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Rudebeck v. Paulson6/27/2000
Appellant Raymond Paulson challenges the district court's grant of summary judgment to respondent Ford Motor Company, contending genuine issues of material fact existed as to whether alleged defamatory statements were privileged and made with malice. He also challenges the denial of his request for indemnification from Ford for his attorney fees. We affirm as to summary judgment on the defamation claim but reverse the indemnification decision and remand.
FACTS
Respondent Ford Motor Company is a Delaware corporation with its principal place of business in Dearborn, Michigan. Ford operates a St. Paul plant at which Sandra Rudebeck and Raymond Paulson worked. In 1994, Paulson became the plant's final area manager, one of the top-salaried positions. Rudebeck became a salaried supervisor in 1995.
In February 1996, another Ford supervisor asserted various claims against Ford including allegations of sexual harassment by Paulson. Gail Shirey, a personnel relations associate from Ford headquarters, conducted an investigation into the allegations against Paulson. She interviewed primarily female salaried employees, including Rudebeck. Shirey issued a report determining that Paulson's behavior constituted sexual harassment. She recommended that he be demoted and transferred to another Ford facility. Ford acted on her recommendation.
In 1997, Rudebeck sued Paulson, Ford, and another supervisor, alleging sexual harassment and related claims and defamation. Ford began discussing settlement with Rudebeck and informed Paulson. Paulson then brought claims against Ford and Rudebeck for defamation and related claims and sought indemnification from Ford.
Rudebeck settled with Ford and the other supervisor, and the district court granted summary judgment in favor of Ford on Paulson's defamation claim. After dismissal and summary judgment of other counts, the issues that remained were: (1) Rudebeck's claims against Paulson for sexual harassment and related claims and defamation; and (2) Paulson's claim against Ford for indemnification. The jury found Paulson did not defame Rudebeck, and the district court ruled for Paulson on Rudebeck's sexual harassment claims. The court denied Paulson's request that Ford be ordered to indemnify him for his attorney fees.
The district court denied Paulson's motion for amended findings on the indemnification claim and motion for amended judgment reinstating the defamation claim against Ford. Paulson then filed a notice of appeal.
ISSUES
I. Are the allegedly defamatory statements protected by a qualified privilege, absent a showing of malice, because they were made on reasonable or probable grounds in the course of an investigation into alleged misconduct by an employee?
II. Is the employee, who prevailed in the sexual harassment lawsuit another employee brought against him, entitled to indemnification from his employer under Delaware law?
ANALYSIS
Standard of Review
When reviewing a summary judgment, an appellate court will determine whether there are any genuine issues of material fact and whether the district court erred in its application of law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990). When reviewing a purely legal issue, a reviewing court is not bound by and need not defer to the district court's decision. Frost-Benco Elec. Ass'n v. Minnesota Pub. Utils. Comm'n, 358 N.W.2d 639, 642 (Minn. 1984).
I.
For a statement to meet the legal standards for defamation, it must be communicated to someone other than the plaintiff, it must be false, and it must tend to harm the plaintiff's repu
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