Date: 06-23-1999

Case Style: Journal-Gazette Company, Inc. v. Bandido’s Inc.

Case Number: 57S03-9709-CV-00495.

Judge: Howard E. Petersen

Court: Circuit Court, Noble County, Indiana

Plaintiff's Attorney: Edward L. Murphy, Jr. and Diana C. Bauer of Miller Carson Boxberger & Murphy, Fort Wayne, Indiana and Robert E. Connolly of O'Dowd Wyneken & Connolly, Fort Wayne, Indiana.

Defendant's Attorney: James P. Fenton of Eilbacher Scott, P.C., Fort Wayne, Indiana; Cathleen M. Shrader and John D. Walda of Barrett & McNagny, Fort Wayne, Indiana.

Description: Defamation - Bandido's is a Mexican-style restaurant with three locations in Fort Wayne Indiana, and one in Lima, Ohio. On September 13, 1988, the Allen County Board of Public Health conducted a health inspection of the north-side Bandido's in Fort Wayne. In the report, the inspector identified several violations and made the following relevant remarks: "Evidence of flies, roaches and rodents noted. Advise exterminator to do a full clean out of premise. Rodent droppings noted only in restroom." Immediately thereafter, Mr. Schindler, the owner of Bandido's, received a letter from the Fort Wayne - Allen County Board of Public Health advising him of a hearing to determine whether the restaurant permit should be revoked. On October 3, the day before the hearing, another inspector visited the restaurant for the sole purpose of gathering information for the hearing. At this time, the inspector did not find any evidence of rodents. On October 4, without permitting Mr. Schindler to speak, the Board of Public Health revoked Bandido's permit and closed the restaurant. In a letter dated October 5, 1988, to Mr. Schindler, Dr. Irmscher, the Commissioner for the Board of Public Health, stated that "This permit was revoked after a full and complete hearing and review of all food inspections for 1988." June Remley was assigned the task of writing an article concerning the closing of Bandido's for the Fort-Wayne Journal-Gazette, a daily newspaper. Once written, the story was turned over to her supervisor, Gabby Jacobs, the Assistant Metro Editor. The story was untitled and Remley never saw the story again before publication. Jacobs's job was to resolve any questions or ambiguities and generally get the story ready for publication. The story was then submitted to the news editor, Ellen Garner. Garner's role was to lay out the story for publication, do an initial edit, and make sure the story was still current. Garner also determined how much space was available for the story and for the headline. Next, the story proceeded to the copy editor, Sheila Pinkley. Pinkley's responsibility was to do a final edit of the story which required a word for word, line by line read. Pinkley's job was also to make any necessary changes to meet the spacing guidelines. Finally, Pinkley wrote the headline and the subheadline which are at issue in this case. The story with the headline was then submitted to Pinkley's supervisor, Bill Leonard. Leonard's duty was to approve everything that had been done, do a final review, make sure the layout was acceptable, and make sure the headline accurately summarized the story. The story then went to the Managing Editor, Ellen Garner. Garner reviewed the story and headline. Finally, the page proof editor, Tom Jones, looked for typographical errors, story and headline problems and things of that sort. The article was published on October 6, 1998, and the headline read: "Health board shuts doors of Bandido's Inspectors find rats, roaches at local eatery." While the story itself was accurate, the subheadline inaccurately used the word "rats." The health board never discovered rats at Bandido's and the word "rats" never appeared in the article. The next day, Mr. Schindler advised the Journal-Gazette of the mistake and asked for an immediate retraction. On October 7, 1988, the Journal-Gazette published another article in which it noted the mistake and apologized. The next day, Robert Wright, Bandido's attorney, wrote the Journal-Gazette and the Journal-Gazette's attorney a letter expressing his and Mr. Schindler's satisfaction with the article and the apology that appeared in the story, and his belief that the correction would hopefully reduce the damages suffered by Mr. Schindler. Shortly after this letter was written, Mr. Schindler retained a new lawyer. On October 18, 1988, Robert Connolly, Bandido's new attorney, sent the Journal-Gazette a letter indicating that the October 7, 1988, follow-up story was insufficient because the headline made no reference to a retraction. This letter requested the Journal-Gazette to print a headline retraction the same size as the original story and in the same location. The Journal-Gazette did not comply with this request and consequently Bandido's filed a defamation suit on November 21, 1988.

Outcome: At the conclusion of trial, the jury awarded Bandido's $985,000 in damages.

Plaintiff's Experts: Unknown

Defendant's Experts: Unknown

Comments: The Journal-Gazette appealed and the Court of Appeals reversed the trial court, finding that there was not clear and convincing proof of actual malice. See: Journal-Gazette Co. v. Bandido ' s , Inc ., (Ind. Ct. App. 1996). On petition to transfer, the Supreme Court of Indiana held that both private individuals and public figures must prove actual malice to recover in a defamation suit involving matters of public or general concern. The supreme court also found that Bandido's failed to prove that Journal-Gazette acted with actual malice and reversed the judgment of the trial court. See: 712 N.E.2d 446 (Ind. 1999). The date shown above is the date of the appellate court decision and not the trial date. Reported by JAB.