Anthony Mimms v. CVS Pharmacy, Incorporated
Filing
Filed opinion of the court by Judge Kanne. The judgment of the district court is REVERSED and this case is REMANDED IN PART FOR A NEW TRIAL on the statement made by Alexis Fields. Michael S. Kanne, Circuit Judge; Ilana Diamond Rovner, Circuit Judge and Thomas M. Durkin, District Court Judge. [6923674-1] [6923674] [17-1918]
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In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 17‐1918
ANTHONY MIMMS,
Plaintiff‐Appellee,
v.
CVS PHARMACY, INC.,
Defendant‐Appellant.
____________________
Appeal from the United States District Court for the
Southern District of Indiana, Indianapolis Division.
No. 15‐cv‐970 — Tanya Walton Pratt, Judge.
____________________
ARGUED DECEMBER 8, 2017 — DECIDED MAY 9, 2018
____________________
Before KANNE and ROVNER, Circuit Judges, and DURKIN,
District Judge.*
KANNE, Circuit Judge. Dr. Anthony Mimms is a physician
licensed by the Indiana Medical Licensing Board. He started
his own pain management practice, Mimms Functional Reha‐
* The Honorable Thomas M. Durkin, United States District Court for the
Northern District of Illinois, sitting by designation.
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bilitation, in November 2013. He previously worked at Reha‐
bilitation Associates of Indiana. As part of his practice, he pre‐
scribes opioids and other controlled substances to many of his
patients.
On several occasions, starting in 2013, CVS Pharmacy em‐
ployees informed some of Mimms’s patients that they would
not fill their prescriptions. Mimms sued CVS, alleging the
pharmacy employees made defamatory statements when re‐
fusing to fill the prescriptions. His complaint details nine al‐
legedly defamatory statements.
To prove his claims, Mimms needed to show that the
speakers knew that their statements were false. CVS repeat‐
edly moved for summary judgment on the basis that Mimms
had no evidence that the speakers knew their statements were
false. Ultimately, the district court granted summary judg‐
ment as to five of the statements and denied judgment for the
remaining four statements. It concluded there was a material
question of fact regarding whether the speakers of those four
statements knew that their statements were false in light of
evidence that CVS’s corporate office had concluded an inves‐
tigation of Mimms and had not stopped stores from filling his
patients’ prescriptions. In so concluding, the court rejected
CVS’s argument that knowledge held by the corporate office
could not be imputed to the individual speakers.
The case proceeded to trial before a jury. The four state‐
ments at trial were:
“CVS doesn’t fill Dr. Mimms’[s] prescriptions or
prescriptions for any other pill mills.”
“Dr. Mimms went to jail.”
“Dr. Mimms has been … or will be arrested.”
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“Dr. Mimms is under DEA investigation.”
(R. 211 at 10.)
CVS moved for judgment as a matter of law as to the first
three statements at the close of Mimms’s presentation of evi‐
dence, again arguing that knowledge held by the corporate
office could not be imputed to the speakers. The district court
denied the motion, and the jury found CVS liable for defama‐
tion per se on all four statements and awarded Mimms
$1,025,000 in damages. CVS appeals. For the reasons that fol‐
low, the judgment of the district court is reversed and the case
is remanded in part.
ANALYSIS
CVS contends the district court should have granted judg‐
ment in its favor as to all four of the challenged statements.
Alternatively, CVS argues the district court made several er‐
rors that merit a new trial. We review the district court’s de‐
nial of summary judgment and of judgment as a matter of law
de novo, Winters v. Fru‐Con Inc., 498 F.3d 734, 743, 745 (7th Cir.
2007), and generally review its evidentiary and jury instruc‐
tion rulings for abuse of discretion, Empress Casino Joliet Corp.
v. Balmoral Racing Club, Inc., 831 F.3d 815, 833, 835 (7th Cir.
2016).
A. CVS is entitled to judgment as a matter of law as to the first
three statements.
CVS moved for summary judgment on all four statements
and for judgment as a matter of law as to the first three state‐
ments, preserving its legal argument regarding those state‐
ments for appeal. In both motions, CVS argued Mimms had
provided no evidence that the speakers acted with actual mal‐
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ice, the standard required under Indiana law to prove defa‐
mation in cases involving statements that ascribe misconduct
in one’s profession. Kelley v. Tanoos, 865 N.E 2d 593, 596 (Ind.
2007). “Actual malice exists when the defendant publishes a
defamatory statement ‘with knowledge that it was false or
with reckless disregard of whether it was false or not.’” Jour‐
nal‐Gazette Co., Inc. v. Bandido’s Inc., 712 N.E.2d 446, 456 (Ind.
1999) (quoting New York Times v. Sullivan, 376 U.S. 254, 280
(1964)). “To demonstrate reckless disregard, ‘[t]here must be
sufficient evidence to permit the conclusion that the defend‐
ant in fact entertained serious doubts as to the truth of his
publication,’ or proof that the false publication was made
with a ‘high degree of awareness of their probable falsity.’”
Id. (alteration in original) (citations omitted) (quoting St.
Amant v. Thompson, 390 U.S. 727, 731 (1968) and Garrison v.
Louisiana, 379 U.S. 64, 74 (1964), respectively).
Under this standard, knowledge of falsity held by a prin‐
cipal cannot be imputed to its agent. It is the state of mind of
the speaker that is relevant. New York Times, 376 U.S. at 287.
In New York Times v. Sullivan, the plaintiff alleged the publica‐
tion of an advertisement was defamatory. The Supreme Court
noted there was “evidence that the Times published the ad‐
vertisement without checking its accuracy against the news
stories in the Times’ own files.” Id. Yet the Court concluded
that the “mere presence” of stories in the Times’s files could
not establish that the advertisement was published with ac‐
tual malice, “since the state of mind required for actual malice
would have to be brought home to the persons in the Times’
organization having responsibility for the publication of the
advertisement.” Id. Any knowledge the Times had as an or‐
ganization regarding the veracity of the statement was not im‐
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puted to the individuals who published the statement. Simi‐
larly, in Journal‐Gazette Co. v. Bambino’s Inc., the Indiana Su‐
preme Court focused on evidence reflecting the state of mind
of the author of the challenged headline, not the knowledge
of the newspaper organization as a whole. 712 N.E. 2d at 462.
Here, Mimms needed to demonstrate that the CVS em‐
ployees in fact knew that their statements were false or had
serious doubts as to the veracity of their statements. As a mat‐
ter of law, he could not do so by imputing corporate
knowledge to the speakers, and he provided no other evi‐
dence at trial that would allow a reasonable jury to find that
the speakers knew their statements were false.
At oral argument, Mimms argued that emails sent from
corporate officers to store supervisors served as a “bridge”
between the corporate office and the pharmacy employees.
This communication, he contends, is evidence that the speak‐
ers actually knew the results of the corporate investigation. In
the email, an employee states that he will ask a store supervi‐
sor to reiterate to his employees that they were expected to
comply with company policy against making certain deroga‐
tory statements when refusing to fill prescriptions. (R. 73‐11
at 1.) But the record does not indicate that the email was sent
to any of the speakers, and any reminder to follow the corpo‐
rate policy would not have informed the speakers about the
truth or falsity of their statements about Mimms. The policy
instructed employees not to make the statements even if the
employee knew the statement was true. Mimms proffered no
other evidence that would allow a reasonable juror to find the
first three statements were made with actual malice. There‐
fore, CVS is entitled to judgment as a matter of law as to these
three statements.
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B. CVS is not entitled to judgment as to the fourth statement.
CVS did not move for judgment as a matter of law as to
the fourth statement—“Dr. Mimms is under DEA investiga‐
tion.” And generally a party cannot appeal the denial of sum‐
mary judgment after a full trial. Ortiz v. Jordan, 562 U.S. 180,
183–84 (2011); Lawson v. Sun Microsystems, Inc., 791 F.3d 754,
761 (7th Cir. 2015). “Once the case proceeds to trial, the full
record developed in court supersedes the record existing at
the time of the summary‐judgment motion.” Ortiz, 562 U.S. at
184. Where, however, the issue appealed “involve[s] pure
questions of law unrelated to the sufficiency of the trial evi‐
dence, … it’s not necessary for summary‐judgment losers to
relitigate purely legal issues … in a motion under Rule 50(a)
or (b).” Lawson, 791 F.3d at 761.
That exception does not apply here. As to the fourth state‐
ment, the district court in part denied summary judgment on
the basis that there was a genuine issue of material fact re‐
garding whether Alexis Fields, the speaker, had serious
doubts as to the veracity of her statement, based on state‐
ments she made in her deposition testimony. We are not in a
position on appeal to consider whether the district court erred
in denying summary judgment on this basis. We are, how‐
ever, in a position to address whether purported trial errors
warrant a new trial on this statement.
C. CVS is entitled to a new trial on the fourth statement.
CVS claims the district court committed several errors at
trial, including evidentiary errors and jury instruction errors.
Such errors entitle a party to a new trial, unless the errors are
harmless. See generally Fed. R. Civ. P. 52(a).
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1. Evidentiary Rulings
We review the district court’s decision to admit or exclude
evidence for abuse of discretion. Thompson v. City of Chicago,
722 F.3d 963, 971 (7th Cir. 2013). The district court abuses its
discretion when it limits evidence in such a way that “the lit‐
igant is effectively prevented from presenting his or her case.”
Id.
First, CVS challenges the district court’s decision to sup‐
press evidence that Mimms failed to properly answer an in‐
terrogatory. This evidence would have impeached Mimms’s
credibility, an important issue in the case. The district court,
however, accepted Mimms’s explanation that he had been
confused by the question. Accepting this explanation was
within the district court’s discretion.
However, the district court should have allowed CVS to
present evidence that Field’s statement was true—that
Mimms was in fact the subject of a DEA investigation. Under
Indiana law, truth is a complete defense to defamation. Mar‐
tino v. Western & Southern Financial Group, 715 F.3d 195, 206
(7th Cir. 2013); see also Ind. Const. Art. 11, § 10 (“In all prose‐
cutions for libel, the truth of the matters alleged to be libelous,
may be given in justification.”).
CVS sought to introduce evidence that the clinic Mimms
formerly worked for, Rehabilitation Associates of Indiana,
had been subpoenaed for records of Mimms’s former pa‐
tients, including patients that had died or been charged or
convicted of drug crimes. Mimms objected to the introduction
of the evidence, arguing that he had left the practice before
the subpoenas were served and thus the subpoenas could not
be part of any investigation of Mimms. The district court
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agreed and suppressed the evidence. While this may not be
conclusive evidence that the DEA was investigating Mimms
specifically, the fact that the DEA was seeking records for
Mimms’s patients shortly after he left the practice supports
CVS’s claim that Mimms was under investigation. See Heeb v.
Smith, 613 N.E.2d 416, 420 (Ind. Ct. App. 1993) (noting that
“literal truth is not required” to defend a defamation claim
and that “it is sufficient if the statement is substantially true”).
CVS also sought to introduce a transcript from a criminal
trial in which a Health and Human Services agent testified
that he had investigated Mimms with a DEA agent. This too
supports CVS’s claim that Fields’s statement was true. The
district court refused to admit the transcript as evidence, find‐
ing it too prejudicial because of other statements made by the
criminal defendant in the testimony. This prejudicial portion
of the transcript could have been redacted. The testimony of
the agent would have been critical evidence in support of
CVS’s allegation that the DEA was or had been investigating
Mimms. The district court also noted it was excluding this tes‐
timony as hearsay, despite Mimms’s stipulation that the tran‐
script was authentic and his agreement not to assert a hearsay
objection at trial. The district court unnecessarily relieved
Mimms’s of this stipulation. See Graefenhain v. Pabst Brewing
Co., 870 F.2d 1198, 1206 (7th Cir. 1989) (“[A] stipulation is
binding unless relief from the stipulation is necessary to pre‐
vent a ‘manifest injustice’ or the stipulation was entered into
through inadvertence or based on an erroneous view of the
facts or law.”) (quoting Smith v. Blackburn, 785 F.2d 545, 549
(5th Cir. 1986)). CVS relied on the agreement when it decided
not to secure the live testimony of the agent.
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By excluding the evidence of the subpoenas served on Re‐
habilitation Associates of Indiana and the transcript of the
agent’s prior testimony, the district court effectively pre‐
vented CVS from presenting its defense. The district court
should have allowed CVS to present this evidence to the jury.
The district court also should have allowed CVS to present
evidence regarding Mimms’s reputation. Because this is a def‐
amation per se case, damage to Mimms’s reputation is pre‐
sumed. Kelley, 865 N.E.2d at 597. However, evidence regard‐
ing the extent of the harm to his professional reputation as a
result of the statements was critical for minimizing damages.
See Bularz v. Prudential Ins. Co. of America, 93 F.3d 372, 379 (7th
Cir. 1996).
CVS offered evidence tending to show that Mimms al‐
ready had a poor professional reputation. It sought to intro‐
duce evidence of a complaint filed by the Indiana Attorney
General for prescribing an opiate to an alcoholic patient, three
sexual harassment complaints, and the fact that Mimms was
barred from practicing at a hospital and investigated by his
employer for a relationship he had with a nurse. CVS also
sought to introduce evidence of a 2016 criminal investigation
into Mimms’s prescribing practices to show that any damage
to his reputation because of the statements was curbed in
2016. See Ind. Code § 34‐15‐1‐2 (authorizing the introduction
of evidence of mitigating circumstances to minimize damages
in a defamation suit). In response, Mimms argued this evi‐
dence had nothing to do with his reputation as a prescriber
and therefore that it was more prejudicial than it was proba‐
tive.
Obviously, any evidence tending to show that a defama‐
tion plaintiff’s reputation was already tarnished is going to be
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prejudicial to the plaintiff. Here, the evidence offered was lim‐
ited to Mimms’s professional reputation, and the court could
have instructed to jury to consider the evidence for the pur‐
poses of determining damages only if it were concerned that
the jury would determine the case on an improper basis. See
Whitehead v. Bond, 680 F.3d 919, 930 (7th Cir. 2012). Preventing
CVS from presenting this evidence was an abuse of discretion.
Finally, the district court should not have allowed Mimms
to introduce evidence regarding “the knowledge or mental
state of anyone other than the speakers of alleged defamatory
statements for the purpose of attempting to impute actual
malice to that speaker… .” (R. 175 at 11.) In light of our con‐
clusion that knowledge held by the CVS corporate office can‐
not be imputed to the individual speakers, evidence of the
corporate office’s knowledge is irrelevant. Mimms’s counsel
conceded at oral argument that such evidence would be irrel‐
evant in the absence of some other evidence that the speakers
had been informed of the investigation. As we already dis‐
cussed, there is no such evidence in the record. Therefore, the
district court abused its discretion when it allowed Mimms to
present this evidence.
On these grounds, CVS is entitled to a new trial on the
Field’s statement.
2. Jury Instructions
We review whether a jury instruction is a fair and accurate
statement of the law de novo and the district court’s decision
on whether to issue an accurate instruction for abuse of dis‐
cretion. United States v. Carter, 695 F.3d 690, 694 (7th Cir. 2012).
The district court instructed the jury that, to find CVS liable,
Mimms needed to prove that “the alleged speaker knew the
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communication was false or had serious doubts as to the truth
of the communication.” (R. 292 at 24.) The court then in‐
structed the jury that, “In deciding whether a CVS representa‐
tive alleged to have made a statement knew the communica‐
tion was false or had serious doubts as to the truth of the com‐
munication, you may consider that representative’s attitude
or ill will towards Dr. Mimms.” (R. 292 at 30.)
These instructions fairly and accurately summarize the
law. Evidence of ill will alone is insufficient to prove a state‐
ment is defamatory, Brewington v. State, 7 N.E. 946, 959 (Ind.
2014), but such could be used as circumstantial evidence by
the jury to determine the speaker’s state of mind. See Indiana
Newspapers, Inc. v. Fields, 259 N.E.2d 651, 664 (Ind. 1970).
When the two instructions are read together, we are not con‐
vinced that the jurors could have believed that they could
conclude actual malice existed merely by considering the at‐
titude of the speaker. Therefore, the district court did not
abuse its discretion when instructing the jury.
Because we have already determined that CVS is entitled
to a new trial, we decline to address CVS’s objection to the
district court’s refusal to issue a supplemental jury instruction
regarding attorney’s fees. The request was made in response
to a statement made at trial and a note from the jury and thus
was entirely context specific. Should the issue arise again,
CVS is free to raise its objection in the district court.
CONCLUSION
The district court made a legal error when it denied CVS’s
motions for summary judgment and judgment as a matter of
law as to three of the statements. Knowledge held by a corpo‐
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rate office cannot be imputed to the corporation’s local em‐
ployees. Mimms offered no other evidence tending to show
that the speakers who made these challenged statements
knew that their statements were false or had serious doubts
as to the veracity of their statements. CVS is entitled to judg‐
ment on these statements.
CVS did not, however, move for judgment as a matter of
law on the statement made by Fields, and the district court’s
denial of summary judgment on this statement was not based
on a pure legal question. So we leave untouched the district
court’s denial of summary judgment as to the fourth state‐
ment. We find, however, that the district court abused its dis‐
cretion when making several evidentiary rulings and that
these errors prevented CVS from presenting its case. There‐
fore, the jury’s verdict is vacated and CVS is entitled to a new
trial on the fourth statement.
The judgment of the district court is REVERSED and this
case is REMANDED IN PART FOR A NEW TRIAL on the
statement made by Alexis Fields.
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