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Ex-credit union chief loses defamation per se appeal

May 18, 2016

The Indiana Court of Appeals affirmed summary judgment for an employer after the president of a company was fired over an executive's hotline call. The president claimed defamation per se and considered the hotline company liable, but the COA ruled comments made during the call were not defamatory.

Jack Sheets was president and CEO of Interra Credit Union but in 2011 Sheets experienced an inter-cerebral hemorrhage. He returned to work eight months later and during that time a hotline managed by Venture International was installed for employees to call with complaints.

In 2012, Interra vice president David Birky called the hotline and stated he had concerns about Sheets’ leadership. He said Sheets was having trouble following conversations and also accepting different ideas and solving problems. He said he had evidence of all of these allegations. Venture followed up on the call with Birky and provided evidence of the call to the hotline as well as its meeting with Birky to Interra’s board of directors. The board then released Sheets of his duties.

Sheets filed suit claiming defamation per se against Birky and eventually included Interra, Venture and Venture CEO Curt Bechler in the lawsuit. The trial court granted summary judgment for Birky and Interra and partial and then full judgment to Venture and Bechler. Sheets appealed.

The COA in an opinion written by L. Mark Bailey affirmed the trial court’s decision. It said that Birky’s statements were opinions and “did not impute occupational misconduct without resort to extrinsic evidence.” Defamation per se requires accusations without resort to outside evidence, which Birky provided.

Sheets also claimed the trial court abused its discretion by rejecting his proffered jury instructions on intentional interference with an employment-at will contract, but the COA said his instructions were overly broad. “Sheets’s instruction to the effect that the law protects such a contract ‘from outside interference’ is incomplete, in that it does not contemplate that the interference must be intentional or without a legitimate business purpose,” Bailey wrote.

The case is Jack Sheets v. David Birky, Interra Credit Union, Curt Bechler, and Venture International, LLC, 20A04-1509-PL-01620.
 

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