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Sanctions Against Lawyer for Filing Unfounded Libel Lawsuit

Not even under an anti-SLAPP statute—rather, under a statute allowing sanctions for "frivolous conduct in filing civil claims."

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From Payson v. Spivey, decided Friday by the Ohio Court of Appeals (Judge Jeffrey Welbaum, joined by Judges Chris Epley and Ronald Lewis):

Frank Payson[] appeals from a judgment granting R.C. 2323.51 ["frivolous conduct in filing civil claims" -EV] sanctions against him …. In his sole assignment of error, Payson contends that the trial court erred in granting sanctions and in the amount of sanctions awarded. For the reasons discussed below, we conclude that the assignment of error is without merit. Accordingly, the judgment of the trial court will be affirmed….

This action arose from an attorney-client relationship between Payson and Spivey that began in July 2017 and ended in March 2018. After Spivey filed a disciplinary complaint regarding Payson with the Dayton Bar Association ("DBA"), a fee-dispute arbitration occurred on June 26, 2019. The arbitrators ordered Payson to give Spivey a refund of either $1,273.12 or $1,472.02, depending whether a prior check issued to Spivey in the amount of $198.09 was still negotiable.

On August 9, 2019 (a month after the award), Payson filed a complaint against Spivey, alleging that she had committed defamation, defamation per se, and reckless and malicious conduct. No specifics about the alleged defamatory circumstances or statements were included. In the complaint, Payson alleged compensatory damages in excess of $25,000 for each common law claim, for a minimum of $275,000, compensatory damages in excess of $25,000 for each tort claim, for a minimum of $275,000, and punitive and/or liquidated damages in an amount in excess of $25,000 on his tort claims, for a minimum of $275,000. He also asked for attorney fees and costs. [Further procedural details omitted. -EV] …

On February 10, 2021, the trial court granted summary judgment in Spivey's favor …. The basis of the court's summary judgment decision was qualified [privilege] as to the defamation claims. The court observed that when Spivey filled her summary judgment motion on May 21, 2020, Payson still had not identified any defamatory statements, nor had he identified anyone to whom Spivey had made such statements. The only admissible evidence that Payson presented, after nearly two years, was that Spivey had told her father that Payson had given her "bad information" about running an ad in a newspaper. The court noted that the statement did not injure Payson in his profession because Spivey's father stated that this would have nothing to do with his decision on whether to hire Payson in the future.

The court further found a qualified privilege for statements made to family members and noted that Payson "had not identified any clear and convincing evidence to show a triable issue of actual malice, which would defeat the privilege." …

The court held a hearing on Spivey's request for sanctions on September 10, 2021…. [T]he court awarded Spivey $27,633.45 of the $35,012.25 in fees requested, and other expenses of $1,509, for a total award of $29,142.45….

The trial court's decision awarding sanctions against Payson was very detailed. After reviewing the record, the court found that Payson had filed the defamation action against Spivey in retaliation for her DBA ethics complaint and that Payson's conduct during the litigation had increased Spivey's litigation costs. The court also said it did not find Payson's testimony credible.

In addition, the court described Payson's attempts to impede discovery throughout the case, which caused Spivey to file a motion to compel, delayed discovery, and involved Payson's refusal to accept email and his claim that he did not communicate by email (despite evidence that he did).

The court further found that Payson's defamation claim was unsupported by law. In this regard, the court noted that when Payson filed the defamation complaint, he did not have any facts to support a claim that Spivey had made a false statement; instead, Payson relied on speculation and conjecture. The court concluded that Payson's conduct, as a lawyer who had practiced for 30 years, failed to satisfy a reasonableness standard, which tests "'whether no reasonable lawyer would have brought the action in light of the existing law.'"

We have reviewed the entire record, including the pleadings, transcripts of the evidentiary hearing and status conferences, and exhibits presented to the trial court. Our review reveals that the trial court did not abuse its discretion in awarding fees to Spivey and that the court's decision was supported by competent, credible evidence. Moreover, the court correctly concluded that no reasonable lawyer would have asserted claims for defamation against Spivey in light of existing law….

Our review of the record reveals, without doubt, that when the complaint was filed, Payson lacked any facts to support his claim that Spivey had made false statements about him and had injured his reputation. The complaint itself was extremely vague, stating only that that Spivey had made untrue, defamatory statements about Payson. Almost immediately after answering the complaint, Spivey submitted discovery requests to Payson, seeking information about the content of the alleged defamatory statements. Rather than responding, Payson embarked on a course of unfounded motions and attempts to evade discovery, as noted in the Statement of Facts in this opinion….

As Spivey's expert witness noted at the sanctions hearing, there were "39 procedural motions and another seven discovery type motions …. This required a lot of paperwork…. The vast majority of the initial filings of that were made by pro se Plaintiff's attorney [Payson]." It is also apparent that very late in the litigation, Payson was still searching for facts supporting his claim (which he never found). Accordingly, the trial court did not err in finding that no reasonable lawyer would have filed the defamation claim.

Payson argues that he brought the defamation action because he had a "good faith belief that Spivey would make materially false statements to others with the intent of damaging his professional reputation." The trial court found otherwise, stating that:

Presumably, Payson, after practicing for thirty years would have brought a claim for defamation only upon some evidence of a defamatory statement. Here, as Payson testified to, the complaint was brought because he "knew" Spivey "would" say something about him to her family and friends. This testimony does not satisfy the reasonable standard required….

Based on the preceding discussion, the trial court did not err in awarding sanctions against Payson, nor did it award an excessive amount….

NEXT: A Brief History of Certiorari, Error, and Appeal

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  1. Go ahead DaivdBehar.

    Now's your time to shine.

    1. The Disciplinary Counsel never enforces 3.1. Even in plaintiff judicial hellholes, the majority of claims are rejected by judges and by juries. The stinking of the DC makes the profession stink, and gets them hated. The reason 3.1 is not enforced? The forbearance generates jobs for the plaintiff bar, the defense bar and for the garbage judge in the middle. It is a fraud on the public. Because the DC has absolute immunity for its discretion, violence is fully justified by formal logic. Do not kill the DC, just beat their asses. If you kill a DC, its competitors will be grateful, replace them, and be the same. The tort scam is a $500 billion racket. It is a tax of $4000 a worker. It promotes the Chinese Commie Party interests in crushing manufacturing, and all other commerce in the US. So the media of the tach billionaire traitors opposes any reform. I blame judges most all who allow garbage cases to proceed to generate these lousy lawyer jobs. Beat their asses too. To deter.

      1. No lawyer should be allowed to donate to the re-election campaign of a judge.

        1. The $half trillion is the direct cost. The indirect cost? An anemic GDP growth of 3% instead of the natural, more robust one of 10%. This racket is a very expensive and toxic criminal enterprise. Nothing is being done, and public self help has full justification. A list of all participants in it, including defense lawyers, should be started. Defense lawyers have a duty to report unethical conduct. They never do. They never ask for sanctions. To do so would hurt their jobs. Defense lawyers are the most corrupt of all, traitors to their clients.

        2. That's actually not a bad idea, though why limit it to re-election?

    2. It's like the part in the Blind Melon video with the Bee Girl, but the Bee Girl is also an authoritarian asshole.

      1. Hi, Queenie. What race do you identify with? I want to include in my letter of support for the job you deserve, that is more fitting for your great intelligence and knowledge. I think you are wonderful.

  2. On the contrary, the court awarded an unreasonably low amount. The correct penalty for false accusations should be the penalty the accuser was trying to impose on the victim.

    1. Because the suit was retaliatory, it should be considered an intentional tort, and an abuse of process. It justifies exemplary damages. To deter.

    2. That's how my libertopia works: I define perjury more broadly, as any authoritative misrepresentation, and the penalty is whatever the perjurer was trying to get. Used car salesman lying about what he is trying to sell owes the price he was trying to get. This lawyer would owe everything he claimed, a minimum of $275,000, plus court costs etc.

  3. That sure seems like too low a sanction given what this lawyer tried to do.

  4. Court should refer him to the disciplinary counsel. Got to be a violation of several ethics rules as well.

    1. I wonder if they did. It might not show up in this record.

      1. Nothing on his Supreme Court record but two continuing legal education violations. But if it was still being investigated, it wouldn't be public yet.

        Also saw a case where he was criminally cited for feeding stray cats!

        1. Come on Bob--you can't drop a juicy detail like that without including an internet link for the rest of us. Given that this horrible lawyer and horrible person is actually doing something good like feeding animals, I'd like to read about it. Probably the only way this guy is gonna get rehabilitated...at least, in my mind.

  5. One feature of SLAPP statutes is requiring specific facts to support a defamation claim at the initiation of the complaint and gatekeeping to weed out frivolous claims early.

    This case illustrates what happens when you don’t have that. Payton filed a complaint that alleged only vague defamation without saying anything specific about what statements were made to whom. Yet his case was allowed to drag on for two years before he finally lost at summary judgment. The defendant was forced to make discovery motions to find out what was allegedly said to whom, and then motions to compel when he ignored the discovery motions. Payton clearly expected to be able to use a vague complaint to authorize fishing-expedition discovery into the defendant’s communications to find out if Spivey had actually ever said anything bad about him to someone or not. And given what happened in the Ohio trial court, it seems his expectation was more or less warranted. The trial court for example let him depose familu members and ask them what Spivey said about him to them. Only after the fishing expedition came up dry, and it took some fishing before that happened, did the trial court rule against him.

    In a SLAPP regime, failure to clearly state what defamatory statesments were allegedly made to whom in the complaint itself would result in quick dismissal and sanctions, with no fishing expedition allowed.

    1. That's true where I practice. The Complaint must quote verbatim the allegedly defamatory statement or get dismissed on the pleadings. I can understand why a plaintiff wouldn't want to repeat the injurious statement in the initial, publicly filed document, but otherwise you get the kind of stuff that happened here.

      1. We have the same rule in my state.

    2. Well, it also helps if one is litigating under a Twiqbal type pleading regime in which failure to plead the facts is grounds for dismissal.

  6. Federal rule 12(e) and its state counterparts could weed out such complaints if judges were willing to enforce it. "A party may move for a more definite statement of a pleading to which a responsive pleading is allowed but which is so vague or ambiguous that the party cannot reasonably prepare a response."

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