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Shellie Cummings v. Auburn Associates

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA THIRD APPELLATE DISTRICT (Placer)


January 30, 2012

SHELLIE CUMMINGS, PLAINTIFF AND APPELLANT,
v.
AUBURN ASSOCIATES, INC., DEFENDANT AND RESPONDENT. JEFF DUNCAN, PLAINTIFF AND APPELLANT,
v.
AUBURN ASSOCIATES, INC., DEFENDANT AND RESPONDENT. LARRY GONZALEZ, PLAINTIFF AND APPELLANT,
v.
AUBURN ASSOCIATES, INC., ET AL., DEFENDANTS AND RESPONDENTS.

(Super. Ct. No. SCV21366), (Super.Ct.No. SCV21360), (Super.Ct.No. SCV21365)

The opinion of the court was delivered by: Nicholson , Acting P. J.

Cummings v. Auburn Assocs.

CA3

NOT TO BE PUBLISHED

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

Plaintiffs Shellie Cummings, Jeff Duncan, and Larry Gonzalez each sued their former employer, Auburn Associates, Inc. (Auburn Honda), and Auburn Honda's former owner, Jay Cooper, alleging defamation and invasion of privacy. Plaintiffs accused Cooper of slander for telling another employee that each was "a thief and a snake," and a "lying, thieving snake." Plaintiffs also claimed Cooper violated their privacy rights by informing the other employee how much money each had received in settlement of wrongful termination litigation they had earlier brought against Auburn Honda and Cooper.

The trial court granted Auburn Honda's motions for summary judgment against each of the complaints, and Cooper's motion for judgment on the pleadings against Gonzalez's complaint. It ruled as to Auburn Honda that Cooper's statements were not actionable because they were statements of opinion, and that Cooper's disclosure of the settlement terms did not violate plaintiffs' privacy rights. As to Cooper, it ruled he was entitled to judgment on the pleadings against Gonzalez under the doctrine of collateral estoppel.

Plaintiffs appeal. We affirm Auburn Honda's summary judgment awards on the same grounds relied upon by the trial court. However, we reverse the judgment on the pleadings awarded to Cooper, as the summary judgment on which the court relied to find collateral estoppel was not a final judgment for purposes of the collateral estoppel doctrine.

FACTS

The earlier employment lawsuits were brought by plaintiffs and another terminated employee, Richard Huse. They accused Auburn Honda and Cooper of wrongful termination, hostile work environment, retaliation, sexual harassment, and discrimination.

Former Auburn Honda general manager Larry Leonardo testified in his deposition for this matter that while he worked at Auburn Honda, Cooper would often come into his office to vent about plaintiffs' lawsuits. He would return from meetings involving the litigation "very, very, very upset." He was "pissed off at the whole thing." He would call the plaintiffs "'a bunch of liars, thieves,'" a "bunch of lying, cheating thieves," "liars and thieves and cheats," "[a]mongst other things." This happened about six times.

Ultimately, plaintiffs settled their lawsuits. Each plaintiff executed express waivers of any known or unknown claims arising out of their employment or association with Auburn Honda and Cooper. They also executed express waivers of the provisions of Civil Code section 1542.

As the lawsuits began settling, Cooper would inform Leonardo of the settlements and the amount of money each plaintiff agreed to accept. He informed Leonardo that Cummings settled for $115,000, and Gonzalez for $130,000. Cooper also told Leonardo that Duncan "'settled for [$]385,000, and that it is not that much money by the time he gets done paying taxes and the lawyer fees.'" Cooper, however, was "outraged" that Huse, whom he called the "'worst . . . son of a bitch . . . of the bunch,'" had not settled. Eventually, Cooper told Leonardo that Huse had settled for $385,000. After the four cases settled, Cooper did not speak about plaintiffs with Leonardo anymore.

Shortly thereafter, Leonardo was terminated. Leonardo later informed Duncan and Huse what Cooper had called them while the earlier litigation was underway. Huse asked Leonardo to prepare and sign a declaration attesting to what Cooper had said to help support another lawsuit by plaintiffs against Auburn Honda and Cooper. Leonardo did so, wherein he recounted the events just described.

Cummings and Gonzalez learned from Huse and Duncan of Cooper's comments to Leonardo about plaintiffs and his disclosures of the settlement terms. Each of them filed these separate actions accusing Auburn Honda and Cooper of defamation for the comments he made about them to Leonardo, and invasion of privacy for disclosing the financial terms of their settlements to Leonardo. Huse's case is not before us.

Auburn Honda filed motions for summary judgment or summary adjudication against the complaints. Regarding the defamation causes of action, Auburn Honda argued, among other things: (1) the complaints were barred by plaintiffs' express waivers of claims they had executed as part of settling the earlier litigation that released all unknown claims arising from their employment or association with Auburn Honda; and (2) the alleged statements by Cooper were statements of opinion and thus not actionable.

As for the invasion of privacy causes of action, Auburn Honda argued plaintiffs could not establish that tort because: (1) the settlement amounts were not a private fact, as the settlement agreements did not require Auburn Honda to keep the information confidential; and (2) any disclosure made was not done so publicly but only to one other person.

The trial court granted Auburn Honda's motions for summary judgment or summary adjudication. It granted the motion against the defamation cause of action because Cooper's alleged statements as a matter of law were statements of opinion and were not actionable. It granted the motion against the invasion of privacy cause of action because the settlement agreements required only the plaintiffs, and not Cooper, to keep the settlement amounts confidential. As Cooper was under no obligation to keep the settlement terms confidential, disclosing those terms could not form the basis of an invasion of privacy cause of action.

The court rejected Auburn Honda's argument that the waiver of claims in the earlier settlement agreements barred these actions. It found these actions did not arise from plaintiffs' employment and association with Auburn Honda and Cooper. That finding, however, did not affect the court's ultimate order granting summary judgment.

As for Cooper, he had attempted to join in Auburn Honda's summary judgment motion against Cummings, but the trial court found his attempt was procedurally defective, and it did not rule on his purported motion. It appears Cooper did not join in Auburn Honda's motion against Duncan. In the Gonzalez matter, Cooper did not file or join in Auburn Honda's motion for summary judgment. Instead, he filed on shortened time a motion for judgment on the pleadings based on the doctrine of collateral estoppel. He claimed the court's ruling on Auburn Honda's summary judgment motion against Gonzalez's complaint would involve the identical issues Gonzalez raised against Cooper, and collateral estoppel would preclude Gonzalez from relitigating them.

The trial court granted Cooper's motion for judgment on the pleadings. It found Gonzalez's action against Cooper was barred under collateral estoppel, and that its earlier judgment based on Auburn Honda's summary judgment motion against Gonzalez was sufficiently final for purposes of applying collateral estoppel.

Plaintiffs appeal from their respective judgments. They argue the trial court erred by granting summary judgment. Regarding the defamation causes of action, they assert Cooper's statements were statements of fact and not opinion. They were sufficiently ambiguous, plaintiffs argue, so as to justify sending the issue to a jury. Plaintiffs also claim Auburn Honda was barred from asserting the statements were opinions because Cooper denied making them. Even if the statements were opinion, plaintiffs claim they were still actionable as they were implicitly based on undisclosed defamatory facts.

As for the invasion of privacy causes of action, plaintiffs argue their right to privacy was not dependent on Cooper being contractually obligated to keep the settlement terms confidential. They claim they have presented sufficient evidence on the elements of the tort of invasion of privacy so as to survive a motion for summary judgment.

Lastly, Gonzalez challenges the judgment on the pleadings entered against him in favor of Cooper. He claims the trial court erroneously applied collateral estoppel, as the court's judgment in favor of Auburn Honda and against him was not a final judgment on which the court could rely to bar Gonzalez from litigating the issues he raised against Cooper. He also argues Cooper failed to establish that the facts Gonzalez pleaded justified judgment on the pleadings.

We have consolidated the appeals for purposes of briefing, argument, and decision.

DISCUSSION

I

Summary Adjudication of Defamation Cause of Action

Plaintiffs claim the trial court erred by concluding Cooper's alleged statements as a matter of law were opinions and not actionable for defamation. They assert the statements were actionable statements of fact. They also claim Auburn Honda waived the opinion defense because Cooper denied making the statements. Even if the statements were opinion, plaintiffs argue they remained actionable, as they implied being based on undisclosed defamatory facts. We disagree with plaintiffs' arguments.*fn1

An essential element of defamation is that the publication must contain a false statement of fact. (Gregory v. McDonnell Douglas Corp. (1976) 17 Cal.3d 596, 600 (Gregory).) "If defendant's statement is one of opinion, then it cannot be false and is outside the meaning of libel." (Tschirky v. Superior Court (1981) 124 Cal.App.3d 534, 539.) The court must determine "'whether a reasonable fact finder could conclude the published statement declares or implies a provably false assertion of fact.'" (McGarry v. University of San Diego (2007) 154 Cal.App.4th 97, 113.) Whether a statement is one of fact or opinion is a question of law to be decided by the court. (Baker v. Los Angeles Herald Examiner (1986) 42 Cal.3d 254, 260 (Baker).)

The distinction between an opinion and a statement of fact is "frequently a difficult one" and requires the court to put itself in the position of the hearer in order to determine the meaning of the statement according to its probable effect on the average hearer. (Baker, supra, 42 Cal.3d at p. 260.) An apparent statement of fact may assume the character of an opinion "in light of the nature and content of the communication taken as a whole." (Gregory, supra, 17 Cal.3d at p. 601.) Courts look to the "totality of the circumstances," examining first the language of the statement, then the context in which the statement was made. (Hufstedler, Kaus & Ettinger v. Superior Court (1996) 42 Cal.App.4th 55, 67-68.)

Examining the language of the statement in this case, we find Cooper's claim that plaintiffs were snakes, i.e., "worthless or threacherous fellow[s]" (Merriam-Webster's Collegiate Dict. (11th ed. 2006) p. 1179, col. 1), and, to a great extent, the claims that they were lying, cheating, and thieving have at least the appearance of fact. We look to the circumstances surrounding the statements to determine whether they could be reasonably understood in the defamatory sense.

Cooper made the statements at issue to Leonardo, who was Auburn Honda's general manager. Cooper made the statements after he came back from meetings regarding plaintiffs' lawsuits. When Cooper came back from these meetings he was "very, very, very upset." He would go into Leonardo's office and "vent" because he was "pissed off at the whole thing."

Language which might be considered a statement of fact may assume the character of a statement of opinion when made in a "setting in which the audience may anticipate efforts by the parties to persuade others to their positions by use of epithets, fiery rhetoric or hyperbole . . . ." (Gregory, supra, 17 Cal.3d at p. 601.) In the setting involved here, Cooper was angry over the lawsuits filed by his ex-employees and the demands they made. He was "venting" his anger to his general manager. It is a setting in which the general manager would have expected Cooper's epithets to be statements of his opinion of plaintiffs, rather than statements of actual fact.

The statements are analogous to the one in Greenbelt Coop. Pub. Asso. v. Bresler (1970) 398 U.S. 6 [26 L.Ed.2d 6], in which the Supreme Court held that the statement that a real estate developer's negotiating position was "blackmail" was not a statement of fact where it was made during heated negotiations between a city and the developer over the sale of land for a school. The court held that it was impossible to believe that any reader could have thought that the developer was being charged with a crime. (Id. at p. 14.) Rather, the statement was a criticism of the developer's legal negotiating proposals. (Ibid.)

Likewise, courts have regarded as opinion statements that a plaintiff "was a 'shady practitioner' (Lewis v. Time Inc. (9th Cir. 1983) 710 F.2d 549, 554), 'crook' (Lauderback v. American Broadcasting Companies (8th Cir. 1984) 741 F.2d 193, 195-198), or 'crooked politician' (Fletcher v. San Jose Mercury News [(1989) 216 Cal.App.3d 172,] 190-191)." (Copp v. Paxton (1996) 45 Cal.App.4th 829, 837.)

Under the totality of the circumstances presented here, we agree with the trial court that no reasonable fact finder could conclude the statements implied a provably false factual assertion.

Plaintiffs argue Auburn Honda cannot claim conditional privilege as a defense to the defamation because Cooper denied making the statement. Plaintiffs misconstrue Auburn Honda's defense. The trial court did not find the statement was conditionally privileged. Rather, it found the statement was one of opinion rather than fact, and thus was not actionable defamation. The cases and authorities cited by plaintiffs that prevent raising a conditional privilege as a defense where the publisher denies making the statement (see e.g., Russell v. Geis (1967) 251 Cal.App.2d 560; 5 Witkin, Summary of Cal. Law, Torts (10th ed. 2005) § 591, p. 868.) do not apply here.

Plaintiffs also claim Cooper's statements are actionable because they imply knowledge by Cooper of defamatory facts underlying his opinion. But this argument only repeats an element of the test discussed above to determine whether a statement is an opinion. In analyzing that issue, a court must determine "'whether a reasonable fact finder could conclude the published statement declares or implies a provably false assertion of fact.'" (McGarry v. University of San Diego, supra, 154 Cal.App.4th at p. 113, italics added.) However, contrary to plaintiffs' implication that we parse each word to determine if it implies a fact that can be proven wrong, we look to the totality of the circumstances to determine whether a statement is one of opinion. Whether a statement's words imply a provably false assertion of fact is only one element of those circumstances.

"'California courts have developed a "totality of the circumstances" test to determine whether an alleged defamatory statement is one of fact or of opinion. First, the language of the statement is examined. For words to be defamatory, they must be understood in a defamatory sense. [Citations.] Where the language of the statement is "cautiously phrased in terms of apparency," the statement is less likely to be reasonably understood as a statement of fact rather than opinion. [Citation.] [¶] Next, the context in which the statement was made must be considered. Since "[a] word is not a crystal, transparent and unchanged, [but] is the skin of a living thought and may vary greatly in color and content according to the circumstances and the time in which it is used[,]" the facts surrounding the publication must also be carefully considered. [Citation.]

"'This contextual analysis demands that the courts look at the nature and full content of the communication and to the knowledge and understanding of the audience to whom the publication was directed. [Citation.] "'[T]he publication in question must be considered in its entirety; "[i]t may not be divided into segments and each portion treated as a separate unit." [Citation.] It must be read as a whole in order to understand its import and the effect which it was calculated to have on the reader [citations], and construed in the light of the whole scope and apparent object of the writer, considering not only the actual language used, but the sense and meaning which may have been fairly presumed to have been conveyed to those who read it. [Citation.] If the publication so construed is not reasonably susceptible of a defamatory meaning and cannot be reasonably understood in the defamatory sense, [the statement is not actionable]. [Citations.]'"' [Citation.]" (Hufstedler, Kaus & Ettinger v. Superior Court, supra, 42 Cal.App.4th at pp. 67-68.)

Thus, even though some of the words used by Cooper could, when parsed out of context, impliedly assert a fact that could be proven false, e.g., that plaintiffs are liars or thieves, the statements are not actionable because their context indicates a nondefamatory sense and meaning. For these reasons, we affirm the trial court's determination that Cooper's statements were opinion and not actionable.*fn2

II

Summary Adjudication on Invasion of Privacy Claim

Plaintiffs claim the trial court erred by granting summary adjudication against their claims of invasion of privacy on the basis that their settlement agreements did not require Cooper to keep the settlement terms confidential. They argue their right to privacy was not dependent on Cooper being contractually obligated to keep the settlement terms confidential. They claim they have presented sufficient evidence of invasion of privacy so as to survive a motion for summary judgment. We disagree.

The tort of invasion of privacy in the publication of private facts contains the following elements: "(1) public disclosure (2) of a private fact (3) which would be offensive and objectionable to the reasonable person and (4) which is not of legitimate public concern." (Diaz v. Oakland Tribune, Inc. (1983) 139 Cal.App.3d 118, 126.) These elements are substantially the same as the formulation set forth in the Restatement, which provides: "One who gives publicity to a matter concerning the private life of another is subject to liability to the other for invasion of his privacy, if the matter publicized is that of a kind that [¶] (a) would be highly offensive to a reasonable person, and [¶] (b) is not of legitimate concern to the public." (Rest.2d Torts, § 652D, p. 383; Shulman v. Group W Productions, Inc. (1998) 18 Cal.4th 200, 214.) Plaintiffs' claim for invasion of privacy fails because the information Cooper disclosed was neither private nor offensive and objectionable to the reasonable person.

Plaintiffs argue their settlement amounts were confidential, even though the settlement agreement did not require Auburn Honda or Cooper to keep them confidential. They rely on statutes preventing the disclosure of information on a tax return by a business performing bookkeeping services as support for their claim to a right of privacy in their financial matters independent of the settlement agreement. (Civ. Code, §§ 1799-1799.1a.) Such statutes, however, do not make amounts received in settlement of a lawsuit "private." If the amount was to be treated confidentially by Auburn Honda and Cooper, plaintiffs should have included that requirement in the settlement agreements.

This argument also suffers because a cause of action for invasion of privacy requires that the private facts disclosed be "offensive and objectionable to the reasonable person." (Diaz v. Oakland Tribune, Inc., supra, 139 Cal.App.3d at p. 126.) "As is said in Davis v. General Finance & Thrift Corp., 80 Ga.App. 708 [57 S.E.2d 225, 227]: '. . . the protection afforded by the law to the right of privacy must be restricted to "ordinary sensibilities" and not to supersensitiveness or agoraphobia. [Citation.] There are some shocks, inconveniences and annoyancies [sic] which members of society in the nature of things must absorb without the right of redress.'" (Carlisle v. Fawcett Publications, Inc. (1962) 201 Cal.App.2d 733, 748.)

We are persuaded by the Oregon Supreme Court's holding in a case containing similar facts. In that case, the plaintiff's husband committed suicide, and an agent of the defendant insurance company, in order to advertise the company's business, told several people in plaintiff's hometown how much the insurance policy on the husband's life paid out to plaintiff as beneficiary. (Hamilton v. Crown Life Ins. Co. (1967) 246 Or. 1.) The court reasoned as follows: "The disclosure to strangers of the fact that the husband had left the plaintiff some life insurance, while distinctly a private matter, would not be substantially more embarrassing to an ordinary reasonable person in plaintiff's position than would have been a disclosure to strangers that her husband had left her a safe-deposit box full of securities, or a substantial checking account in the bank. When the facts alleged in the complaint are examined in the light of what would be offensive to the ordinary reasonable person, the injury is not one that would justify resort to the courts for damages." (Id. at pp. 5-6.)

Likewise here, the amounts plaintiffs received in settlement of their claims are not facts that would be offensive to the ordinary reasonable person. The fact that plaintiffs were under a contractual obligation not to disclose the amounts of the settlement is of no consequence. By receiving a substantial amount in settlement of their actions, plaintiffs were in effect the winners in the cases, and the disclosure of the amounts of the settlement, viewed from the standpoint of the reasonable person, was not highly offensive.

Plaintiffs cite Teamsters Local 856 v. Priceless, LLC (2003) 112 Cal.App.4th 1500, for the proposition that the salaries of city employees are private, but they fail to recognize that Priceless was overruled by the California Supreme Court, which held that any expectation of privacy that public employees have in the confidentiality of their salaries is not reasonable. (International Federation of Professional & Technical Engineers, Local 21, AFL-CIO v. Superior Court (2007) 42 Cal.4th 319, 335.)

The trial court correctly granted summary adjudication against plaintiffs' invasion of privacy causes of action.

III

Collateral Estoppel as Basis for Judgment on the Pleadings

Gonzalez argues the trial court erred when it granted Cooper's motion for judgment on the pleadings as to Gonzalez's complaint. He claims the trial court improperly relied on collateral estoppel in granting the motion. We agree that the doctrine of collateral estoppel was inapplicable.

Collateral estoppel precludes the relitigation of issues that were argued and decided in a prior proceeding. (Lucido v. Superior Court (1990) 51 Cal.3d 335, 341.) One requirement for the doctrine to apply is that the decision in the prior proceeding be a final decision on the merits. (Ibid.)

In this case, the doctrine of collateral estoppel is inapplicable because the judgment on which the trial court relied to grant Cooper judgment on the pleadings -- the judgment entered in favor of Auburn Honda based on the award of summary judgment against Gonzalez -- was not a final judgment at the time the court granted Cooper's motion. "Under California law, a judgment is not final for purposes of collateral estoppel while open to direct attack, e.g., by appeal. [Citation.]" (Lumpkin v. Jordan (1996) 49 Cal.App.4th 1223, 1231, fn. 5.)

The trial court filed its order granting Cooper judgment on the pleadings on April 2, 2009. At that time, however, the court's order granting Auburn Honda's motion for summary judgment on which it relied was only three days old, as it had been granted and filed on March 30, 2009, and the judgment on that order was not entered until April 2, 2009, the same day the court granted Cooper's motion for judgment on the pleadings. Moreover, Gonzalez timely filed his notice of appeal from that judgment on May 28, 2009. Thus, at no time has the court's judgment in favor of Auburn Honda and against Gonzalez been final for purposes of collateral estoppel, and judgment on that basis was error.

Were we to review the motion for judgment on the pleadings on the merits, as we are authorized to do (Schabarum v. California Legislature (1998) 60 Cal.App.4th 1205, 1216), we still could not affirm the judgment. "The standard for granting a motion for judgment on the pleadings is essentially the same as that applicable to a general demurrer, that is, under the state of the pleadings, together with matters that may be judicially noticed, it appears that a party is entitled to judgment as a matter of law. (Code Civ. Proc., § 438, subd. (d); Smiley v. Citibank (1995) 11 Cal.4th 138, 146.)" (Schabarum v. California Legislature, supra, 60 Cal.App.4th at p. 1216.)

It is not apparent from Gonzalez's complaint that Cooper is entitled to judgment as a matter of law. The complaint alleges Cooper told a third party that Gonzalez was a thief. Because the complaint rightfully does not describe the context in which the publication was made, we cannot tell from the pleading that the statement was opinion and thus not actionable.

Cooper claims the trial court could have taken judicial notice of its ruling on the summary judgment motion to establish the basis for granting him judgment on the pleadings. We disagree with that assertion, as judicial notice of factual findings made in court orders does not establish the truth of the findings, and the findings in this case were not a proper subject of judicial notice because the summary judgment was not final for res judicata or collateral estoppel purposes. (Kilroy v. State of California (2004) 119 Cal.App.4th 140, 145, 147.)

Cooper argues we should still affirm the judgment because he submitted a joinder to Auburn Honda's motion for summary judgment but failed to timely file his own separate statement of undisputed facts. Cooper is referencing the wrong case. Cooper attempted to join Auburn Honda's motion for summary judgment against Cummings; there is in our record no motion for summary judgment or joinder by him to Auburn Honda's summary judgment motion against Gonzalez. The lack of a noticed motion or joinder may explain why Cooper felt compelled to file, on shortened time, a motion for judgment on the pleadings.

Perhaps Cooper thought he had filed a motion or joinder in the Gonzalez case. Indeed, Cooper filed in that case a separate statement of undisputed facts allegedly in support of his own motion for summary judgment, a joinder to Auburn Honda's reply brief, and a joinder to Auburn Honda's response to Gonzalez's separate statement of additional facts. However, with no motion or joinder on record, there was never any noticed motion by him for summary judgment against Gonzalez. The only motion pending before the court on his behalf was his motion for judgment on the pleadings, and the court's grant of that motion was in error.

DISPOSITION

The judgments in favor of Auburn Honda against Cummings, Duncan, and Gonzalez are affirmed. The judgment in favor of Cooper against Gonzalez is reversed. Costs on appeal are awarded to Auburn Honda except in C062026, Gonzalez v. Auburn Associates, Inc., et al., where the parties shall bear their own costs. (Cal. Rules of Court, rule 8.278(a).)

We concur: HULL , J. ROBIE , J.


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