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STATE OF MICHIGAN
COURT OF APPEALS


TERRELL PIERCE and DAELYN PIERCE, Plaintiffs-Appellants, v DANIEL, SEYMOUR & GROSSMAN, P.C., SCHUYLER SEYMOUR, JR., JAMES L. EDMONDS, UAW LOCAL 599, and DAVID YETTAW, Defendants-Appellees. W.

UNPUBLISHED September 18, 1998

No. 199727 Genesee Circuit Court LC No. 94-033444 NO

Before: Corrigan, C.J., and Cavanagh and Bandstra, JJ. PER CURIAM. Plaintiffs appeal as of right the trial court order granting defendants' motions for summary disposition pursuant to MCR 2.116(C)(8) and (10). We affirm in part, reverse in part, and remand for further proceedings. I Plaintiffs first argue that the trial court erred in granting summary disposition pursuant to MCR 2.116(C)(8) on the basis that their second amended complaint lacked specificity. A motion for summary disposition under MCR 2.116(C)(8) tests the legal sufficiency of a claim by the pleadings alone. This Court reviews de novo a trial court's decision on a motion for summary disposition pursuant to MCR 2.116(C)(8) to determine whether the claims are so clearly unenforceable as a matter of law that no factual development could possibly justify recovery. All factual allegations supporting the claim, and any reasonable inferences that can be drawn from the facts, are accepted as true. Smith v Stolberg, ___ Mich App ___, ___; ___ NW2d ___ (Docket No. 202848, issued 8/18/98). The elements of a libel cause of action are (1) a false and defamatory statement concerning the plaintiff, (2) an unprivileged communication to a third party, (3) fault amounting to at least negligence on the part of the publisher, and (4) either actionability of the statement irrespective of

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special harm or the existence of special harm caused by publication. Northland Wheels Roller Skating Center, Inc v Detroit Free Press, Inc, 213 Mich App 317, 323; 539 NW2d 774 (1995). A complaint in a libel action must specifically plead the defamatory words complained of. Royal Palace Homes, Inc v Channel 7 of Detroit, Inc, 197 Mich App 48, 62; 495 NW2d 392 (1992). After reviewing the complaint, we conclude that the trial court did not err in finding that it is not sufficiently specific. Plaintiffs quote verbatim blocks of text from the various letters and articles, without indicating which particular statements are allegedly defamatory. While the passages contain statements that could be defamatory, they also contain some statements that do not appear to be untrue and other statements that, even if untrue, are not defamatory. MCR 2.111(B)(1) requires a plaintiff to state "the specific allegations necessary reasonably to inform the adverse party of the nature of the claims the adverse party is called on to defend." The Supreme Court has explained: "Leaving a defendant to guess upon what grounds plaintiff believes recovery is justified violates basic notions of fair play and substantial justice." Dacon v Transue, 441 Mich 315, 329; 490 NW2d 369 (1992). This Court has held that a complaint in a libel action must specifically plead the defamatory words complained of. Royal Palace Homes, supra. Because plaintiffs' complaint does not clearly delineate what statements are alleged to be false, libelous, and defamatory, it is not sufficiently specific. II Plaintiffs next argue that the trial court abused its discretion in refusing to allow them to amend their complaint. This Court will not reverse a trial court's decision on a motion to amend a complaint absent an abuse of discretion that results in injustice. Phillips v Deihm, 213 Mich App 389, 393; 541 NW2d 566 (1995). Amendment is generally a matter of right rather than grace. Patillo v Equitable Life Assurance Society of the United States, 199 Mich App 450, 456; 502 NW2d 696 (1992). A trial court should freely grant leave to amend if justice so requires. MCR 2.118(A)(2). Leave to amend should be denied only for particularized reasons, such as undue delay, bad faith, or dilatory motive on the movant's part, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party, or where amendment would be futile. Phinney v Verbrugge, 222 Mich App 513, 523; 564 NW2d 532 (1997). At the October 21, 1996, hearing, the trial court refused to allow plaintiffs to amend their complaint, stating, "Well, it's been amended twice now." However, plaintiffs only amended their complaint once in response to a court directive. Plaintiffs first amended their complaint to add defendants UAW, Yettaw, and Braid. The second amended complaint was filed in response to a trial court order dismissing the first amended complaint for lack of specificity. In response to this order, plaintiffs filed their second amended complaint on September 5, 1995. The second amended complaint included the specific dates, sources, and places of publication, as ordered by the trial court. The complaint also contained the verbatim blocks of text from the various letters and articles that plaintiffs alleged had been created and disseminated by defendants.

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After reviewing the record, we conclude that the trial court should have allowed plaintiffs to amend their complaint. As discussed in Issue I, the trial court correctly found that plaintiffs' second amended complaint was not sufficiently specific because it contained too much extraneous material.1 However, while leave to amend may be denied because of repeated failure to cure deficiencies by amendments previously allowed, Phinney, supra, here plaintiffs essentially created a new deficiency while attempting to correct a separate one. The trial court dismissed the first amended complaint because it did not contain enough information; the trial court then dismissed the second amended complaint because too much information was provided. There is no evidence that plaintiffs did not file their second amended complaint in good faith, and in fact the trial court did not make a finding of bad faith. There is no indication in the record that defendants would have been prejudiced by an amendment. The quotations from the letters and articles included in plaintiffs' second amended complaint contained a number of statements which, if false, could well be defamatory. Because leave to amend should be freely given when justice so requires, we hold that the trial court abused its discretion in refusing to allow plaintiffs to amend their complaint. See MCR 2.118(A)(2); Phillips, supra. We therefore remand to the trial court so that plaintiffs may amend their complaint. III Plaintiffs next assert that the trial court erred in granting partial summary disposition to Dave Yettaw, the UAW, and Dean Braid (the UAW defendants) with regard to Documents A, C, J, P, Q, and X. A The trial court granted the UAW defendants' motion for summary disposition pursuant to MCR 2.116(C)(8) as to Documents A and C on the basis that the second amended complaint did not allege any involvement by any UAW defendant in these publications. Plaintiffs argue that, contrary to the trial court's finding, the complaint did allege involvement by the UAW defendants in the publication of Document A. On page 22 of the second amended complaint, subparagraph vii states: Said document was published by Defendants Daniel, Seymour & Grossman and Schuyler Seymour thereof when copies of the document and/or the Headlight newspaper articles of November 10, 1994 was sent out of the law offices of Daniel, Seymour & Grossman to the managers or directors of all credit unions in the Flint area particularly including all those credit unions identified in the Flint area Yellowpages [sic]. Such document and statement was further published when sent as an attachment and exhibit with certain correspondence generated in concert between Schuyler Seymour and Dave Yettaw sent to the National Credit Union Administration in Chicago Illinois in October of 1994 and November of 1994 and January of 1995. Because the complaint clearly alleges that defendant Yettaw had a role in publishing Document A, we conclude that the trial court clearly erred in granting summary disposition with regard to defendant

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Yettaw on the allegations involving that document. However, because the complaint makes no allegations regarding defendant UAW Local 599 and defendant Braid, the trial court did not err in granting summary disposition to these defendants. With regard to Document C, plaintiffs essentially concede that the second amended complaint does not allege involvement by any UAW defendant. However, plaintiffs assert that discovery has revealed that Document C was republished by defendant Yettaw as an attachment to a January 30, 1995, letter to the National Credit Union Administration (NCUA). Plaintiffs therefore seek permission to amend their complaint. We instruct the trial court to permit plaintiffs to amend their complaint to include this allegation on remand. See MCR 2.118(A)(2). B The trial court granted summary disposition with respect to Documents J, P, Q, and X pursuant to MCR 2.116(C)(10). The court explained that "the unrebutted affidavit of Dave Yettaw and deposition of Schuyler Seymour state that the UAW defendants were not involved in the creation and publication of these documents." A motion for summary disposition may be granted pursuant to MCR 2.116(C)(10) when, except with regard to the amount of damages, there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Giving the benefit of reasonable doubt to the nonmovant, the trial court must determine whether a record might be developed that would leave open an issue upon which reasonable minds might differ. Moore v First Security Casualty Co, 224 Mich App 370, 375; 568 NW2d 841 (1997). Plaintiffs contend that the affidavit and deposition testimony were in fact rebutted. Plaintiffs claim that they attached as Exhibit C to their response to the motion for summary disposition a January 30, 1995, letter by Yettaw to the NCUA that specifically referenced and attached Documents J, P, Q, and X. We have examined plaintiffs' response to the motion for summary disposition and found no Exhibit C, nor is the aforementioned letter attached. However, a January 30, 1995, letter by Yettaw to the NCUA is Document S in the second amended complaint. The letter specifically lists more than thirty enclosed documents. Documents J, P, Q, and X may have been among these items. For example, the first enclosure mentioned by Yettaw is a Summary of Witnesses; Document X appears to be a list of witnesses and summary of what they could testify to. Item 9 on the list is "Six letters sent to C[redit ]U[nion]'s Board of Directors." Document J is a letter to the board of directors of the Security Federal Credit Union (SFCU). Documents P and Q are letters to the NCUA dated, respectively, October 20, 1994, and November 15, 1994; these are specifically mentioned in Yettaw's letter as Items 19a and b. On this record, we conclude that Yettaw's affidavit and Seymour's deposition merely raise questions of fact regarding the UAW defendants' involvement in the publication of Documents J, P, Q,

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and X. Accordingly, the trial court erred in granting the UAW defendants' motion for partial summary disposition with respect to these documents. IV Plaintiffs assert that the trial court erred in granting summary disposition to defendant Braid on the basis that he could not have been negligent because he did not have discretion not to publish Yettaw's articles. Plaintiffs maintain that a genuine issue of material fact exists as to whether Braid had control of the content of Headlight , Local 599's newspaper. The trial court relied on Yettaw v Local Union 599, UAW, UAW Public Review Board, Case No. 942 (1992). However, we conclude that the trial court read Yettaw too broadly. Yettaw did not involve editorial decisions to strike defamatory statements in an officer's column, but rather editorial decisions to suppress a union officer's opinions regarding issues "which may be the subject of legitimate debate among union members." Yettaw, supra at 7. Yettaw does not stand for the proposition that columns by union officers are not subject to editing, but rather that the editor may not censor the viewpoints of union officers on matters of legitimate discussion among union members. Furthermore, the free speech principles emphasized in Yettaw do not comprehend an absolute right to make defamatory statements. The Constitution merely places limits on the application of the state law of defamation so that protected speech is not discouraged. See Harte-Hanks Communications, Inc v Connaughton, 491 US 657, 686; 109 S Ct 2678; 105 L Ed 2d 562 (1989). These limits vary, depending on considerations such as whether the plaintiff is a public or private figure and whether the speech at issue is of public concern. See Milkovich v Lorain Journal Co, 497 US 1, 14-16; 110 S Ct 2695; 111 L Ed 2d 1 (1990); Philadelphia Newspapers, Inc v Hepps, 475 US 767, 774-775; 106 S Ct 1558; 89 L Ed 2d 783 (1986). Therefore, the elements of a cause of action for defamation, and the plaintiff's burden of proof, are structured to balance the competing First Amendment interest in protecting the freedom of speech with a State's interest in ensuring that a person may be compensated for injury to his reputation. See Milkovich, supra at 22-23; Locricchio v Evening News Ass'n, 438 Mich 84, 117-122; 476 NW2d 112 (1991), cert den 503 US 907; 112 S Ct 1267; 117 L Ed 2d 495 (1992). Accordingly, even under a broad reading of Yettaw, the editor of a union publication may remove libelous material from a column because the principle of freedom of expression does not include the right to make defamatory statements. In Michigan, all persons who are "`actively connected with and engaged in the publication of a libel are responsible for the results.'" Bowerman v Detroit Free Press, 279 Mich 480, 491; 272 NW 876 (1937), quoting Johnson v Gerasimos, 247 Mich 248, 252; 225 NW 636 (1929). Thus, an editor is generally liable for defamatory statements contained in his newspaper because he has extensive supervisory control over the publication. 53 CJS

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