I Heard the News Today, Oh Boy

What happens when a disgruntled (or perhaps a “principled”) apartment owner creates a website for the purpose of discussing events and conditions in a building and allegedly posts defamatory statements? In the case of Trump Village Section 4 and Igor Oberman v. Yuliya Bezvoleva Aka Julia Bezvoleva, Inna Yeselson, Josef Stalin, Aborigen, www.tv4news.org, two shareholders were sued by the cooperative corporation, Trump Village Section 4, and its board president, Igor Oberman.

The defendants, Julia Bezvoleva and Inna Yeselson allegedly started a website for the purposes of discussing events and conditions in Trump Village. According to the co-op, the website was designed to provide information, announcements, and advice to and for residents of Trump Village. The co-op asserted, however, that the website was not being used as a forum to benefit the Trump Village community but instead was being used as a site to post 19 separate defamatory statements throughout a one-year period. Although the complaint asserts that Bezvoleva and Yeselson authored the statements, there is no proof of that since they were posted anonymously.

The Statements

The allegedly defamatory statements focused largely on the condition of the building, elections, and Oberman’s alleged actions. One accused the co-op of fraud in the election process: “The bylaws mean nothing if you are Mr. Oberman’s friend.” There were specific statements about Oberman, including that he improperly placed his name on the ballot; that he misinformed people (apparently concerning his status as a lawyer or judge); that he was the reason Trump Village hired a managing agent whose activity led to fines and violations; and that under Oberman’s leadership, Trump Village engaged in frivolous and discriminatory activity.

In another post, Bezvoleva and Yeselson were alleged to have written that a shareholder was threatened when she asked the co-op’s accountant a question during the annual meeting. In another, Bezvoleva and Yeselson allegedly wrote that shareholders asked if election results were going to be “fabricated again.” Another post stated that shareholders did not support Oberman’s rule – where anyone can be brought to court “for opposing his ‘view’ on principles of democracy and [as part of the] harassing dictator’s practices.” Another post stated that abatements belonging to shareholders were taken by co-op representatives. Yet another asserted that (1) Oberman entered into a management agreement without full board approval; (2) the managing agent was “double dipping”; (3) despite extermination services, the number of roaches remained the same; and (4) it is “no surprise” that Green Earth Pest Control is one of the “bigger donors to the failed political campaign of Igor Oberman.”

There were more accusations, including posts that shareholders allegedly received robocalls concerning an election even though phone numbers were given to management only for emergency use and were confidential; candidates allegedly were “unreasonably disqualified;” prior board members reversed a rebate allegedly belonging to shareholders and “since when is it legal for a board . . . to take shareholders’ money without their consent?”; “there is odor and rodents from garbage, yet exterminators keep coming and charging;” “fair elections don’t exist in this beautiful complex;” Oberman disqualified candidates “who don’t share his views;” “authorities should investigate this ‘crook;’” “Oberman’s goal is to destroy Trump Village;” “Oberman spends co-op money for his own personal retaliation” (attempts to evict people); “Oberman is under investigation by HUD and Human Rights;” “Oberman has a personal video camera to monitor his neighbors;” “Trump Village’s security guards escort Oberman and his family and are used to threaten shareholders;” Oberman says he can “use our common funds for his personal protection;” many of the elderly did not receive the full amount of their tax rebates; and the main parking lot remained covered in ice until the sun melted it.

The Law

The co-op sued for libel. The court described the elements as a false statement, published without authorization, constituting fault by, at least, a negligence standard that causes special harm or is defamatory, per se. The defendants sought to have the complaint dismissed, arguing that the statements were protected by the common interest privilege, which provides, in a nutshell, that when people share a common interest, statements concerning that common issue are qualifiedly protected. The rationale is that the flow of information between people who share a common interest should not be impeded.

But the privilege does not apply when the information is published to others outside the community. The court found that the website material was not disseminated solely to those in Trump Village – there was no password or other limitation as to who could view the website material. Anyone who has access to the internet can see the information. Indeed, the court adopted the co-op’s assertion that, when the words “Trump Village” are typed into Google, the website appears as the fourth choice on the first page of the search engine; when typing “Igor Oberman,” that is the second result. The court concluded that Bezvoleva and Yeselson were not shielded by the common interest privilege.

Moreover, the court pointed out that the common interest privilege can be overcome by a showing of malice, that is, the author knew the statement was false or he had a reckless disregard for the truth. There was a history of ill-will between the parties. Yeselson and others in a 2012 complaint alleged that Oberman harassed Yeselson and attempted to evict her. Thus, the court found – at this early stage of the litigation – that even if the statements were protected by the common interest privilege, there was a sufficient showing of malice that would preclude dismissal of the complaint.

Bezvoleva and Yeselson next claimed that the complaint should be dismissed because Oberman, as president of Trump Village, and Trump Village itself, are limited public figures. This is important because the law provides that statements, even if otherwise defamatory (within limits), are immune from liability if Oberman had “voluntarily acted to influence the resolution of a public controversy.” The privilege applies if there is a controversy, the outcome of which affects the general public or some segment in a substantial way. In other words, Oberman will have thrown himself into the public arena. But not in a run-of-the-mill matter: “to be considered a public controversy for this purpose, the subject matter must be more than simply newsworthy.” The court disposed of this claim and concluded that Oberman and Trump Village had not voluntarily thrust themselves into a public controversy or sought out public attention.

Bezvoleva and Yeselson next argued that their statements could not be defamatory because they were mere opinion. The court considered three factors: (1) whether the statements have a precise meaning that is readily understood; (2) whether the statements are capable of being proven true or false; (3) whether the statements (in context) tell listeners or readers that what is said is opinion, not fact. Analyzing each element, the court concluded that the statements were not mere opinion – they implied they were based on undisclosed facts and appeared on a website that purported to be knowledgeable about Trump Village.

Bezvoleva and Yeselson then argued the statements were simply not defamatory – that they did not expose the co-op to “public contempt, ridicule, aversion, or disgrace, or induce an evil opinion of [them] in the minds of right-thinking persons and deprive [them] of their friendly intercourse in society.” The court did not agree. Nor did it agree with the claim that Bezvoleva and Yeselson – who created the website – knew precisely who authored these posts and refused to provide the information.

Bezvoleva and Yeselson also claimed that the complaint should have been dismissed because, under the Federal Communications Decency Act, website owners cannot be liable for statements made by third parties. The problem with this argument, according to the court, was that the complaint alleged that it was Bezvoleva and Yeselson who wrote and created the alleged defamatory content and they did not produce evidence to the contrary.

The Takeaway

As the appeals court told us in Levandusky v. One Fifth Avenue Apartment Corp. 25 years ago, cooperatives and condominiums are quasi-governments – “a little democratic sub-society of necessity.” The board makes decisions for the building and, thus, the apartment owners. And if an owner does not like the way the building is being run, there are things he or she can do, all within the dictates of a democracy, such as run for the board or propose a slate or complain to management and the board. Depending on the nature and severity of the alleged issue, he or she can call a governmental agency to complain about building conditions or even start a lawsuit.

If owners want to solicit information and support from other apartment owners, they can write letters, and even if the owners’ statements are questionably defamatory, they may be protected by the common-interest privilege if the complaining owners keep it “all in the family.”

In other words, the common-interest privilege may apply if the information is communicated only to those within the community who have an interest in those same common issues. What a complaining apartment owner cannot do, however, is make (arguably defamatory) assertions on the internet or in a publication for all to see.

The defendants in this case raised just about every possible defense to the publication (and alleged authorship) of the statements on the website, and the court analyzed, and disposed of, every argument.

On a final parenthetical note (although perhaps not really beside the point), we do not know why an apartment owner would want to make public some of the claims the defendants are alleged to have made here. Even if the statements are patently true and accurate in all respects, those kinds of statements might be expected to have a negative effect on resale prices. It’s something to consider before an apartment owner gets up on a soapbox.

The Attorneys For Plaintiffs: Daniel S. Szalkiewicz & Assoc

For Defendants: Weil, Gotschal & Manges