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The complete text of the November 16, 1982 memorandum and order of the district court is printed in the "Decisions" section of this report at page 653.
The complete text of the December 10, 1982 per curiam opinion of the circuit court is printed in the "Decisions" section of this report at page 657. Benford v. American Broadcasting Companies, Inc.
Civil Action No. 79-2386 (D. Md.) and No. 83-1168 (4th Cir.) On November 23, 1979, George H. Benford, the state manager for Maryland for the American Family Life Assurance Company, filed suit in the Circuit Court for Baltimore County against the American Broadcasting Companies, Inc. ("ABC"); Margaret Osmer, an ABC employee; David Holton, the Chief Investigator for the Select Committee on Aging of the U.S. House of Representatives; Kathleen Gardner, a Select Committee professional staff member; and Mrs. Isaac (Betty) Hamburger and Mrs. Lillan M. Teitelbaum, two special senior citizen investigators who worked for the Select Committee without pay. The three count complaint charged the defendants with tortious and unconstitutional conduct arising from the Select Committee's investigation into abuses in the sale of health insurance to the elderly, and was based on a meeting arranged by the Congressional defendants at which Mr. Benford presented his cancer insurance products to what he believed were officers of Maryland senior citizens groups. Unknown to Mr. Benford, the meeting was recorded by ABC; subsequently, portions of the tapes were broadcast on the ABC Nightly News. After the meeting, the plaintiff learned that Congressional defendant Gardner, who had obtained employment with his agency and who had accompanied him to the meeting at defendant Hamburger's home, was actually an employee of the Select Committee, as was Chief Investigator Holton, who also attended the meeting.
Specifically, Count I of the complaint alleged a violation of the Maryland Wiretapping and Electronic Surveillance Act (Md. Cts. & Jud. Proc. Code Ann., $$ 10-401, et seq.); Count II alleged a violation of the Fourth and Fourteenth Amendments to the United States Constitution; and Count III alleged a violation of the common law of civil conspiracy in Maryland based on the commission of certain enumerated overt acts. The complaint sought $600,000 in compensatory damages and $12 million in punitive damages ($200,000 and $4 million respectively on each count).
On December 27, 1979, the Congressional defendants and ABC petitioned for removal of the action to Federal court pursuant to the Federal removal statute (28 U.S.C. § 1441(a)-(c)) and the Federal public official removal statute (28 U.S.C. § 1442(a) (1) and (4)). On January 10, 1980, the plaintiff filed a motion to remand the case to state court, contending that the constitutional violations alleged in Count II of the complaint were "collateral to, and entirely dependant (sic) upon," the principal violation of the Maryland wiretapping statute alleged in Count I, and therefore could not provide the basis for Federal question jurisdiction. Further, the plaintiff argued, the Congressional defendants were not "officers of the United States or any agency thereof,” nor were they acting “under color of such office” as required by the Federal public official removal statute. Additionally, the plaintiff maintained that the case should be remanded to state court because defendant Betty Hamburger had invoked the jurisdiction of the state court to vacate a default judgment against her and therefore was precluded from petitioning for removal, and because defendant Margaret Osmer had not joined in the removal petition.
On January 31, 1980, the Congressional defendants filed a memorandum in opposition to the plaintiff's motion to remand, arguing that Count II of the complaint was a claim arising under the Federal Constitution and therefore “squarely within the class of actions for which a federal forum is appropriate.” [Congressional Defendants' Memorandum in Opposition to Plaintiff's Motion to Remand, January 31, 1980, at 3]
And since the "state and federal claims derive from a common nucleus of operative facts . . . [t]he doctrine of pendent jurisdiction . . . applies and the state claim is appropriate for Federal court determination.” [Id. at 5] Further, the memorandum contended that the removal statute should be broadly construed to include Congressional staff: “it is submitted that the Congressional defendants may remove under section 1442(a)(1) because they are either themselves "officers of the United States," or are acting under Members of Congress who have been held to be officers of the United States." [id. at 9] Beyond this, the memorandum argued, for purposes of the removal statute, the Congressional defendants were acting "under color of office" as the term had been defined by the courts, since they had been directed by a House committee to conduct the investigation at issue. Finally, the memorandum asserted that defendant Osmer did not have to join in the removal motion because she had not been served with process at the time it was filed and defendant Hamburger's insubstantial defensive action in state court did not waive her right to remove.
Similar arguments were raised by defendant ABC in its memorandum in opposition to the remand motion filed the same day.
On March 7, 1980, a hearing was held before Federal District Court Chief Judge Edward S. Northrup on the plaintiff's motion to remand the case to state court. After oral argument, the Judge denied the motion and ruled from the bench that the defendants were entitled to remove the action to Federal court pursuant to the general removal statute. Judge Northrup noted that Count II of the complaint asserted a claim arising directly under the Constitution and therefore within the original jurisdiction of the court, notwithstanding the plaintiff's contention that the count was "entirely dependent” on a claim arising under state law. The court held that defendant Osmer's failure to join in the removal petition was not fatal because she had not been served at the time it was filed, and defendant Hamburger's action in state court to vacate a default judgment against her did not waive her right of removal. The court did not rule on the Congressional defendants removal claims as Federal officials, having determined that removal was proper under the general statute.
On April 15, 1980, the Congressional defendants filed a motion to dismiss the complaint or alternatively for summary judgment, arguing that the acts they performed were done in the course of a valid legislative investigation and as such were absolutely privileged under the Speech or Debate Clause. In an accompanying memorandum, the defendants contended:
[I]t is established beyond peradventure of doubt that the Congressional investigation conducted by the Select Committee on Aging was an official and authorized exercise of Congressional power, and that the acts committed in furtherance thereof by the Congressional defendants, as alleged by Plaintiff, were also a vital and fundamental part of the information gathering process to enable Congress to "legislate wisely and effectively''; McGrain v. Daugherty, 273 U.S. at 175, in the area of insurance sales to the elderly.
Moreover, the particular methods utilized by the Com-
? It is well settled that Congressional aides are entitled to protection under the
April 15, 1980, at 9] The defendants also maintained that the suit was barred by the doctrine of official immunity which protects Federal officials from tort suits based on actions performed within the line of duty, and by the doctrine of qualified immunity which protects officials if their actions are taken in good faith and with a reasonable belief that they are lawful. In support of these contentions, the Congressional defendants submitted extensive affidavits and exhibits attempting to establish that it was within their official duties "to gather information on various informal bases as a predicate to the Select Committee's legislative functions." [Id. at 17]
Turning to the substance of the complaint, the defendants asserted that even if all the facts as alleged by the plaintiff were true they did not constitute a violation of Maryland law or the U.S. Constitution, and therefore failed to state a claim on which relief could be granted. With respect to Count I, the defendants argued that the Maryland wiretapping statute was inapplicable since "none of the statements or actions attributed to the four Congressional defendants could constitute interception, procuring to intercept, or disclosure or use, of any wire or oral communication of the plaintiff.” (Id. at 19) Further, according to the memorandum, the
The Speech or Debate Clause of the U.S. Constitution provides that "for any Speech or Debate in either House, (U.S. Senators and U.S. Representatives) shall not be questioned in any other Place." (art I, $ 6, cl. 1]
statute did not purport to reach Federal investigators, and could not do so without contravening the Supremacy Clause of the Constitution. Moreover, the defendants contended, the key meeting filmed by ABC did not constitute a “private conversation" as required by the Maryland statute, and the filming was in any event consented to by the Congressional participants which was sufficient under Maryland law.
With respect to Count II of the complaint, the memorandum argued that “not one of the acts attributed to these defendants are, even if assumed to be true, violative of the Fourth Amendment" under prevailing Supreme Court decisions. [Id. at 28] And as to Count III, the memorandum maintained that under Maryland law only unlawful acts could give rise to a claim for civil conspiracy, and, since the acts of the defendants were not unlawful, the complaint failed to state a claim for which relief could be granted.
On July 7, 1980, having previously been granted permission by the court to do so, the plaintiff filed an amended complaint with three additional counts. The new Count IV alleged a violation of the Federal Eavesdropping Statute (18 U.S.C. $8 2510, et seq); Count V alleged a "malicious interference with business relations"; and Count VI alleged invasion of privacy. For each new count, the plaintiff sought $200,000 in compensatory and $4 million in punitive damages, the same amount claimed in each of the three counts of the original complaint.
On August 22, 1980, the Congressional defendants responded with a supplemental motion to dismiss the new counts or alternatively for summary judgment, based in essence on their earlier arguments. With respect to Count IV, they contended that the eavesdropping statute applied only where there was a justifiable expectation of privacy and further that the statute specifically provided for consensual monitoring. With respect to the common law torts alleged in Counts V and VI, the defendants again asserted the defenses of absolute and qualified immunity.
Also on August 22, defendant ABC filed an answer to the amended complaint and a motion to dismiss Counts II and IV. ABC argued that the counts should be dismissed for failure to state a claim upon which relief could be granted because the Fourth Amendment did not regulate nongovernmental searches and seizures and because the alleged surveillance of the meeting at issue was consented to by four of the five people present.
On September 3, 1980, prior to responding to any of the defendants' motions, the plaintiff served notices of depositions on several of the Congressional defendants. In response, the Counsel to the Clerk of the House sought a protective order staying discovery until the "potentially dispositive" preliminary motions were decided by the court. The defendants argued that such a stay was necessary to prevent any "needless intrusion" on the functioning of the Legislative branch and to avoid the legal determination of the plaintiff's authority to depose the Congressional staff members. Furthermore, the defendants insisted, permitting discovery would itself constitute an “abridgement of the privileges and immunities of the legislative branch.” Terming the attempt to take depositions "litigative harassment of an ongoing legislative process,” the defendants contended that discovery should be considered only after the pending dismissal/summary judgment motions were ruled upon.
On October 2, 1980, Mr. Benford filed opposition motions both to the Congressional defendants' motion for a protective order and to the motions to dismiss the complaint. With respect to the request for a protective order, the plaintiff asserted that discovery was necessary on the issue of the purported "authorization" of the Congressional defendants to aid in the taping of the relevant meeting. According to the plaintiff, this "authorization" was a material fact in dispute which prevented the granting of summary judgment.
With respect to the motions to dismiss, Mr. Benford contended that he had stated a claim upon which relief could be granted in each of the statutory, constitutional and common law counts in the complaint. As to Count I, he insisted that, contrary to the Congressional defendants' position, the Maryland wiretapping statute did apply to Federal investigators; that the Supremacy Clause did not bar its application in cases where Federal agents were acting illegally in violation of a valid state law; that the meeting filmed did constitute a "private conversation" for purposes of the statute; and that consensual monitoring was not permitted without the agreement of all parties involved. Further, the plaintiff argued, the Congressional defendants were not protected by either the Speech or Debate Clause or official or qualified immunity from tort liability for violations of state and Federal statutes and the Federal Constitution. Citing Hutchinson v. Proxmire (see page 122 of Court Proceedings and Actions of Vital Interest to the Congress, March 1, 1981 for a discussion of that case), the plaintiff asserted, inter alia, that the Speech or Debate Clause did not even immunize Members from comparable activities “outside the House of Congress.” In contending that the remaining counts of the complaint also stated a cause of action, the plaintiff emphasized again that in his view there was no consensual monitoring under either Maryland or Federal law without the consent of all the parties, and that consent in any event would be vitiated if a party was not acting under color of law and the purpose of the "interception" involved a criminal or tortious act. Additionally, Mr. Benford maintained, he had a "reasonable expectation of privacy” of his statements at the key meeting because "the meeting was in a private house in regard to a private matter”. In support of this contention, counsel submitted an affidavit of Mr. Benford outlining his understanding of the meeting.
In a reply memorandum filed on October 9, 1980, the Congressional defendants noted that the plaintiff had narrowed his focus to challenging the authorization for the electronic surveillance rather than the authorization for the legislative inquiry on cancer insurance. They asserted, however, that such surveillance was "within the authority delegated to the staff by the Chairman," and therefore protected by the Speech or Debate Clause from discovery.
On October 16, 1980, the district court held a hearing limited to the immunity defenses and the issue of discovery related thereto. After oral argument, Judge Northrup indicated from the bench that he would deny the Congressional defendants' motion to dismiss or alternatively for summary judgment and for a protective