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August 24, 2015

COA concludes that exemplary damages are not available in suits for libel unless claimant seeks a retraction

In a case centered upon claims of defamation, the Court of Appeals has held that exemplary damages may not be recovered unless the claimant specifically requested a retraction of the alleged libelous remark, in conformance with MCL § 600.2911(2)(b).  In Hope-Jackson v. Washington, No. 319810, the Court of Appeals affirmed the decision of the trial court tolling the statute of limitations under MCL § 600.5855 and awarding $360,000 in damages under a theory of defamation per se but vacated the trial court’s award of $140,000 in exemplary damages as a finding of fact had been made that the claimant never sought a retraction of the defamatory remarks.
 
Claimant Doris Hope-Jackson is the former Superintendent of Willow Run Community Schools and filed this action alleging, among other things, defamation on the part of respondent, Sheri Washington.  The claim arose from posts made to a website called willowrunwatchdogs.com, where respondent was alleged to have posted negative statements about claimant, including a statement that she had violated state and federal laws while serving as superintendent of Willow Run.  The claims were submitted to arbitration where the defamation claim was initially dismissed as being time-barred under the one-year limitations period.  After dismissal of the claim, however, the arbitrator ordered supplemental briefing on whether the statute of limitations was tolled under MCL § 600.5855, which allows for tolling where a person fraudulently conceals the existence of the claim or the identity of any person who is liable for the claim.
 
Testimony in the record demonstrated that a witness believed respondent was actually the administrator of the offending website, however, respondent denied this allegation.  Nevertheless, the arbitrator took judicial notice that respondent was the website’s administrator and found that she had actively concealed her administrative role.  However, the arbitrator still refused to toll the limitations period, reasoning that the period of limitations continued to run because claimant was aware she had a possible cause of action for defamation whether or not she knew the identity of the person involved.  The circuit court ruled that dismissal of the defamation claim was a clear error of law under MCL § 600.5855 and remanded the matter to the arbitrator for consideration of that claim alone.
 
On remand, the arbitrator found respondent had made at least two per se defamatory statements, made with actual malice, and awarded $360,000 in per se damages and $140,000 in exemplary damages.  In the circuit court, claimant moved to confirm the award and respondent moved to have it vacated.  The circuit court granted claimant’s motion and entered a judgment for claimant totaling $505,754.50.  The respondent appealed asserting that the defamation claim was time-barred and that tolling did not apply.  Respondent further argued that the arbitrator committed clear legal error by awarding exemplary damages under MCL § 600.29211(2)(b).
 
The Court of Appeals held that because respondent had fraudulently concealed her identity, tolling of the limitations period was appropriate.  The Court of Appeals further held that by statute, exemplary damages may not be awarded unless the claimant makes a specific request to the defendant to publish a retraction.  Here, the arbitrator made the factual finding that claimant never made such a request, and such a factual finding was not reviewable.  Therefore, the Court of Appeals affirmed in part, but vacated the portion of the arbitrator’s post-remand order awarding $140,000 in exemplary damages to claimant.

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