COA throws out jury’s $550,000 defamation, blacklisting verdict

A jury’s $550,000 defamation and blacklisting verdict in favor of a former school athletic director in northwestern Indiana was overturned Tuesday by the Indiana Court of Appeals.

Chad Rueth won the judgment after he sued School City of Hammond District. Rueth had been athletic director for Gavit High School for several years until principal Michelle Ondas decided not to renew his contract in 2012. Rueth wasn’t aware that Ondas had decided several months earlier not to renew his contract, during which time Rueth was a finalist for the athletic director position at his alma mater, Bishop Noll Institute.   

But members of Bishop Noll’s hiring committee heard rumors, including from Ondas’ husband, that Rueth would be out of his job at Gavit, even though he had been invited to re-apply. Emails in the court record from committee members, who ultimately chose someone else as AD, show Rueth’s situation at Gavit had been a factor in their considerations.

Rueth said he learned of Ondas’ decision not to renew his contract the day of his interview with the Bishop Noll committee. Rueth said the interview didn’t go well because he was still reeling, and he informed Bishop Noll’s principal afterward that he was being let go as AD at Gavit.

A Lake Superior jury weighing the evidence returned a general verdict for Reuth and awarded damages of $550,000, and the trial court later entered judgment. School City of Hammond District filed a motion to correct error, which the trial court denied. The Court of Appeals reversed.

“(W)e conclude that there is insufficient evidence to support a verdict for defamation or blacklisting, and, as such, the trial court abused its discretion by denying the District’s Motion to Correct Error,” Judge Patricia Riley wrote in School City of Hammond District v. Chad Rueth, 45A03-1603-CT-450.

Because Ondas communicated to Rueth that his contract would not be renewed, the statement was truthful and did not meet the elements of defamation, the panel held. And while the court acknowledged its duty of deference to a jury verdict, it also noted, “all the members of the Hiring Committee who testified, as well as Principal Ondas, indicated there was no communication between the District and the Hiring Committee regarding Rueth. … Accordingly, there is insufficient evidence to support a verdict for defamation,” Riley wrote.

Likewise, the panel ruled that Rueth had not been a victim of blacklisting, through which damages could be awarded under I.C. 22-5-3-2. Rueth was not fired from his teaching position at Gavit, and the fact that his athletic director contract was not renewed was not tantamount to a discharge, the COA found.