ROSSER v. CLYATT et al.; CLYATT v. GRADY ELECTRIC MEMBERSHIP CORPORATION
A18A0843, A18A0987
In the Court of Appeals of Georgia
November 2, 2018
McFADDEN, Presiding Judge.
FIFTH DIVISION; McFADDEN, P. J., RICKMAN and GOSS, JJ.
McFADDEN, Presiding Judge.
Under the Georgia Electric Membership Corporation Act,
The dispute ended up in court, and the parties settled. Five months later, Thomas A. Rosser, Sr., the former president and general manager who resigned pursuant to the settlement agreement, filed a defamation lawsuit against four Grady EMC members who had formed a group called Take Back Our Grady EMC; a
Case No. A18A0987 stems from a separate, but related, lawsuit. In that case, Grady EMC sued William Gordon Clyatt, one of the founders of Take Back Our Grady EMC. Grady EMC sought, among other things, to permanently enjoin Clyatt from publicly disclosing certain records obtained in the earlier, settled litigation. Clyatt appeals the trial court‘s order granting injunctive relief. Because there is no evidence that Grady EMC would suffer an imminent and irreparable injury absent the permanent injunction, we reverse the grant of injunctive relief. We affirm the trial court‘s other rulings.
Case No. A18A0843.
1. Background.
In 2014, Clyatt, a member of Grady EMC, began questioning some of management‘s decisions, including, among other things, lending $468,000 to Rosser; hiring Rosser‘s son as president and general manager of Grady EMC to succeed Rosser; and holding tens of millions of dollars in earnings instead of returning the money to the member-owners.
In April 2014, Clyatt met with Grady EMC leadership to discuss his concerns, but he was not satisfied with their response. Clyatt purchased nine advertisements in the local newspaper, the Cairo Messenger, to publicize his concerns. Other members of Grady EMC contacted Clyatt, and ultimately a group of them, including Clyatt and defendants Ronald Sellars, Seaborn Roddenberry, and Jerome Ellis, formed a committee they called “Take Back Our Grady EMC.”
Five months after the dismissal of the 2014 lawsuit, Rosser filed this action, alleging that certain statements written by Clyatt were defamatory. He sued Clyatt, Sellars, Roddenberry, Ellis, Jane and John Doe defendants, Deep South Coins and Jewelry, Inc., which is owned by Clyatt and whose Facebook page included statements about Rosser, and the Messenger Publishing Company, the publisher of the local newspaper, the Cairo Messenger, which published Clyatt‘s and Take Back Our Grady‘s paid advertisements about Rosser. The defendants answered the complaint and moved to strike it under
2. The anti-SLAPP statute applies.
(a) The two-step framework.
First enacted in 1996, the statute was significantly revised effective July 1, 2016. Neff v. McGee, 346 Ga. App. 522, 524 n. 2 (816 SE2d 486) (2018). The revised statute applies to this case even though some of the allegedly defamatory statements were made prior to July 1, 2016. See generally Crane Composites, Inc. v. Wayne Farms, LLC, 296 Ga. 271, 273 (765 SE2d 921) (2014) (“[B]ecause the rights created by the statute pertain to the conduct of litigation, the statute is acting prospectively, not retroactively, when applied to litigation commenced after the effective date.“). See also Atlanta Humane Society v. Harkins, 278 Ga. 451, 454 (1) (603 SE2d 289) (2004).
The revision did three things. It expanded the scope of protected speech to include any conduct that reasonably could be construed as conduct related to “a matter of public concern in furtherance of the right to petition, not just to speech
The revision “replaced the plaintiff‘s complaint verification requirement with a probability-of-success standard (subsection (b) (1))[.]” Id. And it “provided a right of direct appeal from the grant or denial of a motion to dismiss under the statute (subsection (e)).” Id. The statute now provides:
A claim for relief against a person or entity arising from any act of such person or entity which could reasonably be construed as an act in furtherance of the person‘s or entity‘s right of petition or free speech under the Constitution of the United States or the Constitution of the State of Georgia in connection with an issue of public interest or concern shall be subject to a motion to strike unless the court determines that the nonmoving party has established that there is a probability that the nonmoving party will prevail on the claim.
The application of the statute “involves a two-step process for determining whether a claim is subject to being stricken. In the first step, the defendant bringing an anti-SLAPP motion to [strike] must make a prima facie showing that the plaintiff‘s
“The burden then shifts to the plaintiff to demonstrate that there is a ‘probability’ that [he] will prevail on [his] claims at trial.
(b) The statute applies.
We agree with the trial court that the statements “could reasonably be construed as” having been made “in connection with an issue of . . . public concern,” see
We reject Rosser‘s argument that because the earlier lawsuit had been settled the matter was no longer a public concern. Under the settlement, Rosser and the other defendants did not admit liability. And the settlement agreement required the formation of a committee to study many of the issues Clyatt had questioned, including whether Grady EMC‘s patronage-capital policy (under which earnings are returned to members) should be modified; whether bylaws should be modified; and whether Grady EMC‘s policies regarding issuing company vehicles should be modified. The agreement required the committee to present its report to the board of directors and to Clyatt and the other plaintiffs by September 2016. In other words, some of the issues raised in the lawsuit had not been resolved.
Moreover, separate and apart from the settlement, the defendants (or at least some of them) sought to replace two members of the board of directors at an
Finally, indicating that the matter was still of public concern, on June 8, 2016, after the settlement and some of the allegedly defamatory statements had been made, the Cairo Messenger published a letter to the editor from the Grady EMC board itself. In the letter, the board expressed disappointment with Clyatt for continuing with his criticisms after the settlement of the lawsuit, voiced support for the leadership of Rosser and his son who succeeded him, and suggested that it was “time to move on.”
The trial court did not err in finding that the defendants met their burden of making a prima facie showing that the statements reasonably could be construed as
3. The trial court did not err in determining that Rosser had not established that there is a probability that he will prevail on his claims.
Rosser argues that the trial court erred in striking his lawsuit without determining whether there was a probability that he would prevail on his claims. See
Rosser then argues that, to the extent the trial court did make such a determination, the court erred. We disagree. We cannot say that the trial court erred in determining, based on the undisputed material facts, that Rosser had not satisfied his burden of demonstrating that there is a probability that he will prevail on his claims.
(a) The statements at issue.
In his brief, Rosser argues about the following allegedly defamatory statements contained in his complaint, all of which were written by Clyatt:
[Rosser] has stolen from the EMC for years. There are many ways to steal.
Did Tommy Rosser get money for [the Sowega Power, LLC] transaction?
One question to ask yourself why was Tommy Rosser forced to resign. Not for being a great employer or an honest person. He has stolen from the EMC for years.
Tommy Rosser had no idea that the fraud and corruption would be uncovered.
Were the personal cars of either Tommy Rosser, Bo Rosser, or their spouses paid for by the membership of the Grady EMC?
Did Tommy Rosser or any current former director, officer, or employee of Grady EMC ever have or had any ownership or membership interest or profit in any of the 7 for-profit LLCs and corporate entities in the past? We can prove that they did.
This is a conspiracy by the Rossers and some of the board members to benefit themselves with the funds and assets of the Grady EMC and its membership.
For over 70 years the past and present board members and three generations of Rossers have allowed corruption and unethical practices to take place at the Grady EMC.
If there are no unethical wrongdoings to answer for, then why did Tommy Rosser begin transferring all of his properties out of his name once the lawsuit was filed? Moving? Going on a trip? You be the judge.
Did the board and the Rossers receive kickbacks from vendors?
The Rossers, and others associated with Grady EMC have misled the members/owners for 78 years. They have used our money to enrich themselves while living lavish lifestyles. Tommy Rosser has mislead, pillaged the Grady EMC funds and worst of all, double-crossed all but one of the board of directors which he worked for . . . . One way that Tommy and Bo Rosser have misled the membership is through the forming of for-profit LLCs. If you will remember, this very same thing
happened at Cobb EMC. . . . These LLCs are a way the Rosser[s] and directors move and hide the members[‘] money.
The corrupt practices outlined in [Cobb EMC‘s] audit mirrors that which has been and is occurring at Grady EMC. Simply substitute the names and companies with the Rossers and Grady EMC and you‘ll have a clear picture of what has happened at Grady EMC.
(b) Opinion.
“The expression of opinion on matters about which reasonable people might differ is not libelous.” Davis v. Sherwin-Williams Co., 242 Ga. App. 907 (531 SE2d 764) (2000). Many of these statements, such as “Tommy Rosser had no idea that the fraud and corruption would be uncovered,” are non-actionable opinion as the trial court found. Rosser argues that even if some of the statements were opinion, they are nonetheless actionable because they imply defamatory facts that can be proven false. We disagree.
[Rosser‘s] reasoning is unpersuasive because implicit in it is the assumption that [the defendants] used the word[s] [“stolen, “steal,” “stole,” “fraud,” “corruption,” and “conspiracy“] in [their] legal sense and thereby implied some objective facts which make [Rosser guilty of crimes] as determined under Georgia law. Having reviewed [the defendants‘] statement[s] in . . . context[, as described in Division 2 (a)], we cannot make this assumption. It is apparent from the context . . . that
[the defendants] did not use the [words] in [their] legal sense or as a legal conclusion, but used [them] only to express [their] subjective opinion criticizing [Rosser‘s management of Grady EMC]. More importantly, the average reader would not have construed [the defendants‘] statement[s] to be . . . legal conclusions that [Rosser committed crimes]. . . . [Rather,] the average reader . . . would have taken the statement[s] for what [they were], [] subjective, hyperbolic opinion[s] that cannot be proved to be true or false and that concern[] a matter on which reasonable people might differ; i.e., [whether Rosser mismanaged Grady EMC to his benefit and to the detriment of the members].
Webster v. Wilkins, 217 Ga. App. 194, 195 (1) (456 SE2d 699) (1995) (citations omitted).
(c) Rosser is a limited-purpose public figure.
Whether Rosser is a public figure “is a critically important issue, because in order for a public figure to recover in a suit for defamation, there must be proof by clear and convincing evidence of actual malice on the part of the defendant. Plaintiffs who are private persons must only prove that the defendant acted with ordinary negligence.” Riddle v. Golden Isles Broadcasting, LLC, 275 Ga. App. 701, 703 (1) (621 SE2d 822) (2005) (citation and punctuation omitted).
Contrary to Rosser‘s argument, the evidence demonstrates that Rosser is a public figure for purposes of this controversy. When
an individual voluntarily injects himself or is drawn into a particular public controversy[, he may] become[] a public figure for a limited range of issues. Whether a person is a public figure is a question of law that requires the court to review the nature and extent of the individual‘s participation in the specific controversy that gave rise to the alleged defamation. A three-part analysis is used to determine whether an individual is a limited-purpose public figure. Under this analysis, a court must isolate the public controversy, examine the plaintiff‘s involvement in the controversy, and determine whether the alleged defamation was germane to the plaintiff‘s participation in the controversy.
Cottrell v. Smith, 299 Ga. 517, 525 (III) (A) (788 SE2d 772) (2016) (citation and punctuation omitted).
(1) The public controversy.
The first step in our analysis requires identification of a public controversy, which must be more than merely newsworthy. Rather, if it is evident that resolution of the controversy will affect people who do not directly participate in it, the controversy is more than merely newsworthy and is of legitimate public concern. In short, if the issue was being debated publicly and if it had foreseeable and substantial ramifications for nonparticipants, it was a public controversy. Moreover, courts must look only to those controversies that already existed in the public arena before the alleged defamation.
Ladner v. New World Communications of Atlanta, Inc., 343 Ga. App. 449, 453 (1) (a) (806 SE2d 905) (2017) (citations and punctuation omitted).
Here, the public controversy is the operation and management of Grady EMC under Rosser‘s and his son‘s tenures and the upcoming board elections. Although Rosser resigned from Grady EMC, many of the decisions that were the subject of the allegedly defamatory comments were made by Rosser in his capacity as head of Grady EMC. And “the resolution of the controversy will affect people who do not directly participate in it,” Ladner, supra, the more than 13,000 members of Grady EMC.
The controversy pre-existed the defendants’ allegedly defamatory statements and survived the settlement. As noted in Division 2 (b), supra, the settlement
(2) Rosser‘s involvement in the controversy.
“A plaintiff in a libel case must be deemed a public figure if he purposefully tries to influence the outcome of a public controversy or, because of his position in the controversy, could realistically be expected to have an impact on its resolution.” Atlanta Humane Society v. Mills, 274 Ga. App. at 163 (2) (b) (citation omitted). “[E]ven a single interview given to the media may be sufficient to establish a plaintiff as a limited-purpose public figure.” Id. (citations omitted).
(3) The alleged defamation was germane to Rosser‘s participation in the controversy.
An allegedly defamatory publication “is germane to a plaintiff‘s participation in a controversy if it might help the public decide how much credence should be given to the plaintiff.” Jones v. Albany Herald Publishing Co., Inc., 290 Ga. App. 126, 131 (1) (c) (658 SE2d 876) (2008) (citation omitted). As the former head of Grady EMC and the person who made the challenged decisions, Rosser was germane to the controversy and was a limited-purpose public figure in relation to it. Atlanta Humane Society v. Mills, 274 Ga. App. at 164 (2) (c).
“[I]n order for a public figure to recover in a suit for defamation, there must be proof by clear and convincing evidence of actual malice on the part of the defendant.” Ladner, 343 Ga. App. at 452 (1) (citation omitted). A public figure proves actual malice by showing by clear and convincing evidence that the person who made the defamatory falsehood did so “with knowledge of its falsity or with reckless disregard for the truth.” Williams v. Trust Co. of Georgia, 140 Ga. App. 49, 52 (I) (230 SE2d 45) (1976) (punctuation omitted). See also Evans v. Sandersville Georgian, Inc., 296 Ga. App. 666, 668 (1) (675 SE2d 574) (2009) (to avoid summary judgment in his defamation suit against publisher of newspaper, plaintiff had to “make a showing with clear and convincing evidence that the statements complained of were made with actual malice—that is, with knowledge that they were false or with reckless disregard for their truth or falsity“) (citation and punctuation omitted).
(T)he standard of proof of actual malice is extremely high; it must be shown by clear and convincing evidence that false and defamatory statements were published with actual malice. Actual malice in a constitutional sense is not merely spite or ill will, or even outright hatred; it must constitute actual knowledge that a statement is false or a reckless disregard as to its truth or falsity. Actual or constitutional malice is different from common law malice because knowledge of
falsity or reckless disregard of the truth may not be presumed nor derived solely from the language of the publication itself. Reckless disregard requires clear and convincing proof that a defendant was aware of the likelihood he was circulating false information. Thus, it is not sufficient to measure reckless disregard by what a reasonably prudent man would have done under similar circumstances nor whether a reasonably prudent man would have conducted further investigation. The evidence must show in a clear and convincing manner that a defendant in fact entertained serious doubts as to the truth of his statements.
Cottrell, 299 Ga. at 525-26 (II) (A) (citation omitted). “Publishing with such doubts shows reckless disregard for truth or falsity and demonstrates actual malice. [The] failure to investigate does not in itself establish bad faith.” Williams, 140 Ga. App. at 55 (III) (citations, punctuation, and emphasis omitted).
In arguing that Clyatt and the other defendants had actual malice, Rosser primarily points to evidence that he contends demonstrates that the statements were false. But “[i]t is not a question of the truth of the alleged falsehood. The defamatory statement may be false but it is still not actionable unless it was uttered with knowledge of its falsity or in reckless disregard for the truth.” Williams, 140 Ga. App. at 62 (IV) (emphasis in original).
Clyatt testified that he asked the question about Rosser transferring title to his properties once the 2014 lawsuit had been filed, because according to court documents, once the lawsuit was filed, Rosser transferred title to certain pieces of property. His question about the board and the Rossers receiving kickbacks was based on statements from unnamed sources, including, specifically, a statement that a manager had bragged about a tree-trimming company paying for his personal trips. Also, Clyatt questioned what could explain the $3.8 million renovation of the Grady EMC building, when the cost should have been half as much. He added that he had
Clyatt explained he based his questions about Sowega Power LLC — asking whether Rosser got money for the transaction — on the fact that Rosser was its registered agent. He based his statements and questions about the other for-profit LLCs on the research conducted by an attorney at a law firm that he consulted regarding his concerns. The attorney‘s research, according to Clyatt, had uncovered certain inexplicable transactions.
Clyatt believed that Rosser was forced to resign by the litigation committee that was appointed by the judge in the earlier action. Indeed, Rosser‘s counsel, during Clyatt‘s deposition, conceded that he knew that Clyatt thought that.
As for the question whether the membership of Grady EMC paid for the cars of Rosser, his son, and their spouses, Clyatt testified that he had asked for documents regarding this issue, but did not receive them. He noted, however, that 25 employees drove lavish, EMC-owned cars; they drove the cars home at night; and Grady EMC did not require them to pay for the personal use.
As for whether the newspaper acted with actual malice, the owner, editor, and publisher of the Cairo Messenger testified that the paper makes every effort to verify the truthfulness of what it publishes. He had “no reason to doubt” Clyatt, whom he had known for 30 years and who had never lied to him, and “had no reason to think he‘s not trustworthy.” The publisher testified that he did not know of anyone more knowledgeable about the allegations than Clyatt, who “had done a lot of investigating” and may have gathered information due to his status as a plaintiff in the earlier lawsuit. The publisher knew about Rosser‘s having staff work on his cars, storing his cars at Grady EMC, and the loan. The publisher testified that he had been shown documents and had a reasonable belief that they were true.
Rosser has pointed to “no evidence, much less ‘clear and convincing’ evidence, that [the defendants] disbelieved [the statements] or that [they] otherwise had a high degree of awareness of the probable falsity of what [they] posted [and published]. . . [T]he evidence more forcefully supports the opposite conclusion, i.e., that [the
4. Failure to conduct a hearing.
Rosser argues that the trial court erred by granting the motion to strike without conducting a hearing. Rosser relies on
All discovery and any pending hearings or motions in the action shall be stayed upon the filing of [an anti-SLAPP] motion to dismiss or [an anti-SLAPP] motion to strike made pursuant to subsection (b) of this Code section until a final decision on the motion. The motion shall be heard not more than 30 days after service unless the emergency matters before the court require a later hearing. The court, on noticed motion and for good cause shown, may order that specified discovery or other hearings or motions be conducted notwithstanding this subsection.
In Jefferson v. Stripling, 316 Ga. App. 197, 200 (3) (728 SE2d 826) (2012), we held that the statute mandates a hearing on motions to dismiss or strike under
The phrase “the vote . . . shall be taken in public” employs the use of a definite article (“the“) and is therefore referential, presupposing a required action. Simply put, the language does not mandate a vote on a relevant employment decision, it simply references such vote and requires that any such vote be taken in public. Thus, consistent with the design of the Open Meetings Act, the plain language of (b) (2) requires that when a vote on a relevant employment matter is taken, it must be taken in public.
Id. Similarly, the phrase in the anti-SLAPP statute that “[t]he motion [to dismiss or strike] shall be heard not more than 30 days after service,”
We need not decide whether Jefferson, 316 Ga. App. at 197 (3), was correctly decided, however. Because the material facts are undisputed, in the interest of judicial economy, we may exercise our discretion to address the issues Rosser raises in his appeal. Massey v. Allstate Ins. Co., 341 Ga. App. 462, 469 (2) n.9 (800 SE2d 629) (2017). See also Jones v. Spruill, 337 Ga. App. 200, 202 (1) (786 SE2d 848) (2016) (physical precedent only) (where facts are undisputed and issue before court is
Case No. A18A0987.
5. Background.
This related case involves Grady EMC‘s action to enjoin Clyatt from publicly sharing certain records from the 2014 litigation. Grady EMC filed a complaint asserting breach of contract and seeking a temporary restraining order and preliminary injunction. The breach of contract claim stemmed from an email agreement between the attorneys in the 2014 litigation. In that email exchange, the attorney representing the plaintiffs, Clyatt and the others, agreed that “[a]t this time we will not share an[y] documents [provided to a litigation review committee appointed in the 2014 litigation] with anyone other than the plaintiffs.”
Four days after the hearing, Grady EMC filed a pleading entitled “first amended complaint” in which it sought “more limited relief [than requested in the original complaint] given facts discovered” at the hearing. In light of the parties’ stipulation at the hearing, Grady EMC asserted that it only sought to “enjoin Clyatt from sharing with anyone the private information in the documents,” in accordance with Clyatt‘s agreement to redact such information. Grady EMC explicitly asserted that it sought no further relief.
The next day, the trial court entered the order on appeal. Based on the parties’ stipulation at the hearing, the court enjoined Clyatt from publishing personal, identifying information in the records, including dates of birth, social security numbers, driver‘s license numbers, and checking account numbers. The court found that during the hearing, before the court and on the record,
Clyatt explicitly and solely agreed/stipulated that he would voluntarily enjoin himself and forgo publishing any personal private information contained in the documents produced to him by Grady EMC during previous litigation. Unambiguously, Defendant Clyatt agreed not to publish personal identifying information contained within said records, specifically including dates of birth, social security numbers, driver‘s license numbers, and actual account numbers listed on business or personal checks.
The court ruled that other than this restriction, Clyatt‘s use of the documents was not enjoined. The court determined that given the stipulation and Grady EMC‘s amendment to its complaint, Clyatt‘s motion to strike under
6. Grant of injunctive relief.
Clyatt argues that the trial court erred by granting Grady EMC injunctive relief because the court lacked jurisdiction; because Grady EMC lacked standing; because the amended complaint was in reality a supplemental pleading for which Clyatt was not given notice; and because the injunction merely pre-emptively enforced Clyatt‘s
Entry of a permanent injunction is appropriate only in clear and urgent cases where there is a vital necessity to prevent a party from being damaged and left without an adequate remedy at law. Equitable relief is a matter within the sound discretion of the trial court. The grant of a permanent injunction is to be sustained on review unless the trial court has manifestly abused its discretion. A trial court manifestly abuses its discretion when it grants an injunction adverse to a party without any evidence to support such judgment and contrary to the law and equity.
Savannah Cemetery Group v. DePue-Wilbert Vault Co., 307 Ga. App. 206, 210 (2) (704 SE2d 858) (2010) (citations omitted). “Injunction ought not to be granted unless the injury is pressing and the delay dangerous, and there is no adequate remedy at law. . . . No allegation is made that [Clyatt] has improperly [disclosed personal identifying information].” Lue v. Eady, 297 Ga. 321, 329 (2) (c) (773 SE2d 679) (2015). In fact, as noted, Clyatt stipulated in open court that he will not do so. “Courts of equity will not exercise this power to allay mere apprehensions of injury, but only where the injury is imminent and irreparable and there is no adequate remedy at law.”
Here, there were no allegations, much less evidence of, Grady EMC imminently suffering an injury because of Clyatt‘s disclosure of personal identifying information. Under these circumstances, the trial court erred and the grant of injunctive relief is, therefore, reversed. See Parker v. West View Cemetery Assn., 195 Ga. 237, 243 (24 SE2d 29) (1943) (finding that defendants would not engage in certain behavior in the future meant that interlocutory injunction was unnecessary); Behn & Foster v. William H. Young & Co., 21 Ga. 207, 211 (1857) (“It is good ground to refuse an injunction, if the party against whom it is moved propose in the presence of the Chancellor to do all that a Court, on the most favorable construction of complainant‘s case, ought to decree for him, provided he complies with his proposition.“).
7. Motion to strike under the anti-SLAPP statute.
Clyatt argues that the trial court erred in denying his motion to strike and finding it moot. He argues that Grady EMC‘s claims in its original complaint were not resolved by the attempt to eliminate them by amending the complaint, and they are subject to his motion to strike under
Clyatt alleges that he was harmed because the trial court‘s mootness order removed the case from the attorney fees provision of
We deny Clyatt‘s request for an award of fees for the costs of this appeal.
THIS OPINION IS PHYSICAL PRECEDENT ONLY. COURT OF APPEALS RULE 33.2.