Zeran v. Diamond Broadcasting, Inc.

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

KENNETH M. ZERAN,

Plaintiff-Appellant and
Cross-Appellee,

v. Nos. 98-6092 and 98-6094

DIAMOND BROADCASTING, INC.,

Defendant-Appellee and
Cross-Appellant.

ORDER
Filed February 17, 2000

Before HENRY and MURPHY, Circuit Judges, and KIMBALL,*

On the court’s own motion, the order and judgment filed on January 28, 2000, has

been ordered published. The published opinion is attached to this order.

Entered for the Court

Patrick Fisher, Clerk of Court

*
The Honorable Dale A. Kimball, United States District Judge for the District of
Utah, sitting by designation.
 F I L E D
United States Court of Appeals
Tenth Circuit

JAN 28 2000
PUBLISH

UNITED STATES COURT OF APPEALS PATRICK FISHER
Clerk
TENTH CIRCUIT
________________________________

KENNETH M. ZERAN,

Plaintiff-Appellant and
Cross-Appellee,

v. Nos. 98-6092 and 98-6094

DIAMOND BROADCASTING, INC.,

Defendant-Appellee and
Cross-Appellant.

_______________________________

APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF OKLAHOMA
(D.C. No. CIV-96-0008-T)
_______________________________

James A. Ikard (Leo Kayser, III, of Kayser & Redfern, LLP, New York, New York, with
him on the brief), Oklahoma City, Oklahoma, for Plaintiff-Appellant and Cross-Appellee.

Robert D. Nelon (Jon Epstein and Lorinda G. Holloway, with him on the brief), of Hall,
Estill, Hardwick, Gable, Golden & Nelson, P.C., Oklahoma City, Oklahoma, for
Defendant-Appellee and Cross-Appellant.

Before HENRY and MURPHY, Circuit Judges, and KIMBALL,* District Judge.

KIMBALL, District Judge.

*
The Honorable Dale A. Kimball, United States District Judge for the District of
Utah, sitting by designation.
 Plaintiff-Appellant Kenneth Zeran (“Plaintiff”) appeals from an order of the

district court granting Defendant-Appellee Diamond Broadcasting, Inc. (“Defendant”)

summary judgment. Defendant cross appeals the district court's denial of Defendant's

application for costs. After a background section, each matter is considered in turn.

Plaintiff has also appealed the district court's denial of Plaintiff's motion for a new

trial and requested certification of two questions to the Oklahoma Supreme Court. These

subsidiary matters are addressed in connection with the primary legal issues to which they

pertain.

BACKGROUND

Plaintiff was the victim of a malicious hoax. In the immediate aftermath of the

bombing of the Alfred P. Murrah Federal Building in downtown Oklahoma City, a

posting appeared on an Internet bulletin board announcing the availability for sale of

“Naughty Oklahoma T-Shirts,” bearing such slogans, to repeat only the least offensive, as

“Rack'em, Stack'em and Pack'em — Oklahoma 1995” and “Visit Oklahoma — it's a

Blast.” Another slogan crudely referenced the children who died in the bombing. The

posting was made by someone using the screen name “Ken ZZ03 " and indicated that the

shirts could be ordered by telephone. The number provided was Plaintiff's business

telephone number.

Plaintiff had nothing to do with the posting. Plaintiff lives in Seattle, Washington,

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and is an accomplished artist, photographer, and film maker. America Online (“AOL”),

an Internet service provider, provided the unique screen name “Ken ZZ03” to an

individual who opened up a trial AOL membership. AOL maintains a database with the

names, addresses, phone numbers, and credit card numbers of its members, searchable by

screen name. However, AOL does not verify member information before allowing a new

member to go online utilizing a trial membership, which AOL disseminates by the tens of

thousands. The true identity of Ken ZZ03 remains unknown, as the account was opened

with false information.

Ken ZZ03 opened up at least two more AOL membership accounts with false

information, adopting similar screen names (Ken ZZ033 and Ken Z033) and posting

increasingly offensive items for sale, always providing Plaintiff's telephone number.

The first posting appeared on April 25, 1995, six days after the bombing. On that

same day, Plaintiff began receiving phone calls, which he described as “negative,”

“unpleasant,” and “nasty and threatening.” The additional postings were made on April

26, 1995, and on April 28, 1995.

Upon learning of the postings, Plaintiff, who is not an AOL member, notified AOL

that he was not involved and asked AOL to delete the postings, place notices on AOL that

the postings were false, and take steps to prevent his phone number from appearing in any

future postings. AOL declined to help and the postings remained on the Internet for at

least a week.

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 Defendant owns KRXO, a classic-rock radio station in Oklahoma City. On April

29, 1995, an AOL member sent an e-mail containing a copy of the original, April 25th

posting to one of KRXO's on-air personalities, Mark (“Shannon”) Fullerton, who,

together with Ron (“Spinozi”) Benton, hosted the “Shannon & Spinozi Show,” a drive-

time morning show, which usually consisted of light-hearted commentary, humor, and

games. In the aftermath of the bombing, and continuing for a period of four to six weeks

thereafter, however, the show had become a forum for discussion of the bombing and

expression of the emotions it aroused. Its tone was serious and somber.

Shannon first saw the e-mail either late in the evening on the day it was sent or

early the next morning, May 1, 1995. Shannon was an AOL member and had given his

screen name out over the air to enable his listeners to send messages to him. He did not

know the person who sent the posting.

Before beginning his shift on May 1, Shannon unsuccessfully attempted to e-mail

Ken ZZO3 through AOL, but received a pop-up message informing him that the

addressee was not a known AOL member. He did not attempt to call the telephone

number on the posting, purportedly because it was before business hours.

Shannon then went on air, discussing the posting, reading the slogans, and reading

Plaintiff's telephone number. Shannon urged his listeners to call Ken ZZ03 and tell Ken

ZZ03 what they thought of him for offering such products. On that day, Plaintiff received

approximately 80 angry, obscenity-laced calls from the Oklahoma City area, including

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death threats. Plaintiff described it as the worst day of his life and, shortly thereafter,

involved law enforcement. The anxiety Plaintiff felt as a result eventually led him to visit

his family physician, who treated Plaintiff by prescribing an anti-anxiety drug.

Although most of the callers hung up before Plaintiff had an opportunity to speak,

Plaintiff was able to learn that the posting had been mentioned on KRXO. Plaintiff called

KRXO and asked that KRXO broadcast a retraction, which it did.

Plaintiff does not know of anyone who knows him by the name Kenneth Zeran

who saw the AOL postings, heard the broadcast, or associated him with “Ken Z” or the

phone number on the AOL postings.

DISCUSSION

A. Defendant's Motion for Summary Judgment.

Based on the broadcast, Plaintiff asserted claims of defamation, false light invasion

of privacy, and intentional infliction of emotional distress. The district court granted

Defendant's motion for summary judgment on all claims. "We review the granting of

summary judgment de novo, applying the same legal standard used by the district court

under Fed.R.Civ.P. 56(c)." Chiles v. Ceridian Corp., 95 F.3d 1505, 1510 (10th Cir.

1996).

1. Defamation.

Defamation through an oral communication, or slander, is defined by statute in

Oklahoma as a false and unprivileged communication that (1) charges a person with a

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crime; (2) accuses him of having an infectious, contagious, or loathsome disease; (3)

maligns him with respect to his office, profession, trade, or business; (4) imputes to him

impotence or want of chastity; or (5) by its natural consequences, causes actual damages.

Okla. Stat. tit. 12, § 1442 (1991).

The district court correctly determined that the only subdivision possibly

applicable to the broadcast is the last one, slander per quod. Evidence of special

damages was consequently required. Kleier Advertising, Inc. v. Premier Pontiac, Inc.,

921 F.2d 1036, 1046 (10th Cir. 1990) (applying Oklahoma law and affirming dismissal of

defamation per quod claim when plaintiff failed to allege special damages); Krebsbach v.

Henley, 725 P.2d 852, 856 (Okla. 1986) (affirming grant of summary judgment against

plaintiff alleging defamation per quod when uncontroverted facts were insufficient to

support inference that plaintiff had suffered special damages).

The district court questioned whether the medical expenses incurred by Plaintiff

were sufficient to establish the required special damages, but granted summary judgment

on the ground that the evidence was insufficient to establish an injury to Plaintiff's

reputation. We affirm on both grounds.

Emotional distress is not a form of special damages, and Plaintiff's de minimis

medical expenses, consisting of one visit to his physician and one prescription drug

purchase, are insufficient to support the cause of action. Under the principle of de

minimis non curat lex, the de minimis doctrine, the law does not care for, or take notice

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of, very small or trifling matters. Conway v. Watt, 717 F.2d 512, 516 (10th Cir. 1983).

Although Plaintiff suffered an injury, the district court correctly found that

Plaintiff did not suffer an injury to his reputation, which is the essence of an action for

defamation. In understanding Oklahoma law in this regard, Colbert v. World Publishing

Co., 747 P.2d 286 (Okla. 1987), is instructive. In Colbert, the defendant newspaper

published the plaintiff's photograph in connection with an article reporting the death of a

local school teacher who had previously been convicted of a gruesome murder and was

reported to be mentally ill. Id. at 287. The plaintiff was teased and ridiculed as a

consequence, but no one believed that he was a murderer or mentally ill.

In distinguishing an action for defamation from an action for false light invasion of

privacy, the Oklahoma Supreme Court explained that in the former, "recovery is sought

primarily for the injury to one's reputation," that is, "what others may think of the person,"

while in the latter, the "interest to be vindicated is the injury to the person's own feelings."

Id. at 289.

Plaintiff's defamation claim fails because Plaintiff has not shown that any person

thinks less of him, Kenneth Zeran, as a result of the broadcast. As the district court

found, there was no evidence that anyone who called his number in response to the

postings or the broadcast even knew his last name. In other words, under the facts of this

case, there was an insufficient link between Plaintiff's business telephone number and

Plaintiff himself for Plaintiff to have sustained damage to his reputation.

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 For this reason, we deny Plaintiff's motion to certify to the Oklahoma Supreme

Court the question of whether a previously anonymous person can be given a negative

reputation for which he can recover in defamation. The question is not determinative

here because there is no evidence that a negative reputation for Plaintiff was created by

the broadcast.

2. False Light Invasion of Privacy.

Oklahoma has recognized false light invasion of privacy as formulated in the

Restatement (Second) of Torts § 652E (1977), which provides:

One who gives publicity to a matter concerning another that places the other
before the public in a false light is subject to liability to the other for
invasion of his privacy, if
(a) the false light in which the other was placed would be
highly offensive to a reasonable person, and
(b) the actor had knowledge of or acted in reckless disregard
as to the falsity of the publicized matter and the false light in
which the other would be placed.

McCormack v. Oklahoma Publishing Co., 613 P.2d 737, 740 (Okla. 1980); Colbert, 747

P.2d at 290. Mere negligence is insufficient to establish the requisite fault necessary to

hold a defendant liable — the defendant must have "had a high degree of awareness of

probable falsity or in fact entertained serious doubts as to the truth of the publication."

Colbert, 747 P.2d at 291.

The district court granted summary judgment to Defendant on this claim on the

ground that Plaintiff had failed to offer proof that Defendant's employees either knew the

postings were fictitious or acted recklessly, as that term is defined by the controlling

8
authorities. The district court was influenced by the fact that Plaintiff's own expert found

that they did not satisfy the level of culpability necessary to impose liability, opining only

that "Mark Shannon and Ron Benton were extremely negligent and violated standards of

professional conduct when hosting the Shannon and Spinozi Show on May 1, 1995." We

affirm on the same basis.

Plaintiff first asserts that the district court erred in interpreting Oklahoma law to

require evidence of recklessness, arguing that, given the facts of this case, the Oklahoma

Supreme Court would no longer apply the Colbert recklessness standard and would

instead follow other states that have permitted recovery under a negligence theory in false

light media cases involving private individuals and matters of public concern. In the

alternative, Plaintiff seeks certification to the Oklahoma Supreme Court of the question of

whether the recklessness standard applies here.

In Colbert, the Oklahoma Supreme Court surveyed and rejected the arguments for

a negligence standard in false light cases stating that it was "committed" to "a standard of

knowing or reckless conduct to afford recovery to those who suffer mental anguish by

reason of a false light invasion of privacy." 747 P.2d at 292. Plaintiff has cited no

authority subsequent to Colbert that justifies Plaintiff's prediction that the Oklahoma

Supreme Court would retreat from the Colbert requirements. Accordingly, we decline to

certify the question at issue and uphold the district court's application of the recklessness

requirement.

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 Plaintiff next argues that even if knowing or reckless conduct is required, the

conduct of Shannon and Spinozi, in accepting the posting at face value and failing to

verify its authenticity, is sufficient to avoid summary judgment, notwithstanding

Plaintiff's expert's failure to use the term "reckless" in describing their actions. Plaintiff

also assigns error to the district court's refusal to accept a new affidavit from Plaintiff's

expert, submitted in connection with Plaintiff's motion for a new trial filed pursuant to

Rule 59(e) of the Federal Rules of Civil Procedure.

In order to establish reckless disregard, Plaintiff must demonstrate actual

knowledge of probable falsity. "The only extent that an investigation enters into the

consideration of the premises is if the investigation is made and through it, actual

knowledge is imparted." Jurkowski v. Crawley, 637 P.2d 56, 60 (Okla. 1981).

Plaintiff's expert's affidavit, regardless of its content, is not relevant for the same

reason. Plaintiff's expert could not possibly have had personal knowledge concerning the

relevant question, namely, whether Shannon and Spinozi had an actual, subjective

awareness that what they were repeating on the air was probably false. For this reason,

we find that the district court did not abuse its discretion in denying Plaintiff's motion for

a new trial and affirm the district court's dismissal of the claim.

3. Intentional Infliction of Emotional Distress.

Oklahoma recognizes intentional infliction of emotional distress ("IIED") as

formulated in the Restatement (Second) of Torts § 46(1) (1965), which provides:

10
 One who by extreme and outrageous conduct intentionally or recklessly
causes severe emotional distress to another is subject to liability for such
emotional distress, and if bodily harm to the other results from it, for such
bodily harm.

The district court granted summary judgment against Plaintiff on the ground that

Plaintiff failed to present evidence sufficient to show that KRXO behaved in an extreme

and outrageous way toward him and on the ground that Plaintiff failed to demonstrate that

he suffered severe emotional distress as a result. We affirm on the same grounds.

"It is the trial court's responsibility initially to determine whether the defendant's

conduct may reasonably be regarded as sufficiently extreme and outrageous to meet the §

46 standards." Eddy v. Brown, 715 P.2d 74, 76 (Okla.1986). The conduct must be beyond

all bounds of human decency or such as is regarded as utterly intolerable in a civilized

community. Id. at 77.

The conduct on which Plaintiff's claim is based — the commentary of a radio talk

show host concerning an offensive advertisement that appeared on the Internet, even if

that host failed to first verify that the information contained in the advertisement was

accurate — does not compare to the kinds of conduct that have sustained IIED claims.

We find the present case to be controlled by Jordan v. World Pub. Co., 872 P.2d 946

(Okla. Ct. App. 1994), in which the plaintiff, a public figure, sought recovery for

negligent infliction of emotional distress when a newspaper published an offensive letter

to the editor falsely attributed to him.

Like Plaintiff here, the plaintiff in Jordan alleged that the defendant failed to

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verify the authorship of the letter before publishing it. The Court of Appeals of

Oklahoma upheld the trial court's dismissal of the claim on the ground that the First

Amendment required the plaintiff to establish at least the same level of intent to recover

for the infliction of emotional harm as is necessary to find defamation, or the protection

provided by the First Amendment "could be circumvented merely by labeling a lawsuit as

negligent action rather than one for libel." Id. at 948.

Notwithstanding Plaintiff's status as a private figure, the same principle applies

here. Colbert requires private figures to demonstrate actual knowledge of probable falsity

in order to recover from an act of negligent publishing. To allow recovery on a lesser

showing of culpability for the same act under a different cause of action would erode the

protections Colbert affords.

It is also the trial court's initial responsibility to determine whether the distress

allegedly suffered by the plaintiff is severe emotional distress. Joffe v. Vaughn, 873 P.2d

299, 302 n.6 (Okla. Ct. App. 1993). "In other words, the distress must be of such

character that 'no reasonable person could be expected to endure it.'" Daemi v. Church's

Fried Chicken, Inc., 931 F.2d 1379, 1389 (10th Cir. 1991) (quoting Restatement (Second)

of Torts, supra, § 46 cmt j) (applying Oklahoma law). Again, we concur with the district

court in his finding that the evidence Plaintiff submitted fails to show that the level of

distress he suffered was sufficiently severe to be actionable.

In Daemi, this Court upheld the district court's finding, made at the conclusion of a

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bench trial, that the plaintiff's evidence failed to support an IIED claim. Such evidence

showed that the defendant's conduct made the plaintiff "literally sick to his stomach" and

caused the plaintiff to seek treatment from a doctor on at least one occasion. 931 F.2d at

1389. Plaintiff suffered similar symptoms, and, without minimizing the distress Plaintiff

endured, we agree that it was not sufficiently severe.

In this regard, we are not influenced by the fact that Plaintiff did not seek

professional treatment and did not discuss his distress with those closest to him. This

Court recognizes that there are differences in the manner in which individuals cope. This

Court is more influenced by the lack of evidence showing that the distress interfered with

Plaintiff's ability to conduct his daily life affairs.

B. Defendant's Application for Costs.

Defendant appeals an order of the district court denying it costs as a prevailing

party under Rule 54(d)(1) of the Federal Rules of Civil Procedure. The district court

denied Defendant's application on the grounds, as explained in the order, that, "while the

court felt compelled under the applicable law to find in the defendant's favor, it did not

condone the behavior of the defendant's employees."

"A district court's denial of costs to the prevailing party is reviewed under an abuse

of discretion standard." Aerotech, Inc. v. Estes, 110 F.3d 1523, 1526 (1997). Defendant

argues that the district court abused its discretion by denying costs as a penalty not for

improper behavior as a litigant, but for non-actionable behavior giving rise to the

13
litigation.

Rule 54(d)(1) provides in relevant part that costs "shall be allowed as of course to

the prevailing party unless the court otherwise directs." The allowance or disallowance

of costs to a prevailing party is within the sound discretion of the district court.

Homestake Mining Co. v. Mid-Continent Exploration Co., 282 F.2d 787, 804 (10th Cir.

1960). However, this discretion is limited in two ways. "First, it is well established that

Rule 54 creates a presumption that the district court will award costs to the prevailing

party." Cantrell v. IBEW Local 2021, 69 F.3d 456, 458-59 (10th Cir. 1995). Second, the

district court must provide a valid reason for not awarding costs. Id. at 459. The district

court's stated reason for denying costs was, essentially, that although Defendant's

behavior was not legally actionable, it was sufficiently distasteful to warrant the denial of

litigation costs.

While this Court has discussed various circumstances in which a district court may

properly exercise its discretion to deny costs, including when the prevailing party was

only partially successful, when damages were only nominal, when costs were

unreasonably high or unnecessary, when recovery was insignificant, or when the issues

were close or difficult, see, e.g., Cantrell, 69 F.3d at 459, this Court has never attempted

to create an exclusive list of valid reasons. Nor has this Court stated that misconduct

outside the litigation process is not a justifiable reason for denying costs.

However, case law from other jurisdictions points to the conclusion that a district

14
court may not deny costs on the ground that the district court personally disapproves of

the conduct upon which the plaintiff's unsuccessful claim was based. See, e.g., Zenith

Insur. Co. v. Breslaw, 108 F.3d 205, 207 (9th Cir. 1997) (“[D]enial of Rule 54(d) costs

operates to punish the prevailing party for some impropriety during the course of the

litigation.” (emphasis added)); White & White, Inc. v. American Hosp. Supply Corp., 786

F.2d 728, 730 (6th Cir. 1986) (stating that the district court may deny costs “where the

prevailing party should be penalized for unnecessarily prolonging trial or for injecting

unmeritorious issues”); Popeil Bros., Inc. v. Schick Elec., Inc., 516 F.2d 772, 775 (7th

Cir. 1975) (“[T]he denial of costs to the prevailing party or the assessment of partial costs

against him is in the nature of a penalty for some defection on his part in the course of the

litigation . . . .” (emphasis added) (quoting Chicago Sugar Co. v. American Sugar

Refining Co., 176 F.2d 1, 11 (7th Cir. 1949), cert. denied 338 U.S. 948 (1950))); Smith v.

Southeastern Penn. Transp. Auth., 47 F.3d 97, 99 (3d Cir. 1995) (quoting Chicago

Sugar). In Chicago Sugar, the Seventh Circuit went even further, strongly implying that

extra-judicial misconduct cannot be the basis for a district court’s denial of costs to the

prevailing party: “[T]he penalty of denial or apportionment of costs under Rule 54(d)

should be imposed only for acts or omissions on the part of the prevailing party in the

actual course of the litigation . . . .” Chicago Sugar, 176 F.2d at 11 (emphasis added).

Accordingly, we now hold that the district court's own view of extra-judicial

conduct, which the law does not recognize as legally actionable, should play no part in the

15
district court's decision whether to override the presumption that the prevailing party

receives costs. In denying Defendant costs on that basis, the district court abused its

discretion.

CONCLUSION

For the foregoing reasons, we AFFIRM the district court's grant of summary

judgment in favor of Defendant and we REVERSE and REMAND the district court's

denial of costs to Defendant, with instructions to determine, consistent with this order,

whether Defendant should receive its costs.

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