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Schwartz v. Worrall Publications Inc.

Decided: July 22, 1992.

LAWRENCE S. SCHWARTZ AND SCHWARTZ, PISANO, SIMON, EDELSTEIN & BEN ASHER, A PARTNERSHIP, PLAINTIFFS-RESPONDENTS,
v.
WORRALL PUBLICATIONS, INC., A NEW JERSEY CORPORATION; CHRIS GATTO AND JOHN DOE (A FICTITIOUS NAME REPRESENTING A PARTY OR PARTIES UNKNOWN), DEFENDANTS-APPELLANTS



On appeal from the Superior Court, Law Division, Essex County.

R.s. Cohen and Kestin. The opinion of the court was delivered by R.s. Cohen, J.A.D.

Cohen

The opinion of the court was delivered by

R.S. COHEN, J.A.D.

This is a defamation case. On leave granted, defendant Worrall Publications, Inc., appeals the denial of its motion for summary judgment. We reverse.

Worrall publishes the Belleville Post (Post), a free weekly newspaper. Plaintiff Lawrence Schwartz is an attorney who represented the New Jersey School Boards Association (Association) when it came under the scrutiny of the State Commission of Investigation (SCI) for losses which the Association's insurance

group had sustained. Schwartz is a past-president of the Association, a former Belleville School Board attorney, and a partner in the law firm of Schwartz, Simon & Edelstein.

On Thursday, March 29, 1990, the front page of the Post carried an article headlined, "State investigating former BOE [Board of Education] attorney." The by-line attributed authorship to Post staff writer Chris Gatto, a defendant here. Although Schwartz was in fact not the target or focus of any investigation by SCI, the article stated:

A former Belleville school board attorney who once served as president of the New Jersey School Boards Association, is now the target of a state investigation as the recipient of allegedly excessive legal fees stemming from an ongoing insurance controversy.

The association, which employs a $70,000-a-year attorney to head its own staff, is awaiting the results of an investigation by the [SCI] into the fees charged by Livingston-based attorney Lawrence S. Schwartz. The investigation is looking into losses sustained by the association's Insurance Group. The SCI report is expected to be completed shortly.

Schwartz, who is also a former Belleville school board member, served as the association president from 1976 to 1978. According to Frank Belluscio, a spokesman for the [association], Schwartz's fees have totalled $353,851.

Belluscio said Schwartz was paid $297,617 to represent the association in its dealings with the SCI, the investigation now focusing on him. The balance was paid to the lawyer for representing the association in three separate lawsuits that arose from the loss.

Jeremiah Regan, the association's president said Schwartz was hired by the group because of his familiarity with school law and the association itself. The attorney represents 22 school boards in the state. Regan said he saw no possible conflict in hiring a former president.

Schwartz was hired without following the bidding process -- in accordance with the state law that permits contracting for services without bids.

About two weeks later, Schwartz's law firm sent the Post a letter demanding an immediate retraction of the "false and defamatory statements." One was not printed until June 21, 1990, over a month after suit had been started against Worrall and Gatto. The complaint alleged that the article was defamatory, damaged Schwartz and his law firm, and tortiously interfered with the firm's business advantages.

Worrall moved for summary judgment on the theses that the Post article was not "of and concerning" the law firm, and that Schwartz was a public official or figure who failed to establish actual malice on the part of defendants. Schwartz and his law firm cross-moved, seeking partial summary judgment on the question whether the statements in the article were defamatory. The Law Division Judge denied Worrall's motion, and granted plaintiffs ...


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