Lawyers who feel the urge to comment publicly, and perhaps passionately, about litigation opponents should be heartened by an appeals court ruling that gave an attorney wide latitude.
The Appellate Division on Thursday not only found the lawyer didn’t defame an adversary’s client by talking to the press but also held the other party liable for frivolous-litigation sanctions.
The ruling, in Samost v. Voorhees, A-5786-10, stemmed from long-running litigation over developer Joseph Samost’s obligation to repair Kenilworth Lake Dam in Evesham Township after it was damaged in a 2004 storm and the lake was drained. Samost owns the dam.
After a court ordered Samost to repair the dam, he sought contribution from lake-front homeowners. When Samost failed to comply with a court order to deposit $250,000, claiming insufficient funds, landowners represented by Gregory Voorhees moved to enforce their rights. They argued Samost was violating the Fraudulent Transfer Act by liquidating or hiding assets.
On Dec. 17, 2010, Burlington County Superior Court Judge Michael Hogan found Samost had the money to deposit but had been manipulating his assets through interlocking entities. He ordered an immediate freeze on Samost’s interest in the entities and prompt payment of the $250,000 to a court-appointed receiver. In addition, Hogan held Voorhees’ clients were entitled to counsel fees, later awarding them about $25,500.
Right after the ruling, while still in the courthouse, Voorhees spoke with a reporter for The Courier Post of Cherry Hill, who quoted him saying, "We believe the court has seen through the actions of Joseph Samost … and chased down assets of a man who tried to hide them from the court and the homeowners."
Based on those words, Samost brought a defamation suit against Voorhees, his firm and four clients who were standing next to him when he spoke them. Samost filed the suit in Camden but the defendants got it transferred to Burlington County, where the dam, the clients and the litigation are situated and where the allegedly defamatory comments were made.
Judge Karen Suter threw out the suit on a motion for summary judgment and sanctioned Samost another $14,205 for suing Voorhees’ clients on a theory of respondeat superior. She held that Voorhees’ comments, which started with "We believe," were "not capable of a defamatory meaning as a matter of law" because they reflected "his and his clients’ opinion about Judge Hogan’s decision and their interpretation of what it means" rather than being "a statement of verifiable fact that can be proven true or false."
Appeals judges Francine Axelrad, Paulette Sapp-Peterson and William Nugent, in a per curiam opinion, agreed with Suter that Voorhees’ utterance was an opinion, which is not actionable. But it was also a "fair characterization of Judge Hogan’s ruling and fair comment on his decision," they said.
"That Voorhees may have embellished those findings or used hyperbole by saying the court had to ‘chase down’ Samost’s assets does not mean that the statement was defamatory," they added.
The panel quoted Suter’s finding that Samost’s complaint was misleading in that it edited out the "We believe" portion of Voorhees’ comment.
They agreed with Suter that "the attorney-client relationship does not give rise to a claim under respondeat superior."
They said the claim was groundless as a matter of law and the counsel fees awarded under the frivolous litigation statute were justified as a deterrent.
The appeals court pointed out that Samost presented no evidence that the homeowner defendants authorized or ratified Voorhees’ comments and that his lawyer, Thomas Hagner, conceded at oral argument that the homeowners were named solely because they were present at oral argument before Hogan and "flanked" Voorhees when he spoke to the press.
Like Suter, the panel saw the filing of the defamation case in Camden as done in bad faith to create an inconvenient forum for the defendants.
Samost’s explanation that the dam straddles both counties and that the Courier Post, a potential defendant, is located in Camden County was "of no moment," said the court.
Suter "was well within her discretion in concluding that the homeowners were sued to get back at them for their participation and success in the Kenilworth dam litigation.
John Slimm, of Marshall Dennehy Warner Coleman & Goggin in Cherry Hill, who defended Voorhees, calls the ruling very significant for lawyers in New Jersey in providing guidance on speaking to the press.
Paul Leodori, Voorhees’ partner at Leodori & Voorhees in Medford, represented the land owner defendants in the defamation case. He says that if the case had come out the other way, "it would have such a chilling effect that the public would never get comments again from lawyers in New Jersey."
Samost’s claim against the clients "seemed to boil down to guilt by association" and if it had not been thrown out, it could have undermined the attorney-client relationship, he adds.
Leodori says the underlying case settled and the dam is being rebuilt.
Hagner, of Hagner & Zohlman in Cherry Hill, did not return a call. •