and does not constitute, legal advice.

For further information please feel free to contact either Kenneth L. Moskowitz, Esq. (klm@bmk-law.com) or Steven R. Rowland, Esq. (srowland @bmk-law.com), or call either  at 973-376-0909.

Mr. Moskowitz is a former prosecutor and is a founding partner of Brown Moskowitz & Kallen, P.C., in Summit New Jersey.  He represents clients in diverse business disputes, commercial litigation, internal investigations, “corporate divorce” matters, insurance coverage litigation and other business related disputes.   

Mr. Rowland is a litigation partner at Brown Moskowitz & Kallen, P.C.  He represents corporate clients in complex litigation matters including business disputes, commercial litigation, insurance coverage, and construction.  He also has substantial appellate experience with numerous reported decisions.

 

Sticky
Jul 18, 2018
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Selling Your Business, Step 1: The Broker’s Agreement

By: Stuart M. Brown, Esq.

Selling your business will be complicated, emotional and, almost definitely, stressful.  Once you decide to sell your business, the first step is usually hiring an intermediary – either a business broker or an investment banker.  The intermediary will ask you to enter into an engagement agreement.  This person is working for you and with you, so sellers frequently choose not to have a mergers and acquisitions attorney review the engagement agreement before signing it.  Besides, you may think, what could go wrong?   Plenty!  To avoid uncertainty while ensuring a clear understanding of the specific terms you are committing to, at what cost, and for how long, hire an M&A attorney to review the engagement agreement.

Here are some deal points to keep in mind when entering into engagement agreements with intermediaries:

The agreement should provide a reasonable period of time for the intermediary to prepare a confidential information memorandum and market your business.  This is known as the exclusivity period.  The exclusivity period should be an amount of time that you and the intermediary believe is reasonably sufficient to market your business and close a deal; however, there should be a defined end point.  A defined termination date will guide and incentivize the intermediary and create an orderly exit from the relationship with the intermediary.Read More

Sticky
Mar 29, 2017
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The Claim of An Implied Duty To Comply With “Industry Standards” For Protecting Clients’ Confidential Information

The Continuing Evolution Of Cybersecurity Risk Management

By: Kenneth L. Moskowitz, Esq. and James D. DeBartolo, Esq.

In April 2015, a client of the Chicago based law firm Johnson & Bell, LTD (“J&B”) filed a class action lawsuit in federal court in Illinois against its attorneys charging that they failed to protect their clients’ confidential information (“Action”).[1]  The Action and the claims asserted therein are compelling reminders of the evolving risks facing those entrusted to protect their clients’ confidential data.  Plaintiffs allege in the Action that, notwithstanding the fact that J&B had not suffered a cybersecurity breach to date that had caused them any harm or damage, the firm nonetheless should be adjudged liable for failing to maintain “industry standard” cybersecurity  protections.

Read More

Sticky
Jan 26, 2017
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Theft of Computer Data And Other Cyber Attacks

A Survey Of Relevant Statutory Law And Some Practical Considerations

By: Kenneth L. Moskowitz, Esq. and James D. DeBartolo, Esq.

The business community and employers are under the constant threat of the conversion or corruption of their invaluable computer assets by employees, competitors and “hackers.” To address these ever-present and evolving threats, both the United States and the State of New Jersey have enacted statutes that both criminalize such conduct and provide for private causes of action that include remedies designed not only to make the victim whole, but to punish and deter such unlawful conduct. This article presents a brief survey of the relevant statutes,[1] and offers some practical risk mitigation strategies to be considered by the business owner before his or her business becomes just another victim.Read More

Sticky
Jul 19, 2016
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