Jonathan W. Hugg
Jonathan W. Hugg ()

Editor’s note: It was reported just prior to press time that Walter Logan settled with the District Attorney’s Office for $1.7 million. The office also issued a retraction and apology.

My favorite president, Teddy Roosevelt, often referred to his office as a “bully pulpit,” meaning that it was a prominent position from which he could preach his views and the world had no choice but to listen and consider them. Publicity intoxicated Roosevelt and he loved forcefully expressing his decisive opinions. The mere fact that Roosevelt was the president made certain that the press would take note when he extolled the “strenuous life” or environmental preservation. However, it also meant that when he denounced his adversaries as the “malefactors of great wealth,” or as guilty of “all forms of iniquity from the oppression of wage workers to defrauding the public,” it caused them permanent stigma. One hundred years later, the reputations of the financiers and industrialists of the late Gilded Age, private citizens whom Roosevelt frequently targeted, still have not recovered.

Of course, only in their own minds do most local commissioners or board members have the stature of Roosevelt. The setting may be provincial, but every township or county potentate still craves the limelight of his or her own bully pulpit. At every borough council or school board meeting, some ambitious, loquacious rising star searches out the press. The opportunity to increase his or her name recognition and impress constituents with free print, radio and television exposure is irresistible.

Indeed, the more intimate the community setting, the higher the profile of a local politician’s public statements. We trust our public servants to speak out responsibly and judiciously and appeal to our better natures, or at worst just to blow harmless hot air. However, when a vindictive bully uses the pulpit of public office to attack a private citizen or business, the suggestion of official imprimatur multiplies the harm to the personal reputation of the victim. Suddenly, with no semblance of due process, the politician’s ire tarnishes its object as a public enemy. The politician has enhanced his or her career at a cost to our client’s public standing.

The troubling fact is that under Pennsylvania law, public office is de facto a license for defamation. Article I of the Pennsylvania Constitution purports to protect our clients’ allegedly “indefeasible rights” to “reputation.” Despite this, for more than 60 years, Pennsylvania courts have held that common law “high public official immunity” shields public officials from personal accountability when engaged in their official duties, even when their actions are defamatory, arbitrary or capricious.

For instance, in Factor v. Goode, 612 A.2d 591 (Pa.Cmwlth 1992), the Commonwealth Court upheld the grant of preliminary objections dismissing a defamation claim against the mayor and revenue commissioner of Philadelphia. The mayor and revenue commissioner had conducted a press conference where they incorrectly described Marvin and Kathleen Factor as being among the top 20 delinquent property tax payers in Philadelphia, and as “‘deadbeats’ and ‘tax cheats’ who think that ‘they’re above the law.’” However, no one ever charged the Factors with any crime and Marvin Factor was disabled.

Similarly, in Osiris Enterprises v. Borough of Whitehall, 877 A.2d 560 (Pa.Cmwlth 2005), the Commonwealth Court affirmed the grant of preliminary objections against Osiris, a construction company that had filed a defamation claim against Whitehall Borough Council members. Without conducting any investigation or affording Osiris any notice, the council had unanimously voted to declare Osiris a “non-responsible” and “non-responsive” bidder, debarred Osiris and then publicized the designation.

In both Factor and Osiris, the proffered rationale for insulating the high-handed public officials from liability was that they allegedly could not perform their civic duties if they shared the risk borne by every private citizen of having to answer for false public statements.

As the Pennsylvania Supreme Court stated in Matson v. Margiotti, 88 A.2d 892 (Pa. 1952), “to permit slander, or libel … suits where the official’s charges turn out to be false, would be to deter all but the most courageous or the most judgment-proof public officials from performing their official duties.” That was small solace to Marjorie Matson, whom Attorney General Charles J. Margiotti accused of being a communist and thus allegedly unfit to serve as an assistant district attorney in McCarthy-era Allegheny County. In 2014, it is reasonable to expect that a public official with the audacity or arrogance to use the pulpit of his or her office to bully private citizens and tarnish their reputations would at least have the facts straight.

Since Pennsylvania law is, characteristically, ineffective against reckless conduct by local officials, our clients must look to the federal Civil Right Act, 42 U.S.C.A. § 1983, for any remedy. Section 1983 creates a cause of action for deprivations of federal constitutional rights without due process. However, the U.S. Supreme Court has held that damage to reputation alone does not amount to a deprivation of “liberty” or “property” protected by due process, in Paul v. Davis, 424 U.S. 693 (1976). Rather, an aggrieved citizen must meet the “stigma plus” test of establishing injury to his or her reputation as well as the additional element of burden or harm to “some additional right or interest,” as in Hill v. Borough of Kutztown, 455 F.3d 225 (3d Cir. 2006).

The U.S. Court of Appeals for the Third Circuit has held that a campaign of defamation, harassment and intimidation by public officials that impairs a citizen’s liberty and property interest in his or her business triggers the protection of Section 1983, per Thomas v. Independence Township, 463 F.3d 285 (3d Cir. 2006). Thus, unlike Pennsylvania law, federal courts require public officials to govern with at least a minimum of respect for the reputations of their citizens and their livelihoods.

A stark example of this is the recent decision of the U.S. District Court for the Eastern District of Pennsylvania in Logan v. Salem Baptist Church, 2013 U.S. Dist. LEXIS 120305 (E.D. Pa. August 23, 2013). The facts of the case are, to say the least, alarming, and could supply rich material for discussions of professional, prosecutorial and political ethics and tactics.

Salem Baptist Church allegedly enlisted political connections to avoid settling a breach of contract dispute with Walter Logan and his construction company, which the church had terminated because of delays and financial problems in a building project. After Logan initiated AAA arbitration, but before hearings started, the church and its lawyers convinced the Montgomery County District Attorney’s Office to investigate Logan, charge him with theft and arrest him. Notably—and oddly behind the scenes—the church and its lawyers assisted the District Attorney’s Office in drafting the search and arrest warrants.

District Attorney Risa Vetri Ferman herself then proceeded to give several interviews to reporters about the prosecution, which resulted in a number of newspaper articles and a news radio report. Ferman said in the Philadelphia Tribune that Logan “was entrusted by the church with overseeing a major construction project and he took money from them and he hired people to do work. He then ripped off his subcontractors, never paid them and pocketed the money for himself,” according to the opinion. Subsequently, however, the arbitrator found in favor of Logan’s company and against the church. Personnel at the District Attorney’s Office acknowledged internally that the result of the arbitration undercut the prosecution of Logan. However, seemingly because of political considerations, more than six months passed before Ferman dropped the charges.

Logan sued everyone involved, including Ferman for false public statements under Section 1983 and numerous state law causes of action. Ferman moved for summary judgment. Unsurprisingly, the district court granted her motion as to the state law claims based upon her immunity as a high public official. However, the court allowed Logan’s Section 1983 claim to go to trial. The court concluded that there was sufficient evidence for a jury to find that Ferman’s “public statements significantly altered Logan’s ability to pursue his construction business.”

Specifically, Logan testified at deposition that the publicity from the criminal case against him prevented his companies from winning several lucrative, long-term construction contracts, halted other projects because he could not access credit, and caused the entity that won the arbitration with the church to cease all construction work.

Especially considering the traditional immunity granted to prosecutors, this result is stunning. However, precisely because the public official is the district attorney, it was proper for the court to allow a jury to decide if her statements to the press violated Logan’s civil rights.

A prosecutor in particular has a duty under Rule of Professional Conduct 3.6 to avoid prejudicial pretrial publicity (nevermind her obligation under Rule 3.8 not to prosecute a charge she knows lacks probable cause). It served no legitimate public purpose to try Logan (who was supposed to be presumed innocent until proven guilty) in the press. On the record before the court, Ferman knew or should have known that her statements were not only defamatory, but would also harm Logan’s business.

Indeed, considering the influence of the church and the pending arbitration, that may have been the point. The ruling of the court in Logan will hopefully cause rash public officials to consider whether it would be prudent to engage in some self-restraint when they assume their bully pulpits rather than demagoguery.

Jonathan W. Hugg is a member of Clark Hill’s litigation practice group. He concentrates on commercial and appellate litigation, with an emphasis on financial institution, regulatory enforcement, municipal and lender liability matters. He has served as special counsel to numerous local agencies and also represents businesses and individuals in disputes with government.