Thursday, March 13, 2008

Defamation liability in internal investigations?


Jackson v. City of Columbus, decided today by the Ohio Supreme Court, illustrates the importance of being thorough in all internal investigations of employee misconduct, and only disclosing the results of such investigations on a need to know basis.

The Mayor of Columbus asked his Columbus Public Safety Director, Thomas Rice, to conduct an internal investigation of his Police Chief, James Jackson, on allegations of police corruption. In June 1997, Rice presented his report of the investigation to the Mayor and released it to the public. In the report was a statement attributed to Keith Lamar Jones, an inmate at the Chillicothe Correctional Institution, which alleged that Jackson had impregnated a juvenile prostitute. A polygraph conducted during the interview of Jones concluded that he was deceptive during the interview but that his statements about the underage prostitute were not entirely invalid. Following the public release of the report, Jackson filed a defamation suit against the City. Both the trial court and the court of appeals found in the City's favor, in that the comment about the juvenile prostitute was subject to a public interest privilege. The Ohio Supreme Court accepted the case on the issue of whether one "commits defamation by publishing the defamatory statements of a third party when the publisher has a high degree of awareness of the probable falsity of those statements.”

Defamation occurs when a publication contains a false statement "made with some degree of fault, reflecting injuriously on a person’s reputation, or exposing a person to public hatred, contempt, ridicule, shame or disgrace, or affecting a person adversely in his or her trade, business or profession." If a plaintiff makes out a defamation case, a respondent may then invoke a conditional or qualified privilege, which must be supported by "good faith, an interest to be upheld, a statement limited in its scope to this purpose, a proper occasion, and publication in a proper manner and to proper parties only." A qualified privilege may be defeated only if a plaintiff proves with convincing clarity that a publisher acted with actual malice. "Actual malice" is defined as "acting with knowledge that the statements are false or acting with reckless disregard as to their truth or falsity." "reckless disregard", in turn, means that a publisher of defamatory statements acts with a "high degree of awareness of their probable falsity," or when the publisher "in fact entertained serious doubts as to the truth of his publication."

The Ohio Supreme Court decided that the City abused its privilege in reporting that Jackson had impregnated a juvenile. First, the City relied solely on the word of a convicted felon with a history of being a liar, and who had a questionable polygraph result. Secondly, and perhaps more importantly, Rice never interviewed Jackson about the allegation. According to Jackson, had he been asked, Rice would have been told that Jackson had a vasectomy and could not have impregnated anyone.

Before you conclude that the Jackson case doesn't apply to your business, consider that it teaches some general lessons on the handling of all internal investigations. Ohio court have held that employers enjoy a qualified privilege to disclose the results of internal investigations. See Lennon v. Cuyahoga Cty. Juvenile Court; Blatnik v. Avery Dennison Corp. When conducting internal investigations into allegations of sexual harassment or other employee misconduct, Jackson highlights a couple of important points.

  • Consider your source. Who is providing certain information is as important as the information that is provided. Do not take what a witness says at face value without taking into consideration the witness's credibility. Does the witness have history of truthfulness? Does the witness have something to gain in the outcome, such as a promotion if another employee is terminated? Is the witness biased towards either the victim or accused? These questions are important in determining how much weight to give to a witness's statements, if any at all.
  • Only disclose to those who need to know. Confidentiality is key in any internal investigation, even more so if the allegations are as devastating as sex with an underage prostitute. The more widely you disclose the fruits of any investigation, the more you open yourself up to a claim that you have abused the qualified privilege. The best practice is to limit the sphere of knowledge to those who absolutely need to know, and further limit what is told to those who need to know. How much information to disclose and to whom is largely a judgment call, but as a rule of thumb less is better.