Ex-Bosses Sue Union for Defamation, Win Appeal in Illinois

Frederick Dubinsky and Roger Hall, ex-union bosses, won an appeal in their suit against the Air Line Pilots Ass’n and several other union bosses for defamation and invasion of privacy. The two charged that a letter by boss Richard Hurst falsely accused them of criminal conduct related to two attempts to buy United Airlines stock under an employee stock ownership plan. ALPA moved to dismiss the suit, alleging that the two failed to state a viable claim for relief.

The Aug. 1994 letter accused the two of wrongdoing in connection with the buyout plan and related payments to ALPA’s staff attorney Charles Goldstein. Goldstein collected a fee that more than doubled his salary in 1984, with the first buyout attempt, and again in 1994, when employees successfully took control of United. Hurst wrote, “I believe that federal laws have been broken;” comparing the matter to Watergate and suggesting that the Dep’ts of Labor and Justice investigate. Hurst charges used excerpts from the Racketeer Influenced & Corrupt Org. Act, as well as a chart summarizing possible” RICO charges. The Jenner & Block law firm was hired to investigate the payments to Goldstein and ultimately reported in Sep. 1994 that neither Dubinsky and Hall broke any laws and that the ALPA attorney never actually collected the purported $2 million fee following the 1994 buyout. ALPA and Hurst’s motive for the allegations was not reported.

The trial court dismissed Dubinsky and Hall’s suit, but an Illinois Appellate Court reversed in part. Justice Margaret O’Mara Frossard said, “We agree that a jury could find that being falsely accused of the criminal activity at issue here would be highly offensive to a reasonable person. Finally, plaintiffs pleaded defendants knew the statements were false or acted with reckless disregard as to whether the statements were true or false, thus satisfying the actual malice standard. Whether in fact defendants acted with actual malice remains a jury question.” [Chicago Daily Law Bulletin 7/9/99]