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A worker in Pennsylvania cannot sue a co-worker for slander over criticisms made to their superiors that related to job performance since such remarks are not capable of defamatory meaning under state law, a federal appeals court has ruled. In a 15-page unpublished opinion in Sheehan v. Anderson, a unanimous three-judge panel upheld a decision by Senior U.S. District Judge Louis C. Bechtle that said Pennsylvania law recognizes a “conditional privilege” whenever a co-worker makes comments to management about another worker’s job performance. In the suit, John Sheehan, an examiner employed by the Federal Reserve Bank, complained that three of his co-workers had falsely accused him of “sitting around, drinking coffee and talking” for more than an hour every morning and creating an “antagonistic” work environment in which others were afraid to express their opinions. The suit said Sheehan was reprimanded after the comments were made. An employee of the bank since 1987, Sheehan still works in its Philadelphia office in the Supervision Regulation & Credit Department. In addition to the defamation claim, the suit alleged that the bank acted in bad faith and violated Sheehan’s constitutional right to due process. But the bank’s lawyers — Frank A. Chernak of Montgomery McCracken Walker & Rhoads and Howard J. Bashman of Buchanan Ingersoll in Philadelphia — argued that the defamation claim was fatally flawed since the statements were all made in the workplace to a limited audience of Sheehan’s superiors and focused entirely on his job performance. That argument succeeded with Bechtle and has now succeeded again with the 3rd U.S. Circuit Court of Appeals. “Given the context, audience and nature of the alleged communication, we conclude that while the statements were critical of Sheehan and thus may annoy or embarrass him, they are not sufficient as a matter of law to create an action for defamation,” Senior U.S. Circuit Judge Walter K. Stapleton wrote in an opinion joined by Judges Anthony J. Scirica and Leonard I. Garth. Under Pennsylvania law, Stapleton said, the trial judge must first decide whether a statement is capable of defamatory meaning. In that analysis, he said, Pennsylvania courts have held that “the nature of the audience is a critical factor.” And a statement is defamatory, he said, only if it tends to “blacken a person’s reputation” or “expose her to public hatred, contempt, ridicule, or injure her in her business or profession.” Pennsylvania courts have also defined categories of speech that are not actionable defamation, Stapleton said, including statements that can only be understood as expressions of pure opinion and those that merely annoy or embarrass an individual but do not impugn his character. Stapleton found that the Pennsylvania courts have consistently dismissed defamation cases in which the statements were limited to work-related complaints — even if the worker said he was falsely accused of being “vulgar, crude and obscene.” The only way such a case can survive, Stapleton found, is if the plaintiff can show that his character was attacked, such as with accusations of dishonesty, or if the remarks challenged his ability or fitness to do the job. But if the statements focus only on the plaintiffs’ job performance, Stapleton found, the Pennsylvania courts protect such speech as opinion. Sheehan was represented by attorney Robert J. Sugarman.

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