Plaintiff Richard H. Williams and his brother, defendant Robert W. Williams, were two of the principals in the Universal Oven Company, Inc. Apparently plaintiff decided to end his association with the corporation, much to the displeasure of his brother and other members of the corporation. The Universal Oven Company, Inc., at the instigation of defendant, instituted an action (hereinafter referred to as the Universal action) against plaintiff and filed the summons and complaint with the County Clerk of New York County. The complaint alleged that plaintiff herein conspired with others to misappropriate and misuse the company's trade secrets and assets. Thereafter, defendant had copies of the summons and complaint in the Universal action printed and circulated to members of the trade. A covering letter signed by Mrs. Harry R. Williams, Chairman of the Board of Universal, was included with the copies and stated: "We enclose for your information a copy of the summons and complaint on file in the office of the Clerk of The County of New York in our suit against former employees and consultants of the Universal Oven Company."
Plaintiff, believing he had been unjustly maligned by defendant's complaint and the use to which it had been put, brought the present suit.
Special Term denied a motion by the defendant to dismiss plaintiff's complaint and the Appellate Division affirmed.
It should be noted at the outset that, since this is a motion to dismiss plaintiff's complaint under CPLR 3211, we must presume
Plaintiff alleges two causes of action, one sounding in abuse of process and the other in libel. He claims that the Universal action was totally without basis in fact and was begun solely for the purpose of ruining his business reputation by widespread publication of the complaint.
The defendant contends that the complaint does not state facts sufficient to constitute abuse of process, and he further asserts that neither cause of action may be upheld because section 74 of the Civil Rights Law prevents the maintenance of an action against any person for the publication of a fair and true report of a judicial proceeding.
We agree with defendant that the complaint does not state a cause of action for abuse of process. "The gist of the action for abuse of process lies in the improper use of process after it is issued." (Dean v. Kochendorfer, 237 N.Y. 384, 390; Hauser v. Bartow, 273 N.Y. 370.) Process is a "direction or demand that the person to whom it is directed shall perform or refrain from the doing of some prescribed act." (Matter of Smith, 175 Misc. 688, 692-693.) It follows that there must be an unlawful interference with one's person or property under color of process in order that action for abuse of process may lie.
However, we hold that plaintiff has set forth a cause of action in libel and that section 74 of the Civil Rights Law does not provide a defense. The legislative history of section 74 reveals that it was not intended to apply to the unusual factual pattern of this case.
Section 74 had its genesis in section 1907 of the former Code of Civil Procedure which originally provided that an action for libel could not be maintained against "a reporter, editor, publisher,
This court, in Lee v. Brooklyn Union Pub. Co. (209 N.Y. 245, 248-249 ), discussed the nature of the privilege established by section 1907 as follows: "It is to be observed that this is not a case of absolute privilege, which attaches to judicial proceedings, nor is it a case of qualified privilege resting upon some duty or interest of the one making the publication. Cases under those heads have little or no relevancy, and, as no case directly in point in this jurisdiction has been discovered by us or called to our attention, we must look to the reason upon which the claim of privilege in this case must rest. The obvious reason is the public interest in having proceedings of courts of justice public, not secret, for the greater security thus given the proper administration of justice. For that reason it was early provided by statute in this state, that `the sittings of every court within this state, shall be public, and every citizen may freely attend the same.' (1 R. S. part 3, chap. 3, § 1; see, also, Judiciary Law, § 4.) The public generally may not attend the sittings of the courts, but they may be kept informed by the press of what goes on in the courts * * * The point is that the proceeding was one which the public had the right to hear and the defendant had the right in the public interest to report."
This qualified privilege was re-enacted into our then new Civil Practice Act as section 337. (L. 1920, ch. 925.)
However, in 1930, the statute was amended by deleting the exception for actual malice and rendering to newspapers an absolute privilege in publishing fair and true reports of judicial proceedings. (L. 1930, ch. 619.) The apparent reason for removing the malice limitation was to afford the news media a greater freedom to publish news of public interest without fear of suit.
In 1940 section 337 (L. 1940, ch. 561) was expanded to apply to "any person, firm or corporation". The Judiciary Committee of the Assembly (1940 Assembly Journal, vol. 1, pp. 1020-1022) in reporting on this change said: "This amendment confers upon all persons the same privilege now accorded to newspapers and radio broadcasters by sections 337 and 337-a of the civil practice act, which privilege, by decision of the court
In the above-mentioned Lewis case, the defendants were sued for libel when they sent out copies of newspaper reports of testimony in an examination before trial. The Trial Judge charged the jury that the communication was privileged because it contained a fair and accurate report of a judicial proceeding, and that the verdict must be for the defendants unless the plaintiff proved express malice on the part of the defendants in making the publication. We affirmed the trial court's instruction. (262 N.Y. 489.)
In 1962 the present statute, section 74 of the Civil Rights Law (L. 1962, ch. 310) replaced section 337 of the Civil Practice Act and provides in pertinent part that "A civil action cannot be maintained against any person, firm or corporation, for the publication of a fair and true report of any judicial proceeding, legislative proceeding or other official proceeding, or for any heading of the report which is a fair and true headnote of the statement published."
Defendant urges us to apply section 74 to the case before us and to hold it a complete defense to plaintiff's cause of action.
In implementing a statute, the courts must of necessity examine the purpose of the statute and determine the intention of the Legislature. It has sometimes been said that if the words of a statute are clear on their face the statute must be administered on the basis of those words, and that only statutes of doubtful meaning are subject to judicial interpretation. However, this rule of construction suffers from the basic fallacy that words have meaning in and of themselves. A statute is "clear and unambiguous" because the court has considered the meaning of the statute and reached a conclusion on the question of legislative intention. (2 Sutherland, Statutory Construction, p. 316 [3d ed., 1943].)
While the facts of this case may appear to fit within the wording of section 74, it would require us to attribute an extreme maliciousness to the Legislature to hold that the statute was intended to protect the defendant's attempt at defamation. If no action were found to lie in this case, the courts would be sanctioning an ingenious means of defamation.
The purpose of section 74 of the Civil Rights Law, as discussed above, is the protection of reports of judicial proceedings which are made in the public interest. In light of this purpose, it is impossible to conceive of the Legislature's intending to protect the defendant's perversion of judicial proceedings. It would be contrary to reason to say that the Legislature considered it necessary to protect such defamation in order to implement the salutary aims of the statute.
The defendant and the dissenters below assert that finding any cause of action in this case will weaken the fundamental policy of free access to our courts. We disagree. Our holding today in no way infringes upon the right of a person to bring an action or to say or write material pertinent to a suit within the confines of that action. In addition, this decision is not intended to restrict in any manner the reporting of news stories and other reports which are made in the public interest.
We conclude that it was never the intention of the Legislature in enacting section 74 to allow "any person" to maliciously institute a judicial proceeding alleging false and defamatory charges, and to then circulate a press release or other communication based thereon and escape liability by invoking the statute. "Society has a pervasive and strong interest in preventing and redressing attacks upon reputation", and the courts are delegated with the responsibility of protecting that right. (Rosenblatt v. Baer, 383 U.S. 75, 86.)
For the reasons stated above, the order of the Appellate Division as to abuse of process should be reversed; and as to libel should be affirmed. Further, we deem it advisable that the trial of the libel action be held in abeyance until the disposition of the Universal action and any attempt to join the two actions be
While I agree entirely with the result reached by the majority in this case, and concur in their conclusion that the statutory phrase "any person" must necessarily be interpreted to exclude plaintiff (defendant herein), I do so for reasons other than those set forth in the majority opinion.
As we have held so recently in another situation, the purpose and applicability of a statute cannot be considered without first discussing its legislative history. (French v. Banco Nacional de Cuba, 23 N.Y.2d 46.) I would also add that the statute must be viewed in light of the law existing at the time of its enactment. I, therefore, begin with a discussion of that law.
As early as 1850, this court unanimously adopted the common-law rule that words spoken or written in a judicial proceeding by a party to that proceeding could not provide the basis of a cause of action for libel (Garr v. Selden, 4 N.Y. 91). As one eminent authority expressed it, "The interest of society requires that whenever men seek the aid of courts of justice, either to assert or to defend rights, of person, property or liberty, speech and writing therein must be untrammelled and free. The good of all must prevail over the incidental harm to the individual. So the law offers a shield to the one who in a legal proceeding publishes a libel, not because it wishes to encourage libel, but because if men were afraid to set forth their rights in legal proceedings for fear of liability to libel suits greater harm would result, in the suppression of the truth. The law gives to all who take part in judicial proceedings, judge, attorney, counsel, printer, witness, litigant, a right to speak and to write, subject only to one limitation, that what is said or written bears upon the subject of litigation". (Seelman, Libel and Slander in the State of New York, ¶ 191 [1933 ed.]; emphasis supplied.) Thus, prior to both this court's decision in Lewis v. Chemical Foundation (262 N.Y. 489) and the recent (1930 and 1940) amendments to section 337 and 337-a of the Civil Practice Act, it was established beyond refute that a party had an absolute right to say anything in a judicial proceeding, without fear of committing a libel, in accord with a general policy of encouraging the use of the courts.
Subsequent to that amendment, this court had before it the case of Lewis v. Chemical Foundation (262 N.Y. 489, supra). There, the cause of action accrued in 1930, prior to the aforementioned amendment. As the majority properly noted, after reciting the pertinent facts, this court was merely asked in Lewis to review the trial court's charge which required that plaintiff prove there was malice on the part of the defendant when he made the publication. We affirmed the correctness of that charge.
Seven years after this memorandum decision was published, the Legislature enacted the predecessor of section 74 of the Civil Rights Law, which provides that "A civil action cannot be maintained against any person, firm or corporation, for the publication of a fair and true report of any judicial proceeding". The bill jacket accompanying this amendment, stated that it "confers upon all persons the same privilege now accorded to newspapers and radio broadcasters by sections 337 and 337-a of the civil practice act, which privilege, by decision of the court of appeals is accorded to all persons (see Lewis v. The Chemical Foundation Incorporated, et al., 262 N.Y. 489 (1933); Seelman, Libel and Slander in the State of New York, Sec. 213)."
To understand this amendment, we are thus required to analyze the authority for it. It is undisputed that the Lewis decision dealt merely with the question of actual malice where the defendant had republished a newspaper article. Seelman, commenting on the statute's predecessor in paragraph 213 of his work, declares that, although "the statute refers only to newspapers,
It is in this setting that we are asked to determine the intent of the Legislature when they enacted the predecessor of section 74 of the Civil Rights Law. Our duty is apparent. We must determine whether the amendment enlarges the right of a litigant in a judicial proceeding or the right of a person who publishes a "fair and true report" of that proceeding. As indicated above, the litigant was under no restraint insofar as he could write or say anything he desired, so long as it related to litigation. The reporters, on the other hand, were required to
Were the Legislature planning to expand the rights of the litigants to the point where they could both commence a suit with impunity and then publish a true and fair report of that suit — albeit with actual malice — and escape liability, I feel some mention of this would have been made. Certainly, they were aware of the paragraph in Seelman (¶ 191) which discusses the rights of parties to be free from actions for libel as that paragraph precedes the paragraph cited in the bill jacket. I, therefore, conclude that it was never the intention of the Legislature in the 1940 amendment to allow "any person" to institute a judicial proceeding alleging false, malicious and defamatory charges, and then to circulate a press release or other communication based thereon and escape liability by invoking the statute. The purpose of the 1940 amendment, I submit, was to extend to all disinterested persons the privilege then possessed by the press — to publish true and fair reports of judicial proceedings without fear of liability. Such an interpretation gives this statute a meaningful purpose. The alternative construction, suggested by defendant, cannot claim any such purpose. Indeed, it is clearly sufficient that parties — particularly plaintiffs — be protected from anything that they say or write which is germane to a lawsuit, without clothing them also with an absolute right to distribute whatever malicious matter they may author. Moreover, the construction I propose is in accord with the Supreme Court's statement in Rosenblatt v. Baer (383 U.S. 75, 86): "Society has a pervasive and strong interest in preventing and redressing attacks upon reputation". We are delegated with the responsibility of protecting that right.
It is also noteworthy that charges such as those contained in the initial complaint could have been made if true in an open letter to the persons who, as in this case, are in a particular industry and might have dealings with the plaintiff. Such notice would then make these competitors liable for any damages suffered by Universal as a result of their use of trade secrets. This rule of liability is well settled and was recognized prior to the 1940 amendment to the Civil Practice Act. (See, e.g., Colgate-Palmolive Co. v. Carter Prods., 230 F.2d 855, 864-865.)
The interpretation of section 74 proposed by the defendant and accepted by the dissenters would extend the right of the employer from the above-mentioned rule where the charges are true to the present situation where, according to the allegations of the complaint, the charges are false and malicious. Again I note that the Legislature did not indicate any intention to achieve such a result when they enacted the 1940 amendment. I can perceive of no reason which would justify such an unwarranted expansion.
The dissenters, acknowledging their opposition to malicious lawsuits, suggest that the plaintiff may have a remedy in an action for malicious prosecution. In proposing such an alternative, they ignore the clear admonition of the statute that "A civil action cannot be maintained * * * for the publication of a fair and true report of a judicial proceeding". If the alleged acts do not constitute a libel, it should logically follow that the same acts do not constitute a basis for an action alleging malicious prosecution. Additionally, it should be noted that plaintiff has not pleaded the essential elements of a cause of action for malicious prosecution. It is well settled that the mere bringing of a civil action, even if groundless, ill motivated and damaging to the defendant, does not provide a sufficient basis for such an action unless the person or property of the plaintiff was interferred with by some incidental remedy such as attachment, arrest or injunction. (See, e.g., Munoz v. City of New York, 18 N.Y.2d 6; Burt v. Smith, 181 N.Y. 1; Lustig v. Greene, 30 A.D.2d 935, mot. for lv. to app. den. 23 N.Y.2d 644.) The alternative is therefore untenable.
In conclusion, I am of the opinion that to interpret the words "any person" to include the parties to the litigation not only fails to conform to the reasoning behind the common-law rules relating to the commencement of an action and the need for truly
The complaint should be dismissed in its entirety. In my view, the count alleging libel is just as lacking in merit as that — which the court is holding insufficient — charging abuse of process.
As I see it, an unreasoned and unreasonable fear of abuse — a fear that people will deliberately file complaints containing maliciously false, defamatory and unsupportable allegations for the purpose of publishing and circulating copies of those complaints — has led my brothers of the majority to sustain the libel cause of action despite the absolute privilege granted by section 74 of the Civil Rights Law. Indeed, I suggest, the court implicitly recognizes that no cause of action is stated for libel by providing that the trial is to be held in abeyance until the other case, in which the present plaintiff is a defendant, has been disposed of in his favor and shown to be without foundation or merit. The strained and incongruous result thus achieved not only is at odds with the language and with the legislative history of section 74 but is completely unnecessary to protect against the sort of abuse envisioned by the court.
In September of 1965, the Universal Oven Company — of which the defendant Robert Williams and his mother were the principal officers — served and filed, in the Supreme Court, New York County, the complaint charging the plaintiff herein, his brother Richard, with conspiring to misappropriate and misuse the company's trade secrets and assets.
The plaintiff, as well as the court, recognizes that a newspaper or other stranger to the Universal Oven litigation could have, with complete impunity, published the complaint in that case or described its contents. But, it is said, circulation of that absolutely privileged pleading by this defendant to interested parties, engaged in the same trade as the Universal Oven Company, subject him to an action for libel. The contention flies in the face of both the language and the legislative history of the Civil Rights Law. In the plainest of terms, section 74 of that statute declares:
The provision contains no exception or qualification, either express or implied, for persons who initiated or were parties to the judicial proceeding, and no such exception or qualification is indicated in the legislative history. In fact, there is basis for the conclusion that the Legislature had in mind, when it adopted the present statutory language, situations very like the one in the case now before us.
A statutory privilege for reports of judicial proceedings has existed in this State since at least 1854 (L. 1854, ch. 130, §§ 1, 2). Up until relatively recently, it is true, that privilege was a qualified one — which could be defeated by a showing of actual malice — and applied only to "a reporter, editor, publisher * * * of a newspaper." (See former Civ. Prac. Act, § 337, as enacted by L. 1920, ch. 925.) However, the more recent developments in this area, both legislative and judicial, have removed any reasonable ground for the conclusion that a showing of malice can
In the Lewis case (262 N.Y. 489), to which the Committee referred, it was alleged that in January of 1930 — at a time when the statutory privilege was still a qualified one — the defendants had privately circulated 200,000 copies of a deposition made by one of them in an earlier proceeding in which the latter was a party. The plaintiff argued that these self-serving statements should not be accorded any protective privilege since the "publication of the libel by the author is not `the publication of a fair and accurate report of a judicial proceeding'". (See Brief of Plaintiff-Appellant Lewis [in Court of Appeals, 262 N.Y. 489], pp. 24-25.) This court disagreed, holding that the defendants were entitled to the same statutory privilege then granted to those connected with newspapers, despite the fact that one of them was actually a party in the earlier proceeding and no public policy was shown to be served by the publication and circulation
Viewing the clear and unambiguous language of the statute in the light of these decisions and of the history of the privilege in general, the conclusion is clear that the absolute protection previously granted newspapers was, indeed, intended to be conferred upon and inure to the benefit of "any person", whether or not he participated, or was involved, in the original proceeding.
Although the result of applying the statute as it was written may, perhaps, be to allow an occasional libel to go uncompensated, this does not require us, to cull from the court's opinion (p. 598), to attribute "extreme maliciousness to the Legislature". The simple fact is, as Judge BURKE very appropriately observes — quoting from Seelman's work on Libel and Slander — "`The good of all must prevail over the incidental harm to the individual'" (concurring opn., p. 600). And, continuing to quote, Judge BURKE adds, "`the law offers a shield to the one who in a legal proceeding [or, I would interpolate, in a report of such proceeding] publishes a libel, not because it wishes to encourage libel, but because if men were afraid to set forth their rights in legal proceedings [or to inform other interested persons thereof] for fear of liability to libel suits greater harm would result, in the suppression of the truth'".
Vehemently opposed though I am to a maliciously false and baseless lawsuit — whether or not it was instituted by the plaintiff to afford him a predicate for thereafter publishing the complaint — I do not believe that we should seek to discourage such conduct by misreading the applicable statute or rewriting its
Nor may such a cause of action be ruled out on the ground, advanced by the court, that there must be "interference with plaintiff's person or property" (opn., p. 596, n. 2; also concurring opn., p. 604). Although language in lower court cases may be found to such effect, the Court of Appeals has never so decided. On the contrary, in Burt v. Smith (181 N.Y. 1, 5, supra), this court — though noting that "[d]amages are rarely recovered * * * for the malicious prosecution of a civil action, unless person or property is interfered with" — made it quite clear that such a suit "may be founded upon a civil action when commenced simply to harass and oppress the defendant." And, in our most recent utterance on the subject (Munoz v. City of New York, 18 N.Y.2d 6, supra), the court, after observing that "the essentials of malicious prosecution" were laid
The conclusion, therefore, is clear; the fear felt by the majority — to which I alluded above — that according an absolute privilege to one who publishes a report of a maliciously activated judicial proceeding "would be sanctioning an ingenious means of defamation" (opn., p. 598) is without foundation.
Statements which appear in the opinions that the statute was not intended to allow "`any person' to maliciously institute a judicial proceeding" (opn., p. 599) or "to permit persons to institute false and malicious actions" (concurring opn., p. 605) persuasively establish that the court is truly concerned not with the alleged defamation, relevant though it may be on the issues of motive and damages, but to the allegedly malicious institution of the earlier proceeding. This is, indeed, borne out by the court's determination that the libel action is not to be tried until, and if, Universal Oven's conspiracy action has been terminated and disposed of adversely to Universal. Thus revealed is the majority's recognition that the present plaintiff's action depends solely upon whether the defendant was guilty of malicious prosecution of the original litigation — whether, in other words, he caused Universal Oven's suit to be brought in bad faith and without probable cause — and not upon the subsequent publication and circulation of the complaint.
The order appealed from should be reversed and the complaint dismissed.
Order modified, with costs, in accordance with the opinion herein and, as so modified, affirmed. Question certified answered in the negative.