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Costello v. Ocean County Observer

Decided: July 20, 1994.


On certification to the Superior Court, Appellate Division.

Garibaldi, Clifford, Handler, Pollock, Stein, O'Hern


The opinion of the Court was delivered by


This case involves a newspaper article describing allegations contained in an unfiled complaint that a police lieutenant fondled a woman while she was handcuffed during a strip-search. We address whether the fair-report privilege applies and whether the lieutenant is a public figure subject to the actual-malice burden of proof.


In October 1990 Joseph Fisher, a supervising editor at the Ocean County Observer, assigned reporter Whit Andrews to investigate

reports of possible misconduct by certain Seaside Heights police officers. Andrews, a 1989 college graduate, began working for the newspaper in April 1990. Fisher gave Andrews a docket number and told him to determine whether a "notice of claim" had been filed. After Andrews made several trips to the courthouse, on November 7, 1990, a Judge's law clerk permitted Andrews to inspect a file with the specified docket number, titled Nicholas J. Guiliano v. Borough of Seaside Heights and James Magovern, III.

The file contained a pro se Order to Show Cause and an affidavit of Guiliano with several attached exhibits. In the Order, Guiliano complained that he had been arbitrarily denied discovery in connection with pending disorderly-conduct and obstructing-Justice complaints filed against him in the Municipal Court of the Borough of Seaside Heights, that were scheduled for trial on August 14, 1990. Specifically, Guiliano sought the employment records of Patrolman Magovern from the Borough. Guiliano's affidavit stated that on May 17, 1988, Patrolman Magovern had gone to Guiliano's home "with reference to a window of a neighboring building being broken," and had arrested Guiliano's female acquaintance, Elizabeth Fesl. Officer Magovern issued a summons at that time to Fesl for disorderly conduct and obstructing Justice. Four months later, the police also issued a summons to Guiliano for obstruction of Justice in connection with that incident.

Paragraphs 8 and 9 of Guiliano's affidavit state:

8. On or about sometime in January 1989, a Notice of Tort Claim was filed with the attorneys for the Borough and copied to the Defendants in the proposed civil action. A true and exact copy is attached hereunto as Exhibit "E".

9. Sometime subsequent a general form of release was entered into by all parties with the exception of Patrolman Magovern.

[Emphasis added.]

Although the affidavit described Exhibit E as a Notice of Tort Claim, the exhibit was actually a typewritten, unsigned, unfiled seventy-four page federal court complaint with 257 paragraphs, which had "DRAFT" stamped on it. In the complaint, Guiliano and Fesl assert claims against Seaside Heights and many of its

police officers, including Lieutenant Costello. According to the complaint, Costello conducted an unlawful search of Fesl after she was arrested. The complaint states:

111. On May 17, 1988, Plaintiff was unlawfully arrested in the Borough of Seaside Heights, New Jersey and was physically taken to the Seaside Heights Municipal jail. Defendant-Costello took Plaintiff-Fesl to a separate room and she was told by Defendant-Costello that Costello, personally, would do a bodily search for contraband.

112. Plaintiff-Fesl refused and while handcuffed, Defendant-Costello pulled down the Plaintiff-Fesl's blouse, already somewhat open, and instructed to Fesl to bend over so that he may "frisk" her for weapons and or contraband.

113. When she duly refused, Defendant-Costello, forcibly bent her over and proceeded to search and "feel up" the Plaintiff-Fesl's genital and anal areas. Defendant-Costello also at this time fondled and breached the Plaintiff-Fesl's breasts, all while Fesl was still handcuffed.

114. When Fesl responded that this was blatantly illegal and illegitimate, Costello replied, "what's the matter don't you like it."

The draft complaint involved a separate action from the Order to Show Cause, as evidenced by the different captions. The draft complaint named Guiliano and Fesl as plaintiffs, but the Order to Show Cause named only Guiliano. Fesl was not a party in the Order to Show Cause proceeding, and the file that Andrews consulted did not contain any affidavits or statements from her.

At his deposition, Andrews said that he did not know the meaning of an Order to Show Cause, did not understand the relationship of the attached exhibits to the Order to Show Cause, and did not know the status of the matter. He also claimed to be unaware that the Order to Show Cause had been returnable September 14, 1990, approximately six weeks before his visit. Andrews does claim, however, that he attempted to contact sources regarding the allegations contained in the draft complaint.

Andrews allegedly tried to communicate with Lieutenant Costello, Officer Magovern, and other Borough officials on the day he inspected the file, without success. He did not attempt to communicate with Fesl or Guiliano. On the next day, November 8, 1990, Andrews telephoned the Borough's attorney, Ronald Hoffman, and told Hoffman that in the Guiliano file he had found a copy of a very lengthy proposed complaint arising out of the May 17, 1988,

incident. He specifically mentioned the allegation against Costello and stated his intention to write a story describing Costello's alleged improprieties. Hoffman had two conversations with Andrews that day. He prepared a file memo that afternoon memorializing his telephone conversations with Andrews.

The first conversation occurred at 1:00 p.m. At that time, Hoffman could recall only that complaints from the May 17, 1988, incident were pending in municipal court. However, he specifically informed Andrews of the following regarding Costello:

I indicated that I had no knowledge of that allegation [Costello's alleged search of Fesl] and further indicated that, to the best of my knowledge, there were no indictable criminal complaints, municipal court criminal complaints or complaints of a disciplinary nature with the Seaside Heights Police Department involving that allegation. I indicated that that information was totally new to me and I knew nothing about it.

Andrews told Hoffman that he intended to publish the alleged improprieties of Costello. Hoffman then related:

I cautioned Mr. Andrews regarding the possibility of libel/slander. I indicated to him that I was certain that the Observer [sic] had an attorney on staff and that perhaps it would be a good idea to review the contents of the story with said attorney prior to publishing same in the newspaper. Mr. Andrews responded by saying that they were on a very tight budget, had no attorney on staff and were anxious to have the story printed so that they could get the story into print prior to the Asbury Park Press getting the story. He indicated that he would run the proposed story by his editor prior to the printing. I indicated that I would call him back later in the afternoon and advise him whether the Borough had any comment.

Hoffman called Andrews at 4:00 p.m. that day. According to Hoffman's file memo,

I also indicated that the [police] reports and [witness] statement made no reference to Lieutenant Costello. Mr. Andrews agreed. We also commented that the arrest report had Sergeant Tate as the officer in charge at the time the incident took place rather than Lieutenant Costello. It was confirmed that there were no complaints either way involving Lieutenant Costello, particularly of a sexual abuse nature. It was further agreed that the lengthy pleading prepared by Mr. Guiliano had not been filed with any court and that the statute of limitations regarding the allegations contained therein had run. I terminated my conversation with Mr. Andrews and was then advised by William T. Hiering, Jr. that, while I was at my deposition, Andrews had called leaving a message that he had reviewed this matter with his editor and that the story was going to go to print whether we got back to him or not.

Andrews' story appeared in the November 9, 1990, edition of the Ocean County Observer. The front page of the Observer contained the caption, "Woman alleges brutality," and referred readers to page A3. The headline on page A3, written by one of Andrews' editors, read, "Complaint alleges Seaside cop fondled woman." The article stated in part:

A Lakehurst woman is alleging she was handcuffed, beaten and improperly strip-searched by police officers in a May 1988 incident here.

Elizabeth Fesl claims in papers filed in state Superior Court that she was smashed into a brick wall and that a male police lieutenant illegally fondled her breast and genitalia because she broke a window.

The police report from the incident and a witness' account claim that Fesl attacked the police officer and that he only defended himself and used acceptable force to subdue her.

The claim is one of a series of complaints and notices of intent to sue against the borough's Police Department, which has come under fire in recent months from people alleging police brutality.

The strip-search allegations are not addressed in the arrest report.

According to the court papers, Patrolman James Magovern, III and two other officers were called to a scene of a fight between Fesl and her sister at about 2:30 a.m. May 17, 1990 [sic].

The claim following the incident was filed by Nicholas Guiliano, a borough resident, on the woman's behalf. The claim is a notice of intent to sue in the U.S. District Court on the grounds of deprivation of civil rights.

The claim also has been filed as an exhibit in Guiliano's request for a Superior Court order to demand some of Magovern's employment records from the borough.

Seaside Heights Borough Attorney Ronald E. Hoffman had no comment when asked about the notice of intent or pending litigation.

When Fesl got to the police station, the claim says, Lt. James Costello forced her to bend over and "proceeded to search and 'feel up' the Plaintiff-Fesl's genital and anal areas . . . [he] fondled and breached the Plaintiff-Fesl's breasts, all while Fesl was still handcuffed."

"When Fesl responded that this was blatantly illegal and illegitimate," the claim says, Costello replied, "What's the matter, don't you like it?"

No complaints were signed against Costello in connection with the incident, however, despite a lengthy sheet of charges Guiliano ...

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