A split Indiana Supreme Court Tuesday upheld a trial court's ruling that a Papa John's employee's false statement to police that a customer had pulled out a gun is protected by qualified privilege. The dissenting judges believed because the employee first made the false statement to a passerby and then police, he knowingly reported false information so his statement shouldn't be protected.

At issue in Thomas Williams and Sanford Kelsey v. Kelly Eugene Tharp and Papa John's U.S.A. Inc., No. 29S02-0901-CV-40, is whether Kelly Tharp's false statement to police that he saw Sanford Kelsey pull out a gun while in the pizza place should be protected by qualified privilege. Tharp told a passerby outside the store that he had seen Kelsey pull out the gun; he also told another employee, who didn't see a gun. The passerby called police, who pulled the two men over, detained them for an hour, and then determined there was no gun. Tharp gave his father's name and information to police - which he had used to get his job at Papa John's - and then left because he knew he had outstanding warrants.

Williams and Kelsey sued seeking compensatory and punitive damages, alleging defamation per se, false imprisonment, emotional distress, negligence, negligent hiring, retention, and supervision. The trial court granted summary judgment in favor of the defendants on all counts. The Indiana Court of Appeals reversed and remanded on each count.

Chief Justice Randall T. Shephard, and Justices Brent Dickson and Frank Sullivan affirmed Tharp's statement to police was protected by qualified privilege. The high court determined that qualified privilege in Indiana requires more than reckless disregard of the truth to support a claim of defamation or false imprisonment based on an inaccurate report to police of possible criminal activity. The reckless standard would subject a person to liability for reporting criminal conduct not only when the speaker actually knew the statement was false but also if it could be shown they should have known the statement wasn't true, wrote Justice Dickson.

Williams and Kelsey argued there is a genuine issue of whether Tharp made his statement "without belief or grounds for belief in its truth." But the majority determined the plaintiffs hadn't designated sufficient evidence to give rise to a genuine issue about whether Tharp made his statement knowing it was false or that he was so obviously mistaken as to support a reasonable inference that he lied, the justice continued.

Justices Theodore Boehm and Robert Rucker dissented in separate opinions, agreeing with the Court of Appeals' decision. In their dissents, the justices emphasized that Tharp originally gave his false statement to a passerby, which isn't protected by qualified privilege, and then gave the same statement to police. They also noted Tharp didn't call police, misidentified himself to police, and later fled.

The majority also rejected the plaintiffs' application for leave to file a Trial Rule 60(B) motion for relief of judgment because Tharp later pleaded guilty to false reporting. The majority ruled they could file a T.R. 60(B)(8) motion. Justice Rucker, who agreed with Justice Boehm's dissent, believed Tharp's guilty plea was important to the case and the high court shouldn't turn a "blind eye" to the evidence just because the plaintiffs waited to file their motion until after the oral arguments. The justice believed the plea raises a genuine issue of material fact as it could be considered newly discovered evidence, so the high court should at least reverse the trial court's judgment and remand for further proceedings.