BARAN v. MISSION SOLUTIONS LLC
Filing
77
OPINION. Signed by Judge Renee Marie Bumb on 7/9/2019. (dmr)
[Dkt. No. 60]
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
CAMDEN VICINAGE
ANNA BARAN,
Plaintiff,
Civil No. 17-7425 (RMB/JS)
v.
ASRC FEDERAL, MISSION
SOLUTIONS, ROSE WELLS, FRANCIS
MCKENNA, SUSAN GOLDBERG,
OPINION
Defendants.
APPEARANCES:
HAGERTY & BLAND-TULL LAW LLC
By: LaTonya Bland-Tull, Esq.; Robert J. Hagerty, Esq.
523 Haddon Avenue
Collingswood, New Jersey 08108
Counsel for Plaintiff Anna Baran
LITTLER MENDELSON P.C.
By: William J. Leahy, Esq.; Alexa J. Laborda Nelson, Esq.
Three Parkway
1601 Cherry Street, Suite 1400
Philadelphia, Pennsylvania 19102-1321
Counsel for Defendant Mission Solutions, LLC
1
RENÉE MARIE BUMB, United States District Judge:
Following four years of litigation – which included almost
three years in state court, removal to federal court, and a
four-day trial before this Court – the jury spoke:
Defendant
Mission Solutions, LLC (“MSE” or “Defendant”), owed its former
employee, Plaintiff Anna Baran, $3.5 million in compensatory
damages for defaming her by falsely reporting that she had
threatened workplace violence.
It is a verdict that Defendant
contends must be set aside because Plaintiff’s defamation claim
was time-barred long before she ever commenced suit.
As odd as it seems, it was not until the close of
Plaintiff’s case that the Court learned about the parties’
longstanding disagreement over the statute of limitations for
the defamation claim.
Defendant argues that neither Plaintiff’s
pleadings nor the evidence presented at trial support a finding
that any defamatory conduct occurred within the statute of
limitations.
Plaintiff disagrees, contending that a prior state
court ruling, which applied the “discovery rule” and ordered
Plaintiff’s defamation claim to proceed to trial, binds this
Court as “law of the case.”
With the benefit of post-trial briefing, this Court agrees
with Defendant: the defamation claim should have never proceeded
to trial.
Plaintiff clearly misstated the law to the state
court, precipitating the state court’s erroneous application of
2
the discovery rule to a defamation claim.
Thus, the state
court’s unfortunate and incorrect ruling that Plaintiff could
present her defamation claim to a jury, which extended the case
for years and resulted in the verdict in Plaintiff’s favor, was
a direct result of Plaintiff’s misstatements.
This Court holds that a verdict caused by a legal calamity
of Plaintiff’s own creation cannot stand.
For that reason,
Defendant’s Renewed Motion for Judgment as a Matter of Law
pursuant to Fed. R. Civ. P. 50(b), or in the alternative a New
Trial pursuant to Fed. R. Civ. P. 59(a)(1) [Dkt. Nos. 59, 60,
67], will be GRANTED, and the jury verdict on the defamation
claim will be set aside.
The Court will direct the entry of
judgment on the jury’s verdict on the retaliation claim and
judgment as a matter of law in favor of Defendant on the
defamation claim.
I.
FACTUAL BACKGROUND
Plaintiff Anna Baran is a former employee of MSE, a military
defense contractor that supplies systems engineering, software
engineering, integration services and products for missioncritical defense systems.
Plaintiff worked for MSE as a Senior
Quality Assurance Engineer, a position that required security
clearances, until she was terminated for allegedly threatening
to shoot three of her supervisors at MSE.
3
According to Plaintiff’s co-workers, Rosemarie Wells and
Gaynelle Johnson, Plaintiff had long complained that she was the
victim of “bullying” by one of her supervisors, Sue Goldberg.
On January 7, 2013, Plaintiff allegedly told Wells, “don’t be
surprised if this place goes up.” Plaintiff allegedly stated
that “if [she] had a gun,” she would shoot Goldberg, Pat
Brencher, and Paul Nocito (her other supervisors).
Given
Plaintiff’s history of complaining about “bullying,” Wells
became concerned and “very, very upset” about Plaintiff’s
statements.
That same day, Wells reported Plaintiff’s comments
to MSE’s Facility Security Officer Francis McKenna.
Soon
thereafter, Plaintiff was suspended pending an investigation
into her alleged threats.
During the investigation, Plaintiff
denied making any such threats.
Despite Plaintiff’s denials,
she was arrested and charged with making a terroristic threat on
January 9, 2013.
A few days later, January 14, 2013, Defendant
terminated Plaintiff’s employment.
On January 15, 2013, McKenna updated Plaintiff’s incident
history in the Joint Personnel Adjudication System (“JPAS” or
the “JPAS system”) to reflect the circumstances surrounding
Plaintiff’s termination.
JPAS functions as the Department of
Defense (“DoD”) personnel database of record for security
clearance processing.
According to MSE, McKenna entered this
information because federal regulations, reflected in the
4
National Industrial Security Program Operating Manual
(“NISPOM”), require MSE to update JPAS with any “adverse
information coming to their attention concerning any of their
cleared employees.” See NISPOM, Section 3, at 1-302(a).
On May
1, 2013, McKenna finalized his earlier incident report about
Plaintiff’s termination in JPAS (hereinafter referred to as the
“JPAS Report”).
In its entirety, the JPAS Report submitted by
McKenna states:
“On 1/7/13 MSE employee [Rosemarie Wells] advised FSO
[Francis McKenna] that MSE employee Anna Baran allegedly
made statements to [Rose] that she intended to go get a
rifle and return to MSE and shoot 3 employees. This was
partly due to a human resources issue in which Baran
alleged workplace bullying by her supervisor. On 1/8/13
Baran was sent home on administrative leave while the
allegations were investigated. The Moorestown, NJ Police
were notified (incident # 2003-000002810 and they
interviewed [Rose] as part of their investigation.
Burlington County Judge Lois Downey charged Baran with
terroristic threats and as a bail condition ordered that
Baran be evaluated by the Screening Crisis Intervention
Program.
This was done at 1AM on 1/9/13. She was
released at 6AM and taken to the Burlington County Jail
on the above charge. MSE HR investigation was done from
1/9-14/13 and the decision to terminate Baran was made
on 1/14/13.”
MSE Trial Ex. 27.
Although the criminal charges against Plaintiff were
eventually dropped, and her record was expunged, the JPAS Report
does not reflect the final disposition of that matter.
In this
action, Plaintiff contended that MSE’s comments about the nature
of her termination in the JPAS Report prevented her from
5
obtaining a comparable job.1
In at least one instance, Plaintiff
claimed that a job offer was rescinded because she was unable to
secure a security clearance due to the description of events in
the JPAS Report.
Consequently, Plaintiff alleged that
Defendant’s actions continued to negatively impact her
professional, financial, and emotional well-being.
II.
PROCEDURAL HISTORY
The procedural history of this case is long and
complicated.
It began over four years ago, on January 6, 2015,
when Plaintiff filed her original pro se Complaint against
Defendant in the Superior Court of New Jersey, Law Division,
Burlington County (Case No. BUR-L-53-15).
Throughout the course
of those years, the case had been dismissed, reinstated,
proceeded through discovery, and finally set for trial in state
court – all before it was removed to this Court pursuant to 28
U.S.C. § 1442 (the “Federal Officer Removal Statute”) on the eve
of trial in state court.
A.
Early Stages in New Jersey State Court
In her initial pro se Complaint, Plaintiff alleged causes
of action that she described as negligence, malicious
prosecution, intentional and negligence infliction of emotional
1
As discussed infra Section IV.A, at trial, Plaintiff’s
defamation claim was based solely upon information contained in
the JPAS report.
6
distress, defamation, slander, tortious interference, and
retaliation.
On April 24, 2015, the Superior Court granted
Defendant’s Motion to Dismiss and dismissed Plaintiff’s pro se
Complaint without prejudice, but ordered that: (1) Plaintiff was
required to retain legal counsel by July 1, 2015; (2) Defendant
was required to issue a neutral employment reference; and (3)
Defendant was required to use its best efforts to assist
Plaintiff in obtaining a security clearance. [Dkt. No. 1-2, at
69].
Almost seven months passed before Plaintiff’s current
attorneys first entered an appearance on her behalf on November
16, 2015.
Another eight months passed before Plaintiff filed a
Motion to Correct a Clerical Error and Amend Complaint on July
26, 2016, seeking to reinstate the case.
On October 6, 2016,
the Superior Court granted Plaintiff’s motion, reinstating the
case and permitting Plaintiff to file an Amended Complaint.
[Dkt. No. 1-2, at 72].
Plaintiff, at this point represented by counsel, filed her
Amended Complaint on October 18, 2016, almost two years after
she originally commenced the case.
Plaintiff’s Amended
Complaint asserted four counts against Defendant: (1)
Defamation, Libel and Slander (Count One); (2) Defamation, Libel
and Slander per se (Count Two); (3) Hostile Environment in
violation of the New Jersey Law Against Discrimination (“NJLAD”)
7
(Count Three); and (4) Retaliatory Discharge in Violation of the
NJLAD (Count Four). See Pl.’s Am. Compl. [Dkt. No. 1-2, at 8190].
On March 6, 2017, the Superior Court dismissed Counts One,
Two, and Three of Plaintiff’s Amended Complaint, leaving only
Plaintiff’s retaliation claim under the NJLAD (Count Four) as
the parties proceeded to discovery. [Dkt. No. 1-2, at 73-80].
After the parties conducted depositions and other discovery on
Plaintiff’s lone remaining retaliation claim, Defendant moved
for summary judgment.
In response, Plaintiff filed a Motion for
Reconsideration of the Superior Court’s prior order dismissing
the defamation claims.
B.
Motion for Reconsideration
At oral argument before Superior Court Judge John E.
Harrington on September 8, 2017, one month before the scheduled
trial, Plaintiff’s counsel argued for the first time that her
defamation claims should be reinstated because they were
premised upon McKenna’s statements in the JPAS Report.
During
oral argument, counsel for Plaintiff conceded that the
statements in the JPAS Report were made in 2013 and, thus, would
normally be time-barred under New Jersey’s one-year statute of
limitations for defamation claims. See Superior Court Hearing
Transcript, September 8, 2017 (“Superior Court Transcript”)[Dkt.
No. 59-1, Ex. E], at 13:14-23.
However, Plaintiff argued, her
8
claims should be tolled under the “discovery rule,” because
Plaintiff did not learn of the existence of the JPAS Report
until August 2014, when it impacted her ability to obtain a
security clearance. See id., at 13:23-17:16.
In relevant part,
Plaintiff’s counsel had the following exchange with Judge
Harrington:
THE COURT: Okay. From your perspective, what is the
operative date that is within the one year? Because
it's a hard and fast rule unless you can tell me
discovery or some other exception. So, go.
MS. BLAND-TULL: Simply put, what Your Honor just said
is exactly true. Ms. Baran did not discover this JPAS
entry until she began to search for employment.
THE COURT: When was that?
MS. BLAND-TULL: She was on unemployment for a few
months and, then, once she interviewed with L3 in
August of 2015, they –
MR. HAGERTY: '14.
MS. BLAND-TULL: I'm sorry. 2014, excuse me, Your
Honor. That is when she discovered and they alerted
her to the fact that they were unable to continue or
they had to rescind the offer that was forthcoming to
her –
THE COURT: Because –
MS.BLAND-TULL: -- because of this information in the
JPAS system. So, that is when she first –
THE COURT: August of
MS. BLAND-TULL: -- learned of it.
THE COURT: All right. So, discovery is August '14.
We'll get into all whether it's true or not. August
'14. So, if that's the operative -that's the discovery
date, it relates back to all these other
9
circumstances. So the defamation, even though it
occurred some time ago, would have been filed within
time. Does the discovery rule apply to defamation? I
mean, I know it does –
MS.BLAND-TULL: Yes, I'm -- I'm sorry.
THE COURT: -- with neg -- with negligence and –
MS. BLAND-TULL: I -- I was -- my partner was just
alerting me to the fact that, because I'm getting my
dates mixed up. If it occurred in August of 2014, she
was actually within the statute of limitations
THE COURT: I know.
MS. BLAND-TULL: -- when she filed.
THE COURT: I know that. But, -MS.
BLAND-TULL: Okay.
THE COURT: The occurrence is her being told. But, the
action occurred past -- beyond the one year; but, she
didn't know about it until within the one year.
[]
THE COURT: So, if she knew in May of '13, then,
obviously, it's too late, correct?
MS. BLAND-TULL: Correct.
Id., at 13:23-15:19; 16:12-14. (emphasis added)
Defendant objected to the applicability of the
discovery rul.
Judge Harrington, however, held that the
discovery rule or the “continuing tort” doctrine served to
toll Plaintiff’s defamation claim, meaning it accrued in
August of 2014 rather than May of 2013.
Under Judge
Harrington’s analysis, Plaintiff’s Amended Complaint was
also timely because her claims fell within the parameters
10
of her original Complaint. See Superior Court Transcript,
at 31:15-32:9.
In relevant part, Judge Harrington stated:
THE COURT: I believe the discovery rule applies. I
believe that it relates back. I believe that from the
very, very beginning, she's been aggrieved about the
actions of -- of -- of the employer. The employer
did -- now, they should have, could have, would have
she would have known that this was going down, would
have been something she should have known. That's a
different problem for you in the case. What I mean by
that is sending it to this -MS.BLAND-TULL: JPAS.
MR. LEAHY: The JPAS.
THE COURT: J-Pack (sic), yeah. If she's in the
business, she would have known that was happening. I
think I got her to admit that somewhere along the way
when we were talking here. But, I'm -- I'm fairly
confident that I can read the complaint to include all
tortious acts as continuing tort. They – they
committed a second tort. You're allowed to -- to file
a complaint for that basis. I'm comfortable with that.
That's what I was going to do.
Id.
(emphasis added)
Despite Defendant’s argument that the defamation
claims were barred by the statute of limitations, Judge
Harrington granted Plaintiff’s Motion for Reconsideration
and reinstated Plaintiff’s defamation claim.
The court
explained that his decision was final and that he would
allow Plaintiff to present the defamation case to the jury
at trial. See Superior Court Transcript, at 36:15-37:3.
The court clarified that he was not “finding up-front that
there’s a defamation claim.
I’m simply saying that you can
11
continue to present this to the jury.” Id. at 41:24-42:2
(emphasis added).
At the conclusion of oral argument, Judge Harrington
ordered the parties to conduct expedited discovery on the
defamation claim, specifically, the date of Plaintiff’s
discovery of the JPAS report, and scheduled trial for
October 2017.
On September 28, 2017, a formal Order was
entered by the Superior Court [Dkt. No. 74], granting
Plaintiff’s Motion for Reconsideration, denying Defendant’s
Motion for Summary Judgment, and requiring Defendant to
file an Amended Answer.2
C.
Removal to Federal Court
Following Judge Harrington’s decision to reinstate
Plaintiff’s defamation claim, Defendant removed the case to
this Court on September 25, 2017. [See Dkt. No. 1].
Defendant argued that because Plaintiff’s defamation claim
was based on statements mandatorily entered into the DoD’s
JPAS system, removal was warranted under the Federal
Officer Removal Statute.
Specifically, Defendant contended
that, because it was required to report adverse information
2
Because the September 28, 2017 Order simply formalized Judge
Harrington’s holdings made on the record at oral argument on
September 8, 2017, it is assumed to be binding on the parties,
even though it was not entered until after the case had been
removed to this Court on September 25, 2017.
12
into JPAS, it was entitled to absolute immunity defense
under federal law.
Furthermore, Defendant argued that
removal was timely because it had just learned that the
JPAS Report was central to the defamation claims at the
September 8, 2017 oral argument, a position that Plaintiff
does not dispute.
On October 24, 2017, Plaintiff filed a
Motion to Remand [Dkt. No. 5] the case back to state court.
On June 20, 2018, this Court held that Defendant was
entitled to the benefit of the Federal Officer Removal
Statute and that removal was timely. [See Dkt. No. 15].
After the Motion for Remand had been resolved,
Defendant filed an Amended Answer [Dkt. Nos. 19, 20] in
accordance with Judge Harrington’s September 28, 2017
Order.
Notably, neither Defendant’s Amended Answer nor the
Final Pre-Trial Order [Dkt. No. 30] included the statute of
limitations affirmative defense to the defamation claim,
which Judge Harrington had already ruled could be presented
at trial.
Defendant asserted the statute of limitations
affirmative defense, for the first time following removal,
in its Trial Brief, which was filed less than a month
before trial on February 11, 2019. [See Dkt. No. 38, at
11].
13
D.
Trial and Jury Verdict
During a four-day jury trial, from March 4 through March 7,
2019, Plaintiff presented her case that Defendant (1) violated
NJLAD by terminating Plaintiff in retaliation for her complaints
about discriminatory treatment by her supervisor, Sue Goldberg,
and (2) defamed Plaintiff through the incident report entered
into the JPAS system.
In presenting these claims to the jury,
Plaintiff alleged that MSE’s stated reason for her termination
was pre-textual, and that MSE actually terminated Plaintiff in
retaliation for her alleged previous complaints (and threats to
file an EEOC complaint) that Sue Goldberg was discriminating
against Plaintiff on the basis of her Polish national origin.
Plaintiff also alleged that the incident entered into the JPAS
system was knowingly false and defamatory.
At the close of Plaintiff’s case, Defendant moved for
Judgment as a Matter of Law, arguing that Plaintiff’s defamation
claims should not be allowed to proceed to the jury because (1)
they were barred by the statute of limitations, and (2) the
statements in the JPAS Report were entitled to absolute
immunity.
The Court reserved judgment on Defendant’s motion and
allowed the jury to consider the defamation claim.
The jury
found that Defendant’s statements in the JPAS Report were false
and defamatory, and awarded Plaintiff $3.5 million in damages.
14
Following the announcement of the verdict, Defendant
renewed its Motion for a Judgment as a Matter of Law pursuant to
Fed. R. Civ. P. 50(b), and moved in the alternative for a New
Trial pursuant to Fed. R. Civ. P. 59(a)(1) or a Remittitur of
the jury award.
Meanwhile, Plaintiff requested that the jury
remain empaneled for a trial on punitive damages.
In light of
the parties scant briefing on the statute of limitations issue
prior to trial, the Court determined that more briefing was
necessary before deciding the issue.
Therefore, pending the
outcome of the Motion for Judgment as a Matter of Law, the Court
discharged the jury and adjourned the trial on punitive damages.
III.
LEGAL STANDARD
A motion for judgment as a matter of law may be granted
where “a party has been fully heard on an issue during a jury
trial and the court finds that a reasonable jury would not have
a legally sufficient evidentiary basis to find for the party on
that issue.” Fed. R. Civ. P. 50(a)(1).
“While a district court
is permitted to enter judgment as a matter of law at the
conclusion of a trial, when it concludes that the evidence is
legally insufficient, it is not required to do so.
To the
contrary, the district courts are, if anything, encouraged to
submit the case to the jury, rather than granting such motions.”
Unitherm Food Sys., Inc. v. Swift-Eckrich, Inc., 546 U.S. 394,
405 (2006).
15
If the Court denies or reserves on a motion for judgment as
a matter of law raised during trial, the moving party may renew
that motion post-trial under Fed. R. Civ. P. 50(b).
In order to
preserve the right to renew a motion for judgment as a matter of
law, the moving party must raise a Rule 50(a) motion with
“sufficient specificity to put the [nonmovant] on notice” before
the case is submitted to the jury. Williams v. Runyon, 130 F.3d
568, 571–72 (3d Cir. 1997).
Rule 50(b) provides that, in
deciding a 50(b) motion, the court may: “(1) allow judgment on
the verdict, if the jury returned a verdict; (2) order a new
trial; or (3) direct the entry of judgment as a matter of law.”
Fed. R. Civ. P. 50(b).
The standard for deciding the renewed motion is the same as
the standard for deciding the motion made at trial. Neville
Chem. Co. v. Union Carbide, 422 F.2d 1205, 1210 n.5 (3d Cir.
1970), cert. denied, 400 U.S. 826 (1970).
A Rule 50 motion
“should only be granted if ‘the record is critically deficient
of that minimum quantity of evidence from which a jury might
reasonably afford relief.” Raiczyk v. Ocean County Veterinary
Hospital, 377 F.3d 266, 269 (3d Cir. 2004)(citing Trabal v.
Wells Fargo Armored Serv. Corp., 269 F.3d 243, 249 (3d Cir.
2001)).
The key “question is not whether there is literally no
evidence supporting the unsuccessful party, but whether there is
evidence upon which a reasonable jury could properly have found
16
its verdict.” Johnson v. Campbell, 332 F.3d 199, 204 (3d Cir.
2003)(emphasis in original)(quoting Gomez v. Allegheny Health
Servs., Inc., 71 F.3d 1079, 1083 (3d Cir. 1995)).
“In making this determination, ‘the court may not weigh the
evidence, determine the credibility of the witnesses, or
substitute its version of the facts for the jury's version.’”
TransWeb, LLC v. 3M Innovative Properties Co., 16 F. Supp. 3d
385, 391–92 (D.N.J. 2014) (quoting Lightning Lube, Inc. v. Witco
Corp., 4 F.3d 1153, 1166 (3d Cir.1993), aff'd, 812 F.3d 1295
(Fed. Cir. 2016)). The Court must “disregard all evidence
favorable to the moving party that the jury is not required to
believe ... [t]hat is ... give credence to the evidence favoring
the nonmovant as well as that evidence supporting the moving
party that is uncontradicted and unimpeached, at least to the
extent that that evidence comes from disinterested witnesses.”
Reeves v. Sanderson Plumbing Prod., Inc., 530 U.S. 133, 151
(2000)(citation and internal quotation marks omitted).
IV.
DISCUSSION
In its Motion for Judgment as a Matter of Law, Defendant
argues that the jury verdict should be set aside because (1)
Plaintiff’s defamation claim is barred by the statute of
limitations one-year period from publication, see Marino v.
Westfield Board of Education, 2016 WL 2901706, at *5 (D.N.J.
2016)(citing N.J.S.A. § 2A:14-3) and (2) the contents of the
17
JPAS Report are protected by absolute immunity.
In response,
Plaintiff argues, first, that “law of the case” doctrine binds
this Court to Judge Harrington’s decision that the discovery
rule applied to Plaintiff’s defamation claim.
Second, Plaintiff
argues that Defendant waived the statute of limitations defense
by failing to assert it in either the Amended Answer or the
Final Pre-Trial Order.
A.
Statute of Limitations for Defamation
At trial Plaintiff cited the statements in the JPAS Report
as the lone evidence supporting her defamation claim.3
This is
consistent with what Plaintiff advised the state court as the
basis for her defamation claim.
It is undisputed that the JPAS
Report was created by McKenna on January 15, 2013 and then
finalized on May 1, 2013.
Plaintiff, however, did not commence
this action until January 6, 2015, over a year and a half after
McKenna finalized the JPAS Report.
With the JPAS Report’s publication date falling outside New
Jersey’s one-year statute of limitations period, Plaintiff
continues to press the same argument before this Court as she
did before Judge Harrington.
3
She argues that her claim was
Although Plaintiff had previously contended that her defamation
claim was supported by comments from McKenna to a prospective
employer, by Plaintiff’s own admission, she was unable to
present any admissible evidence at trial to support this
allegation. See Trial Tr., Mar. 6, 2019, at 642:3-16.
18
nonetheless timely because she did not find out about the JPAS
Report until August 2014.
Thus, Plaintiff asserts the discovery
date of August 2014 means that her defamation claim was within
the one-year statute of limitations when her original Complaint
was filed in January 2015.
Plaintiff’s argument fails before
this Court and should have failed before the Superior Court.
This Court can find no legal precedent to apply the
discovery rule to a defamation claim in New Jersey, as Plaintiff
has argued for some years now.
Judge Harrington previously
allowed Plaintiff’s defamation claim to proceed under a
discovery rule theory.
The Third Circuit, however, has
explicitly stated that under New Jersey law, “the ‘discovery
rule’ cannot extend the limitations period for defamation
claims.” O'Donnell v. Simon, 362 F. App'x 300, 305 (3d Cir.
2010)(citing Lawrence v. Bauer Publ'g & Printing Ltd., 78 N.J.
371, 396 A.2d 569, 570 (1979)).
Indeed, New Jersey courts have
repeatedly and consistently held that that the discovery rule
cannot, under any circumstances, toll defamation actions. See,
e.g., Nuwave Inv. Corp. v. Hyman Beck & Co., 221 N.J. 495, 500–
01 (2015)(“The statute's clear and unqualified language requires
all libel claims to be made within one year of the date of the
publication. That language cannot be reconciled with the
exception proposed by plaintiffs. In declining to create a
judicial discovery rule, we leave amendment of the statute to
19
the Legislature”); Burr v. Newark Morning Ledger Co., 2018 WL
1955050, at *2 (N.J. Super. Ct. App. Div. Apr. 26, 2018)(holding
that “recent unambiguous precedent dictates” that the discovery
rule is inapplicable to defamation claims); Sivells v. Sam's
Club, 2017 WL 3151246, at *9, n.12 (D.N.J. July 25, 2017)( “As to
the discovery rule, it may not apply to defamation claims at
all.”).
Second, Plaintiff cannot use the continuing tort doctrine
to restart the statute of limitations each time a potential
employer views the JPAS Report.
As noted by the Superior Court
of New Jersey, Appellate Division, “[o]ur courts have never
applied the continuing violation doctrine to defamation claims.”
Roberts v. Mintz, 2016 WL 3981128, at *4 (N.J. Super. Ct. App.
Div. July 26, 2016).
Furthermore, application of the continuing
tort doctrine under these circumstances would be at odds with
the single publication rule in defamation cases, which provides
that “a statement posted on the internet is deemed only to be
published once for purposes of the statute of limitations; the
limitations period does not restart every time the post is
viewed.” Id. at *5(citing Churchill v. State, 378 N.J.Super.
471, 478, 876 A.2d 311 (App.Div.2005)).
Based on the facts in this case, the publication date for
statute of limitations purposes was May 1, 2013: the date
McKenna finalized the JPAS Report within the system.
20
As such,
Plaintiff would have needed to assert her defamation claims no
later than May 1, 2014.
Under the law, these dates cannot be
tolled because Plaintiff only found out about the report in
August 2014.
In short, Plaintiff’s defamation claim was already
too late when she filed her initial pro se Complaint in January
2015.
B.
“Law of the Case” Doctrine
Alternatively, Plaintiff argues that this Court should abide
by Judge Harrington’s prior ruling because it has become “law of
the case.”
This Court disagrees.
The law of the case doctrine
is “an amorphous concept which generally holds that ‘when a
court decides upon a rule of law, that decision should continue
to govern the same issues in subsequent stages in the same
case.’” In re Caterpillar Inc., 67 F. Supp. 3d 663, 669–70
(D.N.J. 2014)(quoting Arizona v. California, 460 U.S. 605, 618
(1983)).
As explained by the Supreme Court, however, “[a] court
has the power to revisit prior decisions of its own or of a
coordinate court in any circumstance, although as a rule courts
should be loath to do so in the absence of extraordinary
circumstances such as where the initial decision was clearly
erroneous and would make a manifest injustice.” Christianson v.
Colt Indus. Operating Corp., 486 U.S. 800, 816 (1988).
The
Third Circuit has recognized several “extraordinary
circumstances” which would permit revisiting a prior decision.
21
Such circumstances exist where (1) new evidence is available;
(2) a supervening new law has been announced; (3) the order
clarifies or corrects an earlier, ambiguous ruling; and (4)
where a prior ruling, even if unambiguous, might lead to an
unjust result. See In re Pharmacy Benefit Managers Antitrust
Litig., 582 F.3d 432, 439 (3d Cir.2009).
Significantly, “the
law of the case doctrine does not restrict a court's power but
rather governs its exercise of discretion.” In re City of Phila.
Litig., 158 F.3d 711, 718 (3d Cir. 1998).
The state court allowed Plaintiff’s defamation claim to
proceed on an erroneous application of the discovery rule.
Moreover, the court compounded the error by ordering that the
defamation claim would proceed to trial.
This Court now
exercises its discretion to correct the Superior Court’s clearly
erroneous application of the discovery rule to a defamation
claim, which was precipitated by Plaintiff’s misstatement of the
law.
Although the record in the state court action demonstrates
that Defendant objected to the court’s finding, Defendant did
not prevail.
The application of the discovery rule to a
defamation claim was “clearly erroneous.”
To permit the verdict
to stand under the law of the case doctrine would result in
“manifest injustice.”
22
C.
Waiver of Defense
Plaintiff argues that Defendant’s statute of limitations
defense should be considered waived because Defendant failed to
include it in either its Amended Answer or the Final Pre-Trial
Order.
The Court finds this argument unpersuasive, but
certainly questions why Defendant failed to raise this
affirmative defense earlier.4
Indeed, Defendant could have moved
to amend its Amended Answer to include the affirmative defense
even after the issue had been raised before this Court at trial.
See, e.g., Ajax Enters. v. Fay, 2007 WL 766335, at *2 (D.N.J.
Mar. 7, 2007)(noting that “amendments may be made during trial,
after the close of testimony, or even after judgment” as long as
the nonmoving party will not be “unfairly disadvantaged or
deprived of the opportunity to present facts or evidence that it
would have offered”).
Defendant now states that “MSE should be
permitted leave to amend and its Answer [] to include the
statute of limitations as a defense,” [Dkt. No. 67, at 3-4], but
4
The Court notes that at the time Defendant filed its Amended
Answer (at the direction of Judge Harrington’s September 28,
2017 Order), Defendant presumably believed, based on Judge
Harrington’s prior holding, that it was precluded from asserting
the statute of limitations affirmative defense until trial. To
that end, Judge Harrington’s ruling would have still been
binding upon Defendant, even though the Amended Answer was being
filed in this Court, because “the orders or judgments entered by
the state court prior to removal should be treated as orders or
judgments entered by the district court.” Tehan v. Disability
Mgmt. Servs., Inc., 111 F. Supp. 2d 542, 547 (D.N.J. 2000).
23
Defendant has never formally requested this Court’s permission
to do so, pursuant to Local Civil Rule 15.1.
Although it would have been wise for Defendant amend its
Amended Answer, Defendant’s failure to amend is not dispositive.
Under established circuit law precedent, the failure to include
a defense in a responsive pleading does not automatically result
in a waiver.
As previously noted by the Third Circuit,
affirmative defenses, which include the statute of limitations,
are not waived if raised at a “pragmatically sufficient time”
with no prejudice to the plaintiff. See Balter v. United States,
172 F. App'x 401, 403 (3d Cir. 2006)(citing Eddy v. VI Water &
Power Authority, 256 F.3d 204, 209 (3d Cir. 2001)).
Moreover,
“issues tried by the express or implied consent of the parties
are ‘treated in all respects as if they had been raised in the
pleadings.’” Charpentier v. Godsil, 937 F.2d 859, 864 (3d Cir.
1991)(quoting Prinz v. Greate Bay Casino Corp., 705 F.2d 692,
694 (3d Cir. 1983)).
Furthermore, even though the statute of
limitations affirmative defense was not asserted in the Final
Pre-Trial Order, “[i]t is well established that departure from
or adherence to the pretrial order is a matter peculiarly within
the discretion of the trial judge.” Beissel v. Pittsburgh & Lake
Erie R. Co., 801 F.2d 143, 150 (3d Cir. 1986)(citing Berroyer v.
Hertz, 672 F.2d 334, 338 (3d Cir. 1982)).
24
As acknowledged by Plaintiff, Defendant has asserted the
statute of limitations defense since the case’s time in the
Superior Court.
Plaintiff knew of Defendant’s statute of
limitations objection for almost two years before trial;
Plaintiff cannot now claim to be prejudiced by the assertion of
this defense.
Plaintiff was aware of the statute of limitations
defense, but sought to keep the defamation claim alive based on
a misapplication of the discovery rule.
In actuality, by
arguing the law of the case, Plaintiff undermines her argument
that she had insufficient notice of Defendant’s statute of
limitations defense:
MS. BLAND-TULL: Yes, your Honor. And, Judge, I know
that your Honor may not be bound by the previous
ruling of the Superior Court judge in this case, but
this has all been the subject of a motion, and the
defendant's motion was denied with respect to these
issues in Superior Court. So I understand we are in a
different jurisdiction now, but I would respectfully
argue that there is an issue of the law of the case
that applies to this at this time.
THE COURT: The judge ruled that the statute of
limitations had not transpired on the defamation
claim–
MS. BLAND-TULL: That is correct, Judge.
THE COURT: -- based on the pleading itself.
MS. BLAND-TULL: Correct, Judge.
Trial Tr., Mar. 6, 2019, at 557:11-24 (emphasis added).
On the one hand Plaintiff seeks to prevent Defendant from
raising the statute of limitations defense (under law of the
25
case) and on the other hand Plaintiff contends Defendant failed
to raise it.
Certainly by raising the statute of limitations
defense at the September 2017 oral argument on the Motion for
Summary Judgment and Motion for Reconsideration, Defendant put
Plaintiff on notice.
A defense that was thoroughly litigated
between the parties cannot be said to have been waived. See
Stafford v. E.I. Dupont De Nemours, 27 F. App'x 137, 140 (3d
Cir. 2002)(holding that when one party met the other’s “statute
of limitations defense head-on in the District Court, without
objection. He had a full and fair opportunity to present his
arguments, and he will not now be heard to raise an objection”);
see also Balter, 172 F. App'x at 403 (holding that district
court had properly considered statute of limitations defense
even though it had not been raised in initial motion to dismiss
or summary judgment motion, where “defendants raised the statute
of limitations defense in their objections to the Magistrate
Judge's first Report and Recommendation, and again on remand
from the District Court in their answer and second motion to
dismiss and for summary judgment” and “[plaintiff] was afforded
an opportunity to meet that defense and to present his
arguments”).
Although Defendant would have been prudent to raise this
issue to the Court before trial, this Court is somewhat
reluctant to fault Defendant for failing to do so when Judge
26
Harrington had previously ruled the issue was to be tried before
a jury. See Superior Court Transcript, at 36:24-37:1(Judge
Harrington stating that he “may not let the jury consider” the
defamation claim, but that he was “not preventing them from
putting together a case to bring to the jury on defamation”).
Indeed, it seems that Defendant operated under the belief that
Judge Harrington’s ruling prevented it from raising the statute
of limitations defense again until Plaintiff rested her case at
trial.
To that end, Defendant repeatedly emphasized to this
Court that it was moving for judgment as a matter of law on
statute of limitations grounds “now that the record is closed.”
See Trial Tr., Mar. 7, 2019, at 681:23-684:17 (Defendant arguing
that “your Honor is ruling a closed record in this court.
Harrington did not rule on a Rule 50 motion.
Judge
The record is now
closed, your Honor is not bound by law of the case”).
These
factors all lead this Court to conclude that Defendant
interpreted Judge Harrington’s decision to preclude Defendant
from reasserting the statute of limitations defense until a Rule
50 motion at trial.
In this Court’s final analysis, it would be perverse to
allow Plaintiff to benefit from her own misrepresentations of
the law that caused this legal debacle in the first place.
The
law could not be clearer: there is no discovery rule exception
for defamation claims.
The party who was prejudiced was
27
Defendant who was forced to litigate a time-barred claim for two
additional years.5
Therefore, this Court exercises its
discretion to rule upon Defendant’s statute of limitations
affirmative defense.
D.
Absolute Immunity
Throughout the course of this litigation, Defendant has
leaned heavily on an absolute immunity defense to the defamation
claim.
Specifically, Defendant argued that the defamation claim
fails because MSE is entitled to absolute immunity for
statements made in the JPAS Report.
As noted by Defendant,
“courts have granted official immunity to private actors in
defamation actions resulting from reports prepared by private
industry for government agencies.” Gulati v. Zuckerman, 723 F.
Supp. 353, 356 (E.D. Pa. 1989)(internal citations omitted).
To
this point, MSE argues that government regulations obligated MSE
to report “adverse information” about Plaintiff’s fitness to
hold a security clearance, and that it had no choice but to put
the relevant information in the JPAS Report. For that reason,
Defendant claims that any information provided in the JPAS
Report is entirely privileged.
5
Perplexingly, Defendant viewed a
With the benefit of hindsight, of course it is easy to
criticize Defendant for not raising the statute of limitations
defense before this Court well before trial. However, the Court
sees little point in doing so now.
28
finding of absolute immunity as a forgone conclusion.
This
Court, however, disagrees.
Without binding support from the Third Circuit, Defendant
cites to the Fourth Circuit’s decision in Becker v. Philco
Corp., 372 F.2d 771 (4th Cir. 1967).
In Becker, two individuals
sued their former employer, a defense contractor, for submitting
an allegedly defamatory report to DoD officials, under
regulations which required the contractor to submit a report “of
any loss, compromise, or suspected compromise of classified
information.” Id. at 773.
Ultimately, the Fourth Circuit held
that the employer was absolutely immune from liability for the
alleged defamation in the report.
The Fourth Circuit stated:
“[T]he company has no discretion and is mandatorily
ordered to report the suspicion immediately. There is no
question but that the system of reporting was valid. The
obligation could scarcely be couched in more imperious
or exacting language. It embraces both true and false
accusations,
both
substantial
and
insubstantial
suggestions, perhaps encompassing even rumors. It
demands investigation of them by the company and a report
of it to the Defense Department. That is precisely what
Philco did. Faithful to the contract, it could have done
no less.”
Id. at 774 (emphasis added).
Although the Becker decision sets
a precedent for absolute immunity, even when the information
reported includes rumors, this Court finds that the regulation
at issue in this case is substantially different from the one
examined by the Becker court over fifty years ago.
As outlined
in Section 3 of the National Industrial Security Program
29
Operating Manual, titled “Reporting Requirements,” MSE is bound
to abide by the following guidelines:
1-302 Reports to be Submitted to the CSA
a. Adverse Information. Contractors shall report adverse
information coming to their attention concerning any of
their cleared employees. Reports based on rumor or
innuendo should not be made. The subsequent termination
of employment of an employee does not obviate the
requirement to submit this report. If the individual is
employed on a Federal installation, the contractor shall
furnish a copy of the report and its final disposition
to the commander or head of the installation.
NOTE: In two court cases, Becker v. Philco and Taglia v.
Philco (389 U.S. 979, 88 S.Ct. 408, 19 L.Ed.2d 473), the
U.S. Court of Appeals for the 4th Circuit decided on
February 6, 1967, that a contractor is not liable for
defamation of an employee because of reports made to the
Government under the requirements of this Manual and its
previous versions.
NISPOM, Section 3, at 1-302(a)(emphasis added).
As further
clarified in Appendix C of NISPOM, “Adverse Information” is
defined as “any information that adversely reflects on the
integrity or character of a cleared employee, that suggests that
his or her ability to safeguard classified information may be
impaired, or that his or her access to classified information
clearly may not be in the best interests of national security.”
Whereas the Becker court dealt with a reporting requirement
that embraced “both true and false accusations,” NISPOM clearly
instructs not to report information “based on rumor or
innuendo.”
Therefore, to the extent reports within JPAS are
30
immune from suit, an issue this Court need not decide, that
immunity is qualified, rather than absolute: it does not cover
reports based on rumor or innuendo.
To that end, whether a
report is based on rumor or innuendo would be a factual finding
for a jury.6
Following the verdict, this Court asked the parties if they
wished to ask the jury a special interrogatory about this issue.
Unfortunately, as outlined in the exchange below, the parties
precluded the Court from asking the jury if they found that the
JPAS Report was based on rumor or innuendo:
THE COURT: The only question is that the legal -- let
me just -- I want to make sure I'm not excusing the
jury and then regret it later. The legal argument that
the defendant is making is that they have a legal
obligation to report a threat. Right?
MR. LEAHY: Correct, your Honor.
THE COURT: If the jury found that a threat was never
made does your legal position stand? And should I ask
the jury whether they found -- should I issue a
special interrogatory asking them whether or not they
found that a threat was a made?
(Short pause.)
6
The Court notes that Defendant relies upon Mission1st Grp.,
Inc. v. Filak, 2010 WL 4974549, at *2 (D.N.J. Dec. 2, 2010) to
supports its absolute immunity defense. Indeed, in that case,
the court found that an allegedly false report about a cleared
employee was entitled to absolute privilege because it was made
pursuant to a governmentally imposed duty. Id. However, this
Court declines to follow that decision, as it did not consider
whether the allegedly false report was premised upon “rumor or
innuendo,” as instructed by the plain text of NISPOM.
31
MR. LEAHY: I was -- what we have just discussed, your
Honor, is I don't know that it would change the
defense because -THE COURT:
MR. LEAHY:
to JPAS is
they found
threat was
Because?
-- as you said, anything that is reported
absolutely privileged. At the same time if
that the threat was -- if they found that a
in the made --
THE COURT: But if it were false -- if they found that
a threat was never made and MSE made it up that would
not be privileged, would it?
MR. LEAHY: It would still be privileged, your Honor,
based on the Mission First case. I mean, the privilege
is absolute and holds regardless of whether the
information was rightly reported. And that's quoting
from Mission First which was quoting from Becker. So
that is the law of the land, your Honor.
THE COURT: If it was made reckless does that matter?
MR. LEAHY: It does not matter, your Honor, it is
absolute privilege.
MS. BLAND-TULL: Your Honor, the NISPOM regulations
upon which the case is based specifically say that the
immunity does not apply to rumor, innuendo and -- and
I forget the other language, but language to the
effect of statements that have not been corroborated
or don't have a trustworthiness.
THE COURT: So do I present the issue of qualified
immunity to the jury? Is it not a jury's finding
whether or not it was -MR. LEAHY: It is not, your Honor, because this is not
a qualified immunity issue, this is absolute privilege
issue and so that is a strict legal one, not a jury
issue.
THE COURT: Well, I guess what I would say is the
following: If the parties are incorrect and there
should be a question that I should be posing to the
jury and I find that my failure to pose the question
to the jury prevents me from deciding the issue of
32
this privilege and I have to order a new trial, I
will. I just am not going to lose the jury -- so I
guess the parties need to be confident about it.
Neither one of you want me to issue a special
interrogatory, I'm just cautiously saying to the
parties that if in the end I determine I should have
and I haven't it would necessitate a new trial. But
that will be what it will be I guess.
Trial Tr., Mar. 7, 2019, at 784:16-786:20.
Although the jury’s verdict on the defamation claim
indicates that the jury found that information in the JPAS
Report was false, it does not tell the Court whether the jury
viewed the information as “based on rumor or innuendo.”
There
are many reasons why the jury could have found that Defendant’s
report was false, without being based on rumor or innuendo.
For
example, the jury could have believed that the JPAS Report
contained false information about Plaintiff, but that Defendant
had a good faith reason for mistakenly accepting the information
as factual.
However, this Court cannot speculate as to the
jury’s state of mind.
With the parties unwilling to send a
special interrogatory to the jury, this Court is unable to reach
that issue.
If this Court did not set aside the defamation
verdict on statute of limitations grounds, a new trial would
have been necessary to properly address the immunity issue.
Therefore, in accordance with Fed. R. Civ. P. 50(c)(1), the
Court will conditionally grant Defendant’s alternative motion
for a new trial.
33
V.
CONCLUSION
For the foregoing reasons, Defendant’s Motion for Judgment
as a Matter of Law shall be GRANTED and the jury verdict on the
defamation claim will be set aside.
The Court will direct the
entry of (1) judgment on the jury’s verdict on the NJLAD
retaliation claim and (2) judgment as a matter of law in favor
of Defendant on the defamation claim.
DATED: July 9, 2019
s/Renee Marie Bumb
RENÉE MARIE BUMB
United States District Judge
34
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