Pan Am Systems, Inc. v. Hardenbergh, 1st Cir. (2015)

7/26/2019 Pan Am Systems, Inc. v. Hardenbergh, 1st Cir. (2015)

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United States Court of AppealsFor the First Circuit

No. 14- 2118

PAN AM SYSTEMS, I NC. ; SPRI NGFI ELD TERMI NAL RAI LWAY COMPANY;DAVI D ANDREW FI NK,

Pl ai nt i f f s , Appel l ant s ,

v.

ATLANTI C NORTHEAST RAI LS AND PORTS, I NC. ; CHALMERS HARDENBERG,

Def endant s, Appel l ees.

APPEAL FROM THE UNI TED STATES DI STRI CT COURTFOR THE DI STRI CT OF MAI NE

[ Hon. Nancy Tor r esen, U. S. Di st r i ct J udge]

Bef ore

Howar d, Chi ef J udge,Thompson and Bar r on, Ci r cui t J udges.

Thad B. Zmi st owski , wi t h whom J onat han A. Pot t l e and EatonPeabody wer e on br i ef , f or appel l ant s.

Russel l B. Pi er ce, J r . , wi t h whom Nor man, Hanson & DeTr oy,LLC was on br i ef , f or appel l ees.

Oct ober 9, 2015


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THOMPSON, Circuit Judge.

Overview

Today' s appeal cent er s on a di st r i ct j udge' s deci si on

ki cki ng out t hi s bat t l e- scar r ed def amat i on case on summar y

j udgment . By way of i nt r oduct i on, pl ai nt i f f s ar e Davi d Andr ew

Fi nk, Pan Am Syst ems, I nc. , and Spr i ngf i el d Ter mi nal Rai l way

Company. Fi nk i s t he f ormer Pr esi dent and CEO of Pan Am, t he

par ent cor por at i on of Spr i ngf i el d. Def endant s ar e Chal mer s

Har denber gh and At l ant i c Nor t heast Rai l s & Por t s, I nc. ( "ANR&P, "

f or shor t ) . Har denber gh i s a wr i t er and edi t or at ANR&P, a t r ade

newsl et t er and e- bul l et i n cover i ng t he r ai l r oad i ndust r y. So

def endant s ar e bot h si des t el l us "medi a def endant s" f or al l

pur poses rel evant t o t hi s case. Savi ng cer t ai n det ai l s f or l at er ,

we qui ckl y sket ch t he mai n cont our s of t he par t i es' di sput e.

Basi cal l y, pl ai nt i f f s ar e upset because t hey thi nk f our

ANR&P ar t i cl es publ i shed bet ween December 2009 and Mar ch 2011

cont ai ned f al se and def amat or y st at ement s. Di scussi ng a t r ai n

der ai l ment on a Spr i ngf i el d- owned r ai l l i ne, t he f i r st ar t i cl e

af t er r el yi ng on r epor t s i n l eadi ng newspaper s quot ed a st at e

of f i ci al as sayi ng t he acci dent was "' per f ect l y pr edi ctabl e' "

because t he " ' r ai l r oad system' " was "' hor r endousl y di l api dat ed. ' "

The next ar t i cl e sai d Spr i ngf i el d nei t her st at i oned a cr ew at a

cer t ai n l ocal e nor pr ovi ded f i ve- day- a- week ser vi ce on a cer t ai n


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l i ne despi t e "pr omi s[ i ng] " t o do bot h. Touchi ng on Pan Am' s

"hazmat ser vi ce, " t he t hi r d ar t i cl e r el yi ng on an emai l f r oman

unnamed sour ce cl ai med Spr i ngf i el d " ' l oses' car s on a consi st ent

ongoi ng basi s, i ncl udi ng one car ' l ost ' f or over 60 days. " And

f i nal l y, t he l ast ar t i cl e sai d Pan Am' s owner had " r emoved" Fi nk

" f r om management , " t hough some of ANR&P' s sour ces di d not know

whet her Fi nk had "def i ni t el y l ef t " or whet her t he owner "came t o

New Engl and t o admi ni st er t he coup de gr ace, " but sour ces di d

expr ess t he hope t hat Fi nk' s successor Fi nk' s son, i t t ur ns out

"mi ght have more f r eedom ei t her t o spend more money on

r ai l r oadi ng, or put t he exi st i ng money i nt o di f f er ent [ and one

woul d hope mor e pr oduct i ve] pl aces. " ( Br acket s i n or i gi nal . )

Fed up wi t h t hese wr i t e- ups, pl ai nt i f f s sued def endant s

i n di ver si t y, al l egi ng ( as r el evant her e) def amat i on. Accor di ng

t o Mai ne l aw whi ch t he par t i es agr ee appl i es t o t hi s l i t i gat i on

l i abi l i t y f or def amat i on exi sts i f t her e i s

( a) a f al se and def amatory st atementconcer ni ng anot her ;( b) an unpr i vi l eged publ i cat i on t o a t hi r dpar t y;( c) f aul t amount i ng at l east t o negl i gence ont he par t of t he publ i sher ; and

( d) ei t her act i onabi l i t y of t he st at ementi r r espect i ve of speci al har m or t he exi st enceof speci al har m caused by t he publ i cat i on.

Lest er v. Powers, 596 A. 2d 65, 69 ( Me. 1991) ( quot i ng Rest atement

( Second) of Tor t s 558 whi ch we wi l l cal l "RST" f r om now on) .


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Def endant s moved t o di smi ss t he compl ai nt f or f ai l i ng t o

st at e a cl ai m, ar gui ng ( among ot her t hi ngs) t hat pl ai nt i f f s had

i nsuf f i ci ent l y pl ed f al si t y and f aul t def amat i on el ement s ( a) and

( c) , r espect i vel y. See Fed. R. Ci v. P. 12( b) ( 6) . Act i ng on t he

mot i on, t he j udge di smi ssed t he compl ai nt wi t hout pr ej udi ce,

gr ant i ng pl ai nt i f f s a chance t o r epl ead t o f i x t hese pr obl ems.

The j udge al so r ul ed t hat def endant s shoul d be consi dered "medi a

def endant s" and t hat t he compl ai ned- about speech i nvol ved "mat t ers

of publ i c concer n" ( mor e on t he quot ed concept s l at er ) .

Taki ng t hei r cue f r om t he j udge' s or der , pl ai nt i f f s

seasonabl y f i l ed an expanded compl ai nt . Wor r i ed t hat a f i ght over

t he f aul t el ement mi ght r equi r e t hem t o di vul ge conf i dent i al

sour ces and thr eat en thei r Fi r st - Amendment i nt er est s, def endant s

pr oposed and t he di st r i ct cour t accept ed havi ng t he par t i es do

di scover y on al l i ssues except f aul t , f ol l owed by summar y j udgment

on t hose i ssues, f ol l owed by di scover y on f aul t i f needed. See

Br uno & St i l l man, I nc. v. Gl obe Newspaper Co. , 633 F. 2d 583, 597-

98 ( 1st Ci r . 1980) ( di scussi ng how bi f ur cat ed di scover y l i ke t hi s

can pr ot ect a def endant ' s j our nal i st i c sour ces) . Af t er t he f i r st

di scovery phase, def endants moved f or summary j udgment ,

mai nt ai ni ng t hat t hey had publ i shed not hi ng def amat or y or f al se.

See Fed. R. Ci v. P. 56( a) . Pl ai nt i f f s opposed t he mot i on,

nat ur al l y. But t he j udge gr ant ed t he mot i on, concl udi ng ( i n a


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nut shel l ) t hat none of t he of f endi ng st at ement s wer e act i onabl e i n

def amat i on.

Pl ai nt i f f s now appeal , maki ng t he bi g- pi ct ur e ar gument

t hat t he t r oubl esome passages i n t he of f endi ng ar t i cl es deal i ng

wi t h t he der ai l ment , pr omi ses, l ost car s, and Fi nk' s depar t ur e

ar e capabl e of def amat or y r eadi ngs and ar e pr ovabl y f al se. Wr ong,

and wr ong agai n, def endant s f i r e back. But , f or r easons t o appear

shor t l y, we t hi nk pl ai nt i f f s ar e r i ght about t he l ost - car comment s.

And so we rever se onl y on t hat i ssue.

Let us be per f ect l y cl ear , t hough. Our r ever sal on t he

l ost - car comments does not mean t hat t hose comment s may proceed to

t r i al . Af t er al l , our anal ysi s her e concer ns onl y par t of t he

def amat i on i nqui r y whet her t he bat t l ed- over st at ement s are

capabl e of a def amat ory meani ng and whet her t hey ar e pr ovabl y

f al se. Ther e r emai ns t he quest i on whet her def endant s were at

f aul t . To show f aul t , pl ai nt i f f s wi l l need t o show at t he ver y

l east t hat def endant s were negl i gent and t hey may need t o show

t hat def endant s act ed wi t h act ual mal i ce. See N. Y. Ti mes Co. v.

Sul l i van, 376 U. S. 254, 279- 80 ( 1964) ( hol di ng t hat a publ i c f i gur e

sui ng f or def amat i on must show t hat t he def endant acted wi t h actual

mal i ce) . Because t he j udge bi f ur cat ed di scover y, she l ef t t he

f aul t i ssue f or another day. And so we must do t he same.


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Guiding Legal Principles

Summar y J udgment

We gi ve f r esh revi ew t o t he j udge' s summary- j udgment

r ul i ng, dr awi ng al l r easonabl e i nf er ences i n f avor of pl ai nt i f f s

( t he mot i on' s opponent s) . See, e. g. , Col l azo- Rosado v. Uni v. of

P. R. , 765 F. 3d 86, 92 ( 1st Ci r . 2014) . And we wi l l af f i r m onl y i f

no genui ne i ssues of mat er i al f act muddl e the di sput e and onl y i f

def endant s ( t he mot i on' s proponent s) mer i t j udgment as a mat t er of

l aw. See, e. g. , i d.

Two ot her t hi ngs wor t h not i ng: Fi r st , t o get t he r ul i ng

f l i pped, pl ai nt i f f s must of f er us "mor e t han ar gument s woven f r om

t he gossamer s t r ands of specul at i on and surmi se. " RTR Techs. ,

I nc. v. Hel mi ng, 707 F. 3d 84, 93 ( 1st Ci r . 2013) . And second, we

can af f i r m t he r ul i ng on any gr ound appar ent i n t he r ecor d, even

one not r el i ed on by t he j udge. See, e. g. , Col l azo- Rosado, 765

F. 3d at 92.

Def amat i on

Moder n def amat i on l aw i s a compl ex mi xt ure of common-

l aw r ul es and const i t ut i onal doct r i nes. See, e. g. , Levi nsky' s,

I nc. v. Wal - Mar t St or es, I nc. , 127 F. 3d 122, 132 ( 1st Ci r . 1997) .


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And wor ki ng one' s way t hr ough i t al l can be di zzyi ng. But wor k

our way we must . So of f we go.

(a)Common- Law Rul es

St ar t i ng wi t h Mai ne l aw, we see ( and t hi s i s a par aphr ase

of what we sai d ear l i er ) t hat a def amat i on cause of act i on "ar i ses

f r om( 1) t he def endant ' s unpr i vi l eged publ i cat i on t o a t hi r d par t y

( 2) of a f al se st at ement per t ai ni ng t o t he pl ai nt i f f ( 3) t hr ough

f aul t amount i ng at l east t o negl i gence, ( 4) as l ong as t he

st at ement ei t her i s def amator y per se or causes speci al har m. "1

See Gar r et t v. Tandy Cor p. , 295 F. 3d 94, 103 ( 1st Ci r . 2002)

( ci t i ng Ri ppet t v. Bemi s, 672 A. 2d 82, 86 ( Me. 1996) ) . A st at ement

i s def amat or y i f i t t ends t o har mt he r eput at i on of anot her ei t her

by l ower i ng t he est eem i n whi ch he i s hel d or by di scour agi ng

ot her s f r om associ at i ng wi t h hi m. See, e. g. , Bakal v. Wear e, 583

A. 2d 1028, 1029 ( Me. 1990) ( r el yi ng on RST 559) . Because f or -

pr of i t cor por at i ons have "busi ness r eput at i on[ s] , " t hey t oo can be

def amed. See RST 561 cmt . b; see al so i d. 561( a) ( expl ai ni ng

t hat " [ o] ne who publ i shes a def amat or y mat t er " concer ni ng a f or -

pr of i t cor por at i on can be l i abl e "i f . . . t he mat t er t ends t o

pr ej udi ce [ t he cor por at i on] i n t he conduct of i t s busi ness or t o

det er ot her s f r om deal i ng wi t h i t ") ; see gener al l y Vahl si ng

1 El ement s ( 3) and ( 4) ar e not at i ssue her e.


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Chr i st i na Cor p. v. St anl ey, 487 A. 2d 264, 265- 66 ( Me. 1985)

( deal i ng wi t h a def amat i on act i on br ought by a cor por at i on and i t s

pr esi dent ) . And keep i n mi nd t hat one who r epeat s a def amatory

st atement may be as l i abl e as t he or i gi nal def amer. See RST 578.

Whet her a st at ement i s capabl e of a def amat ory meani ng

i s a t hr eshol d quest i on f or t he cour t . See Bakal , 583 A. 2d at

1030 ( ci t i ng, among ot her aut hor i t i es, RST 614) . To di scer n

meani ng, a cour t must dr aw f r om t he cont ext of t he st atement and

not i nt er pr et wor ds " i n t he most negat i ve . . . way" i magi nabl e.

I d. ( ci t i ng RST 563 cmt . d f or t he i n- cont ext poi nt ) ; see al so

Vei l l eux v. Nat ' l Br oad. Co. , 206 F. 3d 92, 108 ( 1st Ci r . 2000) .

Thi s " i s not a quest i on of t he i ntent of t he speaker , or aut hor ,

or even of t he under st andi ng of t he pl ai nt i f f , but of t he

under st andi ng of t hose t o whom t he wor ds are addr essed . . . . "

Pi car d v. Br ennan, 307 A. 2d 833, 835 (Me. 1973) ( quot i ng Chapman

v. Gannet t , 171 A. 397, 398 ( Me. 1934) ) . But i f t he cour t concl udes

t hat t he st atement can r easonabl y car r y both a def amatory and

nondef amat or y meani ng, i t i s up to a j ur y t o deci de whet her t he

st at ement was i n f act under st ood as def amat or y by i t s r eci pi ent s.

See, e. g. , Schof f v. Yor k Ct y. , 761 A. 2d 869, 871 n. 2 ( Me. 2000)

( ci t i ng RST 614) .

Tr uth i s a compl et e def ense, of cour se. The Mai ne

cour t s' di r ecti on on t hi s i s cryst al cl ear : so l ong as t he


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of f endi ng st at ement t ur ns out t o be t r ue, t he def endant i s f r ee

f r om l i abi l i t y, r egar dl ess of how much t he st at ement may have hur t

t he pl ai nt i f f ' s publ i c r eput at i on. See, e. g. , Pi car d, 307 A. 2d at

83435. Cr i t i cal l y t oo, a st at ement need not be 100% t r ue t o be

pr ot ected i f i t i s "subst ant i al l y t r ue, " a def endant i s saf e.

See McCul l ough v. Vi si t i ng Nur se Ser v. of S. Me. , I nc. , 691 A. 2d

1201, 1204 ( Me. 1997) ; see al so RST 581A cmt . f ( st r essi ng t hat

"[ s] l i ght i naccur aci es of expr essi on ar e i mmat er i al pr ovi ded t hat

t he def amat or y char ge i s t r ue i n subst ance") . The quest i on i s

whet her t he "al l egedl y f al se f act s" about a pl ai nt i f f ar e "var i ant s

of t he t r ue" and so do not "pai nt hi m i n a wor se l i ght . " Haynes

v. Al f r ed A. Knopf , I nc. , 8 F. 3d 1222, 1229 ( 7t h Ci r . 1993)

( Posner , C. J . ) ; see al so McCul l ough, 691 A. 2d at 1204 ( deemi ng t he

cont est ed st at ement t hat pl ai nt i f f was f i r ed "f or ' sever al

i nci dent s' when, i n f act , she was onl y t er mi nat ed f or t wo

i nci dent s" nonact i onabl e because i t was " subst ant i al l y t r ue even

t hough i t may not be t echni cal l y accur at e, " addi ng t hat " [ t ] o a

r easonabl e person, " t he comment " i s no more damagi ng t o her

r eput at i on t han an accur at e st at ement woul d have been") ; Pi car d,

307 A. 2d at 836 ( hol di ng t hat t he di f f erence between t he def amatory

st at ement ( t hat a per son was " f i r ed") and t he t r ut h ( t hat he had

vol unt ar i l y r esi gned) coul d not cause a r easonabl e member of t he

publ i c t o t hi nk l ess of pl ai nt i f f ) .


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(b)Const i t ut i onal Doct r i nes

On t he const i t ut i onal si de, t he Supr eme Cour t r eadi ng

t he Fi r st Amendment ( made bi ndi ng on t he st ates t hr ough t he

Four t eent h) "has hedged about def amat i on sui t s" wi t h l ot s of

"saf eguar ds desi gned t o pr ot ect a vi gor ous mar ket i n i deas and

opi ni ons. " Desni ck v. Am. Br oad. Co. , 44 F. 3d 1345, 1355 ( 7t h

Ci r . 1995) ( Posner , C. J . ) ; see al so Gr ay v. St . Mar t i n' s Pr ess,

I nc. , 221 F. 3d 243, 248 ( 1st Ci r . 2000) . We ment i on onl y t wo.

Because t r ut h can set a def endant f r ee, so to speak, i t

f ol l ows t hat def amat or y st at ement s are not puni shabl e unl ess t hey

ar e capabl e of bei ng pr oved t r ue or f al se. Whi ch br i ngs us t o

opi ni ons. Because t hey expr ess t he speaker ' s subj ect i ve vi ews

( r at her t han i mpl yi ng t hat he possesses obj ect i vel y test abl e

f act s) , t hey ar e Fi r st - Amendment pr ot ect ed not so, obvi ousl y, i f

t hey i mpl y "f al se asser t i on[ s] of f act . " See Mi l kovi ch v. Lor ai n

J our nal Co. , 497 U. S. 1, 19 ( 1990) ; cf . gener al l y RST 566

( st r essi ng t hat an opi ni on st at ement i s puni shabl e "onl y i f i t

i mpl i es t he al l egat i on of undi scl osed def amat or y f act s as t he basi s

f or t he opi ni on") . Li kewi se, st at ement s of "r het or i cal hyper bol e"

ar e not puni shabl e. And nei t her ar e st at ement s usi ng wor ds " i n a

l oose, f i gur at i ve sense. "2 See Ol d Domi ni on Br anch No. 496, Nat ' l

2 Ret ai l - gi ant Wal - Mar t can cal l a compet i t or ' s st or e "t r ashy, "even i f t he st or e i s not actual l y "f i l t hy" "[ t ] he wor d ' t r ashy'


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Ass' n of Let t er Car r i er s v. Aust i n, 418 U. S. 264, 284- 85 ( 1974) ;

see al so Gr ay, 221 F. 3d at 248. Under st and, t hough, t hat si mpl y

sayi ng " ' I t hi nk' " wi l l not shi el d a def endant f rom l i abi l i t y,

par t i cul ar l y when what i s al l egedl y "' t hought ' " i s ( or suggest s)

a f act - pr oposi t i on. See Gr ay, 221 F. 3d at 248. But cour t s ar e

" l i kel y" t o st amp as "opi ni on" st at ement s i nvol vi ng "expr essi ons

of personal j udgment , especi al l y as t he j udgment s become more vague

and subj ect i ve i n char act er . " I d. ; see al so Levi nsky' s, 127 F. 3d

at 129 ( comment i ng t hat " [ t ] he vaguer a t erm, or t he more meani ngs

i t r easonabl y can convey, t he l ess l i kel y i t i s t o be act i onabl e") .

Al so and i mpor t ant l y, wher e t r ut h was once j ust an

af f i r mat i ve def ense, nowadays t hanks t o t he Supr eme Cour t i f

mi sst at ement s i nvol ve i ssues of publ i c concer n, pl ai nt i f f s must

shoul der t he bur den of showi ng t hat t he comment s are f al se. See

Vei l l eux, 206 F. 3d at 108; see al so Phi l . Newspaper s, I nc. v.

Hepps, 475 U. S. 767, 776 ( 1986) . Thi s i ncl udes, of cour se, a

showi ng t hat t he st at ement s at i ssue ar e not subst ant i al l y t r ue

i s a chamel eon t hat cont i nuousl y changes col ors and shades ofmeani ng" ( i t can mean unkempt or sl eazy, f or exampl e) ; i t " i s l oose

l anguage t hat cannot be obj ect i vel y ver i f i ed, " and so i s notact i onabl e. See Levi nsky' s, 127 F. 3d at 129- 30. And t he Bost onGl obe can descr i be pl ai nt i f f ' s pr oduct i on of "The Phant om of t heOpera" ( not t he one cr eat ed by Andr ew Ll oyd Webber ) as " f ake" and"phony" t hese "adj ect i ves admi t of numer ous i nt er pr et at i ons, "meani ng t hey are "unpr ovabl e" and so not act i onabl e. See Phant omTour i ng, I nc. v. Af f i l i at ed Publ ' ns, 953 F. 2d 724, 728 ( 1st Ci r .1992) .


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or , t o r emove t he negat i ve, t hat t he st at ement s are mat er i al l y

f al se. See Vei l l eux, 206 F. 3d at 108- 11 ( i ndi cat i ng t hat a

st at ement t hat i s not subst ant i al l y tr ue i s mat er i al l y f al se, and

vi ce ver sa) ; see gener al l y Masson v. New Yor ker Magazi ne, I nc. ,

501 U. S. 496, 517 ( 1991) ( emphasi zi ng t hat " [ m] i nor i naccur aci es

do not amount t o f al si t y so l ong as t he subst ance, t he gi st , t he

st i ng, of t he l i bel ous char ge be j ust i f i ed" ( i nt er nal quot at i on

mar ks omi t t ed) ) . To qual i f y as a mat t er of publ i c concer n, t he

speech ( based on t he cont ent , f orm, and cont ext ) must t ouch on

i ssues i n whi ch t he publ i c ( even a smal l sl i ce of t he publ i c) mi ght

be i nt er est ed, as di st i nct , say, f r om pur el y per sonal squabbl es.

See, e. g. , Levi nsky' s, 127 F. 3d at 132.

Analyzing the Offending Statements

Tr ai n Der ai l ment

Rel yi ng on ar t i cl es appear i ng i n t he Nashua Tel egr aph

and Manchest er Uni on Leader ( t wo wel l - r espect ed New Hampshi r e

newspapers) , def endant s publ i shed a st ory i n December 2009 about

a t r ai n der ai l ment occur r i ng on t r acks owned by Spr i ngf i el d.

Headl i ned "ST: COAL DERAILMENT*, " t he pi ece began l i ke t hi s ( heads

up t he Fi nk ment i oned i n t he ar t i cl e i s pl ai nt i f f Fi nk' s son) :

17 November , Nashua. THE LOADED [Springfield]BOW COAL TRAIN DERAILED SEVEN CARS of an 87car t r ai n near Br i dge St r eet at about 11 AM.Thr ee t urned over , wi t h coal spi l l i ng out .


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Davi d Fi nk, [ Spr i ngf i el d' s] pr esi dent ,ar r i ved on t he scene i n t he af t er noon. Hesai d pr el i mi nar y i nvest i gat i on showed t hat oneof t he t r uck si des ( a t r uck cont ai ns axl es,

spr i ngs, and ot her equi pment f or suspensi on)had f al l en of f one of t he car s. That causeda chai n r eact i on among several subsequentcar s. Asked whether he t hought t here was apr obl em wi t h t he t r acks, Fi nk sai d, "We' r el ooki ng at ever yt hi ng, but we don' t t hi nk so"because of t he evi dence wi t h t he t r uck. Ani nvest i gat i on i nt o t he cause of t he der ai l mentwoul d l i kel y go on f or about a mont h becauseof metal t hat needs t o be t est ed and otherf act ors .

Cr ews were expect ed t o r eal i gn t he f ourupr i ght car s and move t hemt hat same day. Mostof t he t r ai nan est i mated 74 car scont i nued ont o the Merr i mack St at i on power pl ant i n Bowwi t hout a pr obl em. {Karen Lovet t i n NashuaTel egr aph 18. Nov. 09}

The pi ece cont i nued ( r eader al er t pl ai nt i f f s compl ai n about t he

Pet er Bur l i ng quot es) :

Shows need for track investment?

Pet er Bur l i ng, chai r of t he New Hampshi r e Rai lTr ansi t Author i t y, bl amed [ Spr i ngf i el d] f ort he acci dent . "What has happened here i s aper f ect l y pr edi ct abl e acci dent but i t ' s har dt o descr i be i t as an acci dent , si nce t hepr obabi l i t i es wer e so cl ear i t was goi ng t ot ake pl ace. The onl y t hi ng we di dn' t know i swhen and where. "

Bur l i ng sai d t he acci dent , occur r i ng ona st r et ch of l i ne wi t h a speed l i mi t of under10 mi l es per hour f or l ar ge f r ei ght t r ai ns,made a t r ack upgrade whi ch mi ght have beenpr ovi ded had t he st ate won f undi ng f orpassenger servi ce t o Concor d [ see 09#10A] morei mpor t ant . "A hor r endousl y di l api dat ed


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r ai l r oad syst em has caused a sl ow- movi ng coalt rai n t o f al l of f t he t racks . "

"The poi nt i s not t o say ' I t ol d you so, '

but t o say t hi s i s why we f eel i t i s soi mpor t ant t o get t hi s l i ne upgr aded, and t omai nt ai n i t f or passenger and f r ei ghtoper at i ons. We bel i eve t her e ar e i nst i t ut i onsof t he f ederal gover nment t hat can move t ocar r y t hi s al ong. I ' m goi ng t o Washi ngt on i n[ t he] next coupl e of weeks t o have f ur t herdi scussi ons about t he i ssue. " {Davi d Br ooksi n Nashua Tel egr aph 18. Nov. 09}

And the ar t i cl e ended wi t h these words ( r emember t he Fi nk here

i s pl ai nt i f f Fi nk' s son) :

Fink Response

Any number of r easons coul d expl ai n why t hecar s j umped t he t r ack, i ncl udi ng equi pmentf ai l ur e, Fi nk sai d on 19 November , r espondi ngt o Bur l i ng' s r emar ks. " I don' t know what( Bur l i ng) i s basi ng t hat on. I don' t t hi nk hehas any knowl edge on i t . "

Speci al i st s f r om Pan Am' s mechani cal ,engi neer i ng and oper at i ons depar t ment s wi l lcomb t he wr eckage and anal yze the t r ai n' s"bl ack box" i n t he days ahead, Fi nk sai d.Pi eci ng t oget her what happened wi l l t ake t i me.Fi nk dr ew compar i sons t o an ai r pl ane cr ashi nvest i gat i on, sayi ng mul t i pl e f act or s had t obe consi der ed bef or e reachi ng a concl usi on.

As f or t he t r acks, an aut omated dynami cscar had r ecent l y i nspect ed t he l i ne and f ound

no pr obl ems. " I guess Mr . Bur l i ng i s mor eknowl edgeabl e than t he aut omat ed dynami cscar , " Fi nk sai d. " I don' t know wher e he get shi s i nf or mat i on. "

Pan Am' s i nvest i gat i on t eam i s wor ki ngwi t h t wo Feder al Rai l r oad Admi ni st r at i oni nspect or s. Spokesper son Rober t Kul at sai d i t


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coul d t ake up t o a year bef or e t he FRA r el easest hei r f i ndi ngs. {Der r i ck Per ki ns i nManchest er Uni on Leader 20. Nov. 09}

Lat er , as an at t achment t o hi s af f i davi t i n t hi s case,

Davi d Nagy, Spr i ngf i el d' s di r ector of saf et y and r ai l secur i t y

submi t t ed a r epor t sayi ng a r ai l car owned by a di f f er ent r ai l

company was "a maj or cont r i but i ng cause of " t he acci dent .

Accor di ng t o t he repor t , t he car ' s age and poor condi t i on pr event ed

i t f r om pr oper l y t r avel l i ng al ong t he t r ack.

Bef ore goi ng on, we note t he obvi ous: Bur l i ng' s comment s

came hard on t he acci dent ' s heel s, at a t i me when even Fi nk' s son

conceded t hat Pan Am was " l ooki ng at ever ythi ng" as a possi bl e

cause, t hough Pan Am "d[ i d] n' t t hi nk" t he pr obl em was t r ack-

r el at ed. And f ar f r ombei ng one- si ded, def endant s' pi ece pr ovi ded

a f ul l over vi ew of t he der ai l ment i nvest i gat i on t ol d f r omvar i ous

per spect i ves and even i ncl uded Pan Am' s of f i ci al r esponse

doubt i ng t he cor r ect ness of Bur l i ng' s r emar ks.

Now on t o t he par t i es' argument s.

Convi nced t hat t he phr ase "r ai l r oad syst em" encompasses

onl y t r acks ( whi ch Spr i ngf i el d i s r esponsi bl e f or ) , not t r acks and

t r ai ns, pl ai nt i f f s i nsi st t hat t he Bur l i ng quot es ar e def amat or y

and unt r ue because anot her company' s r ai l car not Spr i ngf i el d' s

t r acks caused t he der ai l ment . Def endant s count er t hat t he

di sput ed comment s ar e i ncapabl e of a def amat or y i nt er pr et at i on,


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because t hey ar e si mpl y Bur l i ng' s subj ect i ve t hought s, expr essed

i n nonact i onabl e hyper bol e. Al so, t hei r ar gument cont i nues, t he

comment s addr ess a mat t er of publ i c concer n, and pl ai nt i f f s have

not met t hei r bur den of showi ng t hat t he remar ks are mat er i al l y

f al se.

For our par t , we need not deci de who i s r i ght on t he

def amatory- meani ng i ssue. And t hat i s because even assumi ng ( i n

pl ai nt i f f ' s f avor ) t hat Bur l i ng' s r emar ks ar e capabl e of a

def amat or y r eadi ng t hat Spr i ngf i el d' s t r acks caused t he acci dent

def endant s cannot be on the hook because ( as t hey argue) t he

speech deal s wi t h an i ssue of publ i c concer n and pl ai nt i f f s have

not shown t he speech ( even i f f al se) i s mat er i al l y f al se. 3 We

expl ai n.

3 Def endant s ar gue t hat pl ai nt i f f s di d not pr eserve any chal l enget o t he j udge' s publ i c- concer n r ul i ng. Thei r t heor y i s t hat whi l epl ai nt i f f s ar gued agai nst a publ i c- concer n f i ndi ng at t he mot i on-t o- di smi ss st age, t hey di d not ask t he j udge t o r evi si t her publ i c-concern r ul i ng at t he summary- j udgment phase. Adopt i ng a bel t -and- suspender s st r at egy, def endant s al so ar gue that a pr i orl i t i gat i on col l at eral l y estops pl ai nt i f f s f rom suggest i ng t hespeech i s not of publ i c concer n. We by- pass t hese compl i cat edquest i ons, because even assumi ng ( f avor abl y t o pl ai nt i f f s) t hatt her e ar e no pr eser vat i on or col l at er al - est oppel pr obl ems, we

easi l y concl ude t hat t he f ought - over speech addr esses mat t er s ofpubl i c concer n.

Anot her qui ck poi nt . Suggest i ng t hat t he r ecor d i s notsuf f i ci ent l y devel oped f or us t o deci de t he publ i c- concer nquest i on, pl ai nt i f f s ask f or a r emand so the par t i es can conductdi scover y on t hat i ssue. But t hei r r equest comes f ar t oo l at e:def endant s squar el y r el i ed on t he j udge' s ear l i er publ i c- concer nr ul i ng i n t hei r summar y- j udgment paper s, yet pl ai nt i f f s never


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Exami ni ng t he speech' s cont ent , f orm, and cont ext ( as we

must ) , we note t hat t he t argeted comment s deal wi t h t he saf ety,

ef f i ci ency, and vi abi l i t y of pl ai nt i f f s ' r ai l way systema system

t hat i s par t of a hi ghl y r egul at ed i ndust r y, what wi t h al l t he

f eder al l aws on saf et y, see 49 U. S. C. 20101- 21311, publ i c

f undi ng, see 49 U. S. C. 22101- 22706, and over si ght , see 49 U. S. C.

103, 701- 727. And i t shoul d go wi t hout sayi ng ( t hough we say

i t anyway) t hat t he publ i c car es deepl y about t he saf et y,

ef f i ci ency, and vi abi l i t y of r ai l ways somet hi ng pl ai nt i f f s do

not cont est . Al so, don' t f or get t hat t he speech appear ed i n a

publ i c newsl et t er , hel pi ng t o educat e t he communi t y and possi bl y

i gni t e publ i c di scour se on t opi cs ci t i zens ar e i nt er est ed i n. 4

asked f or di scover y ei t her i n t hei r obj ect i on or i n a mot i on af t ert he j udge awar ded def endant s summar y j udgment .

4 As t he Supr eme Cour t expl ai ned i n a di f f er ent cont ext :

Rai l r oads have f r om t he ver y out set beenr egar ded as publ i c hi ghways, and t he r i ght andt he dut y of t he gover nment t o regul at e i n ar easonabl e and pr oper manner t he conduct andbusi ness of r ai l r oad cor por at i ons have beenf ounded upon t hat f act . . . . The compani es

hol d a publ i c f r anchi se, and gover nment alsuper vi si on i s t her ef or e val i d. They ar eor gani zed f or t he publ i c i nt er est s and t osubserve pr i mar i l y t he publ i c good andconveni ence.

Wi s. , Mi nn. , & Pac. R. R. Co. v. J acobson, 179 U. S. 287, 296- 97( 1900) .


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Looki ng f or a way out , pl ai nt i f f s basi cal l y i nsi st t hat

our sayi ng that t hi s speech i mpl i cat es a publ i c concer n woul d make

any st at ement about a r ai l r oad a mat t er of publ i c concer n. But

t he char ge i s of f base, because as we j ust expl ai ned our r ul i ng

t oday f l ows f r om a speci f i c exami nat i on of t he cont ent , f or m, and

cont ext of t he pr eci se speech at i ssue her e. And because t he

speech f al l s wi t hi n t he ar ea of publ i c concer n, pl ai nt i f f s must

now pr ove t hat t he di sput ed st at ement s ar e not onl y f al se but

mat er i al l y f al se. Vei l l eux, 206 F. 3d at 108; see al so Hepps, 475

U. S. at 776.

But t hi s t hey have not done. Agai n, pl ai nt i f f s adamant l y

i nsi st t hat t he der ai l ment ' s t r ue cause was a badl y cor r oded

r ai l car owned by another company. For support , t hey r el y on an

i nt er nal r epor t t hat sai d onl y t hat t he r ai l car was "a maj or

cont r i but i ng cause" of t he acci dent . Conspi cuous by i t s absence,

however , i s any suggest i on t her e t hat t he car was t he acci dent ' s

sol e cause and t hat means t hi s document i s f ar t oo t hi n a reed

t o suppor t pl ai nt i f f s' mat er i al - f al si t y char ge. 5 See general l y

Tobi n v. Fed. Expr ess Cor p. , 775 F. 3d 448, 452 ( 1st Ci r . 2014)

5 Pl ai nt i f f s t al k up an af f i davi t by Spr i ngf i el d' s Nagy whi chst at es t hat f eder al of f i ci al s i nspected t he t r acks "j ust pr i or t ot he der ai l ment " ( t o quot e pl ai nt i f f s' br i ef ) and f ound no def ect s.That i nspect i on occur r ed about t hree weeks bef or e t he der ai l ment ,however , whi ch t el l s us not hi ng about t he t r ack' s condi t i on whent he derai l ment happened.


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( emphasi zi ng t hat "[ s] pecul at i on about mer e possi bi l i t i es, wi t hout

more, i s not enough t o st ave of f summary j udgment " ) ; Geshke v.

Cr ocs, I nc. , 740 F. 3d 74, 80 ( 1st Ci r . 2014) ( st r essi ng t hat

unsubst ant i ated concl usi ons cannot bl ock summary j udgment ) .

Sur e, t her e i s some di f f er ence bet ween sayi ng t he t r acks caused

t he der ai l ment ( whi ch i s how pl ai nt i f f s r ead Bur l i ng' s r emar ks)

and sayi ng a r ai l car was "a maj or cont r i but i ng cause" and so t he

t r acks were not t he onl y cause. But even assumi ng t he di f f er ence

i n t hose two st at ement s about t he r ol e of t he t r acks suggest s

f al si t y, pl ai nt i f f s poi nt t o not hi ng i n t he summar y- j udgment

r ecor d i ndi cat i ng t hat t hei r r eput at i ons woul d be i mpr oved at al l

by a mor e pr eci se expl anat i on of t he cause. Cf . gener al l y

Vei l l eux, 206 F. 3d at 111 ( concl udi ng " t hat what ever i naccur aci es

exi st ed wer e [ i n] suf f i ci ent l y mat er i al t o est abl i sh def amat i on") .

Consequent l y we af f i r m summar y j udgment on t hi s ar t i cl e.

Promi ses

I n 1985, New Engl and Sout her n Rai l r oad Company si gned a

l ease wi t h Pan Am t o operate a sect i on of Pan Am' s t r acks bet ween

Manchest er and Concor d ( t wo of t he Gr ani t e St at e' s bi gger ci t i es) . 6

Four t een year s l at er , i n J une 2009, Pan Am asked t he Sur f ace

6 Among ot her t hi ngs, "operat e" means t hat New Engl and Souther ncoul d pr ovi de r ai l servi ce t o cust omer s " l ocat ed on or served by"t he l i ne as of t he l ease' s ef f ect i ve dat e.


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Tr ansport at i on Board ( "STB, " f r om her e on) f or permi ssi on t o end

New Engl and Sout her n' s oper at i ng r i ght s ( over t i me, t he bond

between Pan Amand New Engl and Sout hern became f r ayed over "payment

of i nvoi ces and t he condi t i on" of t he t r acks, appar ent l y) . An

agency wi t hi n t he U. S. Depar t ment of Tr anspor t at i on, t he STB gr ant s

r equest s l i ke Pan Am' s "onl y i f [ i t ] f i nds t hat t he pr esent or

f ut ur e publ i c conveni ence and necessi t y requi r e[ s] or per mi t [ s]

t he . . . di scont i nuance. " See 49 U. S. C. 10903( d) .

Expl ai ni ng t hat i t want ed t o oper at e t he l i ne i t sel f ,

Pan Am submi t t ed an af f i davi t f r om Ri char d Mi l l er , t he assi st ant

t o Pan Am' s vi ce pr esi dent of t r anspor t at i on. Per t i nent l y,

Mi l l er ' s af f i davi t sai d t hat "[ i ] n or der t o pr ovi de ser vi ce" t o

r ai l - l i ne "cust omer s on a consi st ent basi s one cr ew wi l l be

r equi r ed on a f i ve day per week basi s, " wi t h t he "pl an[ ] " bei ng

"t o headquar t er a cr ew i n Concor d, New Hampshi r e. " Pan Am' s

appl i cat i on r el i ed on Mi l l er ' s af f i davi t t o back up i t s cl ai mt hat

i t s pl an woul d serve t he "publ i c conveni ence and necessi t y" yet

t he appl i cat i on sai d ( i n l anguage not f ound i n t he af f i davi t ) t hat

Pan Am woul d pl ace a cr ew i n Concord i f cust omer demand j ust i f i ed

t hat act i on. Her e i s the appl i cat i on' s money quot e:

Once Pan Amservi ce i s r est or ed t o the Subj ectLi ne, Pan Am wi l l assi gn a crew t o beheadquar t ered i n Concor d, New Hampshi r e t owork a f i ve day per week schedul e pr ovi di ngser vi ce t o the f our maj or cust omers and a f ewsmal l er cust omer s on t he Subj ect Li ne as l ong


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as t r af f i c l evel s suppor t such ser vi ce, whi chi s an i ncr ease f r om t he appr oxi mat el y t wo dayper week ser vi ce cur r ent l y pr ovi ded t oManchest er , New Hampshi r e, wi t h t he i ncr eased

r evenue ear ned by Pan Am j ust i f yi ng t hei ncr eased ser vi ce t o t r ansf er car s t o and f r om[ New Engl and Sout her n] . . . .

New Engl and Sout hern wei ghed i n, expr essi ng concer ns

about whether Pan Amwoul d pr ovi de adequate ser vi ce al ong t he l i ne.

The New Hampshi r e Depar t ment of Tr ansport at i on ( "NHDOT, " f or

conveni ence) wei ghed i n t oo, aski ng t he STB t o requi r e Pan Am t o

"i nt er change" at a speci f i c r ai l yar d i n Concor d. 7

The STB l at er grant ed Pan Am' s appl i cat i on i n Apr i l 2010,

sayi ng:

Pan Am cl ai ms t hat i t i s commi t t ed t o wor ki ngwi t h [ New Engl and Sout hern] t o achi eve asmoot h t r ansi t i on of oper at i ons once t he Leasei s t er mi nat ed, and t hat i t i s i nt ent onpr ovi di ng ser vi ce on a consi st ent basi s t hat

wi l l meet and exceed t he servi ce needs anddemands of t hi s gr owi ng regi on of NewHampshi r e. To t hi s end, Pan Am st at es t hat :( 1) i t wi l l operat e one crew on a 5dayaweekbasi s; [ and] ( 2) t he crew wi l l beheadquar t ered i n Concor d, where appr oxi matel y1, 700 car s were i nt erchanged wi t h [ New Engl andSout her n] i n 2006 . . . .

7 As best we can t el l , "i nt er change" i n r ai l way l i ngo r ef er st o "t he pr act i ce of r ai l r oads conveyi ng f r ei ght car s . . . f r omot her compani es over t hei r l i nes" at speci f i ed j unct i on poi nt s.See Wi ki pedi a, "I nt er change ( f r ei ght r ai l ) , "ht t ps: / / en. wi ki pedi a. or g/ wi ki / I nt er change_( f r ei ght _rai l ) ( l astvi si t ed Sept . 9, 2015) .


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"Pan Am has a st at ut or y obl i gat i on t o pr ovi de adequat e

ser vi ce, " t he STB not ed, and "st at es t hat i t i s i nt ent on pr ovi di ng

servi ce on a consi st ent basi s t hat wi l l meet and exceed t he servi ce

needs and demands of t he af f ected area. " Gi ven t hi s concatenat i on

of ci r cumst ances, t he STB deni ed t he NHDOT' s r equest f or a

condi t i on r equi r i ng Pan Am t o est abl i sh an i nt er change at t he

speci f i c Concor d yar d. "We wi l l hol d Pan Am t o i t s assur ances, "

t he STB added. And " [ i ] n t he event [ Pan Am] f ai l s t o l i ve up t o

i t s st at ut or y obl i gat i on t o pr ovi de adequat e ser vi ce, we wi l l

pr ompt l y consi der r equest s f or appr opr i at e cor r ect i ve act i on. "

A mont h l ater , i n May 2010, def endant s publ i shed an

ar t i cl e on t he STB' s deci si on, not i ng among ot her t hi ngs t hat "Pan

Ampr omi ses" t o " ' oper at e one cr ew on a 5- day- a- week basi s, ' " wi t h

" ' t he cr ew . . . headquar t er ed i n Concor d, ' " and t hat " t he STB

decl i ned t o condi t i on t he [ l ease' s] di scont i nuance, " t hough t he

STB sai d i t woul d " ' hol d Pan Am t o i t s assurances. ' " Then came

t he of f endi ng ar t i cl e, i n December 2010, t he per t i nent par t of

whi ch we now quot e ( at t ent i on pl ai nt i f f s gr ouse about t he

comment s f r omPet er Dear ness) :

Better interchange would mean more customers.

Despi t e [ Spr i ngf i el d' s] pr omi se t o l ocat e acr ew i n Concord and swi t ch cust omers f i ve daysa week [ ci t i ng t o the May 2010 ar t i cl e] ,[ Pet er] Dear ness [ New Engl and Sout hern' sowner ] r epor t ed t hat [ Spr i ngf i el d] has donenei t her . I t i s now pr ovi di ng a swi t ch one day


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- 23 -

a week. He bel i eved t hat t o ser ve maj orcust omers Bl ue Seal and Ci ment Quebec,[ Spr i ngf i el d] had t o swi t ch at l east t hr eet i mes a week, whi ch i s " what I pr ovi ded bef or e

I l ef t . "

Pl ai nt i f f s do not ar gue t hat t hi s passage i s def amat or y

because Pan Am act ual l y st at i oned a cr ew i n Concor d, f i ve days a

week. Rat her , t hey pr ot est t hat t hey never pr omi sed t o pr ovi de

t hat ser vi ce and t hat t he passage i s pr ovabl y f al se t o boot .

Def endant s, f or t hei r par t , f ocus t hei r ener gi es on sel l i ng t he

i dea t hat t he speech i nvol ved mat t ers of publ i c concern and was

not mat er i al l y f al se. And t hey have t he bet t er of t hi s ar gument .

As f or publ i c concer n, t he subj ect ar t i cl e addr esses t he

adequacy of Pan Am' s servi ces, and as we not ed bef ore, whether a

r ai l way pr ovi des adequat e ser vi ce i s cl ear l y of concer n t o t he

publ i c. As f or mat er i al f al si t y, t he wor d "pr omi se" i s t he

st i cki ng poi nt , appar ent l y. To pl ai nt i f f s' way of t hi nki ng,

def endant s' pi ece wi t h t he wor d "pr omi se" f r ont and cent er

i mpl i es t hat Pan Am made a f i r m commi t ment t hat i t l at er br oke.

Recal l , however , t hat Pan Am' s Mi l l er di d t el l t he STB ( vi a

af f i davi t ) t hat hi s company "pl anned t o headquar t er a cr ew i n

Concor d" and t hat "one crew wi l l be requi r ed on a f i ve day per

week basi s. " ( Emphasi s our s. ) Mi l l er di d not qual i f y hi s swor n

st at ement by sayi ng Pan Am mi ght do nei t her . J ust t hi nk about

t hat f or a second an aut hor i zed Pan Am honcho t ol d t he STB under


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oat h and wi t hout qual i f i cat i on t hat Pan Am pl anned t o l ocat e a

cr ew i n Concord, f i ve days a week.

Yes, Pan Am di d put a qual i f yi ng phr ase "as l ong as

t r af f i c l evel s suppor t such ser vi ce" i n t he appl i cat i on. Yet

t he STB st i l l cal l ed what Pan Am sai d "assur ances" "assur ances"

t hat Pan Am "wi l l . . . headquar t er [ ] " a cr ew i n Concor d, f i ve

days a week. Pl ai nt i f f s have no beef wi t h t he STB' s "assurances"

t ag. And si nce an "assurance" i s a "pr omi se, "8 t her e i s no f al s i t y

l et al one a mat er i al one when i t comes t o t hi s st at ement . So

we af f i r m t he ent r y summar y j udgment on t hi s art i cl e.

"Lost " Rai l car s

J ones Chemi cal , I nc. known as J CI i s ( as i t s names

suggest s) a chemi cal company. Spr i ngf i el d del i ver s car s car r yi ng

chl or i ne t o J CI ' s New Hampshi r e f aci l i t y. I n May 2007, Spr i ngf i el d

r ai sed i t s chl or i ne- del i ver y pr i ces, addi ng speci al handl i ng

char ges t oo. About f our years l at er , i n Mar ch 2011, def endant s

r epor t ed on how al l t hi s af f ected J CI . Ent i t l ed "PAN AM: HAZMAT

SERVICE*, " t he ar t i cl e' s of f endi ng par t sai d t hi s ( el l i pses and

br acket s i n or i gi nal ) :

Quality of rail service

I n addi t i on t o pr i ce and t he need f or speci alt r ai ns, J CI has had di f f i cul t y wi t h

8 See Oxf or d Engl i sh Di ct i onar y Onl i ne,ht t p: / / www. oed. com/ vi ew/ Ent r y/ 12057 ( l ast vi si t ed Sept . 9, 2015) .


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consi st ency of ser vi ce, accor di ng t o anot hersour ce. I t r equi r es swi t chi ng of at l east f ourcars a week.

The r ai l r oad " l oses" car s on a consi st entongoi ng basi s, i ncl udi ng one car "l ost " f orover 60 days . . . even t hough cer t ai n DHS andDOT st at ut es r equi r e car r i er s t o r el ease [TI H]cars wi t hi n 48 hour s. {e- mai l s t o ANR&P2. Mar . 11}.

TI H st ands f or t oxi c i nhal at i on hazar d. The quot es ar e f r om an

emai l t o ANR&P. Def endant s kept t he sender ' s name out of t he

ar t i cl e.

Af t er pl ai nt i f f s f i l ed t hi s l awsui t , Har denber gh

cont act ed t he sender and got a response f r om t he sender ' s l awyer

sayi ng t he car " l ost " f or over 60 days "was not a TI H car . "

Def endant s t hen publ i shed a cl ar i f i cat i on expl ai ni ng t hat t he

sour ce "was not r ef er r i ng t o l ost TI H car s. "

Pl ai nt i f f s cl ai m def endant s def amed t hem by t el l i ng

r eader s t hat t hey consi st ent l y l ose car s car r yi ng TI H, i ncl udi ng

one car f or over 60 days a char ge, def endant s add, t hat i s f l at -

out f al se. Looki ng t o par r y t hi s at t ack, def endant s cl ai m t he

sent ence i s t oo crypt i c t o convey anythi ng speci f i c enough t o be

consi der ed a ver i f i abl e st at ement of f act . 9 And, def endant s add,

9 "Obvi ousl y, " def endant s t ol d t he j udge, t he wor d " l oses" " wasnot i nt ended t o suggest t hat t he r ai l r oad per manent l y ' l oses car s, 'wi t hi n t he wi de ambi t of connot at i on of t he ver b ' t o l ose. ' ""[ T] he i dea, " def endant s st r essed, "i s not t hat [ p] l ai nt i f f s


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assumi ng t hat ar gument does not car r y t he day, t hey shoul d st i l l

wi n because t he gi st of t he sent ence i s t r ue. Thi s t i me, however ,

pl ai nt i f f s come out on t op.

For one t hi ng, t he st at ement i s capabl e of bei ng r ead i n

a def amat or y way. J ust consi der t he f ol l owi ng: Feder al l aw

r equi r es rai l car r i er s ( l i ke Spr i ngf i el d) t o "f or war d" hazar dous

mat er i al s ( l i ke TI H mat er i al s) ever y 48 hour s unt i l t hey r each

t hei r f i nal dest i nat i on. See 49 C. F. R. 174. 14. Feder al l aw

al so r equi r es r ai l car r i er s ( l i ke Spr i ngf i el d) t o have "pr ocedur es

i n pl ace t o det er mi ne t he l ocat i on and shi ppi ng i nf or mat i on f or

each r ai l car under i t s physi cal cust ody and cont r ol t hat cont ai ns

[ hazar dous mat er i al s] . " See 49 C. F. R. 1580. 103( b) . And

def endant s do not deny that t hei r r eaders r eadi l y know what a bi g

deal i t i s f or a r ai l car r i er t o act l i ke a scof f l aw when i t comes

t o hazar dous mater i al s. So we do not doubt t hat havi ng def endant s

accuse t hem of l osi ng t r ack of TI H car s ( even t empor al l y) a

r eadi l y ver i f i abl e char ge, supposedl y based on speci f i c event s

cer t ai nl y l ower s pl ai nt i f f s' st andi ng i n t he communi t y.

On t op of t hat , t he summary- j udgment evi dence ( t aken i n

t he l i ght most f avor abl e t o pl ai nt i f f s) shows t he st at ement

deal i ng wi t h publ i c saf et y, a qui nt essent i al i ssue of publ i c

l i t eral l y l ose cars , but t hat [ p] l ai nt i f f s had di f f i cul t y t racki ngwhere cer t ai n car s may be at any gi ven t i me on t he syst em. "


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concer n, as we expl ai ned ear l i er i s mat er i al l y f al se. Accor di ng

t o an af f i davi t by Doug St ewar d, Spr i ngf i el d' s super i nt endent f or

t r anspor t at i on, Spr i ngf i el d uses a comput er i zed moni t or i ng pr ogr am

t o t r ack al l TI H- car r yi ng r ai l car s, ensur i ng t he car s "ar e f ul l y

account ed f or . " And Spr i ngf i el d never " l ose[ s] TI H or ot her

r ai l car s on a consi st ent and ongoi ng basi s, " St ewar d emphasi zed.

Feder al agenci es t he Feder al Rai l r oad Admi ni st r at i on and t he

Tr anspor t at i on Secur i t y Admi ni st r at i on r out i nel y audi t

Spr i ngf i el d, he added, t o eval uat e Spr i ngf i el d' s compl i ance wi t h

f eder al l aw. Yet no agency, he st r essed, has ever accused

Spr i ngf i el d of l osi ng TI H or ot her r ai l car s, or of vi ol at i ng any

f eder al l aws i n shi ppi ng car s t o J CI . 10

10 Def endant s t ake shot s at an exhi bi t at t ached t o St ewar d' s

af f i davi t , cal l i ng i t "a crypt i c set of uncl ear document s" e. g. ,"a one- page undated and i l l egi bl e scr een shot and a two- pagewaybi l l f or an empt y car " dat ed t wo year s af t er t he of f endi ngcomment . St ewar d, t hough, based hi s af f i davi t not j ust on hi sr evi ew of t he document s but on hi s personal knowl edge. Anddef endant s compl ai nt s do not suggest t hat t he st atement s we' vehi ghl i ght ed f al l out si de hi s per sonal knowl edge as t he of f i cerr esponsi bl e f or "management and over si ght on t r acki ng r ai l car smovi ng on [ pl ai nt i f f s' ] r ai l syst em" "i ncl udi ng TI H r ai l car s""t o ensur e t hey ar e f ul l [ y] account ed f or and ar e not l ost or gomi ssi ng. " Def endant s' compl ai nt s about Stewar d' s af f i davi t may

per haps be pr essed vi a a pr et r i al mot i on or bef or e a j ur y, i f t hecase goes t o t r i al .

One ot her t hi ng. Def endant s submi t t ed an af f i davi t byDear ness ( New Engl and Sout hern' s owner) sayi ng t hat "TI H cars of t ensat sever al days i n t he Concor d Yar d" and t hat t he "bunchi ng" ofr ai l car s ( i ncl udi ng TI H car s) pr obabl y gave r i se t o "t echni cal [ ]. . . vi ol at i on[ s] of t he 48- hour r ul e on occasi on. " Dear ness' saf f i davi t does not say t hat pl ai nt i f f s l ost t r ack of any car s, l et


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Al l t hat i s l ef t t o do t hen i s compar e t he chal l enged

def amat or y comment ( t hat pl ai nt i f f s l ose TI H car s en r out e t o J CI ,

i ncl udi ng one f or over 60 days i n vi ol at i on of f eder al l aw) wi t h

what we t ake as t r ue at t hi s st age of t he case ( t hat pl ai nt i f f s

never l ost r ai l car s car r yi ng hazar dous mat er i al s, even

t empor ar i l y) . And havi ng done t hi s, we concl ude t hat a sensi bl e

j uror coul d f i nd t hat a mor e preci se expl i cat i on of t he TI H i ssue

woul d have i mpr oved pl ai nt i f f s' publ i c r eput at i on meani ng we

must vacat e t he gr ant of summary j udgment on t hi s ar t i cl e.

Fi nk' s Depar t ur e

Up unt i l 2006, Fi nk was bot h pr esi dent and CEO of Pan Am

and pr esi dent and CEO of t he Pan Am gr oup of r ai l r oad ent i t i es

( t he "Pan Amgr oup, " f or easy r eadi ng) . That year , at hi s request ,

hi s son became pr esi dent of t he Pan Am gr oup, t hough Fi nk st ayed

on as presi dent and CEO of Pan Am and CEO of t he Pan Am group.

Unf or t unat el y, f at her and son di d not shar e the same

operat i onal phi l osophy. Thi ngs came t o a head i n 2011, when Ti m

Mel l on, Pan Am' s pr i nci pal owner , deci ded t hat t he dual - l eader shi p

si t uat i on "was no l onger wor ki ng. " Mel l on gave Fi nk t wo opt i ons:

t ake back t ot al cont r ol of Pan Am' s r ai l r oad oper at i ons or

al one t he ones si t t i ng i n t he Concor d Yar d. Nor does i t s t at et hat an agency actual l y ci t ed pl ai nt i f f s f or l osi ng car s. Agai n,def endant s mi ght perhaps pur sue t hese Dear ness- based ar gument s i na pr et r i al mot i on or bef or e a j ur y, i f a t r i al i s i n t he of f i ng.


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sur r ender power t o hi s son. Fi nk chose t he l at t er , wr i t i ng Mel l on

i n March 2011:

Subj ect t o your accept ance of t he condi t i onspr oposed bel ow r egar di ng sever ance, t hi sl et t er i s submi t t ed t o conf i r mt he r esi gnat i onof my empl oyment , ef f ect i ve at t he cl ose ofbusi ness t oday, f r om al l posi t i ons hel d wi t hPan Am Syst ems, I nc. , and i t s subsi di ar ycompani es, i ncl udi ng my posi t i ons as anof f i cer and di r ect or of t hose compani es. Wi t hr egard t o sever ance compensat i on I woul d agr eet o r esi gn under t he f ol l owi ng condi t i ons:[ condi t i ons r edact ed]

A f ew days l at er , def endant s publ i shed an ar t i cl e about

Fi nk' s depar t ur e. Headl i ned "PAN AM: A NEW DAWN?*, " t he pi ece

st ar t ed out t hi s way ( FYI t he ar t i cl e uses "Fi nk per e" t o r ef er

t o def endant Fi nk (Davi d Andr ew Fi nk) and "Fi nk f i l s" t o r ef er t o

def endant Fi nk' s son11) :

9 Mar ch, Nashua, NHNor t h Bi l l er i ca MA. PAN

AM OWNER TIM MELLON REMOVED DAVE FINK PEREf r om management of t he company, accordi ng t of our separate sour ces: one MBTA, one uni on,one Mai ne sour ce, and one f r om ot her r ai l r oadmanagement i n New Engl and. Sources di f f er onwhat pr eci pi t at ed t he act i on, whet her Fi nk i sf or mal l y removed or i s onl y on a " l eave ofabsence" , and whet her Mel l on came t o NewEngl and t o admi ni st er t he coup de gr ace or di di t by tel ephone, but al l agr ee t hat Davi dAndr ew Fi nk, t he head of PamAmSyst ems, i s no

l onger i n char ge. . . .

11 "Per e" means "f at her " and " f i l s" means "son. " See Oxf or d Engl i shDi ct i onar y Onl i ne, ht t p: / / www. oed. com/ vi ew/ Ent r y/ 140661 ( l astvi si t ed Sept . 9, 2015) ; Oxf or d Engl i sh Di ct i onar y Onl i ne,ht t p: / / www. oed. com/ vi ew/ Ent r y/ 70268 ( l ast vi si t ed Sept . 9, 2015) .


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"One sour ce, " t he ar t i cl e added, st at ed t hat "' [ t ] he ol d man wi l l

st i l l r un t hi ngs. ' Anot her sour ce sai d t hat Fi nk f i l s i s now t he

head of bot h t he r ai l r oad and t he hol di ng company. " " I f Fi nk per e

has def i ni t el y l ef t , " t he ar t i cl e sai d, wr appi ng up, t hen some

sour ces "t hought t hat young Fi nk mi ght have more f r eedomei t her t o

spend more money on r ai l r oadi ng, or put t he exi st i ng money i nt o

di f f er ent [ and one woul d hope mor e pr oduct i ve] pl aces. " ( Br acket s

i n or i gi nal . )

The part i es f i ght har d over whet her t hi s ar t i cl e i s

capabl e of conveyi ng a def amat ory meani ng and whet her t he

st at ement s ar e about mat t er s of publ i c concer n. As pl ai nt i f f s

t el l i t , one can easi l y i nf er gi ven quot es l i ke "r emoved . . .

f r om management , " "coup de grace, " and spendi ng money "more

pr oduct i ve[ l y] " t hat Mel l on r emoved Fi nk f or per f or mance

r easons. And t he poi nt of t he speech, t hey add, was t o spot l i ght

an i nt er nal empl oyment i ssue, not t o r ai se a mat t er of publ i c

concer n. As def endant s see i t , t hough, t he ar t i cl e i s not

act i onabl e because a st at ement t hat a per son was f i r ed wi t hout

more i s not def amatory. See Pi card, 307 A. 2d at 835. And

gi ven quot es l i ke " [ s] our ces di f f er on what pr eci pi t at ed t he

act i on" one woul d have t o t or t ur e t he st or y' s t ext t o concl ude

t hat Mel l on f i r ed Fi nk f or a speci f i c r eason, or so def endant s

want us t o r ul e. Al so, t hey cont end, t he speech f ocuses on t he


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corporate shakeup at a maj or r ai l way company, whi ch i s a mat t er of

concer n t o t he publ i c.

Once agai n, we need not t ake si des on t he def amatory-

meani ng quest i on. Even assumi ng ( f avor abl y t o pl ai nt i f f s) t hat

t he ar t i cl e communi cates t he message t hat Mel l on r emoved Fi nk f or

per f or mance reasons and t hat such a message may be def amat or y,

def endant s cannot be l i abl e because ( so f ar as t he summary- j udgment

r ecor d shows) t he di sput ed st at ement s r el ate t o publ i c concer ns

and ar e not f al se i n any mat er i al sense.

St ar t i ng wi t h t he publ i c- concer n i ssue, despi t e

def endant s' best ef f or t t o pass Fi nk' s depar t ur e of f as i nvol vi ng

a pur el y pr i vat e mat t er ( hi s empl oyment st at us) , t he speech at

i ssue i mpl i cat es r ai l way saf et y, ef f i ci ency, and vi abi l i t y. We

say t hat because the ar t i cl e t al ked about how hi s l eavi ng mi ght

cause Pan Am "ei t her t o spend more money on r ai l r oadi ng, or put

t he exi st i ng money i nt o di f f erent [ and one woul d hope more

pr oduct i ve] pl aces. " And a di scussi on about l eader shi p change

t i ed t o r ai l r oad i mpr ovement i s f i r ml y wi t hi n t he spher e of mat t er s

of publ i c concer n.

Tur ni ng t hen t o mat er i al f al si t y, we poi nt out what

Fi nk' s af f i davi t makes pl ai n. The f at her / son l eader shi p st r uct ur e

was a no- go, gi ven t hei r di f f er ent vi ews on how best t o r un t he

busi ness. And Mel l on had had enough. So t o end t he dysf unct i on,


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Mel l on del i ver ed what def endant s cal l ed t he "coup de gr ace" ( whi ch

can mean an act i on " t hat set t l es or put s an end t o somethi ng"12) ,

essent i al l y t el l i ng Fi nk accor di ng t o Fi nk ei t her you t ake

charge or l et your son t ake charge, but no more power- shar i ng.

Hi s hand f or ced by Mel l on' s "di r ect i ve" ( anot her quot e f r omFi nk' s

af f i davi t ) t he el der Fi nk "agr ee[ d] t o r esi gn" ( a quot e f r omFi nk' s

l et t er t o Mel l on) . Now per haps t her e i s a di f f er ence bet ween

sayi ng Mel l on " r emoved" Fi nk f or per f ormance reasons ( whi ch i s how

pl ai nt i f f s r ead t he ar t i cl e) and sayi ng Fi nk l ef t f ol l owi ng a

Mel l on "di r ect i ve" t o ei t her r et ake t he r ei ns of power or gi ve

t hem up f or ever a di r ect i ve i ssued t o end t he cor por at e pr obl ems

caused by t he f at her / son i nf i ght i ng ( whi ch i s how pl ai nt i f f s

descr i be Fi nk' s depar t ur e) . But even assumi ng any di f f er ence

suggest s f al si t y, pl ai nt i f f s i dent i f y not hi ng i n t he summar y-

j udgment r ecor d showi ng t hei r r eputat i ons woul d be changed f or t he

bet t er by a mor e f ul some account of Fi nk' s l eavi ng. Cf . gener al l y

McCul l ough, 691 A. 2d at 1204 ( f i ndi ng no def amat i on l i abi l i t y wher e

t he chal l enged st at ement was no mor e damagi ng t o pl ai nt i f f ' s

r eput at i on t han a more accur ate st atement woul d have been) . So we

af f i r m t he summar y- j udgment r ul i ng on t hi s art i cl e too.

12 See Oxf or d Engl i sh Di ct i onar y Onl i ne,ht t p: / / www. oed. com/ vi ew/ Ent r y/ 43112 ( l ast vi si t ed Sept . 9, 2015)


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Final Words

Our work over , we r ever se t he grant of summary j udgment

on t he TI H ar t i cl e and af f i r m i n al l ot her r espect s. The par t i es

shal l bear t hei r own cost s.

So ordered.

Pan Am Systems, Inc. v. Hardenbergh, 1st Cir. (2015)

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Transcript of Pan Am Systems, Inc. v. Hardenbergh, 1st Cir. (2015)