To Be or Not To Be Specific—Fact Pleading in Louisiana

The country was recently captivated by the Johnny Depp and Amber Heard trial, arguably the most high-profile defamation case in recent history. Following a colorful trial, a Virginia jury found that a 2018 Washington Post op-ed by Heard defamed Depp. As a result, Depp was awarded $10 million in compensatory damages and $350,000 in punitive damages. At the same time, the jury awarded Heard $2 million dollars in compensatory damages for defamatory statements made by one of Depp’s attorneys, ostensibly on Depp’s behalf. The trial had millions of people asking a number of different questions, including the basic question “What is defamation?” Recent Louisiana cases such as Yanong v. Coleman, 53-933 (La. App. 2 Cir. 5/17/21), 317 So. 3d 905, 911, reh’g denied (June 24, 2021), writ denied, 21-01107 (La. 11/10/21), 326 So. 3d 1249 help to provide an answer.

As explained in Yanong, a party claiming defamation in Louisiana must prove four elements:

(1) a false and defamatory statement concerning another;

(2) an unprivileged publication to a third party;

(3) fault (negligence or greater) on the part of the publisher; and

(4) resulting injuries.

**To prove the third element of “fault,” malice must be shown.

The Yanong court explained that claims of defamation must be balanced against the right to free speech found in the state and federal Constitutions.

Louisiana recognizes two categories of defamatory words: (1) words that are defamatory per se and (2) words that are defamatory in meaning. Id. at 9. Words that are defamatory per se “expressly or implicitly accuse another of criminal conduct, or which by their very nature tend to injure one’s personal or professional reputation, without considering extrinsic facts or circumstances.” Id. When words are deemed defamatory per se, there is a presumption of fault on the part of the defendant that may be rebutted by showing that the statement was true or protected by a privilege such as fair commentary on a matter of public concern. Id. Words that are defamatory in meaning are words that, when taken in context, “a listener could have reasonably understood the communication to have been intended in a defamatory sense.” Id. at 9-10. Proof of words that are defamatory in meaning creates no presumption of fault.

Louisiana defamation suits frequently arise in the employment context. However, defamation claims in the employment context face obstacles. Such cases sometimes fail on the second element, publication to a third party, because “inter-corporate communications…[are] merely a communication of the corporation itself,” meaning an employer may need to communicate the alleged defamatory statement to an outside third party outside for it to be considered “published to a third party.” Cook v. Par. Of Jefferson, 2022 WL 19350, at *11 (E.D. La. Jan. 3, 2022). However, defamation claims do not always fail on the publication element and they are not limited to “A-list” celebrities or multi-million dollar cases.

In Yanong, the Louisiana Second Circuit affirmed a $15,000 compensatory damage award to a plaintiff who successfully proved that statements made by defendants on a podcast show and on Facebook were defamation per se. Yanong, p. 8. Under the facts of the case, the defendants on a live “podcast” expressed on multiple occasions their belief that the plaintiff was a victim of sex-trafficking and that she was purchased by her much-older husband. Id. at 1. The defendant(s) also labeled the plaintiff’s marriage as “legalized prostitution,” and stated that they had contacted foreign authorities to inform them the plaintiff was a victim of “trafficking.” Id. at 2. The statements continued onto social media, where one defendant insinuated the plaintiff’s husband purchased her from a catalogue or an internet matchmaking site. Id.

On appeal, the defendants argued the plaintiff did not prove the publication element of her case. Id. at 5. The appellate court found this contention meritless. The defendants “were fully aware they were engaging” in communications with third parties, they were recoding a podcast, were “shown onscreen on all the broadcasts,” and made comments that showed “they were aware that they had an audience and third parties were engaged in the interactive broadcast.” Id. at 17-19. Thus, the Second Circuit found Plaintiff met her burden on the publication element and affirmed the trial court’s judgment. Id. at. 20.

While the publication element can present a hurdle in some cases, the publication need not be in a national media source as featured in the Depp-Heard case. The Yanong decision reminds that statements made on social media and podcasts can meet the required standard.

A Decade Old Article Finds New Life: Televised Testimony - Keogh Cox.

I have met smart, sophisticated “business” people whose eyes glass over when they try to explain their understanding of “UM” coverage. The picture becomes murkier when discussing “economic-only UM,” a form of UM coverage many people purchase without even knowing it. Through many years and conversations, I have come to conclude that there is a general fogginess that obscures this entire subject with many, if not most, people. This blog is an effort to improve understanding on the subject.What is “UM” Coverage?“UM” signifies “uninsured motorist” insurance coverage, but is more properly described as “uninsured/underinsured” motorist coverage. A person, family, business, or group purchases UM coverage to respond to damages caused in an accident by someone who has either no insurance or not enough to cover the loss. You purchase UM insurance to protect yourself or those connected to you. Without UM, you are gambling that the person who caused the accident (the “tortfeasor”) will have insurance coverage, and enough coverage, to respond to the injuries and damages they have caused.Why UM?This question is simply answered in a two-part response:#1- The roads are dangerous-Unless you are a crop duster or an undercover agent, the most dangerous thing you will likely do on any given day is to drive on a public road, even more so in the age of “smartphones” and distracted-driving.#2- Many drivers lack sufficient liability coverage- An unhealthy portion of drivers have either no insurance on insufficient insurance coverage to address an accident involving severe injuries or damages. The State of Louisiana requires motorists to obtain at least the minimum insurance of $15,000 “per person,” $30,000 “per accident,” and $25,000 to address property damage. If you do not purchase UM, you are trusting that these limits will be enough, as they might be in a minor accident. But what if the injuries are severe or you have multiple passengers in your car, van, or suburban?Often, the same people who reject UM, will buy “collision” coverage on their car to make sure they are not left paying for a car note after the car is destroyed in an accident. In this limited way, you can think of UM insurance as collision coverage on you, your family, passengers, or employees.While perfect statistics are not available, many drivers on the road have no insurance. Frequently, drivers will obtain minimum limits insurance through a “premium finance” arrangement, but will have stopped paying the premiums (thereby losing coverage) by the time of an accident.What is “Economic-Only” UM?In Louisiana, UM coverage will be afforded to you unless you “waive” the coverage under La. R.S. 22:1295. Louisiana residents are presented with a form that allows them to waive or select UM coverage. They are also allowed to select “economic-only” UM. People often choose this option because it is cheaper, but economic-only UM coverage will only pay for economic damages such as lost wages, medical bills, funeral costs, and other monetary damages. Economic-only UM will not pay money to compensate for pain and suffering/mental anguish, scarring and disfigurement, or other non-economic damages.FAQS

• Can UM protect me from a hit-and-run driver? Yes.

• What if another driver’s negligence caused the accident, but there was no physical contact with that driver’s vehicle and they fled? In this scenario, UM may be available under La. R.S. 22:1295(1)(f); however, you will need to identify an “independent and disinterested witness” to establish the actions of the unidentified driver.

• Will UM protect me if I am at fault in an accident? No. The law would consider that a “moral hazard” and invite unscrupulous individuals to cause an accident in hopes of recovering under the policy they purchased.

• Will UM protect me if I am a pedestrian? It may, depending upon the terms of your insurance policy.

• What if an object falls from a vehicle and causes an accident? UM may be available in this circumstance. The ultimate answer may depend upon whether the “falling object” had come to rest before the accident. Rener v. State Farm Mut. Auto. Ins. Co., 99-1703 (La.App. 3 Cir. 4/05/2000), 759 So.2d 214, 215.

CONCLUSIONRational people may decide to reject UM to save money; and this decision may be the right one if they have health insurance, short-term disability, long-term disability, or others such protections. However, people often make such decisions with less than full information. Hopefully, you will make the smart choice.

The nation’s first suit seeking a declaration of coverage under a commercial property policy for business interruption and extra expenses incurred as a result of COVID-19 was filed in a Louisiana state court on March 20, 2020. Since then, similar suits have been filed across the nation by restaurants, casinos, dentists, dive shops, movie theatres, repertory theatre companies, etc. Clearly, the same coverage issues raised in the Louisiana case will be litigated throughout the nation.

The suit in Cajun Conti, LLC, et al v. Certain Underwriters at Lloyd’s, London, et al, Suit No. 2020-02558, was filed on March 16, 2020, in the Civil District Court for the Parish of Orleans, State of Louisiana. Plaintiffs, doing business as Oceana Grill, a restaurant in the French Quarter, allege coverage should be declared to exist because: 1) the property policy is an “all risks” policy such that all risks are covered unless the insurer can clearly and specifically establish an exclusion from coverage; 2) the policy does not contain any exclusion “for losses from a virus or global pandemic;” 3) the virus has “physically impact[ed] public and private property” as it “physically infects and stays on the surface of objects or materials, ‘fomites,’ for up to twenty-eight days;” 4) such “contamination … [is] a direct physical loss needing remediation;” and, alternatively and in addition, 5) the current and future state orders limiting its operations serve to trigger the civil authority provisions of its policy.

A key issue in Cajun Conti as well as in the other COVID-19 business interruption coverage litigation will be whether the existence of the novel coronavirus constitutes a “direct physical loss or damage” under the intendment of an all risks property policy. The Cajun Conti plaintiffs cite to Widder v. Louisiana Citizens Prop. Ins. Corp., 2011-0196 (La. App. 4 Cir. 8/10/11), 82 So.3d 294, writ denied, 2011-2336 (La. 12/2/11) for the premise that the existence of a hazardous condition that renders the insured property unusable or uninhabitable is sufficient to constitute a “physical loss or damage” sufficient to trigger coverage. Notably, in Widder, the actual presence of inorganic lead in the insured property was confirmed to exist and coverage was therefore available. Because policyholders have the burden to establish the existence of “physical loss or damage,” reliance on Widder may require the Cajun Conti plaintiffs to establish coronavirus was actually present in their property or that its presence otherwise caused their property to be unusable or uninhabitable. Presence in the community may not be sufficient to prove the coronavirus made the insured property uninhabitable or unusable.

One of the items of proof required for the triggering of coverage under the civil authority provisions of a commercial property policy is that the alleged business loss was caused by an action by the civil authority that prohibited access to the insured premises. Relying on out-of-state jurisprudence, one Louisiana federal court has determined this factor requires proof that access to the insured premises be “actually and completely prohibited,” which is not satisfied if the access is merely “limited or hampered.” Kean, Miller v. National Fire Ins. Co. of Hartford, C.A. No. 06-770 (M.D. La. Aug. 29, 2007), 2007 WL 2489711, *4-*6. The state orders expressly referenced in the Cajun Conti suit would appear not to satisfy this standard as they served only to limit occupancy and required earlier closures. Even the subsequent stay-at-home orders [Proclamation Number 33 JBE 2020 and 41 JBE 2020, issued respectively on March 22, 2020 and April 2, 2020], may likely be insufficient to satisfy this requirement as they do not expressly mandate closure of restaurants, but simply require restaurants to “reduce operations to continue minimum contact with members of the public,” expressly allow for curbside delivery, drive-thru, and delivery services, and only prohibit the consumption of food and beverages on site.

The specific facts of each business interruption claim and the terms of the relevant policy should be considered in every occasion. Yet, these suits may face problems of proof generally. For now, we expect the novel suits to continue.

John has been practicing over 30 years and is a Senior Partner with firm where he serves on the Management Committee. He has devoted attention to non-profit boards dedicated to assisting at risk children. He enjoys time with his three children and grandchildren. He also enjoys tennis and hiking.

Nancy B. Gilbert is a partner with Keogh Cox in Baton Rouge, Louisiana. She is a puzzle-solver by nature, and specializes in providing clear and in-depth analysis of complex litigation issues.