Scripps NP Operating, LLC, a Wisconsin Limited Liability Company, Successor in Interest to Scripps Texas Newspapers, LP D/B/A Corpus Christi Caller-Times and the E.W. Scripps Company v. Terry Carter

ACCEPTED
13-15-00506-CV
THIRTEENTH COURT OF APPEALS
CORPUS CHRISTI, TEXAS
12/17/2015 5:34:25 PM
Dorian E. Ramirez
CLERK
Oral Argument Requested
NO. 13-15-00506-CV FILED IN
13th COURT OF APPEALS
CORPUS CHRISTI/EDINBURG, TEXAS
12/17/2015 5:34:25 PM
IN THE COURT OF APPEALSDORIAN E. RAMIREZ
FOR THE THIRTEENTH DISTRICT OF TEXAS Clerk
Scripps NP Operating, LLC, a Wisconsin Limited Liability Company,
Successor in Interest to Scripps Texas Newspapers, LP d/b/a Corpus
Christi Caller-Times, and The E.W. Scripps Company, Appellants,
v.
Terry Carter, Appellee
On Appeal from the 214th Judicial District Court, Nueces County, Texas
(Hon. Jose Longoria, Presiding)
APPELLANTS’ BRIEF
Jorge C. Rangel Paul C. Watler
State Bar No. 16543500 State Bar No. 20931600
Jaime S. Rangel Andrew D. Graham
State Bar No. 24033759 State Bar No. 24041002
Joseph M. Marcum JACKSON WALKER, LLP
State Bar No. 12973000 2323 Ross Avenue, Suite 600
THE RANGEL LAW FIRM, P.C. Dallas, Texas 75201
615 N. Upper Broadway, Suite 2020 (214) 953-6000 / (214) 953-5822 fax
Corpus Christi, Texas 78401 Email: pwatler@jw.com
(361) 883-8500 / (361) 883-2611 fax Email: agraham@jw.com
Email: jorge.c.rangel@rangellaw.com
Email: jaime.rangel@rangellaw.com
Email: joe.marcum@rangellaw.com
Attorneys for Appellants
IDENTITY OF PARTIES AND COUNSEL
Appellants:
Scripps NP Operating, LLC, a Wisconsin Limited Liability Company,
Successor in Interest to Scripps Texas Newspapers, LP d/b/a Corpus
Christi Caller-Times, and The E.W. Scripps Company
Lead Appellate Counsel: Appellate Counsel:
Jorge C. Rangel Paul C. Watler
State Bar No. 16543500 State Bar No. 20931600
Jaime S. Rangel Andrew D. Graham
State Bar No. 24033759 State Bar No. 24041002
Joseph M. Marcum JACKSON WALKER, LLP
State Bar No. 12973000 2323 Ross Avenue, Suite 600
THE RANGEL LAW FIRM, P.C. Dallas, Texas 75201
615 N. Upper Broadway, Suite 2020 (214) 953-6000 / (214) 953-5822 fax
Corpus Christi, Texas 78401 Email: pwatler@jw.com
(361) 883-8500 / (361) 883-2611 fax Email: agraham@jw.com
Email:
jorge.c.rangel@rangellaw.com
Email: jaime.rangel@rangellaw.com
Email: joe.marcum@rangellaw.com
Appellee:
Terry Carter
Lead Appellate Counsel: Appellate Counsel:
Rene Rodriguez Craig Smith
State Bar No. 17148400 State Bar No. 18553570
LAW OFFICE OF RENE Law Offices of Craig S. Smith
RODRIGUEZ 14493 S.P.I.D. Suite A; P.M.B. 240
433 S. Tancahua Street Corpus Christi, Texas 78418
Corpus Christi, Texas 78401 (361) 728-8037
(361) 882-1919 / (361) 882-2042 fax Email: csslaw@stx.rr.com
2
Email: rene.rodriguez@rdrlaw.com
Appellate Counsel:
Angelica E. Hernandez
State Bar No. 24027279
AEH Law Firm
410 Peoples Street
Corpus Christi, Texas 78401
(361) 726-0054 / (866) 759-9272 fax
Email: aehlawfirm@yahoo.com
3
TABLE OF CONTENTS
IDENTITY OF PARTIES AND COUNSEL ......................................................... 2
INDEX OF AUTHORITIES .................................................................................... 6
STATEMENT OF THE CASE .............................................................................. 11
ISSUES PRESENTED ............................................................................................ 12
STATEMENT OF FACTS ..................................................................................... 16
A.  Introduction............................................................................... 16
B.  Chamber Treasurer Raises Questions about Carter ............ 17
C.  Carter Takes Tape; Bentley Denied Access. ......................... 23
D.  Issues presented to Chamber Board of Directors. ............... 24
E.  Chamber Leaders and Members Publicly Petition for
Special Meeting ......................................................................... 28
F.  Lawsuits Filed; Carter Placed on Paid Leave ....................... 28
G.  Chamber Adjustments to 2007 Financials ............................ 29
H.  Carter Resigns from the Chamber ......................................... 29
I.  Chamber Obtains Audit of 2007 Financials.......................... 30
J.  Caller-Times Articles Report on the Chamber Events as
They Unfold .............................................................................. 30
STANDARDS OF REVIEW ............................................................................. 35
A.  Elements of Libel ...................................................................... 35
B.  Traditional Summary Judgment Standard ........................... 36
C.  No-Evidence Summary Judgment Standard ....................... 37
D.  Standard of Review in Media Libel Cases ............................ 37
SUMMARY OF ARGUMENT ......................................................................... 38
ARGUMENT ...................................................................................................... 39
A.  The Articles Are Not Defamatory of Carter ......................... 39
B.  The Articles Are True or Substantially True ........................ 45
C.  The Articles Are Non-Actionable Opinion........................... 56
4
D.  The March 19, 20 and May 29, 31 Articles Are Privileged
Fair Reports of Judicial Proceedings Under Common Law
and Texas Statute. ..................................................................... 58
E.  Article-by-Article Analysis Shows the Caller-Times
Appellants Are Entitled to Summary Judgment. ................ 59
F.  The Articles Were Published Without Negligence ............. 83
G.  Carter Cannot Recover Exemplary Damages Because the
Articles Were Published Without Actual Malice ................ 85
H.  Tag-Along Tort Claims Also Fail ........................................... 90
I.  Appellant E.W. Scripps Has No Publisher Liability ........... 91
PRAYER .................................................................................................................. 91
CERTIFICATE OF SERVICE ............................................................................... 93
CERTIFICATE OF COMPLIANCE .................................................................... 94
APPENDIX ............................................................................................................. 95
5
INDEX OF AUTHORITIES
Cases
Ackly v. Bartlesville Examiner-Enter.,
No. 06-CV-529-TCK-PJC, 2007 U.S. Dist. LEXIS 87897 (N.D.
Okla. Nov. 29, 2007) ......................................................................................... 51
AMS Constr. Co. v. Warm Springs Rehab. Found.,
94 S.W.3d 152 (Tex. App.—Corpus Christi 2002, no pet.) ...................54, 55
Assoc. Press v. Cook,
17 S.W.3d 447 (Tex. App—Houston [1st Dist.] 2004, no pet.) .............56, 58
Belo Corp. v. Publicaciones Paso del Norte, S.A. de C.V.,
243 S.W.3d 152 (Tex. App.—El Paso 2007, pet. denied) ............................. 38
Bentley v. Bunton,
94 S.W.3d 561 (Tex. 2002) ....................................................................53, 57, 58
Bich Ngoc Nguyen v. Allstate Ins. Co.,
404 S.W.3d 770 (Tex. App.—Dallas 2013, pet. denied)............................... 56
Burbage v. Burbage,
447 S.W.3d 249 (Tex. 2014) ........................................................................37, 86
Church of Scientology Int’l v. Time Warner, Inc.,
903 F. Supp. 637 (S.D.N.Y. 1995), aff’d, 238 F.3d 168 (2d Cir.
2001) ................................................................................................................... 87
City of San Antonio v. Pollock,
284 S.W.3d 809 (Tex. 2009) .............................................................................. 55
Coastal Transp. Co. v. Crown Cent. Pet. Corp.,
136 S.W.3d 227 (Tex. 2004) .............................................................................. 55
6
Coronado v. Freedom Commc’ns, Inc.,
No. 13-13-00525-CV, 2015 Tex. App. LEXIS 10128 (Tex.
App.—Corpus Christi, Sept. 30, 2015, no pet.) (mem. op.)........................ 58
Danevang Farmers Coop. Soc’y v. Indeco Prods., Inc.,
No. 13–04–445–CV, 2006 WL 2885058 (Tex. App.—Corpus
Christi Oct. 12, 2006, no pet.) (mem. op.) ..................................................... 55
Dolcefino v. Randolph,
19 S.W.3d 906 (Tex. App.—Hou. [14th Dist.] 2000, pet.
denied) ...................................................................................................38, 49, 89
Farias v. Garza,
426 S.W.3d 808 (Tex. App.—San Antonio 2014, pet. filed) ........................ 61
Foster v. Laredo Newspapers, Inc.,
541 S.W.2d 809 (Tex. 1976) ..................................................................84, 85, 86
Freedom Commc’ns Corp. v. Salinas,
No. 13-13-00702-CV, 2015 Tex. App. Lexis 10129 (Tex.
App.—Corpus Christ, Sept. 30, 2015, no pet.) ............................................. 42
Freedom Newspapers v. Cantu,
168 S.W.3d 847 (Tex. 2005) ........................................................................89, 91
Global Relief Found. v. New York Times Co.,
390 F.3d 973 (7th Cir. 2004) .................................................................51, 52, 57
Hancock v. Variyam,
400 S.W.3d 59 (Tex. 2013) ....................................................................40, 41, 45
Hearst Corp. v. Skeen,
159 S.W.3d 633 (Tex. 2005) ........................................................................53, 90
Hearst Newspaper P’ship, LP v. Macias,
283 S.W.3d 8 (Tex. App.—San Antonio 2009, no pet.) ............................... 48
7
Henry v. Nat’l Ass’n of Air Traffic Specialists, Inc.,
836 F. Supp. 1204 (D. Md. 1993), aff’d, 34 F.3d 1066 (4th Cir.
1994) ................................................................................................................... 87
Holly v. Cannady,
669 S.W.2d 381 (Tex. App.—Dallas 1984, no pet.) ...................................... 85
Hotze v. Miller,
361 S.W.3d 707 (Tex. App.—Tyler 2012, pet. denied) ..........................38, 39
Huckabee v. Time Warner Entm’t Co. L.P.,
19 S.W.3d 413 (Tex. 2000) .........................................................................passim
KTRK Television, Inc. v. Robinson,
409 S.W.3d 682 (Tex. App.—Houston [1st Dist.] 2013, pet.
denied) ......................................................................................................... 43, 45
Laidlaw Waste Systems (Dallas) v. City of Wilmer,
904 S.W.2d 656 (Tex. 1995) .............................................................................. 55
Liberty Lobby, Inc. v. Dow Jones & Co.,
838 F.2d 1287 (D.C. Cir. 1988)......................................................................... 88
In re Lipsky,
460 S.W.3d 579 (Tex. 2015) ........................................................................45, 53
Lohrenz v. Donnelly,
350 F.3d 1272 (D.C. Cir. 2003)......................................................................... 90
Main v. Royall,
348 S.W.3d 381 (Tex. App.—Dallas 2011, no pet.) ....................38, 39, 41, 46
McIlvain v. Jacobs,
794 S.W.2d 14 (Tex. 1990) .......................................................................... 46, 49
Means v. ABCABCO, Inc.,
315 S.W.3d 209 (Tex. App.—Austin 2010, no pet.) ..................................... 61
8
Milkovich v. Lorain Journal Co.,
497 U.S. 1 (1990)..........................................................................................57, 58
Musser v. Smith Protective Serv., Inc.,
723 S.W.2d 653 (Tex. 1987) .............................................................................. 41
Neely v. Wilson,
418 S.W.3d 52 (Tex. 2013) .........................................................................passim
New Times, Inc. v. Isaacks,
146 S.W.3d 144 (Tex. 2004) ..................................................................40, 41, 45
NW Commc’n of Tex., Inc. v. Power,
No. 05-99-01641-CV, 2000 WL 1036327 (Tex. App.—Dallas
July 28, 2000, pet. denied) .........................................................................44, 47
Randall’s Food Mkts., Inc. v. Johnson,
891 S.W.2d 640 (Tex. 1995) .............................................................................. 37
Rogers v. The Dallas Morning News, Inc.,
889 S.W.2d 467 (Tex. App.—Dallas 1994, writ denied) .............................. 91
Ryland Group, Inc. v. Hood,
924 S.W.2d 120 (Tex. 1996) ..................................................................46, 54, 55
Scripps Tex. Newspaper, LP v. Carter,
No. 13-09-00655-CV, 2012 WL 5948955 (Tex. App.—Corpus
Christi Nov. 21, 2012, pet. denied) (mem. op.) ............................................ 37
Scripps Tex. Newspapers, L.P. v. Belalcazar,
99 S.W.3d 829 (Tex. App.—Corpus Christi 2003, pet. denied) ................. 85
Shipp v. Malouf,
439 S.W.3d 432 (Tex. App.—Dallas June 24, 2014, no pet.) ....................... 45
Shunta v. Westergren,
No. 01-08-00715-CV, 2010 WL 2307083 (Tex. App.—Houston
[1st Dist.] June 10, 2010, no pet.) .................................................................... 91
9
Stew. v. Sanmina Texas L.P.,
156 S.W.3d 198 (Tex. App.—Dallas 2005, no pet.) ...................................... 55
Stone v. Midland Multifamily Equity REIT,
334 S.W.3d 371 (Tex. App.—Dallas 2011, no pet.) ...................................... 55
Tex. Monthly, Inc. v. Transamerican Nat. Gas Corp.,
7 S.W.3d 801 (Tex. App.—Houston [1st Dist.] 1999, no pet.) .................... 37
Vice v. Kasprzak,
318 S.W.3d 1 (Tex. App.—Houston [1st Dist.] 2009, pet.
denied) ............................................................................................................... 44
Wal-Mart Stores, Inc., 313 S.W.3d 837 (Tex. 2010) (per curiam) ........................ 44
Statutes
Tex. Civ. Prac. & Rem. Code §§ 73.002(a) .......................................................... 59
Tex. Civ. Prac. & Rem. Code § 73.002(b)(1)(A) ................................................. 79
Tex. Civ. Prac. & Rem. Code § 73.002(b)(1)(D) ...........................................78, 81
Other Authorities
Restatement (Second) of Torts § 611 (1977) ....................................................... 59
Tex. R. Civ. P. 166a(c) ........................................................................................... 37
Tex. Const. art. I, § 8.............................................................................................. 75
Tex. R. App. P. 9.4(i)(2)(B).................................................................................... 95
U.S. Const. amend. I .................................................................................57, 75, 90
10
STATEMENT OF THE CASE
Nature of the Case Appellee Terry Carter, former president and
CEO of the Corpus Christi Chamber of
Commerce, filed suit against Appellants
Scripps NP Operating, LLC, a Wisconsin
Limited Liability Company, successor in
interest to Scripps Texas Newspapers, LP
d/b/a Corpus Christi Caller-Times, and the
E.W. Scripps Company alleging libel and
related non-libel claims based on 25 articles
published in the newspaper in 2008.1
Trial Court Disposition Appellants filed their second motion for final
summary judgment2 on all claims against
them and Carter responded.3 The trial court
denied the summary judgment motion.4
Appellants timely perfected this interlocutory
appeal pursuant to Tex. Civ. Prac. & Rem.
Code § 51.014(a)(6).5
1 CR801-16.
2 CR41–1225.
3 2CR1228–6CR12703.
4 6CR12748.
5 6CR12743–747.
11
ISSUES PRESENTED
Did the trial court err in denying Appellants’ second motion for final
summary judgment?
1. Did the trial court err because the Articles were not defamatory
of Carter?
2. Did the trial court err because there is no evidence that the
Articles were defamatory of Carter?
3. Did the trial court err because the Articles were substantially
true?
4. Did the trial court err because there was no evidence that the
Articles were not substantially true?
5. Did the trial court err because the Articles are non-actionable
opinion?
6. Did the trial court err because there was no evidence that the
Articles were not opinion?
7. Did the trial court err because certain Articles were privileged
fair reports of judicial proceedings?
8. Did the trial court err because there was no evidence that
certain Articles were not privileged fair reports of judicial
proceedings?
9. Did the trial court err because the Articles were published
without negligence?
10. Did the trial court err because there was no evidence that the
Articles were published with negligence?
12
11. Did the trial court err in denying summary judgment on
Carter’s exemplary damage claim because the Articles were
published without actual malice?
12. Did the trial court err in denying summary judgment on
Carter’s exemplary damage claim because there was no
evidence that the Articles were published with actual malice?
13. Did the trial court err in denying summary judgment on
Carter’s non-libel claims?
14. Did the trial court err in denying summary judgment because
there was no evidence to support Carter’s non-libel claims?
15. Did the trial court err in denying summary judgment to
Appellant E.W. Scripps Company because it did not publish the
Articles?
16. Did the trial court err in denying summary judgment to
Appellant E.W. Scripps Company because there was no
evidence that it published the Articles?
13
REFERENCES TO THE RECORD
CR301 Volume 1, Clerk’s Record (filed October 28, 2015), page 301
2CR1268 Volume 2, Clerk’s Record (filed October 28, 2015), page
1268 (Volume number included only in citations to volumes
2-6).
14
STATEMENT REGARDING ORAL ARGUMENT
Appellants request oral argument because it will assist the Court in a
case which implicates freedom of speech and press. Although Appellants
believe the legal principles entitling them to summary judgment are well-
settled and readily applied here, oral argument is appropriate as this libel
suit impacts the role of the news media in reporting on leadership
controversies at institutions vital to the economic well-being of the
community.
15
STATEMENT OF FACTS
A. Introduction
In early 2008, the treasurer and two executive committee members of
the Corpus Christi Chamber of Commerce raised concerns over the
financial stewardship and management of the organization by Terry
Carter, president and CEO.6
The questions arose in the course of the executive committee
considering an annual raise and bonus for Carter. Because the controversy
about Carter and the Chamber was newsworthy and a matter of public
concern, the Caller-Times covered it in 24 news articles and an editorial
(collectively, the “Articles”), published February 15, 2008 through June 13,
2008.7 The Articles are the basis of Carter’s libel suit against the Caller-
Times Appellants.8
6 CR299–308.
7 See CR461-62, CR523, CR535-37, CR566-67 (copies of the Articles attached to the
reporters’ affidavits). The Articles are also found at Appendix Tab 1.
8 In his petition and discovery responses, Carter identified certain statements from the
Articles as allegedly containing defamatory, false statements about him. CR669-96;
CR807-09. Appellants moved for summary judgment on all such Articles and
statements.
16
B. Chamber Treasurer Raises Questions about Carter
1. Chamber leadership conducts Carter’s annual review.
In January 2008, the Chamber asked its executive committee to
conduct Carter’s 2007 annual performance review.9 That month, Carter
presented financials to the Chamber showing a profitable year in 2007. 10
Chamber chairman Freddie Martinez11 requested treasurer Damon
Bentley, a local business owner, to review the 2007 financials in connection
with Carter’s request for a raise, performance bonus, and contract
extension.12
That review led Bentley and executive committee members Judy
Hawley and Sylvia Whitmore13 to demand an emergency executive
committee meeting to address issues related to the 2007 financials.14
9 Mtg. minutes, CR116; Hawley Deposition (hereafter “Dep.”), CR1006–07.
10 Martinez Dep., CR1047–48.
11 Martinez, a local business owner, had served on the Chamber board since 2005 and
as chairman since March 2007. Martinez Dep., CR1037–38.
12 Martinez Dep., CR1043, 1048–49; Bentley letter to Chamber board, CR301; Bentley
Dep., CR842–44; Trevino Dep., CR1125. Bentley’s letter to Chamber board is also found
at Appendix Tab 2.
13 Hawley is a former state representative, port commissioner, Chamber board member,
and Chamber executive committee member. Hawley Dep., CR1004–06. Whitmore is a
former chair of the Chamber. Whitmore Dep., CR1192–93.
14 Martinez Dep., CR1040, 1049–50, 1057.
17
2. Financials linked to Carter’s performance review are
questioned.
On February 15, Bentley and others addressed serious financial and
management concerns about Carter to the executive committee.15 The
meeting was audio-recorded.16
Bentley stated that Carter’s performance measures were “directly
linked to the performance of the [2007] financials” but that a salary deferral
by Carter in 2007 altered the Chamber financials by “minus $19,992.”17
Bentley also revealed that Carter had asked a senior staff member “to
forego his pay in October because we were under a financial strain.”18
Bentley summarized that the “big picture is we were presented” financial
statements reflecting $40,000 in net income for 2007 but which was really
“zero or a minus, and maybe even a really big minus.”19
Bentley said he was concerned that Chamber expenses were charged
to the Chamber’s foundation, that money from the building fund was
15 Tape, CR324; Bentley Dep., CR 850-51, 854-55; Martinez Dep., CR1041, 1054.
16 Tape, CR324-25; transcript of tape, CR705-94; Martinez Dep., CR1041, 1052; Trevino
Dep., CR1127-29.
17 Transcript, CR717-19; Trevino Dep., CR1121-22.
18 Transcript, CR 721-23; Trevino Dep., CR1124.
19 Transcript, CR721-23, 732-33, 744-46.
18
shifted to the foundation, and that the Chamber accrued 2008 membership
dues in year 2007.20 Bentley discussed that special events were accounted
for “off the books” and reported to the board only on a net basis.21 Bentley
stated that checks were not signed by the treasurer as required by the
Chamber’s bylaws.22
Carter’s responsibility for the Chamber’s financial performance and
the link to his bonus had been provisions of his employment since he was
hired in 2004.23 His employment contract vested him with responsibility
for the Chamber’s finances and called for a “performance” bonus “based
on the attainment of financial goals for the Chamber.”24 Although Carter’s
contract was later amended as to his bonus,25 his annual reviews
consistently reflected a link between the financial performance of the
Chamber and his compensation.26 Whitmore, Hawley, Martinez, and
20 Transcript, CR724-33; Trevino Dep., CR1123-24.
21 Transcript, CR734-36. See also Bentley’s PowerPoint, CR168, 171; Carter Dep., CR901;
FY2007 audit report, CR252; Martinez Dep., CR1039; Hawley Dep., CR1011-12, 1017.
Bentley’s PowerPoint is also found at Appendix Tab 3.
22 Transcript, CR738; Chamber bylaws, CR292.
23 Carter’s contract, CR122; Carter Dep., CR879.
24 CR125, 130; see also CR133-36; Carter Dep., CR909.
25 CR134, 136.
26 Carter’s performance reviews, CR137-45.
19
Bentley understood that Carter’s bonus was based on the Chamber’s
financial performance,27 and Carter acknowledged the connection.28
Bentley attributed the 2007 financial issues to Carter, stating, “I’ve
lost trust in him, and I don’t think he should be the CEO of the Chamber of
Commerce.”29 Whitmore, Hawley and Martinez also recognized the matter
as an issue of trust between Carter and the Chamber leadership.30
Bentley recommended an audit for 2007 and other executive
committee members agreed.31 Chair-elect Gonzalez summarized: “I think
all of us in this room agree that we have to have the financials correct, and
they have to be reviewed.”32
Toward the end of the meeting, Darrell Thompson, the Chamber’s
outside CPA, was asked whether the concerns endangered the Chamber
27 Whitmore Dep., CR1194, 1204-05; Hawley Dep., CR1010; Martinez Dep., CR1044,
1048; Bentley Dep., CR847, 851; transcript, CR717-19; mtg. minutes, CR116.
28 Carter Dep., CR951-53; Carter and Waller emails, CR152; Carter and Martinez emails,
CR268.
29 Transcript, CR743-47, 749-51.
30 Id.; see also Whitmore letter, CR314; Whitmore Dep., CR1200; Hawley Dep., CR1009.
Whitmore’s letter is also found at Appendix Tab 6.
31 Transcript, CR747, 749, 758; Carter Dep., CR893; Bentley Dep., CR862-63; Whitmore
Dep., CR1194-96, 1202; Hawley Dep., CR1011.
32 Transcript, CR747.
20
foundation’s 501(c)(3) nonprofit status.33 Thompson explained the main
concern would be “individual inurement” where an individual “benefit[s]
personally from a donation” made to a nonprofit organization.34 Applied
to the Chamber, Thompson said: “Now, if I say, Terry, if you’ll keep us on
budget, I’ll give you a share of whatever the bottom line is. If your bonuses
are going to be based on how well you do, which it is for us, okay, you may
have a problem.”35
3. Carter takes part in effort to remove Hawley and
Whitmore.
Before the February 15 meeting began, Carter took part in an effort to
remove Hawley and Whitmore from the executive committee. Carter
asked Bentley to wait outside the meeting in a hallway.36 Carter and
Martinez then met with Hawley and Whitmore to inform them that they
were no longer eligible to serve on the executive committee, and thus,
33 Transcript, CR791-92.
34 Transcript, CR792.
35 Transcript, CR792-93; see also Thompson Dep., CR1141, 1147, 1152-53.
36 Carter Dep., CR891-92; Bentley Dep., CR861.
21
could not take part in its recommendation to the board regarding Carter’s
contract and compensation.37
Despite this, Whitmore and Hawley decided to stay and assist
Bentley with his report.38
4. Carter participates in contentious meeting.
Carter’s participation in the meeting was contentious.39 As Chamber
employee Lucy Reta would tell Caller-Times’ reporter Elvia Aguilar, she
heard Carter and another man shouting from the meeting room.40
Whitmore testified that Carter got loud and was yelling at Bentley.41
Chairman Martinez stated “voices were raised and volume levels
increased.”42 Whitmore testified that Carter stood over her, pointed his
finger at her, and spoke loudly to her.43 Bentley testified that Carter “blew
37 Carter Dep., CR880-81, 891, 902, 913-14; Martinez Dep., CR1040-41; transcript, CR752;
Whitmore Dep., CR1197, 1206; Hawley Dep., CR1007-08.
38 Transcript, CR709-17; Hawley Dep., CR1008.
39 Transcript, CR711-13, 751; Hawley Dep., CR1009; Trevino Dep., CR1129.
40 Reta Dep., CR1096-97, 1099-1100.
41 Whitmore Dep., CR1197-98, 1203-04, 1209.
42 Martinez Dep., CR1041.
43 Whitmore Dep., CR1209.
22
up on him” and had an aggressive attitude and body language.44 Carter
was eventually asked to leave so that Bentley, Hawley, and Whitmore
could present their concerns to Martinez and Gonzalez.45
C. Carter Takes Tape; Bentley Denied Access.
Carter admits he took a tape recording of the meeting from the
building.46 Bentley made several attempts to obtain the tape without
success.47 Indeed, the tape was not produced until ordered released by the
trial court after Bentley filed a lawsuit.48 Bentley was also told by Chamber
staff that he must go through Carter to request financial information. 49
44 Bentley Dep., CR849-50. Carter, a former U.S. Army colonel (CR703), called Bentley
“lieutenant commander,” indicating he outranked Bentley in military hierarchy. See
Lieutenant Commander, Wikipedia,
https://en.wikipedia.org/wiki/Lieutenant_commander (last visited July 6, 2015).
Carter was known for an “aggressive” leadership style. Martinez Dep., CR1047.
45 Transcript, CR714-15; Martinez Dep., CR1041.
46 Carter Dep., CR896; see also Bentley Dep., CR850; Martinez Dep., CR1042, 1045;
Whitmore Dep., CR1198, 1204; Bentley letter to board, CR301.
47 Id.; see also Carter Dep., CR897-98; Bentley letter to board, CR301-02, 314, 316-20;
Martinez Dep., CR1052-53.
48 CR360-61.
49 Bentley Dep., CR861-62; see also Waller Dep., CR1172.
23
D. Issues presented to Chamber Board of Directors.
Two days after the executive committee meeting, Carter sent a letter
to the Chamber board giving his account of the issues.50
On February 20, the Chamber board met to consider the matter.51
Carter himself described it as an “issue raised regarding misappropriation
of funds.”52 Carter advised the board that Chamber CPA Thompson no
longer wanted the engagement “due to high risk.”53 A board member
questioned Carter if a complete audit had been performed for the past year
and he acknowledged it had not—only a review.54
Bentley addressed the board on “irregularities in financials he found
in the month of December” and stated that the “issue was regarding the
performance of the CEO.”55 He made a PowerPoint presentation regarding
his concerns and findings.56 Among other things, Bentley explained that
50 CR240-43. Carter’s letter to the Chamber board is also found at Appendix Tab 5. See
also Bentley Dep., CR859; Carter Dep., CR882; Trevino Dep., CR1131.
51 Mtg. minutes, CR117-20.
52 CR119 (emphasis added).
53 Id.
54 Id.; see also Thompson Dep., CR1138, 1141, 1147.
55 Id.; see also Martinez Dep., CR1042.
56 CR156-72. Bentley’s PowerPoint to Chamber board is also found at Appendix Tab 4.
Mtg. minutes, CR119; Bentley Dep., CR858-59.
24
the building fund had been used without board approval, which was
potentially a “serious problem” for 501(c)(3) status according to CPA
Thompson.57 Bentley’s presentation also included a “summary of 2007
adjustments in which the ‘original NOI [net operating income]’ of positive
$40,425 compared to ‘adjusted NOI’ of negative $61,782 produced a
‘$102,207 swing.’”58
Martinez presented the executive committee’s recommendation to
“postpone review of CEO until annual audit of finance is complete to
include 2006-07.”59 The board then voted to conduct the audit.60
Bentley believed Carter’s February 17 letter to the board61 had
“misrepresented both the intent and the facts presented in the treasurer’s
report” at the board meeting and he responded with his own letter to the
board on February 26, 2008.62 In his letter, Bentley described discovering a
57 Bentley’s PowerPoint, CR162-64; Thompson Dep., CR1155-56; Carter Dep., CR883-84.
58 Id.; see also Bentley letter to board, CR304-07; Bentley Dep., CR862.
59 Mtg. minutes, CR119.
60 Id.; Trevino Dep., CR1130.
61 Carter letter to board, CR240-43.
62 CR299-08; Bentley Dep., CR859.
25
“crucial problem with the use of building fund dollars to supplement the
Chamber’s operating expense account.”63 Bentley wrote:
It is undeniable the financials for 2007 as presented
to the executive committee and board are
inaccurate, inconsistent with the process used in
previous years and a misrepresentation of the
Chamber’s bottom line.64
Bentley stated that he “suspected irregularities in booking expenses
and revenues” had “created the ‘Net Operating Income’ for 2007” and that
“these irregularities had the effect of justifying a performance bonus under
[Carter’s] contract.”65
Bentley then identified three main areas of concern in the Chamber’s
2007 financials:
 Carter deferred his pay for November and December
2007 without booking it as an expense, resulting in
$19,992.00 gain for 2007.66
 Carter used building fund dollars to pay for certain
Chamber expenses, resulting in $18,312.00 gain for 2007.
The “CEO should have never shifted the building fund
63 CR301; Bentley Dep., CR845.
64 CR302-03.
65 CR303.
66 CR303-04; see also email from Waller to Carter, CR154-55; Waller Dep., CR1168-69,
1172.
26
from the Chamber books to the foundation books for the
use of supplementing the Chamber’s financials.”67
 The Chamber accrued January 2008 membership
renewals in 2007, resulting in $63,903.00 gain for 2007.68
On February 28, former Chamber chair Sylvia Whitmore sent a letter
to the board stating that Bentley’s “concerns are very credible, and
appeared to be mostly ignored.”69 She also stated that Carter’s letter to the
board “gloss[ed] over financial irregularities and the declining membership
numbers.”70 Whitmore also expressed concerns with the “interpretation
that I am not officially a member of the executive committee,” “denying the
treasurer access to critical information and advise (sic) of financial
professionals,” and “refusal of Chamber staff to cooperate . . . and refusal
of Chamber CEO to release the tape of the Executive Committee
meeting[.]”71
67 CR304; see also FY2007 adjustments, CR179-83; FY2007 audit report, CR244-66;
Whitmore Dep., CR1195; Carter Dep., CR895, 899; Thompson Dep., CR1145.
68 CR303-05.
69 CR314. Whitmore’s letter also appears at Appendix Tab 7.
70 Id.
71 Id.; Whitmore Dep., CR1202, 1205.
27
E. Chamber Leaders and Members Publicly Petition for Special
Meeting
Carol Scott and other Chamber members eventually petitioned the
Chamber for a special meeting to provide more information to its
members.72 For example, Scott experienced difficulty obtaining accurate
membership lists to assess the declining membership and the number of
signatures needed for the petition.73
On March 3, 2008, a news conference was attended by 11 former
chairs of the Chamber and 60 Chamber members to obtain signatures and
support for the petition asking the Chamber to address financial and other
concerns.74
F. Lawsuits Filed; Carter Placed on Paid Leave
On March 18, Bentley filed a petition in the 214th District Court and
was granted a temporary restraining order preventing Carter and the
Chamber from destroying the tape recording of the February 15 meeting.75
72 Aguilar Aff., CR458; Scott Dep., CR1112. Aguilar’s Affidavit is also found at
Appendix Tab 5.
73 Scott Dep., CR1107-09; Whitmore Dep., CR1199; Hawley Dep., CR1016, 1018. From
Dec. 31, 2006 to Mar. 31, 2008, the Chamber lost 257 members. Compare CR215-39 with
CR184-214.
74 Aguilar Aff., CR457-58; CR 472-75, 515-17; Scott Dep., CR1112, 1114-15.
75 CR337-40.
28
The next day, Carter filed this lawsuit seeking damages against the
Chamber, Bentley, Hawley, Whitmore, the Caller-Times and others.76
On March 26, at a special meeting of the Chamber board, Carter was
placed on administrative leave with pay.77
G. Chamber Adjustments to 2007 Financials
On March 25, 2008, the Chamber adjusted its 2007 financials from
those presented in January.78 The adjustment changed the positive
$40,425.48 net operating income reported in January 2008 to a negative
$95,377.76 NOI, reflecting a total decrease in 2007 NOI of $135,803.24.79
Adjustments were made for special events, accrual of Carter’s salary from
2007 and shifting back money removed from the building fund.80
H. Carter Resigns from the Chamber
After reaching a severance agreement with the Chamber, Carter
resigned effective April 30, 2008.81
76 CR341-53.
77 Aguilar Aff., CR457; CR481; Chamber’s interrog. resp., CR799.
78 FY2007 adjustments, CR179-83; Thompson Dep., CR 1139, 1149-50.
79 Id.
80 Id.; see also CR180-83; Waller Dep., CR1171, 1173-74.
81 Martinez Dep., CR1046, 1053-54, 1061; Carter’s resignation CR641-45; Carter Dep.,
CR885-86, 969.
29
I. Chamber Obtains Audit of 2007 Financials
On August 27, 2008, the Chamber retained an independent CPA to
audit the financial statements for the year ended December 31, 2007.82
On November 12, 2008, the CPA issued his report, which included
the following findings:
 “The misstatements detected as a result of audit
procedures and corrected by management were material,
either individually or in the aggregate, to the financial
statements as a whole.”83
 Various expenditures of the building fund totaling
$95,982.00 were “a breach of the intended purpose of the
funds.”84
 Various weaknesses on internal control over financial
reporting, including a “very high possibility of
management override.”85
J. Caller‐Times Articles Report on the Chamber Events as They
Unfold
1. Community leader tips newspaper
On the morning of February 15, 2008, Caller-Times reporter Jaime
Powell received a news tip about the Chamber from Ruben Bonilla,
82 CR258.
83 CR260-65.
84 CR265.
85 CR264.
30
chairman of the Port of Corpus Christi.86 Bonilla was a well-known and
highly respected local attorney and community leader who had been a
reliable source of information during the years for Powell.87 Veteran
business editor Tom Whitehurst assigned business reporter Elvia Aguilar
to assist Powell with investigating the matter.88
2. Newsworthy developments reported
Whitehurst and other editors and reporters pursued the story
because it was “newsworthy in that it pertained to one of our community’s
most important local organizations, the Chamber of Commerce, and its
CEO and president, Carter.”89 “The fact that high-ranking Chamber
officials were raising questions regarding the CEO and president of the
Chamber made the matter newsworthy.”90 The news was “published in
86 Whitehurst Aff., CR617-18; Powell Aff., CR585; Powell Dep., CR1088.
87 Powell Aff., CR 585.
88 Whitehurst Aff., CR 617-18; Averyt Aff., CR621-22; Aguilar Dep., CR820.
89 Id.; see also Powell Aff., CR587; Aguilar Aff., CR459. Publisher Birmingham was not
involved in deciding news coverage about the controversy. Birmingham Dep., CR873-
74; Averyt Dep., CR836.
90 Whitehurst Aff., CR618-19.
31
good faith for the purpose of providing information to the public on a
matter of public interest and concern.”91
The Articles informed viewers of the controversy involving Carter
that erupted among leadership of the Chamber.92 The Caller-Times
reported allegations by Bentley and others; the newspaper itself did not
originate any allegations about Carter.93
3. Articles balanced with Carter’s explanations
The Articles included numerous items favorable to Carter. For
example, in the first Article published February 15 the newspaper
described the “financial questions” involving Carter “as business practice-
related, not improprieties.”
The Articles also provided readers with Carter’s version of events in
context. For example, the February 27 Article informed readers in detail
about Carter’s February 17 letter to the Chamber board that disputed
Bentley’s assertions and provided his own explanation, including that:
91 Carter concedes the Articles “involved a public matter.” CR415; CR805; see also
Trevino Dep., CR1123; Whitehurst Aff., CR 618-19; Averyt Aff., CR622.
92 See Aguilar Aff., CR454-60; Averyt Aff., CR 620-23; Birmingham Aff., CR624-28;
Cavazos Aff., CR518-22; Chirinos Aff., CR 530-34; Contreras Aff., CR636-40; Jimenez
Aff., CR 562-65; Malan Aff., CR 608-11; Powell Aff., CR 584-88; Reta Aff., CR451-53;
Whitehurst Aff., CR 616-19; Wilson Aff., CR 612-15.
93 Id.
32
 “Carter, in a Feb. 17 letter to board members, said he
deferred part of his salary in 2006 and 2007 for tax
purposes.”
 Carter said in his “letter that the failure to record his
salary deferral as a 2007 expense was a bookkeeping
error.”
 Carter’s “letter says including the January 2008 revenue
was consistent with the chamber’s accounting method
approved by the board in September 2004.”
 Carter’s letter “says he discussed the move with
Thompson and Bentley before shifting the funds”
between the Chamber and the foundation.
 “The foundation has operated with overhead provided by
the chamber and chamber had never been reimbursed for
these expenses, according to Carter’s letter.”94
The March 20 Article likewise presented Carter’s position at length in
reporting on the filing of this lawsuit by him, including that:
 Carter “was seeking damages against Bentley, the
chamber, the Caller-Times and others.”
 Carter accused the Caller-Times Appellants of “false and
defamatory” statements “without regard to the truth.”
 Carter “disputes Bentley’s assertions that Carter deferred
a portion of his salary and transferred funds among
accounts in manner that showed a surplus when
according to Bentley the chamber should have shown a
deficit.”
94 CR241-43.
33
 “Carter also disputes Bentley’s statements that Carter’s
bonus was linked to the chamber’s financial
performance.”
 Carter disputed that his “shifting of funds among
chamber accounts jeopardized the chamber foundation’s
non-profit status.”
 Carter “offers justification for the Chamber accounting
method questioned by Bentley.”
 Carter’s position was that “his bonus would not have
been related to any Chamber condition or status.”95
At all times during the editing process, Whitehurst directed the
reporters to attempt to reach Carter and other Chamber officials for
comment.96 Carter, his attorney, or his lawsuit were quoted or cited 21
times in the Articles.97 Carter declined to comment or to return calls at least
10 times.98 Aguilar alone attempted without success to contact Carter on
eight separate occasions, and twice she spoke to his attorney, who declined
to comment.99 Moreover, Caller-Times’ sources included high-ranking
95 Compare March 20 Article, 2CR1519, with Carter’s Orig. Pet. CR341-53.
96 Whitehurst Aff., CR618.
97 Aguilar Aff., CR457-58, 481-82, 488-90, 498-500; Cavazos Aff., CR520, 525, 527;
Chirinos Aff., CR 532-33, 536-38, 541.
98 Aguilar Aff., CR456; Chirinos Aff., CR532.
99 Aguilar Aff., CR457; see also Carter Dep., CR909 (agreeing he never returned calls
from reporters). The Caller-Times’ investigated, reported, edited and published the
Articles with diligence, balance and in accordance with common journalistic practice.
34
Chamber officials who were in a position to be knowledgeable about the
matters at issue.100
The Caller-Times reviewed and relied on documentary evidence such
as the letters and email by Carter, Bentley and Whitmore to the Chamber
board.101 Editorial writer Nick Jimenez reviewed seven Articles for the
editorial.102
Carter never contacted the Caller-Times to point out that any
statement in the Articles was incorrect. 103
STANDARDS OF REVIEW
A. Elements of Libel
To maintain a libel cause of action against a media defendant, a
plaintiff must prove that the defendant (1) published a statement; (2) that
See Pederson Report, CR665; Pederson Dep., CR1068, 1070-79; Aguilar Aff., CR454-60,
462-96, 498-517; Cavazos Aff., CR518-22, 524-27, 529; Chirinos Aff., CR 530-34, 536-43,
545-61; Jimenez Aff., CR562-65, 567, 569-81, 583; Malan Aff., CR608-11; Powell Aff.,
CR584-88, 590-95, 597-607; Wilson Aff., CR612-15; Whitehurst Aff., CR616-19;
Birmingham Aff., CR624-28, 630, 632, 634-35; Contreras Aff., CR637-40; Averyt Aff.,
CR621-23.
100 Whitehurst Aff., CR618; Aguilar Aff., CR459; Powell Aff., CR587.
101 Whitehurst Aff., CR617-19; Aguilar Aff., CR458; Powell Aff., CR586.
102 Jimenez Aff., CR562-64, 569-81.
103 Whitehurst Aff., CR619; Aguilar Aff., CR459; Powell Aff., CR587; Chirinos Aff.,
CR533; Cavazos Aff., CR521; Malan Aff., CR610; Wilson Aff., CR614; Birmingham Aff.,
CR627; Averyt Aff., CR622; see also Carter Dep., CR971.
35
defamed the plaintiff; (3) while acting with negligence regarding the truth
of the statement, if the plaintiff was a private individual.104 A private-
figure plaintiff must prove actual malice to recover punitive damages from
a media defendant.105
B. Traditional Summary Judgment Standard
A defendant is entitled to a traditional summary judgment upon
establishing that no material fact issue exists and that it is entitled to
judgment as a matter of law.106 To meet this burden, a defendant must
conclusively negate at least one essential element of the cause of action or
establish each element of an affirmative defense.107 The burden then shifts
104 Neely v. Wilson, 418 S.W.3d 52, 61 (Tex. 2013) (citing WFAA-TV, Inc. v. McLemore, 978
S.W.2d 568, 571 (Tex. 1998)). This Court previously affirmed denial of summary
judgment to Appellants on the issue of Carter’s status as a public figure. See Scripps Tex.
Newspaper, LP v. Carter, No. 13-09-00655-CV, 2012 WL 5948955, at *5 (Tex. App.—
Corpus Christi Nov. 21, 2012, pet. denied) (mem. op.). For this appeal, Appellants
assume but do not concede that Carter is a private-figure not required to prove actual
malice as an element of his prima facie case.
105 Burbage v. Burbage, 447 S.W.3d 249, 259 (Tex. 2014) (private figure plaintiff who does
not prove actual malice may recover only damages for actual injury) (citing Gertz v.
Robert Welch, Inc., 418 U.S. 323, 350 (1974)).
106 Tex. R. Civ. P. 166a(c).
107 Randall’s Food Mkts., Inc. v. Johnson, 891 S.W.2d 640, 644 (Tex. 1995); Tex. Monthly, Inc.
v. Transamerican Nat. Gas Corp., 7 S.W.3d 801, 805 (Tex. App.—Houston [1st Dist.] 1999,
no pet.).
36
to the plaintiff to produce evidence creating a fact issue on an element or
defense in order to defeat the summary judgment.108
C. No‐Evidence Summary Judgment Standard
A no-evidence summary judgment is essentially a pretrial directed
verdict.109 The moving party must specifically state the elements as to
which there is no evidence.110 The burden then shifts to the non-movant to
produce evidence raising a genuine issue of material fact regarding each
element challenged.111
D. Standard of Review in Media Libel Cases
The denial of summary judgment to a media libel defendant is
reviewed on interlocutory appeal under the same standards applicable to
the granting of summary judgment.112 On appeal, the court conducts a de
108 Hotze v. Miller, 361 S.W.3d 707, 712 (Tex. App.—Tyler 2012, pet. denied); Dolcefino v.
Randolph, 19 S.W.3d 906, 916 (Tex. App.—Hou. [14th Dist.] 2000, pet. denied) (non-
movant bears shifted burden to raise material fact issue to defeat summary judgment).
109 Hotze, 361 S.W.3d at 712; Belo Corp. v. Publicaciones Paso del Norte, S.A. de C.V., 243
S.W.3d 152, 157 (Tex. App.—El Paso 2007, pet. denied).
110 Belo Corp., 243 S.W.3d at 158; Tex. R. Civ. P. 166a(i).
111 Hotze, 361 S.W.3d at 712; Main v. Royall, 348 S.W.3d 381, 389 (Tex. App.—Dallas
2011, no pet.).
112 Hotze, 361 S.W.3d at 712.
37
novo review of a trial court’s decision to deny the motion for summary
judgment by the media libel defendant.113
SUMMARY OF ARGUMENT
On July 22, 2015, the Caller-Times filed their Second Motion for Final
Summary Judgment (the “Motion”).114 Appellants were entitled to final
summary judgment on the grounds and defenses that the Articles are not
defamatory, are true or substantially true, are non-actionable opinion, are
statutorily privileged as fair reports of judicial proceedings and public
meetings, and were published without negligence or actual malice. There
is no evidence that the Articles are defamatory of Carter or that the Caller-
Times published any false statement of fact about Carter, and no evidence
of negligence or actual malice. In addition, Appellant E.W. Scripps—a
separate entity from the Caller-Times—did not publish the Articles or any
allegedly defamatory statements concerning Carter and there is no
evidence of such publication by that Appellant. Further, Carter’s non-libel
claims fail on one or more essential elements as they are based on the same
113 Id.; Main, 348 S.W.3d at 389.
114 CR41-96.
38
statements and actions underlying his libel claims, and there is no evidence
in support of the non-libel claims. 115
Carter filed a response to the Motion on August 28, 2015, which
offered three reasons for denial: (1) the Caller-Times allegedly published
the statements with actual malice; (2) Carter’s affidavit details alleged false
statements; and (3) an expert deposition for the plaintiff allegedly details
damage to Carter’s reputation.116 Carter failed, however, to offer
competent or legally sufficient evidence to raise any fact issue on the
grounds and defenses in the Motion. His arguments fail as a matter of law.
ARGUMENT
A. The Articles Are Not Defamatory of Carter
1. Standard for Determining Defamatory Meaning
An initial question for the court in a libel case is whether a statement
is reasonably capable of a defamatory meaning from the perspective of an
ordinary reader in light of the surrounding circumstances.117 If the
115 CR42-44 (setting out summary judgment grounds).
116 2CR1229. Because this case may be disposed of on grounds other than damages, that
issue is not discussed herein.
117 Hancock v. Variyam, 400 S.W.3d 59, 66 (Tex. 2013) (citing Musser v. Smith Protective
Serv., Inc., 723 S.W.2d 653, 655 (Tex. 1987)). See also New Times, Inc. v. Isaacks, 146 S.W.3d
39
statement is not reasonably capable of a defamatory meaning, the
statement is not defamatory as a matter of law and the claim fails.118
Likewise, the determination of whether a statement is defamatory per se is
an initial inquiry for the court.119
Courts must give words their ordinary meaning as read by persons
of ordinary intelligence.120 The hypothetical ordinary reader is “no
dullard.”121 The focus must be on the “words used” in the publication, not
plaintiff’s characterization of them.122
2. The Articles are not reasonably capable of the
defamatory meaning claimed by Carter.
a. The Articles do not charge Carter with crime or
fraud.
Statements are defamatory per se if they expressly charge the plaintiff
with crime, dishonesty, or fraud.123 The Articles do not state that Carter
committed a crime or fraud, or that such conduct is suspected. There are
144, 154 (Tex. 2004) (citing Turner v. KTRK Television, Inc., 38 S.W.3d 103, 114 (Tex. 2000);
Musser, 723 S.W.2d at 655).
118 Hancock, 400 S.W.3d at 66.
119 Id.
120 See Musser, 723 S.W.2d at 655.
121 New Times, Inc., 146 S.W.3d at 157 (internal citation omitted).
122 See Musser, 723 S.W.2d at 655; see also New Times, Inc., 146 S.W.3d at 154.
123 Main, 348 S.W.3d at 390.
40
no references to police or prosecutors and no use of such words as “stolen,”
“theft,” “misappropriation,” “malfeasance,” “fraud,” “felony,”
“embezzlement,” “corrupt,” or the like.
b. The Articles may not reasonably be read to imply
or impute a crime by Carter.
The first of the Articles—published February 15, 2008—states that the
“financial questions” at issue are “business practice-related, not
improprieties.”124 Similarly, other Articles, particularly those from
February 27 and March 20 as well as the editorial, extensively convey
Carter’s explanations. Such balanced reporting dispels any implication of
dishonest or criminal conduct and clarifies that the matter is a civil dispute
over accounting practices and executive compensation, not a criminal
matter. Thus, an ordinary reader may not reasonably interpret the Articles
to ascribe criminal acts to Carter.125
124 CR462 (emphasis added).
125 See, e.g., Freedom Commc’ns Corp. v. Salinas, No. 13-13-00702-CV, 2015 Tex. App. Lexis
10129 (Tex. App.—Corpus Christ, Sept. 30, 2015, no pet.) (news report not expressly
stating plaintiff was arrested would not cause ordinary person to infer that plaintiff was
involved in criminal wrongdoing).
41
A more direct accusation of financial malfeasance was recently held
not to falsely impute criminal behavior.126 A Houston television station
reported that a school’s charter was revoked by the State because “millions
of dollars in State funding … was not accounted for,” that the State didn’t
know “how [the school] spent $3 million of taxpayer money,” and that the
school “did not provide proper financial records.”127 The operator of the
school sued the station, contending the statements “insinuate that she
embezzled over $3 million and thereby falsely imputed criminal behavior
to her.”128 The First Court of Appeals rejected the argument:
There is nothing intrinsically defamatory about
KTRK’s reports on the State’s investigation into [the
school’s] mismanaged funds. The reports did not
say or imply that the entire $3 million in state funds
had been misappropriated or embezzled. Rather,
the statements speak to the insufficiency of financial
records to account for spent state funds.129
126 KTRK Television, Inc. v. Robinson, 409 S.W.3d 682, 690-91 (Tex. App.—Houston [1st
Dist.] 2013, pet. denied).
127 Id. at 690.
128 Id.
129 Id. at 691.
42
Likewise, there is nothing intrinsically defamatory in reporting concerns by
Chamber leaders over financial management and accounting practices
under Carter’s watch.
Carter’s own reading of the Articles—that they falsely “implied
financial malfeasance” and “implied or insinuated that I committed
violations of the Penal Code”—does not supply the requisite defamatory
meaning.130 A plaintiff’s characterization that statements make accusations
of criminal conduct is not reasonable when, as here, no such language
appears in the publication.131 Likewise, Carter’s resort in his affidavit to
comments posted on-line by third-party readers also fails to show the
Articles are defamatory because the proper inquiry is objective, not
130 Carter Aff., 6CR12165.
131 See Vice v. Kasprzak, 318 S.W.3d 1, 21 (Tex. App.—Houston [1st Dist.] 2009, pet.
denied) (characterization of statement as accusing plaintiff of “embezzlement” not
reasonable when no such language appears in the publication); NW Commc’n of Tex., Inc.
v. Power, No. 05-99-01641-CV, 2000 WL 1036327, at *34 (Tex. App.—Dallas July 28, 2000,
pet. denied) (media defendant not liable for subjective impressions from statements not
actually charging intentional or criminal conduct).
43
subjective.132 Further, since the comments are extrinsic to the Articles, they
do not demonstrate the alleged defamatory meaning on their face.133
c. The Articles do not injure Carter in his profession.
A publication is defamatory per se if it accuses a person of lacking a
peculiar or unique skill necessary for his profession or occupation.134 Here,
viewed in context, the Articles amount only to general criticism applicable
to a person in any profession or occupation and, therefore, are not
actionable per se.135
For example, accurately reporting that Carter allegedly “shifted
funds” is, at most, a disparagement equally discreditable to a person in any
business or occupation.136 Likewise, “seizing” a tape recording at a
meeting or “shouting” during a meeting does not disparage Carter
132 See New Times, Inc., 146 S.W.3d at 157 (“the question is not whether some actual
readers were misled, as they inevitably will be, but whether the hypothetical reasonable
reader could be”).
133 See Robinson, 409 S.W.3d at 691 (defamatory nature must be apparent on face of
publication without reference to extrinsic facts or innuendo).
134 Hancock, 400 S.W.3d at 66-67.
135 See Hancock, 400 S.W.3d at 67 (Statement charging physician with “lacking veracity”
was not defamatory per se because statement was equally discreditable to persons in
any profession.).
136 See Shipp v. Malouf, 439 S.W.3d 432, 441 (Tex. App.—Dallas June 24, 2014, no pet.),
disapproved on other grounds, In re Lipsky, 460 S.W.3d 579, 587 (Tex. 2015) (false allegation
of personal bankruptcy did not injure dentist in his profession).
44
regarding a particular quality or trait peculiar to his occupation. Carter’s
conclusory affidavit statements of injury to his reputation are legally
insufficient to establish that any statement in the Articles was
defamatory.137 Therefore, the trial court erred in denying summary
judgment to Appellants because the Articles are not defamatory.138
B. The Articles Are True or Substantially True
1. The Articles were not more damaging than a literally
truthful account.
A media defendant is entitled to summary judgment upon a showing
of the substantial truth of an allegedly libelous publication.139 The Articles
are substantially true because they are not more damaging to Carter’s
reputation than a truthful statement would have been.140
If the Caller-Times had published the complete record of the
controversy instead of the Articles, it would not have had a more favorable
impact on Carter’s reputation. For example, publishing Bentley’s letter or
PowerPoint presentation in full would not have caused the ordinary reader
137 See Ryland Group, Inc. v. Hood, 924 S.W.2d 120, 122 (Tex. 1996) (conclusory affidavit
statements are not competent summary-judgment evidence).
138 If articles are not capable of a defamatory meaning, the court need not consider
whether they are false or not substantially true. See Main, 348 S.W.3d at 389.
139 Neely, 418 S.W.3d at 63; McIlvain v. Jacobs, 794 S.W.2d 14, 15-16 (Tex. 1990).
140 Neely, 418 S.W.3d at 63; McIlvain, 794 S.W.2d at 16.
45
to form a better impression of Carter than would the Articles. Likewise,
publishing the entire tape of the February 15 meeting, including
demeaning remarks by Carter to “Lt. Commander” Bentley, statements by
Hawley that she had “a big problem” with Carter’s leadership, and
Whitmore’s questions about “trust” of his leadership, certainly would not
have cast Carter in a more favorable light. Verbatim inclusion in the
Articles of Carter’s February 17 letter or his original petition in this suit
would have no better effect, as those accounts were fairly summarized in
the Articles and do not alter the gist of the reports.141
Carter contends that an audit issued in November 2008 establishes
that the “2007 financial statements had been ‘fairly presented in conformity
with U.S. generally accepted accounting principles.’”142 But the complete
record of the audit report included findings that “misstatements” corrected
in the financials were “material.”143 Likewise, accounting adjustments by
141 See NW Commc’n of Tex., Inc., 2000 WL 1036327, at *25 (publishing plaintiff’s
verbatim account would not have been less damaging because the central facts
remained undisputed).
142 2CR1240.
143 CR264.
46
the Chamber were greater even than those identified by Bentley.144
Publishing such adjustments and final audit would not have been less
damaging to Carter’s reputation than the Articles. Therefore, the Articles
were substantially true.145
2. The gist of the Articles is true.
The “gist” of an allegedly libelous publication is the meaning a
person of ordinary intelligence would give it when read as a whole in
context.146 A publication that correctly conveys the gist, even if it errs in
details, is substantially true.147 Here, the gist of the Articles in relation to
Carter’s libel claims is that serious questions had been raised by certain
Chamber officials concerning the financial performance and management
practices of the Chamber under Carter’s leadership. The Articles correctly
conveyed this gist and, therefore, are substantially true.
144 FY2007 adjustments, CR180 (showing positive $40,425.00 reported in January 2008
under Carter ending in negative $95,377.76 after adjustments of March 25, 2008).
145 The November 2008 audit was not available to the newspaper during the time it
published the Articles and, even if the audit is given the spin presented by Carter, it
does not dispute substantial truth. See Hearst Newspaper P’ship, LP v. Macias, 283 S.W.3d
8, 14 (Tex. App.—San Antonio 2009, no pet.) (audit report allegedly exonerating
plaintiff but not available to newspaper did not raise fact issue on substantial truth).
146 Neely, 418 S.W.3d at 63-64.
147 Id. at 64.
47
3. Items of secondary importance do not defeat
substantial truth.
Carter claims that he was defamed because the Articles reported he
“seized” a tape, could be heard “shouting,” or that he excluded others from
a meeting.148 But these are items of secondary importance that do not
factor into the substantial-truth analysis.149 The gist of the Articles is not
that Carter “seized” a tape recording or “shouted” during a meeting.
Reporting such details, even if incorrect, does not undermine the gist of the
matter that serious questions had been raised by certain Chamber officials
concerning the financial performance and management practices of the
Chamber under Carter’s leadership. 150
4. There is no omission or juxtaposition.
A news report “can convey a false and defamatory meaning by
omitting or juxtaposing facts, even though all the story’s individual
statements considered in isolation were literally true or non-
148CR24-25.
149 See McIlvain, 794 S.W.2d at 16; Dolcefino, 19 S.W.3d at 919 (whether media defendant
“learned” of or “instigated” an investigation may be disregarded as of secondary
importance).
150 Although the items are of secondary importance to the gist of the Articles, they are
in fact substantially true as demonstrated in the article-by-article discussion below.
48
defamatory.”151 Here, there is no material omission or suggestive
juxtaposition as readers were provided a lengthy account of Carter’s
version of events, which Caller-Times personnel consistently sought to
obtain.152
Carter’s case is easily contrasted to that of Neely v. Wilson. There, the
Supreme Court found a fact issue on whether the news report created a
more damaging impression by omitting the material fact that the plaintiff-
physician had not been disciplined by the medical board for use of
controlled substances during surgery.153 But here, the Articles did not omit
information that would place Carter in a more favorable light since the
Caller-Times included his explanations for the actions questioned by
Bentley.
5. The Articles are substantially true reports of
allegations.
In Neely, the Supreme Court noted but did not resolve whether in
some cases involving allegation reporting, substantial truth may be
established by showing the defendant accurately relayed the allegations of
151 Neely, 418 S.W.3d at 64 (quoting Turner, 38 S.W.3d at 114).
152 See supra notes 93-102 and accompanying text.
153 Neely, 418 S.W.3d at 64-69.
49
a third party.154 Such a case is presented here, at least to the extent that
Carter claims the Articles are false because third-party allegations
accurately reported by Appellants were not true.
Where a media defendant accurately reports third-party allegations
against a plaintiff, while including the plaintiff’s denials and without
stating a conclusion of guilt, the reports are substantially true even if the
plaintiff disputes the third-party allegations.155 The defendant is not held
to proving the truth of the third-party allegations in order to be entitled to
the defense of substantial truth.156
Here, for instance, the February 15 and 27 Articles provided an
accurate account of allegations concerning Carter that were presented by
Bentley and others to the Chamber executive committee and board.
Indeed, Carter does not dispute that the Articles accurately reported these
154 418 S.W.3d at 65 (citing Global Relief Found. v. New York Times Co., 390 F.3d 973, 985-
87 (7th Cir. 2004).
155 See Global Relief Found., 390 F.3d at 985-87.
156 Id.; accord Ackly v. Bartlesville Examiner-Enter., No. 06-CV-529-TCK-PJC, 2007 U.S.
Dist. LEXIS 87897, at *8 (N.D. Okla. Nov. 29, 2007) (“when assessing the truth of a
report concerning an investigation, a defendant is under no requirement to show that
the allegations against the plaintiff are true, but must only show that the allegations
were made and that the allegations themselves were accurately recited”).
50
third-party statements.157 Instead, Carter rests his case on conclusory
affidavit testimony that the allegations are false. However, because the
Caller-Times accurately reported the third-party allegations and did not
state or imply Carter’s guilt, Appellants not need additionally prove the
allegations were valid in order to obtain judgment as a matter of law on
substantial truth.158 In such instances, substantial truth is measured only
by whether the Caller-Times accurately relayed the allegations of a third
party, which is undisputed here.159
6. Carter failed to raise a fact issue on substantial truth.
Once the Caller-Times established that the Articles were substantially
true, as shown by the foregoing discussion, Carter had the burden as non-
movant to produce evidence creating a fact issue on that element in order
to defeat summary judgment.160
157 See, e.g., Carter Dep., CR900-01 (Carter admits that the statements reported in the
2/27/08 article came from Bentley’s letter), CR904-05 (Carter admits that statements
reported in the 2/29/08 article came from Whitmore’s letter), CR908 (Carter stipulates
that Whitmore made the statement at issue in the 3/4/08 article).
158 See Global Relief Found., 390 F.3d at 985-87.
159 See Neely, 418 S.W.3d at 65.
160 See Huckabee v. Time Warner Entm’t Co. L.P., 19 S.W.3d 413, 420 (Tex. 2000).
51
a. Alleged proof of actual malice does not prove
falsity.
Carter’s response concentrated on the issue of actual malice due to
his mistaken position that it is dispositive.161 Substantial truth and actual
malice, however, are distinct aspects of a libel case.162 A finding of actual
malice does not imply that a statement was false.163 For a summary
judgment in a private-figure libel case, “whether [the plaintiff] raised a fact
issue regarding the truth or falsity of the underlying statements is the
primary issue in [the] appeal.”164
b. Carter’s affidavit raises no fact issue on
substantial truth.
The only specific evidence that Carter pointed to in his response to
show alleged falsity is his affidavit of August 28, 2015.165 The affidavit,
however, fails as summary judgment proof because it is rife with
substantive defects that make it legally insufficient.
161 2CR1240.
162 In re Lipsky, 460 S.W.3d at 593 (referencing falsity and actual malice as separate
elements); Huckabee, 19 S.W.3d at 420 (same); Hearst Corp. v. Skeen, 159 S.W.3d 633, 636-
37 (Tex. 2005) (same). See also supra note 103 (cases listing defamatory statement and
negligence as separate elements).
163 Bentley v. Bunton, 94 S.W.3d 561, 587 (Tex. 2002)
164 Neely, 418 S.W.3d at 63.
165 2CR1229.
52
Carter’s affidavit declares that certain statements in the Articles
“implied or insinuated” he committed felony violations of the penal code
or “financial malfeasance” but that he “never violated the penal code” or
“engaged in any financial malfeasance.” But such conclusory statements
and opinions “cannot support a judgment.”166 Conclusory statements in
affidavits are not competent summary judgment evidence because they are
not credible and are susceptible to being readily controverted.167 Thus, the
Carter affidavit does not meet the basic requirement to “set forth such facts
as would be admissible in evidence.”168
Appellants made substantive objections to a host of other statements
in Carter’s affidavit, including that specified statements were improper
attempts to offer expert testimony, prohibited by TRE 702, improper legal
conclusions, lacking personal knowledge, speculation, and improper
166 Wal-Mart Stores, Inc., 313 S.W.3d 837, 839 (Tex. 2010) (per curiam). See also AMS
Constr. Co. v. Warm Springs Rehab. Found., 94 S.W.3d 152, 156 (Tex. App.—Corpus
Christi 2002, no pet.) (Affidavit must set forth facts establishing witness competency,
expertise, or personal knowledge to support opinions or conclusions in order to
constitute competent summary judgment evidence.).
167 See Ryland Group, Inc., 924 S.W.2d at 122.
168 See AMS Constr. Co., 94 S.W.3d at 156.
53
opinion.169 Such substantive evidentiary defects are not waived by the trial
court’s failure to rule on the objections but, on appeal, are legally
insufficient to raise a fact issue.170
Further, this Court need not concern itself with the voluminous
document dump that Carter included with his response. Carter repeatedly
makes blanket references to the prior appellate record but fails to quote,
cite, or point the Court to any evidence raising a fact issue.171 As a matter
of law, that approach cannot raise a fact issue on substantial truth or any
other essential element of Carter’s libel claim because courts are “not
169 6CR12708-15.
170 See Laidlaw Waste Systems (Dallas) v. City of Wilmer, 904 S.W.2d 656, 661 (Tex. 1995)
(substantive objection to summary judgment evidence not waivable); Stone v. Midland
Multifamily Equity REIT, 334 S.W.3d 371, 374 (Tex. App.—Dallas 2011, no pet.) (same).
See, e.g., City of San Antonio v. Pollock, 284 S.W.3d 809, 816-17 (Tex. 2009) (testimony
based on unsubstantiated speculation is legally insufficient to support summary
judgment); Coastal Transp. Co. v. Crown Cent. Pet. Corp., 136 S.W.3d 227, 233 (Tex. 2004)
(speculative or conclusory expert opinion may be challenged on appeal as legally
insufficient to raise fact issue on summary judgment); Ryland Group, Inc. v. Hood, 924
S.W.2d 120, 122 (Tex. 1996) (objection that affidavit includes opinions constitutes
substantive defect and may be raised on appeal); Danevang Farmers Coop. Soc’y v. Indeco
Prods., Inc., No. 13–04–445–CV, 2006 WL 2885058, at *3 (Tex. App.—Corpus Christi Oct.
12, 2006, no pet.) (mem. op.) (lack of personal knowledge and conclusory statements
were substantive defects to summary judgment evidence); Stewart v. Sanmina Texas L.P.,
156 S.W.3d 198, 207 (Tex. App.—Dallas 2005, no pet.) (unsubstantiated legal or factual
conclusion was substantive defect to affidavit); AMS Constr. Co., 94 S.W.3d at 156 (“An
objection that an affidavit is conclusory is an objection to the substance of the affidavit
that can be raised for the first time on appeal.”).
171 See, e.g., 2CR1228, 1233, 1241, 1267-70.
54
required to sift through voluminous” records to identify evidence raising a
fact issue.172
In addition, Carter’s benign explanations in his affidavit of
accounting practices under his leadership at the Chamber173 do not render
the Articles untrue.174 A libel plaintiff’s self-serving account that his actions
were in good faith are irrelevant to whether a news organization misstated
the facts.175
Thus, resting merely on conclusions and legal insufficiencies, the
affidavit raises no fact issue on substantial truth.
c. Concealed truth does not controvert substantial
truth.
Carter may not dispute substantial truth by suggesting that the
newspaper should have withheld publication since he does not have a
legally protected right to a reputation based on the concealment of the
172 Bich Ngoc Nguyen v. Allstate Ins. Co., 404 S.W.3d 770, 776–77 (Tex. App.—Dallas 2013,
pet. denied) (quoting Aguilar v. Morales, 162 S.W.3d 825, 838 (Tex. App.—El Paso 2005,
pet. denied).
173 6CR12168, 12170.
174 Again, Carter’s explanations were included in the Articles. See supra notes 93 - 102
and accompanying text.
175 See Assoc. Press v. Cook, 17 S.W.3d 447, 453-54 (Tex. App—Houston [1st Dist.] 2004,
no pet.) (Plaintiff’s explanation that court testimony was incorrect because he relied on
misinformation from a colleague was irrelevant to whether newspaper misstated the
facts of his testimony.).
55
facts.176 Indeed, the full record on the Chamber’s financials is worse than
reported by the Caller-Times (e.g., adjusted March 25 to negative $95,377.76,
as compared to February 27 Article reporting treasurer Bentley
presentation of negative $61,782).177 Truth—not just known truth—is a
complete defense.178
C. The Articles Are Non‐Actionable Opinion
1. Constitutional protection for statements not capable of
objective proof as conveying actual facts.
There are “constitutional limits on the type of speech” that is subject
to a defamation action.179 The First Amendment and Texas law require that
a plaintiff prove that a media defendant published a false, defamatory
statement of fact rather than an unverifiable opinion.180 A statement that is
not capable of objective proof as true or false, or that cannot be read as
176 Global Relief Found., 390 F.3d at 989.
177 CR162-64; Bentley Dep., CR862; Bentley letter to board, CR304-07; FY2007
adjustments, CR179-183; Thompson Dep., CR1139, 1149-50.
178 Global Relief Found., 390 F.3d at 989.
179 Milkovich v. Lorain Journal Co., 497 U.S. 1, 16 (1990).
180 See id. at 19-20; Bentley, 94 S.W.3d at 580-82.
56
conveying actual facts about an individual, is protected opinion.181
Whether a statement is one of fact or opinion is a question of law.182
2. Statements of opinion in the Articles
Numerous expressions of non-actionable opinion appear throughout
the Articles. For instance, references in the March 2 editorial to Carter’s
“highly questionable stewardship of the financial affairs of the chamber,”
“intimidation, secrecy and duplicity,” attempts to bring “transparency and
accountability” to the Chamber and a “question mark” over Carter are
constitutionally protected opinions, not statement of facts.183
Protected statements of opinion in the Articles also include:
 February 15, 16, 27 and 29 Articles that Carter could be
heard “shouting”;184
 February 27 and 29 Articles that Carter “seized the
tape”;185
181 See Milkovich, 497 U.S. at 18-21; Bentley, 94 S.W.3d at 580-81. See also Coronado v.
Freedom Commc’ns, Inc., No. 13-13-00525-CV, 2015 Tex. App. LEXIS 10128, at*7 (Tex.
App.—Corpus Christi, Sept. 30, 2015, no pet.) (Statement must constitute an assertion of
an “objectifiably verifiable” fact in order to constitute actionable defamation.) (mem.
op.).
182 Bentley, 94 S.W.3d at 579-80.
183 See Assoc. Press, 17 S.W.3d at 454 (statement that Texas Ranger captain was a “blight
on law enforcement” was constitutionally protected opinion).
184 CR462-65, 468-71.
185 CR468-71.
57
 February 27 Article reference to “off the books”
accounting, and a “red flag”;186
 March 2 Editorial as a whole;187
 March 4 Article references to “lack of financial
transparency” and not “transparent”;188 and
 May 31 Article references to a “heated exchange” and
“contentious exchange” and “findings of fact.”189
D. The March 19, 20 and May 29, 31 Articles Are Privileged Fair
Reports of Judicial Proceedings Under Common Law and
Texas Statute.
The March 19, 20 and May 29, 31 Articles consisted of fair, true and
impartial accounts of judicial proceedings; namely, judicial proceedings
involving a petition by Bentley and this lawsuit by Carter. Such “fair
reports” of judicial proceedings are privileged against a libel claim by
common law and Texas statute.190
186 CR468-69.
187 CR567.
188 CR474-75.
189 CR526. See also infra Part I. (article-by-article analysis regarding non-actionable
opinion).
190 Restatement (Second) of Torts § 611 (1977); Tex. Civ. Prac. & Rem. Code §§ 73.002(a),
73.002(b)(1)(A).
58
E. Article‐by‐Article Analysis Shows the Caller‐Times Appellants
Are Entitled to Summary Judgment.
Examining each Article and allegedly defamatory statement shows
they are non-defamatory, substantially true, non-actionable opinion and
privileged as fair reports. Carter’s response failed to raise a fact issue on
these grounds and defenses.191
1. February 15, 2008 Article: Financial, Management
Questions Raised at CC Chamber.
a. The Article is not reasonably capable of the
defamatory meaning claimed by Carter.
The February 15 Article does not impute commission of a crime by
Carter and is not reasonably capable of that defamatory meaning claimed
by Carter. Indeed, the Article expressly disclaims that any “financial
questions” involved “improprieties.”
b. The Article is substantially true.
The gist of the February 15 article is that three high-ranking Chamber
officials raised serious financial and management issues at a meeting of the
Chamber’s executive committee. This statement is indisputably true.192
191 See supra notes 158-172 and accompanying text.
192 See supra notes 15-35 and accompanying text. See also mtg. minutes, CR118; FY2007
audit report, CR244-66; LRGlobal contract, CR279-86; Chamber bylaws, CR287-94;
FY2006 financials, CR295-98; Bentley email to Carter, CR309-12; Bentley Dep., CR859-60,
59
c. Statement 2/15-1:
“However, they were asked to present their information
in a meeting that lasted most of Friday morning and
from which Chamber President could be heard shouting.”
i. Not Defamatory
The statement is not defamatory as a matter of law. It does not state
or imply that Carter committed a crime. Shouting in a business meeting is
certainly legal. 193 It may be unflattering to Carter to report that he shouted,
but that does not make it actionable in defamation.194
ii. Substantial Truth
It is undisputed that Chamber employee Lucy Reta told reporter
Aguilar that she heard Carter shouting from the meeting room, an account
corroborated by Whitmore, Bentley, and Martinez, all of whom were
present.195
863-64; Carter Dep., CR888-90; Hawley Dep., CR1010-14, 1017, 1019-20; Martinez Dep.,
CR1049-50, 1053; Powell Dep., CR1088-90; Thompson Dep., CR1141, 1143, 1144-48, 1151-
52, 1154, 1156; Whitmore Dep., CR1201-02, 1205-08; Thompson letter, CR438-39.
193 See Means v. ABCABCO, Inc., 315 S.W.3d 209, 214 (Tex. App.—Austin 2010, no pet.)
(citing Musser, 723 S.W.2d at 655) (statement that a person has done what he has a legal
right to do is not defamatory).
194 See Farias v. Garza, 426 S.W.3d 808, 816 (Tex. App.—San Antonio 2014, pet. filed) (a
statement that is merely unflattering is not actionable).
195 See supra notes 39-45 above and accompanying text.
60
iii. Opinion
As Carter testified in his deposition, whether a person is shouting is a
matter of opinion.196
d. Statement 2/15- 2:
“We agreed from a statement standpoint to say we are
continuing the process of our evaluation and that there
are both serious financial and management issues that we
need to address, according to Bentley.”
Bentley and others testified to the accuracy of the statement
attributed to him.197
2. February 16 Article: Corpus Christi Chamber of
Commerce Pulls Two Off Panel.
The February 16 Article as a whole is not defamatory of Carter and is
substantially true.
i. Statement 2/16-1:
“Before their grievances could be voiced, two of the three,
Judy Hawley and Sylvia Whitmore, were told they no
longer are eligible to serve on the committee, meaning
they can’t participate in the committee’s recommendation
to the full board on matters involving Carter’s contract.”
The statement is non-defamatory and substantially true.198
196 Carter Dep., CR903.
197 See Bentley Dep., CR863; Hawley Dep., CR1010-11, 1013-14, 1017; Martinez Dep.,
CR1042, 1053; Whitmore Dep., CR1201-02, 1205-08.
61
ii. Statement 2/16-2:
“Carter could be heard shouting during portions of the
meeting.”
The statement is substantially true and non-defamatory as discussed
above and herein.199
iii. Statement 2/16-3:
“Bentley was outside in a hallway when Hawley and
Whitmore were dismissed because Carter had denied him
entrance to the meeting.”
The statement is substantially true and non-defamatory.200
iv. Statement 2/16-4
“We agreed from a statement standpoint to say we are
continuing the process of our evaluation and that there
are both serious financial and management issues that we
need to address, according to Bentley.”
The statement is substantially true and non-defamatory.201
198 See supra notes 36-38 and accompanying text. See also Carter Dep., CR890-91, 902-03;
Whitmore Dep., CR1197; Hawley Dep., CR1021; Martinez Dep., CR1040-41; CR326-36;
CR341-53.
199 See Carter Dep., CR891; Whitmore Dep., CR1208. See also Part I.1.c.iii.c. discussing
Statement 2/15-1.
200 See Carter Dep., CR891-92; Whitmore Dep., CR1208; Hawley Dep., CR1021; Bentley
Dep., CR861.
201 See Carter Dep., CR892. See also Part I.1.c.iii.d. discussing Statement 2/15-2.
62
3. February 20 Article: CC Chamber Meeting to Discuss
Financial Irregularities.
“The Corpus Christi Chamber of Commerce executive
committee is meeting to discuss financial irregularities
discovered during a performance review of President
Terry Carter after a raise and bonus for Carter had been
proposed. The financial questions led to a decision to
conduct a full audit.”
The brief February 20 Article—set out in its entirety above—is non-
defamatory and substantially true.202 It is undisputed that Carter used the
term “misappropriation” in discussions of the Chamber’s financials with
executive committee members at the February 20 meeting while Bentley
referred to financial “irregularities” in the same meeting, as shown by the
minutes.203 Carter’s affidavit testimony that “there were no financial
irregularities”204 is a mere conclusion and legally insufficient to raise a fact
issue.205
202 Mtg. minutes, CR118-20; Bentley Dep., CR862-63; Carter Dep., CR892-93.
203 CR117-20.
204 6CR12166.
205 See Wal-Mart Stores, Inc., 313 S.W.3d at 840.
63
4. February 21 Article: Chamber of Commerce: Financial
Questions Lead to Call for Audit.
i. Statement 2/21-1:
“The audit decision occurred at a special called meeting
of the executive committee.”
The statement is non-defamatory and substantially true.206
Carter’s affidavit assertion that the Article’s statement is false that
“Carter and Huseman informed two of three [executive committee
members] that they were no longer eligible to serve”207 raises no fact issue
because he does not dispute that he met with the two when they were
informed of their alleged ineligibility.208 Reporting that Carter
“participated” in informing the two of their alleged ineligibility rather than
that Carter “informed” them himself would have no lesser effect on his
reputation.
206 Carter Dep., CR893.
207 6CR12167.
208 See supra notes 36-38 and accompanying text.
64
5. February 27 Article: Chamber CEO Shifted Funds, Letter
Says.
The February 27 Article is non-defamatory and substantially true.209
The February 27 article presents an accurate account of dueling letters to
the Chamber board by Bentley and Carter regarding the Chamber’s
financial status, accounting practices and Carter’s role.
i. Statement 2/27-1:
“The Corpus Christi Chamber of Commerce chief
executive, whose bonus is based on financial
performance, shifted funds to make a loss look like a
profit, according to a letter by the Chamber’s treasurer.”
The statement is non-defamatory and substantially true.210 Bentley’s
letter, obtained by reporter Aguilar, states, “CEO [Carter] … shifted the
Building Fund from the Chamber’s books for the use of supplementing the
Chamber’s financials.”211 Carter admits he transferred funds from one
account to another.212 This “shift[ing]” of funds made a “loss look like a
209 Aguilar Aff., CR458; Aguilar Dep., CR822-24; Bentley letter to board, CR303-04;
Bentley PowerPoint, CR156-72; Bentley Dep., CR852-53; Thompson Dep., CR1145.
210 Carter Dep., CR894-95, 899, 939, 951-953; Martinez Dep., CR1044, 1048; Thompson
Dep., CR1145; Thompson letter, CR432-36; Bentley letter to board, CR303-04; Bentley
Dep., CR 851-52, 854-55, 862; Whitmore Dep., CR1194, 1204-05; Hawley Dep., CR1010;
Carter’s review, CR137-40, 143-45, 148-50; Carter’s contract, CR121-36; transcript,
CR717-18.
211 Aguilar Aff., CR458; Bentley letter to board, CR303-04 (emphasis added).
212 Carter Dep., CR894-95, 899.
65
profit” because the effect of the transactions was a swing of more than
$100,000; that is, a stated $40,000 profit versus a loss of more than
$60,000.213 Carter also admits a connection between his bonus and
Chamber finances.214
Carter’s affidavit asserts the statement is false because his amended
employment contract did not link his bonus to the Chamber’s financial
performance.215 However, the Article does not base the statement on his
contract and the affidavit does not dispute that executive members
understood Carter’s bonus was based on financial performance.216
ii. Statement 2/27-2:
“Bentley disclosed his concern about the Chamber’s books
at a Feb. 15 meeting of the Chamber executive committee
that included a shouting match with Carter.”
The statement is non-defamatory and substantially true.217
iii. Statement No. 2/27-3:
“During the meeting, which was tape-recorded, Carter
seized the tape and left the building.”
213 Bentley Dep., CR862.
214 Carter Dep., CR951-53; Carter and Waller emails, CR152; Carter and Martinez
emails, CR268.
215 6CR12167-68.
216 See CR468-69; CR12165-172. See also supra notes 16-30 above and accompanying text.
217 See Carter Dep., CR896; see also Part. I.1.c.iii.c. discussing Statement 2/15-1.
66
The statement is non-defamatory and substantially true.218 Bentley’s
letter to the Chamber board states the “CEO [Carter] took the tape and
immediately left the premises” and describes unsuccessful efforts over a
number of days by him to obtain the tape. 219 Carter’s affidavit testimony
that the statement is “blatantly false”220 is a mere conclusion and legally
insufficient to raise a fact issue.221
iv. Statement No. 2/27-4:
“The link between Carter’s bonus and the Chamber’s
financial performance was a red flag for the Chamber’s
accountant, Darrell Thompson, according to Bentley’s
letter.”
The statement is non-defamatory and substantially true.222 Although
Bentley’s letter did not use the term “red flag,” Thompson testified that he
agreed with that characterization.223 Bentley’s letter relates that the
Chamber’s CPA confirmed that the treasurer’s questions about financial
adjustments were valid concerns and that the link between the bonus and
218 See supra notes 46-49 above and accompanying text.
219 CR301.
220 6CR12168.
221 Wal-Mart Stores, Inc., 313 S.W.3d at 840.
222 Thompson letter, 434-35; Thompson Dep., CR1152-53; Bentley letter to board,
CR300-08; tape, CR325; transcript, CR791-93; Carter Dep., CR896, 922-31.
223 Thompson Dep., CR1152-53.
67
Chamber’s financial performance could possibly forfeit the Foundation’s
501(c)(3) status.224 Stating the link was a “red flag” rather than a “concern”
has no greater impact on Carter’s reputation and thus is substantially
true.225
v. Statement No. 2/27-5:
The accountant told the Chamber executive committee
that “use of Building Fund dollars to supplement the
Chamber operating expenses could possibly forfeit the
(Chamber) foundation’s (nonprofit) status because of the
link between the CEO’s bonus to the financial
performance of the Chamber.”
The statement is non-defamatory, substantially true and protected
opinion.226
vi. Statement No. 2/27-6:
“Bentley also sought but never received a copy of the tape
seized by Carter.”
The statement is non-defamatory and substantially true. Carter
admits that as of the date of the article, Bentley had called him to request a
copy of the tape, Carter never returned the call, and Bentley had not
224 Tape, CR325; transcript, CR791-93; Thompson letter, CR434-35.
225 See supra notes 23-28 above and accompanying text regarding the link between
Carter’s bonus and the Chamber’s financial performance.
226 Thompson letter, CR435; Thompson Dep., CR324-25; transcript, CR791-93; Bentley
Dep., CR847-48; Carter Dep., CR896-97.
68
received a copy of the tape.227 Bentley’s letter recounts his unsuccessful
efforts over several days to obtain the tape.228
vii. Statement No. 2/27-7:
“Bentley’s letter states the Chamber showed a $40,425
profit when it should have shown a $61,782 loss. The
numbers provided in Bentley’s letter show that the
Chamber showed the surplus by booking $63,903 in
January 2008 revenue for 2007 and by deferring part of
Carter’s salary. Carter’s February 17th letter says
including January 2008 revenue was consistent with the
Chamber’s accounting method, approved by the Board in
September 2004. He also said in his letter that the failure
to record his salary deferral as a 2007 expense was a
bookkeeping error.”
The statement is non-defamatory and substantially true.229
viii. Statement No. 2/27-8:
“Carter also used $18,312 from the Chamber’s building
fund to pay operating expenses, according to the letter.
He shifted the money to the Chamber’s foundation, then
billed the foundation for expenses in that amount.
Carter’s February 17th letter says he discussed the move
with Thompson and Bentley before shifting the funds.
The foundation has operated with overhead provided by
the Chamber and the Chamber had never been
reimbursed for those expenses, according to Carter’s
letter.”
227 Carter Dep., CR897-98.
228 CR112-13.
229 See supra notes 58, 64-67 and accompanying text. Bentley letter to Freddie, CR112-
13; Bentley letter to board, CR303-05; Carter’s letter, CR240-43; Carter Dep., CR898-99;
FY2007 adjustments, CR180-82; FY2007 audit report, CR260-65; Martinez Dep., CR1051.
69
The statement is non-defamatory and substantially true.230 Carter’s
affidavit contends the statement that he “shifted money to the Chamber’s
foundation” implies a felony on his part,231 which again is an incompetent
conclusion or opinion. Importantly, Carter does not deny that the funds
were shifted; in fact, he admitted he transferred funds from one account to
another.232
ix. Statement No. 2/27-9:
“Among other concerns Bentley listed was the Chamber’s
lack of accounting for special events. His letter described
them as “off the books”, with only net income presented
to the executive committee. Examples of special events in
2007 were the Mayor’s State of the City address, Salute
to the Military and the Conquer the Coast bicycle ride.
Bentley also stated in his letter that he was concerned
that Carter authorizes “significant contracts” without
seeking bids or consulting the executive committee or
board.”
230 Carter letter, CR499; Carter Dep., CR899; Bentley Dep., CR845-46, 852-53; Martinez
Dep., CR1045, 1051-52; Thompson Dep., CR1145; FY2007 audit report, CR245-66;
FY2007 adjustments, CR180-83.
231 6CR12168.
232 Carter Dep., CR895, 899.
70
The statement is substantially true and non-defamatory.233 Once
again, the Article accurately recounted the content of Bentley’s letter,234
which Carter does not dispute.235 Further, Carter admits that he may not
have provided a full accounting of all special events to the board and that
he typically presented special events on a net basis to the board.236
Moreover, the Article makes clear that the phrase “off the books” is
Bentley’s characterization of the disclosed fact that only net income was
presented to the Executive Committee.
Carter agreed that the examples of special events in 2007 cited in the
letter and Article are not false or defamatory.237 Carter also acknowledged
he authorized certain contracts, including some around $50,000, without
bids or executive committee or board approval.238
233 Bentley letter to Freddie, CR112-13; Carter Dep., CR900-02; Martinez Dep., CR1039,
1062; Hawley Dep., CR1011-12, 1017; Bentley Dep., CR860-61; LRGlobal contract CR279-
86; CR252.
234 CR112-13.
235 CR900.
236 CR900-02.
237 Id.
238 Id.
71
6. February 29 Article: Ex‐Chair Airs Her Chamber
Concerns.
The February 29th Article is non-defamatory and substantially true as
a whole.239
i. Statement No. 2/29-1:
“On the morning of Feb. 15, Carter and Huseman took
Whitmore and Hawley behind closed doors and told them
they were no longer eligible to serve on the committee.
As Bentley waited outside, according to witness
accounts, the two women endured shouting from Carter.
They stayed to hear Bentley’s report. Before leaving the
room, Carter seized a tape recording of the meeting and
left the building.”
The statement is non-defamatory and substantially true.240 Although
Carter’s affidavit makes the conclusory assertion that it “is not true” that
the two women endured shouting from him, the affidavit does not dispute
the extensive record that Carter spoke “loudly” to Whitmore and “yelled”
and “blew up” at Bentley in the meeting.241
ii. Statement No. 2/29-2:
“Bentley had been asked to review the Chamber’s
finances in anticipation of a raise, bonus and contract
239 Whitmore Dep., CR1208-09; Whitmore’s letter, CR313-15; Aguilar Dep., CR824-27.
240 See supra notes 190-93 and accompanying text. See also Carter Dep., CR902-03, 962;
Martinez Dep., CR1040-41; Whitmore Dep., CR1203. See also supra note 195 and
accompanying text.
241 See supra notes 39-45 and accompanying text.
72
extension for Carter. Bentley found that Carter shifted
funds among accounts and deferred $19,992 of his 2007
salary. Without those moves, the Chamber’s cash flow
would have been negative, according to Bentley, adding
that Carter’s bonus is based on the Chamber’s financial
performance. According to Bentley, the Chamber
accountant told him that the Chamber Foundation’s
nonprofit status could be in jeopardy because Carter
shifted Chamber Foundation funds to pay operating
expenses and Carter’s bonus is linked to the Chamber’s
financial performance.”
The statement is non-defamatory and substantially true.242
iii. Statement No. 2/29-3:
“…denying the treasurer access to critical information
and advice of financial professionals employed by the
Chamber of Commerce.”
*****
“There was refusal of Chamber staff to cooperate with the
treasurer on a task he was given by the board and the
executive committee.”
The statement is non-defamatory and substantially true.243 Carter
admits the February 29th Article accurately reports that Whitmore’s letter
stated that the treasurer was denied access to critical financial
242 See Carter Dep., CR903-04; Thompson Dep., CR1152; see also Part I.2.i. discussing
Statement 2/16-1.
243 Bentley letter, CR299-308; Bentley Dep., CR861-62; Whitmore’s letter CR313-15;
Carter Dep., CR904-05.
73
information.244 Carter admits he does not know for a fact whether Bentley
was ever denied access to information.245 Bentley’s emails of February 15th
and 18th confirm that he requested information from the Chamber, but was
refused and told he must go through Carter.246 Carter’s affidavit testimony
of alleged instructions to a staff member to fully cooperate offers no actual
proof that Bentley received the information he was seeking.247 Further,
Bentley requested information from Chamber CPA Thompson, but was
refused.248
7. March 2 Editorial: Chamber’s CEO’s Actions Raise
Serious Questions.249
For the reasons set out above and below, the editorial in its entirety is
protected under the First Amendment of the U.S. Constitution, Article 1,
244 Whitmore letter, CR313-15; Carter Dep., CR904.
245 Carter Dep., CR904-05.
246 Bentley Dep., CR861-62.
247 6CR12169.
248 Bentley Dep., CR852-54 (Chamber officials refused to sign a letter of indemnification,
effectively silencing Thompson.); Thompson’s indemnity letter to board, CR437-39.
249 Appellants’ motion inadvertently referred to the editorial as published March 3,
which is corrected herein to the March 2 publication date.
74
Section 8 of the Texas Constitution and the common law as non-actionable
opinion, and is non-defamatory and substantially true.250
i. Statement No. 3/2 (Editorial)-1:
“…highly questionable stewardship of the financial
affairs of the chamber by Carter.”
This statement is non-defamatory, substantially true, and non-
actionable opinion.251
ii. Statement No. 3/2 (Editorial)-2:
“Two executive committee members, former state Rep.
Judy Hawley and bank executive Sylvia Whitmore, were
removed from the committee by Carter after they
attempted to bring transparency and accountability to
the finances of the Chamber at a Feb. 15 meeting.”
The statement is non-defamatory and substantially true.252
iii. Statement 3/2 (Editorial)-3:
“…intimidation, secrecy and duplicity discredit a vital
organization”
This statement is non-defamatory, substantially true and non-
actionable opinion.253
250 Jimenez Aff., CR563-64; Jimenez Dep., CR1029-32.
251 See supra notes 180, 184 and accompanying text. See also Jimenez Dep., CR1029; see
also Carter Dep., CR910.
252 See supra notes 36-37 and accompanying text. See also Jimenez Dep., CR1029-30.
253 See supra notes 180, 184 and accompanying text. See also Jimenez Dep., CR1031-32.
75
iv. Statement No. 3/2(Editorial)-4:
“The fund-shifting, including the deferring of Carter’s
salary, allowed the Chamber to show a profit, thus
qualifying Carter for a bonus.”
The statement is non-defamatory and substantially true as discussed
above.
v. Statement No. 3/2 (Editorial)-5:
“The question mark remains over Carter until he fully
explains his actions or until the Chamber chooses to move
on without him.”
This statement is non-defamatory, substantially true and non-
actionable opinion for the reasons set out above.
8. March 3 Article: Petition Seeks Chamber Changes.
The article is substantially true and non-defamatory.254
i. Statement No. 3/3 (Article)-1:
“Treasurer Damon Bentley reported that Carter had
deferred a portion of his salary and shifted other funds
among Chamber accounts in a manner that turned what
should have been a deficit into a surplus of operating
funds. Carter’s bonus is linked to the Chamber’s financial
performance.”
The statement is non-defamatory and substantially true as set out
above.255
254 Whitmore letter with petition, CR513-17; Scott Dep., CR1106, 1108-09.
76
9. March 4 Article: About 80 Sign Petition on Chamber
Operation.
The March 4th Article as a whole is non-defamatory, substantially
true and a fair report of a public meeting.256
i. Statement No. 3/4-1:
“Never has the lack of financial transparency been an
issue like it is now, Whitmore said.”
ii. Statement No. 3/4-2:
“…I don’t think the current leadership is transparent in
its financial decisions.”
The statements are non-defamatory, non-actionable opinion,
substantially true and a fair report of a public meeting.257
10. March 8 Article: Chamber Board, CEO to Enter Talks.
i. Statement No. 3/8-1:
“Bentley was asked to look into the organization’s
finances as part of a review of a proposed raise, bonus
and contract extension for Carter, whose bonus is linked
to the Chamber’s financial performance.”
The March 8th Article is non-defamatory and substantially true.258
255 See also Carter Dep., CR907.
256 See Aguilar Aff., CR457; Aguilar Dep., CR828; Scott Dep., CR1106, 1108-09; see also
Tex. Civ. Prac. & Rem. Code § 73.002(b)(1)(D).
257 See Whitmore letter, CR313-15; Whitmore Dep., CR1209; Carter Dep., CR907-08;
Hawley Dep., CR1021; see also Tex. Civ. Prac. & Rem. Code § 73.002(b)(1)(D).
258 See Carter Dep., CR908; Aguilar Dep., CR829; Scott Dep., CR1114.
77
11. March 19 Article: Chamber Treasurer Granted
Temporary Restraining Order
The March 19th Article is substantially true. It is also a fair, true and
impartial account of a judicial proceeding.259 As such, it is privileged
against Carter’s libel claim pursuant to Tex. Civ. Prac. & Rem. Code §
73.002(b)(1)(A) (the “fair report privilege” hereafter).
i. Statement No. 3/19-1:
“Corpus Christi Chamber of Commerce treasurer Damon
Bentley has been granted a temporary restraining order
against the chamber and CEO Terry Carter to prevent a
tape recording from being destroyed.”
ii. Statement No. 3/19-2:
“Bentley’s petition for the temporary restraining order
says he has sought a copy of the tape but it has not been
provided, and that Carter took the tape from the
meeting.”
The statements are non-defamatory, protected by the fair report
privilege and substantially true.260
12. March 20 Article: Chamber Unrest Ends Up In Court.
The March 20th Article is a fair, true and impartial account of judicial
proceedings by Bentley and Carter. 261
259 CR326-36.
260 See CR326-36; Carter Dep., CR963-64.
78
i. Statement No. 3/20-1:
“The restraining order, obtained Tuesday, prohibits
Carter and the chamber from destroying a tape of a Feb.
15 chamber executive committee meeting at which
Bentley and two others. . .”
ii. Statement No. 3/20-2:
“One of the members’ concerns, Scott and others have
said, is that the chamber is losing membership but they
couldn’t verify it because the full member list was
withheld.”
The statements are protected by the fair report privilege, non-
defamatory and substantially true.262
13. March 26 Article: Chamber Puts CEO on Paid Leave and
March 27 Article: Chamber CEO on Paid Leave.
i. Statement No. 3/26-1 and 3/27-1:
“Chamber CEO on Paid Leave”
The statement is substantially true and non-defamatory.263
14. March 27 Article: Judge Unifies Filings On Chamber
Events
The March 27th Article is a fair report of judicial proceedings.264
261 See CR326-36; CR342-53; Scott Dep., CR1114-15.
262 See Carter Dep., CR964-65; CR504-517.
263 See Carter Dep., CR908, 965-66.
264 Order of Consolidation, CR359-62.
79
i. Statement No. 3/27(2)-1:
“Bentley sought the consolidation, asserting that his and
Carter’s legal actions arose from the same set of events.”
ii. Statement No. 3/27(2)-2:
“That tape was removed by Terry Carter from the
meeting and taken from the Corpus Christi Chamber of
Commerce immediately after the meeting ended.”
The statements are protected by the fair report privilege, non-
defamatory and substantially true.265
15. April 1 Article: Chamber Had Deficit, Board Tells
Members.
The Article is a privileged as a fair report of a public meeting, non-
defamatory and substantially true.266 Reporter Aguilar attended the
Chamber’s public general membership meeting on March 31, 2008 and
accurately reported on it.267
i. Statement No. 4/1-1:
“Further review of the books by the Chamber executive
committee showed that a deferral of a part of the chief
executive officer’s salary and shifts of more than
$142,000 in membership dues resulted in the surplus,
according to treasurer Damon Bentley.”
265 Carter Dep., CR966; see also CR354-58.
266 See Aguilar Aff., CR457; Carter Dep., CR966-67; FY2007 adjustments, CR180-83; see
also Tex. Civ. Prac. & Rem. Code § 73.002(b)(1)(D).
267 Aguilar Aff., CR457.
80
The statement is privileged as a fair report of a public meeting,
substantially true and non-defamatory.268
ii. Statement No. 4/1-2:
“The membership meeting was a result of a petition drive
started in late February to address concerns of members
who said they had been denied financial information and
membership rosters and who were concerned about the
Chamber’s accounting methods.”
The statement is privileged as a fair report of a public meeting,
substantially true and non-defamatory.269
16. April 29 Article: Chamber, In Need Of Audit, Renews
Accountant Search.
Carter complains about the following statement:
“He said negotiations between Chamber attorney Van
Huseman and Chamber President and CEO Terry Carter
are ongoing.”
The statement is non-defamatory and substantially true.270
268 See Carter Dep., CR967; Thompson Dep., CR1145; FY2007 adjustments, CR179-83.
269 See Carter Dep., CR967-68; Scott Dep., CR1106, 1108.
270 See also Carter Dep., CR968.
81
17. May 2 Article: Chamber Offers Contract Settlement to
Carter, His Attorney Says; May 3 Article: Chamber
Makes Offer, Carter’s Attorney Says; May 23 Article:
Chamber, Carter’s Attorney Confirm Severance
Agreement and May 24 Article: Carter’s salary to be
paid in full.
These Articles are non-defamatory and substantially true.271
18. May 28 Article: Release of Chamber Audio Recording
Sought; and May 30 Article: Judge orders that chamber
tape recording be released today.
Carter complains of the following statement in each article:
“Carter has been on paid leave since March 26.”
The statement is substantially true and non-defamatory.272
19. May 31 Article: Chamber Tape Tells of Heated
Exchange.
The May 31st Article as a whole is privileged as a fair report of a
judicial proceeding, non-defamatory and is substantially true.273
i. Statement No. 5/31-1:
“Chamber tape tells of heated exchange.”
ii. Statement No. 5/31-2:
“A recording of a Corpus Christi Chamber of Commerce
meeting obtained Friday by the Caller Times contains a
271 See also Carter Dep., CR968-69.
272 See also Carter Dep., CR908; Carter’s interrog. resp., CR795-800.
273 See also CR324-25; transcript, CR707-94.
82
contentious exchange between CEO Terry Carter and
other chamber officials.”
iii. Statement No. 5/31-3:
“Early in the segment a contentious exchange between
Carter and Bentley can be heard, as the chamber officials
discuss whether to proceed with Bentley’s financial
report.”
iv. Statement No. 5/31-4:
“Bentley: It’s not a question for me to answer right now.
I’m going to give the findings of fact.”
The statements are a privileged as a fair report, non-defamatory and
substantially true.274
20. June 13, 2008 Article: Ex‐Chamber CEO’s Mediation to
Continue.
The Article is non-defamatory and substantially true.275
F. The Articles Were Published Without Negligence276
A private figure plaintiff must prove negligence in a libel action
against a media defendant.277 Here, the record disproves negligence as the
Caller-Times acted reasonably in checking the truth of the Articles before
274 See CR711; Bentley Dep., CR849-50; Carter Dep., CR969-70.
275 See also Carter Dep., CR970.
276 The Court need not reach the issues of negligence or exemplary damages if it
determines the Articles were non-defamatory or substantially true. See Neely, 418
S.W.3d at 61 (citing McLemore, 978 S.W.2d at 571).
277 See Foster v. Laredo Newspapers, Inc., 541 S.W.2d 809, 820 (Tex. 1976).
83
publication.278 It is undisputed that the Articles were published with
diligence, balance and in accord with standard journalistic practices and
customs.279 The Caller-Times submitted the expert opinion of Tony
Pederson—former editor of the Houston Chronicle and journalism chair at
SMU—that the Articles were prepared in accordance with usual
journalistic standards and practices. 280
Carter’s response offers no evidence or expert opinion to raise a fact
issue that the Caller-Times did not act reasonably in preparing and
publishing the Articles or that they contained any misstatement whose
content would warn a reasonably prudent editor of its defamatory
potential.281
278 See Scripps Tex. Newspapers, L.P. v. Belalcazar, 99 S.W.3d 829, 837 (Tex. App.—Corpus
Christi 2003, pet. denied) (“Negligent conduct is determined by asking ‘whether the
defendant acted reasonably in checking the truth or falsity or defamatory character of
the communication before publishing it.’”) (internal quotation omitted).
279 See Pederson Report, CR665; Pederson Dep., CR1068, 1070-79; Aguilar Aff., CR454-
60; Cavazos Aff., CR518-22; Chirinos Aff., CR 530-34; Jimenez Aff., CR562-65; Malan
Aff., CR608-11; Powell Aff., CR584-88; Wilson Aff., CR613-15; Whitehurst Aff., CR616-
19; Birmingham Aff., CR624-28; Contreras Aff., CR636-40; Averyt Aff., CR620-23.
280 CR664-65.
281 See Foster, 541 S.W.2d at 819. See also Holly v. Cannady, 669 S.W.2d 381, 384-385 (Tex.
App.—Dallas 1984, no pet.) (There was “simply no evidence indicating the existence of
circumstances which would have prompted a reasonable person to question the
statements made and conclusions drawn.”).
84
Carter’s response mistakenly asserted alleged evidence of actual
malice was dispositive of negligence.282 However, actual malice is not the
same as negligence.283 The two concepts are different fault standards in
libel cases. A private figure plaintiff must prove negligence, not actual
malice, on his case in chief.284
G. Carter Cannot Recover Exemplary Damages Because the
Articles Were Published Without Actual Malice
A private figure plaintiff must prove actual malice in order to recover
punitive or exemplary damages in a libel case arising out of reports of a
matter of public concern.285
Here, the evidence establishes that the Caller-Times Appellants acted
without actual malice.286 Actual malice is “not ill will, spite or evil motive”;
it is the making of a statement with either knowledge it is false or reckless
282 2CR1241.
283 See Foster, 541 S.W.2d at 820 (refusing to assess negligence when only actual malice
argued).
284 See Neely, 418 S.W.3d at 61 (citing McLemore, 978 S.W.2d at 571) (public figure libel
plaintiff must prove actual malice while private figure plaintiff must prove negligence).
285 See Burbage, 447 S.W.3d at 259 (private figure plaintiff who does not prove actual
malice may recover only damages for actual injury) (citing Gertz, 418 U.S. at 350).
286 See Aguilar Aff., CR454-60; Cavazos Aff., CR518-22; Chirinos Aff., CR530-34;
Jimenez Aff., CR562-65; Powell Aff., CR584-88; Malan Aff., CR608-11; Wilson Aff.,
CR612-15; Whitehurst Aff., CR616-19; Averyt Aff., CR620-23; Birmingham Aff., CR624-
28; Contreras Aff., CR636-40; Pederson Aff., CR646-48; Pederson Dep., passim; Reta Aff.,
CR451-53.
85
disregard—meaning it was made while entertaining serious doubts as to
the truth of the statement.287 The Articles were published without
knowledge of any falsity and without doubts as to the truth of any
allegedly defamatory statement.288 Although Appellants negated actual
malice, Carter’s various arguments that malice is shown also fail as a
matter of law.
1. Carter failed to show specific allegedly false statements
were published with actual malice.
Carter must demonstrate actual malice separately as to each allegedly
false statement he claims libeled him.289 Yet, Carter's discussion of actual
malice in his response references specific statements in only a handful of
the Articles.290 Thus, the Court may disregard Carter's abstract discussion
287 Huckabee, 19 S.W.3d at 420.
288 See Aguilar Aff., CR459; Cavazos Aff., CR521; Chirinos Aff., CR533; Jimenez Aff.,
CR564-65; Powell Aff., CR587; Malan Aff., CR610; Wilson Aff., CR614; Whitehurst Aff.,
CR619; Averyt Aff., CR622-23; Birmingham Aff., CR627; Contreras Aff., CR639;
Pederson Report, CR664-65.
289 See, e.g., Church of Scientology Int’l v. Time Warner, Inc., 903 F. Supp. 637, 641 (S.D.N.Y.
1995) (on summary judgment, “the Court considers each allegedly libelous statement
individually to determine whether a rational finder of fact could find actual malice”),
aff’d, 238 F.3d 168 (2d Cir. 2001); Henry v. Nat’l Ass’n of Air Traffic Specialists, Inc., 836 F.
Supp. 1204, 1212 (D. Md. 1993) (“The plaintiffs must produce [] evidence that the
defendants uttered [each] challenged statement [] with actual malice”), aff’d, 34 F.3d
1066 (4th Cir. 1994).
290 See Response, 2CR1244 (March 2 editorial); 2CR1252 (May 31 Article); 2CR1254
(February 27, 29, March 8 Articles); 2CR1259 (March 3 Article).
86
of malice regarding unspecified Articles. As to the few Articles he actually
specifies, Carter failed to establish actual malice as shown below.
2. There is no evidence of “reckless” preparation of the
editorial.
Carter makes no attempt to examine whether the author of the
editorial, Nick Jimenez, actually entertained serious doubts as to its truth.
Carter’s response and affidavit do not refer to Jimenez or attempt to rebut
his uncontroverted affidavit that he believed that all facts stated in the
editorial were true based on previously published articles in the Caller-
Times.291 Reliance on previously published reports in reputable news
sources precludes a finding of actual malice.292 Carter also claims the Caller-
Times should have asked Thompson about Bentley’s letter.293 Yet it is
undisputed that Aguilar, the author of the article which quoted the Bentley
letter, attempted to do just that.294
Carter contends actual malice may be found because the editorial
stated that Carter’s actions “would” threaten the chamber’s financial status
291 CR565.
292 Liberty Lobby, Inc. v. Dow Jones & Co., 838 F.2d 1287, 1297 (D.C. Cir. 1988).
293 2CR1247.
294 CR458.
87
when the accountant had only said it “could” threaten it.295 However, the
statement is substantially true296 and therefore cannot support a finding of
actual malice.297
3. Alleged ill‐will is no evidence of actual malice.
Carter alleges publisher Patrick Birmingham demonstrated “dislike,”
“distain (sic),” “animosity,” “outrage,” and “personal animus” towards
him.298 But Birmingham did not write, assign, direct, edit or contribute to
any of the articles,299 and his alleged ill-will does not prove knowing or
reckless falsity.300 Statements that a defendant “didn’t like” or “had it out”
for the plaintiff are not proof of actual malice.301
295 2CR1247.
296 See Dolcefino, 19 S.W.3d at 921 (use of phrase “could not” when “would not” was
actually correct was of secondary importance and statement was substantially true).
297 See also Freedom Newspapers v. Cantu, 168 S.W.3d 847, 855 (Tex. 2005) (mistaken but
rational interpretation of statement is no evidence of actual malice).
298 2CR1248-50.
299 CR624-28.
300 Huckabee, 19 S.W.3d at 424–25.
301 Cantu, 168 S.W.3d at 857-58.
88
4. There is no omission or juxtaposition establishing
actual malice.
As explained above, there was no omission or juxtaposition, as
Carter’s explanations and version of events were included in the Articles.302
In any event, Carter offered no evidence of an omission or juxtaposition
made with the intent of creating a false impression, which is required for
actual malice.303
5. There was no avoidance of the truth or obviously
unreliable sources.
Where a journalist seeks the truth from multiple sources, on both
sides of an issue, there is no purposeful avoidance of truth evidencing
actual malice.304 It is undisputed that information was sought from
numerous, knowledgeable sources—including Carter and his counsel. In
addition, Carter’s claims that the Caller-Times should not have believed
Bentley and other persons with relevant knowledge is no evidence of
actual malice.305
302 See supra notes 150-51 and accompanying text.
303 Huckabee, 19 S.W.3d at 436 (“in the absence of evidence that the defendant selected
the material to portray the judge’s record falsely, the First Amendment protects the
organization’s choice of which material to include in its broadcast”).
304 Skeen, 159 S.W.3d at 637-39.
305 See Lohrenz v. Donnelly, 350 F.3d 1272, 1284 (D.C. Cir. 2003).
89
H. Tag‐Along Tort Claims Also Fail
Carter testified that his non-defamation claims are based on the
newsgathering for and publication of the Articles that he alleges defamed
him.306 His response—which mentions only tortious interference and
conspiracy among his non-libel actions—takes the same approach.307 But
publication-based claims fail along with defamation claims arising from the
same events.308
Carter argued in support of his conspiracy claim (without reference
to the record) that the Caller-Times acted in concert with the people it
interviewed for the Articles.309 But Carter offered no evidence to rebut
testimony from Bentley and Caller-Times personnel negating any such
conduct.310 Therefore, the trial court erred in denying summary judgment
to Appellants on the non-libel claims.
306 CR912.
307 2CR1268-70. Carter’s response does not mention or attempt to identify any evidence
in support of his fiduciary duty or inducement claims.
308 See, e.g., Freedom Newspapers, 168 S.W.3d at 852 n.3; Rogers v. The Dallas Morning
News, Inc., 889 S.W.2d 467, 474 (Tex. App.—Dallas 1994, writ denied).
309 2CR1269-70.
310 Bentley Dep., CR857; Cavazos Aff., CR521; Malan Aff., CR610; Averyt Aff., CR623;
Birmingham Aff., CR628. See Shunta v. Westergren, No. 01-08-00715-CV, 2010 WL
2307083, at *7-8 (Tex. App.—Houston [1st Dist.] June 10, 2010, no pet.) (affirming no-
90
I. Appellant E.W. Scripps Has No Publisher Liability
The threshold element for a libel action is whether a false, defamatory
statement was published. The record is undisputed that Appellant E.W.
Scripps had no involvement in publishing (or researching, preparing,
writing, reviewing, or editing) any of the Articles or content on the website
Caller.com.311 Accordingly, it was error to deny E.W. Scripps Co. summary
judgment because it did not publish any allegedly defamatory statements
concerning Carter.
PRAYER
Appellants pray that the Court reverse the trial court order denying
their second motion for final summary judgment and render judgment that
Appellee Terry Carter take nothing. Appellants further pray for any other
relief to which they may justly be entitled.
evidence summary judgment on conspiracy because plaintiff failed to present evidence
of requisite intent).
311 See Contreras Aff., CR636-40; Contreras Dep., CR988-98; Whitehurst Dep., CR1180-
81; Carter Dep., CR979-80.
91
Respectfully submitted,
/s/ Paul C. Watler
Jorge C. Rangel
State Bar No. 16543500
Jaime S. Rangel
State Bar No. 24033759
Joseph M. Marcum
State Bar No. 12973000
THE RANGEL LAW FIRM, P.C.
615 N. Upper Broadway, Suite 2020
Corpus Christi, Texas 78401
Telephone: (361) 883-8500
Facsimile: (361) 883-2611
Email: jorge.c.rangel@rangellaw.com
Email: jaime.rangel@rangellaw.com
Email: joe.marcum@rangellaw.com
- and -
Paul C. Watler
State Bar No. 20931600
Andrew D. Graham
State Bar No. 24041002
JACKSON WALKER, LLP
2323 Ross Avenue, Suite 600
Dallas, Texas 75201
Telephone: (214) 953-6000
Facsimile: (214) 953-5822
Email: pwatler@jw.com
Email: agraham@jw.com
Attorneys for Appellants Scripps NP
Operating, LLC, a Wisconsin Limited
Liability Company, Successor in Interest to
Scripps Texas Newspapers, LP d/b/a Corpus
Christi Caller-Times, and The E.W. Scripps
Company
92
CERTIFICATE OF SERVICE
On December 17, 2015, I electronically filed Appellants’ Brief with the
Clerk of Court using the File & eFileTexas electronic filing system, which
will send notification of the filing to the following:
Rene Rodriguez
LAW OFFICE OF RENE RODRIGUEZ
433 S. Tancahua St.
Corpus Christi, Texas 78404
361-882-1919 / 361-882-2042 fax
Email: rene.rodriguez@rdrlaw.com
Attorney for Plaintiff Terry Carter
Craig Smith
Law Offices of Craig S. Smith
14493 S.P.I.D. Suite A; P.M.B. 240
Corpus Christi, Texas 78418
361-728-8037
Email: csslaw@stx.rr.com
Attorney for Plaintiff Terry Carter
Angelica E. Hernandez
AEH Law Firm
410 Peoples Street
Corpus Christi, Texas 78401
361-400-2966 / 866-759-9272 fax
Email: aehlawfirm@yahoo.com
Attorney for Plaintiff Terry Carter
/s/ Paul C. Watler
Paul C. Watler
93
CERTIFICATE OF COMPLIANCE
Pursuant to Texas Rule of Appellate Procedure 9.4(i)(2)(B), I hereby
certify that the above styled document contains 14,431 words, excluding
the caption, identity of parties and counsel, table of contents, index of
authorities, statement of the case, issues presented, and statement of oral
argument, signature, certificate of service, certificate of compliance and
appendix. In making this certification, counsel is relying on a word-count
computer program used to prepare the document.
/s/ Paul C. Watler
Paul C. Watler
94
APPENDIX
TAB DESCRIPTION
1. Order denying Second Motion for Final Summary Judgment,
6CR12748
2. The Articles, CR462-78, 481-82, 485-92, 524-27, 538, 541, 567
3. Bentley’s February 26 letter to Chamber board, CR299-08
4. Bentley’s PowerPoint presentation to the Chamber board, CR156-
72
5. Carter’s February 17 letter to Chamber board, CR240-43
6. Affidavit of reporter Elvia Aguilar, CR454-60
7. Whitmore’s February 28 letter to Chamber board, CR313-15
95
TABl
96
CAUSE NO. 08-1360-F
TERRY CARTER § IN THE DISTRICT COURT
Plaintiff, §
I
~ §
§ 2141h JUDICIAL DISTRICT
CORPUS CHRISTI CHAMBER OF §
COMMERCE, SCRIPPS NP §
r'IID"Il'D , T1'~.t" I I .t" '"'~· {,
.IJUYU I "JJ li I '-'VlYIIC "' I ~ .. > 8
SUCCESSOR IN INTEREST TO SCRIPPS §
TEXAS NEWSPAPERS, L.P., d/b/a §
CORPUS CHRISTI CALLER TIMES, §
and THE E.W. SCRIPPS COMPANY 6
1-- - - - - - -.._.Ditefenda.n.ts i NI !ECES-CO.ll!SI:V:, IEXA~
"-----;
ORDER DENYING CALLER-TIMES DEFENDANTS' SECOND
MOTION FOR FINAL SUMMARY JUDGMENT
_j' I
vn the- q <=:):>e.IC , 2
A~AA ,_)
12748
97
TAB2
98
February 15, 2008
Financial, management
questions
raised at CC Chamber
Jaime Powell
CR462- 463
Exhibit M-1 to Aguilar Affidavit
Exhibit Q-1 to Powell Affidavit
99
Financial, management questic - aised at CC Chamber : Corpus Chrisf.ler Times, C... Page 1 of 2
call.etcom
COR?US CHRISTl TEXA~
Primcr- tri~ndly srory
React more at caflcr.ccm
Financial, management questions raised at CC
Chamber
Two members of chamber of commerce's executive
committee, who asked for meeting to discuss the issues, told
they are no longer eligible to serve
EXHIBIT
By Jaime Powell
Originally published 05:00p.m ., February 15, 2008
I "~-I''
Updated 05:00 p.m., February 15 , 2008
CORPUS CHRISTl - Three high-ranking Corpus Christi Chamber of Commerce
officials raised what they describe as serious financial and management issues Friday.
After demanding an emergency meeting Friday of the chamber's executive committee
to air their concerns, two of the three officials, Judy Hawley and Sylvia Whitmore, were
told they are no longer eligible to serve on the executive committee, Hawley said.
However, they were asked to present their information, in a meeting that lasted most of
1
Friday morning and from which chamber President Terry Carter could be heard
shouting.
No chamber officials would discuss the nature of the financial issues. The concerns
arose after chamber chairman-elect Robert Gonzalez recommended a raise, bonus
and contract extension for Carter in January and executive committee treasurer
Damon Bentley was asked to review the chamber's financial standing, Hawley said.
At the meeting, chamber chairman Freddie Martinez Jr., legal counsel Van Huseman
and Carter told Hawley she was no longer on the board because she was an appointee
of the Port of Corpus Christi and the port did not contribute money to the chamber this
year. They told Whitmore, a banker and a past chamber chairman, that she was no
longer eligible because she is no longer immediate past chairman.
Carter declined to comment. Attempts to reach Martinez and Whitmore were
unsuccessful. Huseman said he reviewed Hawley's and Whitmore's status at
Martinez's request. Huseman said Carter's contract runs through the end of the year,
and described the financial questions as business practice-related, not improprieties.
Bentley said Carter's review was continuing.
"We agreed from a statement standpoint to say we are continuing the process of our
l C.R. 462
100
February 16, 2008
Chamber pulls two offpanel
Jaime Powell
CR464-465
Exhibit M-1 to Aguilar Affidavit
Exhibit Q-1 to Powell Affidavit
101
FROM THE COVER
CHAMBERJnm< lA
The financial concern•
a.rose after chamber dJ.air-
ma.n·clect Robert Gon:r.&·
lez recommended a raise,
bonu1 a.nd contract tnen·
•
'I* are gcnng to conduct our yearly
audit ofthe chamber and that will give
us the re.rults of2007. Frankly I am go-
ing to rely on the audit to a718weT any
further questions.'
•
lion for Carter In J&nuary
and executive committee
trcuurtr Damon Bentley
wu &Jked to review the bets of the executive com- Freddie saya you can't vote
chamber's ttnancial staru:i- mittee Based on the dwn· on anythln& but Jet'a so
lnC. Hawley taid Friday. ben bylaws, the executive ahead. and hear what you
Bentley, Gooule%. Ha.w- oommfttet 1s made up of the have to~..
tey and Wbitmore would c!Wrman,chalr-dcct,lmme- Gonzalez. wouldn't com-
not describe the ft.nanclal c!Wepastch&lr,vlcechalntt ment on Friday's eventl
and manacement c:ooc:erns. any, and tbe:trt.asurer, Hule- becauae, he l&id, they hap-
Attemptl to reach chamber manAJd.Uodc:rthote~. pened In clooed ....son.
ehalmw>- Martine. Bentley, Manlnez and Gon- Bentley wu outlide In 1.
Jr. wueUlliUCteSStul. zalc:z are the ol'l1y member~, ha1lway when Hawley and
Cb&mbtr lcca.I counsel Hwern.a.Dsa.ld. Whitmore were dbmlsse:d
Van Hustman. who attend- lb.wlcylw been the Port because Carter had denied
ed the meetiRJ Friday, de- of Corpua Cbrbtl'l repre· him entrance to the meet-
acrtbed the ftna.Ddal ques- aentative on the cb&mber IQ&.
tiow u business prutice-re- boanl. but thls ......the port •1 wu oot privy to the
lated. DOt improprieties. He didn't reocw its tund.Jn.r of mect1n&: because I wu ukt:d
aaid Ca.rtt:r'l contra.et runs the cbambu, which lutyear DOt to come in,• Benne,. said.
throush the end of the ...... wu $45,000. For that ru- •He went iMide aod closed
The....:ut!Yeboud, with aon, Huseman &aid Hawley, the door. They (Hawley and
all five mtJTi)ers pruent, met a porteommissklne:r, no lon· Whitmore) uplalned to me
twowedts aco m~ cer ahould be on the c:ha.m- what happened.. It wu a
otftc:e LDd. weed to put off berboanl. strance tce.D&rlo. 1 was sad·
m&klnJ a decision and to PortCh&lrmanRuben Bo- - a n d I'm still ""J)'-
eall Freddie, he ca11ed me a1the port's Solomon P. Ortiz lawaweare:supposedtohave
and called Sylvia_ He said. International Center. The an auc:!it every year; Hawley
'thtreartSOmtfrtecularities chamber bad begun UliDI said. "l.&&tyearwehadaspot
I am concerned about. We the center less. 10 neither of audit. We felt very Jtron&IY
---
oeed a tun executiVe com· the - f o r the ori&iual that we oocht to have a tun
mtttee meettns as soon as servk:e q:reemeot with the audit..
chamber lj)plie...,..udlyand in January not to renew, meat standpoint to say we
sot no response, Hawiefa.od Hawley Pid abe asked Mar- are contlnulnc the process
Bentley said. tine& if he wanted huto rt· of our eva.lnatton and that
•At that point, Damon alp and he indicated that there are both ICriow: ftnan-
h a d ahared those things she should Jtay on the eom- dal and manqement lsaues
and e a ch meuase we left mittoe bccanse the chamber that we need to address...
wu more atrklent than the rtillwutrylnctonqodat.ea After Bentley ddivertd
last,• Hawley uJd.. "Ft.naJJy d..twithport. blutpOrt,lhwlcyandWbk-
we aent hand-delivered let- Whitmore is put ch&lr, "'"'lelt the m«tiQ&.
ten to Bobby and Freddie but not lmmed1ate put "J am atill very commit~
,.questlnr tlw they uncel ch&1r. ted and willinc to serve u
other meetlnp to bold an "The bylaws are: clearand Immediate put chair, u
executive aeuion u an ex· theywante4todoth!luthe 1 thoucht I wu aervtnc:
eeutiYe board to discuss the bylaws 1peclty,• Huaeman Wb.ltmore said. "But J udy
l=(ularltia.. said. aDd l clld lea.. the c:lwnbcr
Martinez sent a.o e-maO Whitmore wu chainnan omct after we told Freddie
camnc for an emergency twotennaqo. but remained a.nd Bobby that we recom-
meetin& at 8 Lm. Friday. on the committee In place meoded a full audit btc.ause
When Hawley arrived 10 of reflne17 maaater Dave I no lon~ had a vote.•
minutes early, wlth Whit· Allen, who resl&ntd u chair· Gonules u.kl a tun audit
more and Bentley tollowinl man early af\e:r Koch IodUJ· ofclwnberftnances Is In the
a abort time later, Martinez tries, wbk:h owna F1lnt HUll work&. He would not elabo-
wu behind closed doors in n!tlnery In Corpua Chrlni. ...._
Carter's otnce with Huse· transferred him from the "We are COinI to ccnduct
man. city. Whmuore remained on our yearly &udk otthe cham·
"'1ben Terry and Freddie the committee at Mattlne%'1 ber and that wltl ctYe us the
come ln and ta.lk to Sylvia reqaut, abe, Hawley aod re.sults of 2007," Gon:a:ale1
and me,• Hawtey aa.kl. "We Bentley &ald. Wd."'Fraolllylamcoins:to
are the only ones in the room. lb.wlcy- their abrupt rely on the audit t o amwer
They td1 us. Ttny says, "in
anticipation that there mar
be action t.Uen today, we. ...
dismissal Friday, att.u hav-
in& been asleloo,_,occumd: to answer questiona abOut what was meeting of the execudve
l)Threeotthecommtttee'J!Wemembers discussed. The meeting wu not tape committee, followed by a
broughtthe1\nand.alconcrrnstothefu11 recorded, a departure from the usual full board meeting. Marti·
commfttee'satt.ention,and2)Carterand pnctice. nez, who also cll&irs the er-
Hu.scmaninfonnedtwoo!thethreethat Laurie Cook, a recently appointed ecutive committee, said no
they were no longer eltgiblt to serve on board member and former chamber auditor has been chosen and
the committee. chairwoman, offered perspective on
Those two, Jucly Hawley and Sylvia why there may not be a set schedule
Whitmote,dJd not attend Wedne.sd.ay's for the audlt. Cook, a cert.lfted pubUc
meetinc. The third, bo&rd treasurer accountant, pointed out that this is
Damon Bentley, declined to answer income tu: sca.son. the busiest time for
questlonsallerWednesday's~ practking CPA& A CPA hired to audit
People famlllar with Wcdoe.day's the chamber on a rtrlct schedule during
proceedinp: saw Bentley dei!Yer a. Pow· tu season would be likdy tp charge a
erPoint presentation on the ftDandal premium rate. she said. The ataodard
lssues, with paper copies distributed practice for &n orpnizatlon eon.duct-
to boord members. Aftetwvd, Trmlio lnl an audit would be to advertise !Of
was observed eollectinc thoae paper requests for proposals from potential
copies from boord mcmbcn. aod Bent- auditors, she said.
....... cbon:mu second-in-commaDd's 2007 sal- Calkr-Timudid not acquire the mandedthemeettngvfacertifted
The Corpus Chr isti Chamber of ary to 2008, chamber treasurer letter from Bentley, but h as veri- letter after committee members
.flllaryWQ.S Commercechtefexearttve. whose Damon BeDtley said In a let- fied It as what be sent &nd board Freddie Martinez Jr., the chair-
1137,000 plus bonus Is based on 1\nanctal per- ter 1\lesday to board members. members received. man, and Robert Gonzalez, the
benefits and formance. shifted tuncb to make Carter, In a Feb. I7letter to board Bentley disclosed his concern
cpmse.s. a loss look like a pront. accord- members, said he deferred part of about the chamber's bookl at a
1 C.R. 468
108
•
CAllU•TUtU ·Febn.ary27.2(X)8· ~·· 7A
FROM THE COVER/ NATION
CHAUBERJrcm< lA
c.halrman-elect, did not numben prorided in Bent·
respond to phone ea.ll.s for ley's letter show that the
more than a week. chamber showed the aur·
Ourtn1 the mectins:. plus by bookin1 $63.90.5 tn
which was tape-rtadoY.acknowtcdcedthat expenses, accordin& to the
beddcmdparto!hlssalary ktter. He lhitted the mooey
!orth.atreuon. totbedwnbenfouodadoo,
The amou.nt Carter de· then bOled the foundation
fernd lutyearwu$19..992. for apen.ses Ln that amount.
accordiDI to Bentley's Itt· Carter's Feb.l71etta'a,ys be
IU. dbcuned the move with
Carter's 2006 salary, Thompson and Bentley be-
the molt recent available Con: shlftin& the funds. The
throqh a ftn&ndal report foundation hu operated
required by &overnment with ..W.ea4 provided by
rulea for nonprofit orza· the chamber and the cham·
niutlona, wu $137,000 ber had never bet.n reim-
plua $8,000 In bend\ls and bursed for those expenses,
$6,000 In upenses. &ca)l"diag to Carter'llctter.
Thellnkbetweencan.r'S Amonr other concern•
bonus and. the clwnber's fi. Bentley lilted wu t he
nancW perfonn.nce wa.s a chamber'l Jack of aecou.o t·
red flag for the chamber's ln& tor special event1. Hi.l
accountant,OarTtllThornp- lettcrdescrlbed them as •ott
aon, aecordins: to Bentley's the book&; with only net ln·
letter. The a.ccountant told comepresentedtotheencu·
the eh&mber executive com· ttve eonunlttet. Examples of
mlttee that •use of Building special events In 2007 were
Fund dolla.n to supp&ement thema)'Or'I.SweottheCity
the dwnber operatins: ex· address, Salute to the MOI-
penses could possibly forfeit tary and the Cooquer the
the (chamber) foundation~ Coo>t blcyde ride.
(nonprofiQswus bc:causeot Bentley also ltaUd In his
the Unk between the CEO's letter that hewas conc:erned
bonus to the ftnancial per- that carter autborizes ~ir·
tonnance of the chamber." nlftcant con~ w1t.bout
Tbebulldlnatundwasset 1eddDI bld.a or con.aultins
up to pay for the chamber's the execut1V'e coaunlttee or
CYentual moYe frOm lb cur· boud.
rentbuikiin&. DOW owned by He also uJd a compari-
the r~cnJ aovernment as son oCyu.r-cnd lllelllbenhip
pa.rtotthedealtha.tallowed lisu •reflects a .li.(niflcaot
the federal c:ourthouse to be decline in member orpnl-
builtoextdoor.Thedwnber zations in 2()(11.·
wlllh.avt:tomoYeby201L Anaudltoftbedwnbeds
The letter also said the peodlno.Theorp.ahatioo~
accountant •no kmsez- wiU bylaws can for an annual
discuss this matter and that a.udit but Bentley and otl...-
.....,.,t
the eha.mber has become a
'hl$11 risk' .. that
b e - DO Joo&u want ID be
top cbamber oftldala have
&&fd they"~ DOt sure when
the last audit was done.
o.aoc:!ated with."
TbompaonoCUDS.
The other two eucutlve committee
members, Chairman Freddie Martinet
J r. and Chairman-elect Robert Gont.a-
IC'l, said Thursday they are mov1nc u
quickly u they ea.n to hire a.n auditor to
conduct a tun audit. They uJd they deter
to chamber attorney Van Huscm&n'• lepl
Interpretation of chamber bylaws In the
r emoval of both Whitmore and Hawley
from the executfvoe committee. Phonemes-
sqale!tonHulnd·shltltl!f wu &llowoe.
cerns about recent ft.nanclal moves eounU in a manner that tu rned
by t op executive Teny Carter, and wbat should bavebecoadeftdtinto
1C.R.472
116
• •
CAllU· TIMts •Marchl2008•Mon~· S A
NATION/ FROM THE COVER
CHAMBERJ;= IA llrm that Includes Jobn Bell,
who for years was the cham~
The petition asks for: froml Oper«ntofthemem· ber'$1tt()maid he signed the
got Involved In
the process because he wu
upset about Ha.wley and
Under the modltied system Steve Woerner, CEO a.t Whitmore's removal as wen
used by the ehamber, reve- I>rUcoU Cluldren's Hospital as eoocernedabout Bentley's
nue Is booked lmmecllately. and chamber chairman lo 11.nandal qtaUons.
For e.z:ample, 2008 chamber 2004, sa.1d. he stped the pe· •tthinkltwuquite rude
dues collected ln 2007 were tition becaUJe he is worried how two of the most re-
booked In 200 7 thoush about the chamber's future. spected women ln the com·
they were paid for a 2008 "Onceyouareachairman munity were treated and 1
expense. you are part of the iofonnal think we as members need
l~adership of the chamber to have more transparent
AUDIT COMMITTE£ and because of that I have and frequent ftnanclal re-
The board should appoint a vested interest In IU suc- port s," he said. "We also
a n audit committee of a.t cess,• Woerner sa.l.d.. "'I want need toha.veclear goals and
leastfwtch.ambermemben; to see ftsucceedand frankly a mission forthechamber."
including the sitting cham· I ha.ve heard enou,b con- Chamber member Tom
ber treasurer, two" past cerns where we were going Dobson, c:hairmaD and CEO
chairs and two other mem- to see an exodus ofthe metno ~loc.,b­
ben selected by a mtJority berahip and 1 don't want to thepetitlon~si&ners-
vote ofthe board, accordJng oeethal." "As &l onrtime member
to the petition. Notable depa.rture.s in a nd past director of the
Tbe petition also uka the pan year included Ful-- Corput Chrlatf Chamber of
that the c:hamber publishfts ton..coastcon construction, Commerce,• Dobson 1aid,
aonua1aud.itanddtstrlbtrte whole partaers lllclude for- "'I'm very concerned about
ittoallmembenwlth.1Dl20 mer chamber cbainnan Jim the accounting questions
daysofthe close oftbefiscal Barnette; Bank af America; raised recently. I strong1y
year. UtF Distrilruton , the Bud- encour&&e t he chamber
Former chai rwoman w.lserb=distrlbuu>r,San l:t\. •
• ....... '~; ...."!f'l · : `` -~ "'"' ,-.,.~ , _ - ``- "'~ .,..
.......
•
~:,·:,.:-.~-~atff~imt
50 CENTS THURSDAY, MARCH 20, 2008 CITY EDITION
Chamber
unrest
ends up
in court
Treasurer, CEO
each make filings
6 A •Ttwnday• Man:h20,2008• CAllER·TI MU * IY RVJA AIWJLAI
FROM THE COVER ""-"-
Dboa!1sfaction within the CorJ>us
Christ!CiwnberofCommen:olw
moved to the court S)'StmL
CHAMBER/,..... lA condition or mtus.lo addition, Chamber treasurer Damon
since the bonus was not linked Bentley has obtained a tempo-
the aecwed. "pla.intJfrs em- to the 1'\nanclal performance rary restrainiog order against the
ployment wtth the chamber is ofthe chamber, use ofBuilding chamber and its chief executive.
in jeopardy and any ch&.nee of Fnnd dollars t o supplement the Terry Carter. Carter bas filed a
continued employment with the chamber operatina: expenses separate lawsuit seddn.g damag·
chamber through Dec. 31, 2010, would not have forfeited the es against Bentley, the chamber,
is essentially oonerlstent." foundation's 50l(c)3 status as the C'4.Un--Timu and others.
Chamber attorney Van stated by defebda nt Damon The restralnlng order, ob~
Hustmt.n destribtd Bentley':J Bentley and reported by defen· tained. 1\.tesday, prohibits Carter
petition a.s frivolous. He said da.nt C.7'ima
n--Timts. tie Carter's 2008 contract was account. Neither would identify
The Corpus Christi Chamber of Chamber attorney Van Huse- concluded. Hu.seman said it the amount, but interim CEO
Commerce and CRO Terry Cart- man and Carter's attorney, Rene was and Rodriguez said some Ken Treviri.o said It was in the c.ter is
er's attorney gave confUcting Rodrig uez, also confirmed that details rema.ined to be resolved. $132,000 range. A copy of the former CEO q{
reports Friday abou.t a sever- t he resignation would be eff~­ Those deuils Involved the 1\nal tMChmnbft"
ance agreement, but confirmed iive April 30. Carter has been compensation amount, federal Pfeo.se Uti CKAMIWt UA q{Commnu.
CAlLER· TIMES •May24, 2008•5atvd.y•lJA
FROM THE COVER
CHAMBERfrom lA
contract, provided by Huse· name who drew up the
man, calls for a $136,500 contract on behalf of the
salary and various benefi.ts. chamber. Steve Woerner,
Treviti.o said the $132,000 the chamber's board chair-
repre.sented. salary and ben-- man at the time Carter was
efits not already paid this hired, sa.ld he didn't re-
year. member the deu.tb of the
Attempta to reach Cuter contract or who wrote the
were unsucct!sful Friday. contract.
Huseman said Carter's John Bell, a former long-
contract was so favorable to time chamber attorney,
him that the chamber was said he was the chamber's
not In a position to obtain a,ttorney in 2004 but wasn't
a n agreement not to sue involved in the contract.
In exchange for the s ever· "I asked for a copy of
ance. that contract several times
According to a copy ofthe and never cot one," said
employment contract Carter Bell, who is representtnc
signed in 2001. when he was two deferidant& In Carter's
hired. he could be terminat- lawsuit, chamber executive
ed without cause only after committee members Judy
a 90-day written notice and Hawley and Sylvia Whit-
a vote of at least 75 percent more.
otthevotin&membertofthe Carter filed a l awsuit
board of directors. In such Much 19&&1!nst the cham-
an event, Carter would be ber, its treasurer Damon
compensated for 100 per· Bentley, Hawley, Whitmore,
cent ofthe remalnlng salary the Coll~r--Ttm•s and pth-
andbeneftts. ers,seeking damages for ac-
If there was cause for tions be claims jeopardized
termination, Caner would his employment with the
be releued from his con· chamber. AU defendants
trtct only if a 90·day wrlt· deny Carter's alleptions.
ten noUee wu liven along Huseman said the cham-
with vote of at least 75 bertrled to persuade Ca.rter
per cent of the board a.nd to drop the lawsuit as part
only if Carter •n agra.ntly of the cont ract settlement,
violated" policy a dopted but he wouldn't agree to lt.
by the chamber. In such a Had t h e ch amber not
ease, Carter rtill would re- settled the remainder of the
ceive full Cm lA for personal use?'" tion. That's the p roblem.•
Bentley: •No."' Carter later left the room
chairman-elect Robert Gon- Carter: "'Are you making and Bentley could be heard
zalez, chamber attorney Van any accusations t hat I have giving his financial report.
Huaeman,chalrmanFredcUe intentionally, intentionally The recordini's release Frt~
M&liiDC2; Jr. and ell:eeutive misled an executive comllllt · da,y resulted from a motion by
commltt« members Judy tee or members of this board the CaUer-Tim.c.s to compel
Hawley and Sylvia Whit- of directors? Intentionally?"' its relea.se In accordance with
mor e w ere recognizable Bentley: "'I'm not solng to 214th Di.strlctJud.ge:J~ Long-
on t he recording. Bentley, a.nswer that."' oria's March 26 order that it be
Hawley and Whitmore are Carter: •Why not?"' made available to all parties.
named defendants In Cart· Bentley: •tt'S nota Question CaU •r~Timu attorney
er's lawsuit. for me to answer rizht ·now. Jorge Rangel61ed the motion
Ea~.rt y ln t he aecment a I'm cotng to CIYe the !Uuliu~ ·l \u~¥1.Jw.y w.Cttr he mtule sever-
content ious exchange be· of facts. There's no opinions al requests for the recording
tween Cart er and Bentley that I have. There's jll!t facts, after March 26.
can be heard, u the cham~ Terry. ·- I have a 1\dudary re· Since Feb. 15, the record-
ber ofl\dals discuss whether aponsibility -· Don't call me Ins had been In Huseman's
to proceed with Bentley's n- lieut enant commander and custody.
n&.Dcial report. don't stare me down.• On Fr iday morning, t he
Bentley: "'I really don't Carter also c.an be heard In parties reached a.n agreement
want Terry sitting here star- a n ell:change with Hawley, in on the releaseof the recording,
ing me down .• which he uks why she won't beading off a. scheduled 10:30
Carter: "'Why? If you've look him in the face. · a.m. hearing on the issue in
got a problem with me, get "Oh, I have a probl~m," Longoria's oourt.
In my face and say 'Terry,
here it is.' ... Ueutena.nt com·
Hawley replied. "I have a biz
problem, Terry. ... I have a ConlclCt Mary Ann CatJClWS
1 C.R. 526
mander ... Art: you making problem with tr u.stlns your at 886·36!3 orca~@
any accusations that I have leadership with this organita· aJller.cam
mi••nnf"t'lnri • t,..... ,..,v f~•"tl "
153
June 13, 2008
Ex-Chamber CEO
mediation to continue
Mary Ann Cavazos
CR527
Exhibit N-1 to Cavazos Affidavit
154
Soc:tVm O
• •
BUSINESS&OPINION
CORRECTION: Please see 11.2, 611412008
Ex-Chamber CEO's me ation to continue
.,...,..,_
aTMArf.U.CA.VAZOS lawsuit. lty• ~=-.bu~
~=~fttsrematned tobepa.ld
!j
ure. One defendant, the CaU.r- would be productiYe to do10 at thls
[
has been set.
nm.u, did not participate.
an=e::~=.``
Attomey.lobnBell,_.onc poiot In the litlptloo.The C.U...
A severance agreement that nmu intends to agrusiYely de-
chamber oftlclaJs Sylvia Wblunon:
canen anomey, Rene Rodriguez,
prevlously described u nearly eon-
dudedlsnow!lnal,~ald
and Judy Hawley, said the medla.-
- procoss will proceed.
feud q&lnst tbe claima that Mr.
tion was unsuccessful and t.ht.liti·
Carter hu filed a.M anticipates
tbat the facti and the law will show
under way, with former chamber
chairmen Bud Harris and Debbie
U ndsey-Opel leadln& the &earth.
I
.
Thunday. "Thel&wauhllveryddeod&ble," that tbe CclUf'-7\met i.a:ln DO way They hope to hire an Interim for 60
'!bat-otluepanlefrom BeD saki. Uable to Mr. Carter." to 90 days wbUe • natloaal oeatth
Catter'llawsu.Jt apinst the eham- Attorney Robert Anderaon, RodriJUez aaJ.d Thurtday that for a. permanent CEO proeeeda,
ber, aome chamber officials, the representing chamber treuurer hll cli~nt's stveranu: ~ent Martinez saki.
Col£tr..1'i.'I'I'&U and others. The ~e¥­ Damon Bentley, utd there l.a no wtth \he c:b.amberwasco'mpletedlo
erance agreement did not lnclude plan atthi$point forfuturemed:l.l· lateMoy.CbarnberclWrmanFr-
0
0
u
u
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tn
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0
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a
172
184
TABS
185
Exhibit A-15
240
186
MEMORNDUM
FOR: Doard of Directors, Corpus Christi Chamber of Commerce
FROM: Terry Carter, CEO
DATI<:: February 17,2008
SUBJECT: Allegations concerning inappropriate busincs.~ pr~ctices
Ladies and Gentlemen:
The specially culled meeting for Wednesday, february 20th was culh:d at Board
Direction for the singular purpose of receiving a recommendation from the Executive
Co!Tunittce regarding my employment contract. The Executive Committee will report that
they have been unable to make a recommendati on.
I would appreciltle your consideration at that meeting to eon.~idcr the following facts in
response to allegations that have been made both privately and publicly regarding my job
pcrfonnance. Up until this time I have not been afforded on opportunity to address the
allegations and may not be given that opportunity during Wednesday's Board meeting.
As I understand, there are four allegations:
J. Th11t J with malice favorably affected the net nperating profit on the yeur-end
P&L statement by deferring my November und December income and not
showing it as an expense.
R.liSPONSE: l differed compensation in 2006 (documentation is Available to
support this defcnal) and elected to do so again in 2007 for ta~t reasons. My wife made
approximately SOk more this year than last year. None of her additional income had
taxes withheld during 2007. Jam happy to provide the documentation to suppo11 this
fuel.
The Chairman was notified in October 2007 of my intention In defer my income.
The correct bookkeeping entries are to expense on the P&L the defc1rcd compensation
und show it ns a liability on the balance sheet at the time thnt the compcnsulion should
have been paid. Our bookkeeper failed to make these entries and I failed to check the
en try before they were presented. I am the one tlutl found the error during the January
!'lltccutivc Committee meeting and brought it to the attention of our Treasurer, Damon
Ucntley. J:ollowing the meeting, I immediately went to the bookkeeper to sec what had
happened and instructed him to contact our CPA, Dnrryl Thompson, ond gel the correct
entries and make t11cm to the books, which he did. This was simply n bookkeeping error
that was immediately corrected.
2. That I am using a modified accrual accounting method that according to Damon
Bentley should not be used.
CCOOS59
241
187
RESPONSE: We arc using a modified accrual basis of accounting that has been
!lppr(wcd by the Board of Directors. When I was employed in August 2004, I inherited an
organization that had vc:ry inconsistent accounting and financial controls and practices.
My instructions from the Boord was to fix it and do .~o fast. In consultation with our then
Treasurer, narron nergstrom, and our then CPA, Kendra Kennison, we put into place a
modified accrual basis of accounting. This treats revenue on a c~sh basis so that you
record the revenue when you receive it and accrue certain expenses. This basis of
accounting was approved by the Board of Directors in September 2004 and has been in
place since that time. One of our current Board members was present at tbe meeting and
will validate this tiJCI.
3. Transfer of the building fund from the Chamber of Commerce (a 50l(c)(6))
corporation) to the Chmnbcr Founda tion (a 501 (c)(3)) without Roard approval.
RESPONSE: The transfer of these funds was done in consultation with our CPA.
We had u discu``ion with our CPA about both the propriety of making the transfer, the
reason for doing so, and the exact entries to affect the transfer. During the course of the
conversation, we discussed ifthcrc were any restrictions that wou ld preclude making the
trnnsfer. Ken Trevino researched archived documents relating to the building and
buildi ng fund and could not find ony restrictions of any nature on the building fund. We
concluded that not being able to lind restrictions was insufficient. Therefore, our Cl> A
talked with his senior partner, Mr. Joe Dove, who set up the building fund. Mr. Dove
confirmed that there never were any restrictions placed on the "building" fund . During
the December Board meeting, Leon Loeb asked about the funds. I fully explained to the
Board what we bad done.
4. That I used a portion of the building fimd after it was transferred to the:
Foundation to pay certain operating expenses.
RESPONSE: That is correct. The Chamber of Commerce hns for many ycnrs
housed the Foundation and its operations, which include among other things Leadership
Corpus Christi. The Chamber has never sought any reimbursement from the .F oundation
for the cost of providing space, administrative, overhead and managerial support. I
caused to be invoiced the roundation for about $18,000 for telephone and utility support
During "FY 07, that represented about60% of the total cost oftclcpl10ne and electricity.
The Foundation has never been charged for space allocation, bookkeeping services,
managerial oversight or administrative support. This was discussed with our Treasurer,
Damon Bentley, during a two-hour FY'08 operating budget meeting. My lield notes
developed in preparing the budget, reflect that T had some question as to whether 60%
was a reasonable number. At no time, did Damo11 Ot:nlley ever question or contribute any
dialogue to that convcr!Xtlion. If he h11d rniscd any exceptions during the budget meeting,
the percentage would have been adjusted.
CCIJOSGO
242
188
5 There seems to be some concerns raised as to whether the by-laws of the Chamber
arc tx:ing followed to the letter of the Jaw. Spedfically, were there 5 members on
the 2008 Nominating Committee as opposed to the required
(, 7'!
RESPONSE: Ladies and gentlemen, we as management und you as our Directors
make every effort to comply with our Bylaws as closely as possible. There is no way that
I can attest that in every single case aud illStancc that the bylaws arc complied with 100%
of the time. What I can say is that we make a very good effort to comply with the bylaws
and its intentions. If we arc to comply with 100% of the bylaws, you as directors must
approve every prospective member before they join the Chamber. You must also approve
every member that is dropped for non-payment of dues. This distracts from your ability
to work nt a strategic level. My recommendation is that the bylaws shou ld be reviewed,
edited and in some cases rcwtiuen to reflect the modem operations of a chamber of
comrn~rce that represents a mid-size American city.
CLOSfNG COMMENTS: I am not calling into quest ion the motives of any individual
that questions the operations of our Chamber. Ow· records have always been open to any
director or officer of the corporation. 1 have insisted on complete transparency with
respect to all aspects of the management ofthe Chamber of Commerce.
However, never in my professional career has my integrity been called to question as
right now. There is NO Allegation that any illegal activity or misappropriation of money
has taken place. That leaves this essentially as a matter of bookkeeping practices. I have
three immediate concerns:
l. What was of such critical and grave w·gency that these discussions had to take
place while I was in Cardiac Intensive Ca re at Shoreline Hospital I 8 hol\J's
after having undergone a 5-hour open-hc11rl surgery?
2. Who provided unauthorized information to the local newspaper that was
clearly one-sided and seemed very much designed to embnrrass the Chamber,
the Chamber s taff: Chamber Di rectors and our lilmilies.
3. I have not been allowed to respond or otherwise defend any of these
allegations ul uny meeting to date. The chairman has advised me that I may
not be ullowcd tube present at the entire Board meeting in Wednc~dfty and so
I present these facts to you in advance.
CC00561
243
189
TAB6
190
EXHIBIT "M"
454
191
( CAUSE NO. 08-1360-F
TERRY CARTER § IN THE DISTRICT COURT
§
vs. § 2141h JUDICIAL COURT
§
CORPUS CHRISTI CHA11J3ER OF §
COMMERCE, SCRIPPS TEXAS §
NEWSPAPERS, LP d/b/a CORPUS §
CHRlSTI CALLER TIMES, DAMON §
BENTLEY, JUDY HAWLEY, SYLVIA §
WHITMORE, et al. § NUECES COUNTY, TEXAS
STAT E OFTEXAS §
§
COUNTY OF NUECE S §
AFFIDAVIT OF ELVIA AGUILAR
BEFORE ME, the undersigned authority, personally appeared Elvia Aguilar, who, after
being duly sworn by me, upon her oath, testified as follows:
( I. "My name is Elvia Aguilar. I am over the age of 18 years and competent to make
this Affidavit. All statements contained in this Affidavit are within my own
personal knowledge and are true and correct.
2. I graduated from Baylor University with a Bachelor of Arts degree in 2005, with a
major in journalism. After graduating from Baylor, I worked as a reporter for the
San Antonio Express-News' bilingual publication, Conexion, from June, 2005
until June, 2006. At that time, I started working for the Caller-Times as a busj.ness
reporter. As such, 1 was in charge of covering banking, tourism, real estate,
business and finance issues in the Coastal Bend area. This included the Co1pus
Christi Convention and Visitors Bureau, the Co1pus Christi Chamber of
Commerce, and Corpus Christi Regional Economic Development Co1poration's
4A board, among other groups and organizations. In July or August, 2008, I
began my current position with the Caller-Times as an education reporter.
3. Since I was the business reporter for the Caller-Times, sometime during the
rooming of February 15, 2008, my direct editor, Tom Whitehurst, assigned me to
assist with a story j:egarding the Corpus Christi Chamber of Commerce. As a
result of my news-gathering activities regarding the matter, .I authored or
contribute.d to the following articles regarding Terry Carter and the Co1pus Christi
Chamber of Commerce between February 15, 2008 and June 13, 2008~ which is
the time p~riod during which the articles about which Terry Carter is complaining
.
/
\
in the above referenced lawsuit, were published by the Corpus Christi Caller-
Times:
EXHIBIT
.I 455
192
(
a. "Financial, Management Questions Raised at Corpus Christi Chamber",
published ori February 15, 2008;
b. "Corpus Christi Chamber Pulls Two Off Panel", published on February
16, 2008;
c. "Corpus Christi Chamber Meeting to Discuss Financial Irregularities",
published on February 20, 2008;
d. "Chamber of Commerce: Financial Questions Lead to Call .for Audit",
published on February 21, 2008;
e. "Chamber GEO Shifted Funds, Letter Says", published on February 27,
2008;
f. "Ex-Chair' Airs Her Chamber Concerns", published on February 29, 2008;
g. "Petition Seeks Chamber Changes", published on March 3, 2008;
h. "About 80 Sign Petition on Chamber Operation", published on March 4,
2008;
1. "Chamber Board, CEO to Enter Talks", published on March 8, 2008;
j. "Chamber Treasurer Granted Temporary Restraining Order Protecting
Tape of Meeting", published on March 19, 2008;
k. "Chamber Unrest Ends up in Court", published on March 20, 2008;
1. "Chamber to Discuss Petitioners' Concerns, published on March 21, 2008;
m. "Chamber Puts CEO on Paid Leave", published on March 26, 2008;
n. "Chamber CEO on Paid Leave", published on March 27, 2008;
o. "Chamber Finances Move to Forefront", published on March 31, 2008;
p. '!Chamber Had Deficit, Board Tells Members", published on April 1,
2008;
q. "Chamber, in Need of Audit, Renews Accountant Search", published on
April 29, 2008;
r. "Chamber <;>ffers Contract Settlement to Carter, his Attorney Says",
published on May 2, 2008;
•s. "Chamber Makes Offer, Carter's Attorney Says", published on May 3,
2008;
• t. "Chamber, Carter's Attorney Confinn Severance Agreement", published
on May 23, 2008;
• u. "Chamber's 'Acting CEO Resigns"; published on May 27, 2008; and
v. "Chamber Acting CEO Resigns", published on May 28, 2008.
True and correct copies of the foregoing articles are attached hereto and incorporated
herein by reference as Exhibit "M-1 ".
. I
4. As part of my research and news-gathering activities in connection with my
preparation of the f~regoing articles, I interviewed the following individuals:
i
a. Lucy Reta, Van Huseman and 'Judy Hawley as sources for the February
15th article;
( b. Sylvia Whitmore and Van Huseman as sources for the February 16, 2008
article;
2 456
193
( c. Butch Escobedo, Lawie Cook, Freddie Martinez and Mark Scott as
sources for the February 21, 2008 article;
d. Lucy Reta and Kendra Kinnison as sources for the February 27, 2008
article;
e. Freddie Martinez, Robert Gonzalez and Sylvia Whitmore as sources for
the February 29, 2008 article;
f. Steve Woerner, Tom Dobson, Dusty Durrill and Carol Scott as sources for
the March 3; 2008 article;
g. Freddie Martinez, Sylvia Whitmore, Carol Scott and Judy Hawley as
sources for the March 4, 2008 article;
h. Freddie Martinez, Carol Scott, Leon Loeb, and Laurie Cook as sources for
the March 8, 2008 article;
i. Van Huseman and Carol Scott as sources for the March'20, 2008. article;
j. Freddie Martinez and Carol Scott as sources for the March 21, 2008
article;
k. Van Huseman and Rene Rodriguez as sources for the March 26, 2008
article;
l. Freddie Martinez, Van Husem~ and Rene Rodriguez as sources for the
March 27, 2008 article;
m. Ken Trevino, Carol Scott and Freddie Martinez as sources for the March
31 , 2008 article;
n. Michelle Peters, Damon Bentley, Laurie Cook, Carol Scott, Bud Harris,
Ken Trevino and Van Huseman as sources for the April I, 2008 article;
( and my att~ndance at the Chamber of Commerce general membership
meeting on March 31, 2008;
o. Ken Trevino. as source for the April29, 2008 article;
p. Van Huseman, and Rene Rodriguez as sources for the May 2, 2008 article;
q. Van Huseman, Rene Rodriguez and Ken Trevino as sources for the May 3,
2008 article;
r. Van Huseman as source for the May 23, 2008 article;
s. Freddie Martinez as source for the May 27, 2008 article; and
t. Freddie Marpnez as source for the May 28, 2008 article
5. Additionally, as part of my research and news-gathering activities in connection
with my preparation of the foregoing articles:
a. I attempted .to reach Plaintiff, Terry Carter, for his comments for the
stories published on February 16th, February 20th, February 21'1, February
27lll, February 29111, March 3rd, March 4th, March &lb. I was unsuccessful in
my attempts' as Plaintiff did not respond to my messages. Further, per
Plaintiffs attorney, Rene Rodriguez, Plaintiff had no comment for the
March 26th article and declined to comment for the March 27th article. .
b. I attempted¥> reach Sylvia Whitmore for comments for the February 15lll
article. I was not successful in contacting her.
(
3 457
194
( c. I attempted to reach Freddie Martinez, the chairman of the Corpus Christi
Chamber of Commerce, for his comments for the stories published on
February 16th and March 3rd. MJ:. Martinez did not respond to my
messages.
d. I, together with my co-worker, Denise Malan, attempted to reach all of the
Chamber of Commerce Board members on or abou~ February 18th.
e. I attempted to reach Darrell Thompson, the Chamber of Commerce's CPA
during the time period in question, did not return my telephone calls for
the February 27tii article.
f. I attempted to reach Van Huseman, the attorney for the Chamber of
Commerce. He did not return my telephone messages for his comments
.for the February 15th and 29th articles.
g. I attempted to reach Damon Bentley for his reaction to the Plaintiffs
lawsuit for the March 20th article. He did not return my calls.
6. Additionally, as part of my research and news-gathering activities in connection
with my preparation of the foregoing artiqles, I reviewed and relied upon the
following written ~ources, all of which are attached hereto· and incorporated
c· herein by reference as Exhibit "M-2":
a. Plaintiff Terry Carter's memorandum to the Chamber of Commerce Board
.of Directors dated February 1i\ .
b. Darrell Thompson's e-mail to Damon Bentley dated February 20th;
c. The Chamber of Commerce Board of Directors' letter to its members
dated February 22nd;
d. Damon Bentley's e-mail to the Chamber of Commerce Board of Directors
dated February 26th;
e. Sylvia Whitmore's letter to the Chamber of Commerce Board of Directors
dated February 28th; .
f Damon Bentley's lawsuit filed on March 18th, styled: Damon ·Bentley v
The Corpus 'Christi Caller-Times cmd Terry Carter; responsive pleadings
and Orders;
g. Terry Carter,'s lawsuit filed on March 19th, styled: Terry Carter v Corpus
Christi Chamber ofCommerce, eta/., responsive pleadings and Orders;
h. The Chamber of Co~erce Petition; and
1. Chamber of Commerce invitation to the March 31 , 2008 Annual
Membership Meeting. ·
Additionally, on M~y 30, 2008, I listened to a portion of an audiotape containing
the February 15, 2008 Corpus Christi Ch~ber of Commerce meeting which the
Caller-Times had obtained on May 30, 2008 pursuant to a Motion to Compel that
( had been filed by th~ Corpus Christi Caller-Times' attorney.
4 458
195
(
7. In addition to my own newsgathering in connection with the aforementioned
articles that I authored, Dan Kelley, Beth Wilson, Denise Malan md Fanny
Chi.rinos, reporters at the Caller-Times, contributed to the articles based on
information they had gathered during their own news gathering activities.
8. In interviewing the above-named persons, I asked them to elaborate on the
matters raised in Mr. Bentley's e-mail of February 26, 2008 to the Chamber
Board of Directors, Ms. Whitmore's letter of February 28, 2008 to the Chamber
Board of Directors, and Mr. Carter's memorandum to the Chamber. Board of
Directors on February 17, 2008. They were unwilling to do so. In researching and
writing .the aforementioned articles, I relied in good faith on the sources and
infonnation listed in paragraphs 4 . and 6 because they, particularly, Damon
Bentley, Sylvia Whitmore and Judy Hawley, were high-ranking Chamber officials
who, by virtue of their then and former positions with the Chamber of Commerce,
were in a position to be knowledgeable about the matters and issues involved,
regarding the Corpus Christi Chamber of Commerce and Terry Carter. At all
times I believed that the matters about which I was writing were newsworthy
because they involved a controversy between high-ranking officials of a
significant local organization, the Corpus Christi Chamber of Commerce, and its
high-profile CEO and President, Terry Carter. I also relied on information I
obtained from a long-time Chamber employee, Lucy Reta, who was known by me
( to be reliable. ·
9. At no time did Terry Carter contact me, or to my knowledge, anybody else at the
Caller-Times, to point out that any statement contained in the articles listed above
in paragraph 3 :vas ~accurate or incorrect.
10. Prior to and at the time of the publication of the articl~s listed above in paragraph
3: (a) I had no knowledge that any of the statements in said articles, including,
but not limited to, the ·statements about which Terry Carter is complaining in the
above referenced lawsuit, was false; (b) I never entertained any doubts as to the
truth of any of the statements contained in said articles, including, but not limited
to, the statements about which Terry Carter is complaining in the above
referenced lawsuit;' (c) I had no knowledge nor suspected that any of the
statements in said articles, including, but not limited to, the statements about
which Terry Carte~ is complaining in the above referenced lawsuit, nor each
article as a whole; nor the totality of said articles, could create a false or
substantially false i.inpression regarding Terry Carter in the minds of the ordinary
reader of said articles.
11. Prior to and at the tin1e of the publication of the articles listed abov~ in paragraph
3, I believed that all of the statements contained in said articles, including but not
limited to, the statements about which Terry Carter is complaining in the above
referenced lawsuit, were true and correct.
(
5 459
196
( 12. Prior to and at the time of the publication of the articles listed above in paragraph
3, I did not and do not now, bear any personal ill will toward Terry Carter."
"FURTHER AFFIANT SAYETI! NAUGHT."
CL.:~
Elvia Aguil·
SWORN TO AND SUBSCRIBED BEFORE ME, the undersigned authority, on the 24th
day of September, 2009.
~:``t~J!``;\ ROXANE MARIE IGLESIAS
``.'..
It ..:.._,e No18ry ~lie. State of Texas
.~ My Commission El