Victory at the New York Court of Appeals

Dr. Jeanetta Stega, represented by Beranbaum Menken LLP, won an important victory at the New York Court of Appeals on June 29, 2018. The Court of Appeals overturned a decision by the Appellate Division, First Department, and held that Dr. Stega could sue her former employer, New York Downtown Hospital, and its Acting Chief Medical Officer, Dr. Stephen Friedman, for statements made during the course of a U.S. Food and Drug Administration inspection that defamed her character and professional reputation. You can read the opinion here. The Appellate Division had ruled that because Dr. Friedman’s statements were made as part of a governmental proceeding, they were absolutely privileged and he and the Hospital could not be sued for defamation – no matter how false or malicious were the statements. The Court of Appeals, in reversing, noted that Dr. Stega had no opportunity during the FDA investigation to challenge the accusations made against her. If, as the First Department had ruled, Dr. Friedman’s statements were absolutely privileged, Dr. Stega would then be deprived of any legal recourse to restore her good name and defendants would have “a license to destroy a person’s character by means of false, defamatory statements.” This was unacceptable to the Court of Appeals. Accordingly, the Court ruled that defamatory statements made in the course of governmental proceedings, such as the FDA investigation, which do not allow the defamed party a chance to rebut the statements, are subject to a qualified, not absolute, privilege. A qualified privilege enables people individuals, like Dr. Stega to sue for defamation, but to prevail they must show that party the statements were made with malice or knowledge that they were untrue.

Thanks to the New York Court of Appeals decision, Dr. Stega may now pursue her lawsuit and restore her hard earned reputation. The decision also shows that the Court will not retreat from its long-held role of protecting a person’s good name from malicious attacks, such as the one to which Dr. Stega was subjected.