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Gannett Co.

5/3/2000

Submitted: November 23, 1999


Appeal from Superior Court. Affirmed in Part, Reversed in Part, and Remanded.


This is an appeal from a Superior Court judgment in a libel action following a jury verdict assessing damages. The plaintiff-appellee, Margo Kanaga, M.D. ("Dr. Kanaga") claimed to have been libeled by a newspaper account of her treatment of a former patient, Pamela Kane ("Kane"). The article in question was written by Jane Harriman ("Harriman") and published in a daily newspaper distributed by Harriman's employer, Gannett Co., Inc. t/a The News Journal Company ("Gannett"). Gannett and Harriman (collectively the "media defendants") defended the article as a substantially accurate report of a complaint to the New Castle County Medical Society and, thus, constitutionally protected.


The jury determined, through answers to specific interrogatories, that the article was factually false and defamatory. The jury also determined that the article caused actual damage to Dr. Kanaga, awarding her $2.6 million in compensatory damages and $250,000 in punitive damages. The jury made separate compensatory and punitive damage awards against Kane. The awards against Kane, however, have not been appealed.


In this appeal, the media defendants contend that the article in dispute was constitutionally protected fair comment and, as a matter of law, not defamation. They also challenge the award of actual damages on the ground that it was based on speculation and inadmissible expert testimony. Dr. Kanaga cross-appeals from the Superior Court's exclusion of evidence of Gannett's wealth in relation to the proof of punitive damages.


We conclude that the jury's determination of liability is sustainable factually and is consistent with the law of the case. We further conclude, however, that the jury's verdict fixing actual damages was based upon expert testimony, to which timely objection was made, that lacked an admissible foundation. Accordingly, we reverse the damages award. With respect to the cross-appeal, we hold that under the modern view on punitive damages, the wealth of the defendant is an admissible factor and reverse the Superior Court's holding to the contrary. In sum, we affirm the determination of liability but reverse the award of both actual and punitive damages and remand for a new trial limited to damages.


I.


The factual basis for this litigation is set forth at length in a previous decision of this Court that reversed a grant of summary judgment in favor of the defendants. See Kanaga v. Gannett Co. Inc., Del. Supr., 687 A.2d 173 (1996) ("Kanaga I"). We briefly summarize those facts as they unfolded at trial.


Kane consulted Dr. Kanaga on April 2, 1992, after complaining of a heavy menstrual flow. During a physical examination, Dr. Kanaga observed a fibroid tumor "sitting in her cervix." Dr. Kanaga told Kane about the tumor and that its position would prevent her from doing a myomectomy (removal by surgical forceps). Dr. Kanaga recommended a hysterectomy for treatment of the tumor and also recommended that Kane have her ovaries and tubes removed because of a risk of ovarian cancer. Dr. Kanaga testified that she discussed with Kane her opinion that a myomectomy would be a risky procedure and not the safest or best method for treatment considering Kane's age and the position of the tumor. Dr. Kanaga, however, advised Kane to obtain a second opinion. On April 10, 1992, Dr. Kanaga's office received a request by Kane for a copy of her medical records in order to obtain a second opinion.


On April 19, 1992, Kane experienced heavy bleeding and consulted Ronaldo Domingo, M.D. ("Dr. Domingo") at the emergency r

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