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FIFTH DIVISION
June 2, 2000

No. 1-98-4369

PRESIDING JUSTICE THEIS delivered the opinion of the court:

Plaintiff, Lynda S. Gardner, brought this four-count complaint inthe circuit court of Cook County to recover damages for injury to herreputation and business resulting from allegedly defamatory statementspublished by defendants, Senior Living Systems, Inc. (SLS), BrucePaller, and Barry Gruber, in letters to their present and potential customers. The circuit court granted defendants' motion to dismisswith prejudice pursuant to section 2-615 of the Illinois Code of CivilProcedure (the Code) (735 ILCS 5/2-615 (West 1998)), on the basis thatthe publications were susceptible to an innocent construction and wereotherwise not actionable. For the following reasons, we reverse andremand for further proceedings.

Plaintiff was a former employee of SLS, a company that sells,services, and provides technical support for its line of computersoftware to the health-care industry. Plaintiff had worked in thecompany's support department, providing computer services and trainingto SLS customers for about three years. In September 1996, sheresigned and went to work as an independent sales representative on acommission basis for Answers on Demand, a competitor of SLS.

In count I of her complaint, plaintiff alleged that, shortlyafter her resignation, defendant Paller, her former support manager atSLS, authored and published a letter about her to SLS customers. Thatletter is attached to plaintiff's complaint. Therein, she directsattention to statements made by Paller that she claims falsely accusedher of being "unethical" and taking actions that were "illegal." Sheadditionally alleged that the letter falsely accused her of"soliciting SLS clients and contracting her services" for SLS softwaretraining or custom work, falsely accused her of failing to remove SLSsoftware from her computer, maliciously stated that she had "refusedto sign a non-disclosure agreement" with SLS, and threatened SLScustomers with "possible future problems" if they made use of herservices. As a result, she alleged that the letter impugned herintegrity and prejudiced her in her business. She sought compensatoryand special damages, as well as punitive damages for the allegedlymalicious acts.

Count II was directed at SLS for having approved or ratified thePaller letter and alleged liability under the doctrine of respondeatsuperior. Count III was directed at defendant Gruber. Plaintiffalleged that, two weeks after the Paller letter, Gruber, vicepresident of SLS, authored and published a separate letter to SLScustomers and/or sales prospects, specifically addressing her. Thatletter is also attached to plaintiff's complaint. Therein, shedirects attention to Gruber's postscript, which she claims falsely andmaliciously accused her of "software piracy and industrial espionagerelated to theft of trade secrets," maliciously stated that "suit willbe filed shortly" against her and threatened recipients of the letterthat such lawsuit would likely affect any client that does businesswith her. As a result, she alleged that the Gruber letter impugnedher integrity and prejudiced her in her business. She soughtcompensatory and special damages as well as punitive damages onaccount of the alleged malicious acts. Lastly, count IV was directedat SLS for having approved or ratified the Gruber letter and allegedliability under the doctrine of respondeat superior.

Defendants subsequently filed a motion to dismiss the complaintfor failure to state a cause of action pursuant to section 2-615 ofthe Code (735 ILCS 5/2-615 (West 1998)). The trial court granted themotion with prejudice and denied plaintiff's motion forreconsideration.

On appeal, plaintiff contends that the trial court erred as amatter of law in finding that the complaint was legally insufficient. Specifically, she argues that these statements fall into one of therecognized categories of words that are actionable per se and are notcapable of a reasonable innocent construction. Defendants maintainthat the dismissal of the complaint was proper because the languagecontained in the letters does not constitute libel per se, is subjectto the Illinois innocent construction rule, and is absolutelyprivileged.

In considering whether the trial court properly dismissed thecomplaint, we note that a motion to dismiss under section 2-615attacks the legal sufficiency of the complaint. Van Horne v. Muller,185 Ill. 2d 299, 305, 705 N.E.2d 898, 902 (1998). The court must takeall well-pleaded facts as true and draw all reasonable inferences fromthose facts that are favorable to the plaintiff. Bryson v. NewsAmerica Publications, Inc., 174 Ill. 2d 77, 86, 672 N.E.2d 1207, 1213(1996). Exhibits attached to the complaint are included as part ofthe complaint and must also be considered in that determination. Kirchner v. Greene, 294 Ill. App. 3d 672, 677, 691 N.E.2d 107, 112(1998). A cause of action should not be dismissed on the pleadingsunless it clearly appears that no set of facts can be proved under thepleadings which will entitle the plaintiff to recover. Van Horne, 185Ill. 2d at 305, 705 N.E.2d at 902. The standard of review governingdismissals pursuant to section 2-615 is de novo. Kirchner, 294 Ill.App. 3d at 679, 691 N.E.2d at 113.

With this standard in mind, we consider whether plaintiff'sallegations state a cause of action for defamation per se. Astatement is defamatory if it impeaches a person's reputation andthereby lowers that person in the estimation of the community ordeters third parties from dealing with that person. Kolegas v. HeftelBroadcasting Corp., 154 Ill. 2d 1, 10, 607 N.E.2d 201, 206 (1992). The question of whether a statement is actionable is a question oflaw, and each case must be decided on its own facts and circumstances. Newell v. Field Enterprises, Inc., 91 Ill. App. 3d 735, 741, 743, 415N.E.2d 434, 441, 442 (1980). However, certain words are consideredlibelous per se because their publication is so obviously andnaturally hurtful to the person aggrieved that proof of theirinjurious character is unnecessary. Mittelman v. Witous, 135 Ill. 2d220, 239, 552 N.E.2d 973, 982 (1989). Accordingly, in such cases, theplaintiff need not plead or prove actual damage to reputation. VanHorne, 185 Ill. 2d at 307, 705 N.E.2d at 903.

Statements that fall into the category of defamatory per seinclude those that (1) impute the commission of a criminal offense;(2) impute infection with a loathsome communicable disease; (3) imputeinability to perform or lack of integrity in the discharge of dutiesof office or employment; (4) prejudice a party or impute lack ofability in her trade, profession or business; and (5) those thatimpute adultery or fornication. Van Horne, 185 Ill. 2d at 307, 705N.E.2d at 903.

Applying these categories to the present case, we first considerthe Paller letter. Plaintiff asserts that the statement falselyaccusing her of "illegal" actions based upon her leaving with SLSsoftware are actionable per se because they impute the commission ofthe crime of theft and thereby prejudiced her in her business. Despite defendants' assertion that the word "theft" does not appear inthe statement, it is not necessary that the words state the commissionof a crime in terms of art or with the particularity of an indictmentfor such words to be libelous. Catalano v. Pechous, 83 Ill. 2d 146,157, 419 N.E.2d 350, 355 (1980). However, the crime must be anindictable one, involving moral turpitude and punishable byimprisonment or death. Adams v. Sussman & Hertzberg, Ltd., 292 Ill.App. 3d 30, 46, 684 N.E.2d 935, 947 (1997).

The crime of theft is punishable by imprisonment and is committedwhen a person knowingly obtains or exerts unauthorized control overproperty of the owner and intends to permanently deprive the owner ofthe use or benefit of the property. 720 ILCS 5/16-1(a)(1)(A) (West1996). Therefore, the statements by Paller to his customer, thatplaintiff left with SLS software, that despite many requests neverreturned the computer to have the software removed, and that SLSbelieved these actions to be illegal, when taken in the light mostfavorable to the plaintiff, are sufficient to impute the commission ofa theft. Additionally, these statements would be sufficient tosubject plaintiff to the criminal offense of unlawful use of recordedsounds or images. 720 ILCS 5/16-7 (West 1996).

However, even if a statement is defamatory per se, it may not beregarded as defamatory if the statement is reasonably capable of aninnocent construction. Bryson, 174 Ill. 2d at 90, 672 N.E.2d at 1215. To determine whether a statement is capable of an innocentconstruction, the court must consider it in context, giving the wordsand their implications their natural and obvious meaning. Bryson, 174Ill. 2d at 90, 672 N.E.2d at 1215. Whether an innocent interpretationis reasonable is a question of law for the court to decide. Bryson,174 Ill. 2d at 90, 672 N.E.2d at 1215.

The statements made by Paller, taken in context of the letter,are as follows:

"It has recently come to our attention thatone of our former support employees, Lynda Gardner,has in fact been soliciting SLS clients andcontracting her services. Lynda's actions are at aminimum unethical and because she left with [SLS]software, we believe illegal.

Lynda refused to sign a non-disclosureagreement stating personal policy and prior to herresigning last summer, had [SLS] software loaded onher personal laptop computer. Despite manyrequests, she has never returned the computer tohave the software removed. She felt it unnecessaryand stated 'It's a waste of time, if I really wantthe software I can copy it from a client'scomputer.'"

The letter then warned customers that any work Gardner performed ontheir system could void their warranty and software agreement.

Defendants assert that the statements are reasonably susceptibleto an innocent construction, namely, that plaintiff's conduct could beviewed, not as theft, but as a lack of rigor in following companyprocedure because she viewed it as a waste of time. Furthermore, theyargue that calling her actions "illegal" is susceptible to otherinterpretations, including civil liability, citing Main v. Baker, 176Ill. App. 3d 255, 258-59, 530 N.E.2d 715, 717 (1988).

Standing alone, the word "illegal" may be innocently construedbecause it does not necessarily connote the commission of a criminaloffense. However, here, considering the statements, and giving thewords and implications their natural and obvious meaning, it isevident that the statements taken together were intended to accuseplaintiff of unauthorized control of the software, not a lack of rigorin following company procedure. While the innocent construction ruledoes not allow for the balancing of reasonable constructions, we neednot construe the words in their best possible sense where thedefamatory meaning is far more reasonable, nor do we need to "espousea naïveté unwarranted under the circumstances." Bryson, 174 Ill. 2dat 94, 672 N.E.2d at 1217.

Additionally, the implication of the letter went beyond a merewarning about customer warranties; it warned that customers should notdo business with plaintiff because she stole defendants' software andwas using it illegally to compete for SLS customers. While it is forthe jury to determine the truth or falsity of the statements (Bryson,174 Ill. 2d at 100, 672 N.E.2d at 1220), taking the allegations in thelight most favorable to the plaintiff, the effect of the letter was toattribute criminal activity to her and to prejudice her in her abilityto do business within the same marketplace. Thus, plaintiff haspleaded sufficient facts to support a cause of action for defamationper se against Paller and SLS, and the trial court erred in dismissingcounts I and II of the complaint.

Plaintiff next asserts that the statements falsely accusing herof being "unethical" based on her solicitation of SLS customers andrefusal to sign a nondisclosure agreement are actionable per sebecause they imputed a lack of integrity in her employment andprejudiced her in her post SLS business.

We find that these statements are not reasonably capable of thedefamatory meaning ascribed to them. Merely calling plaintiff"unethical" here cannot not be reasonably interpreted as statingactual verifiable facts and therefore falls under a constitutionallyprotected opinion. Bryson, 174 Ill. 2d at 100, 672 N.E.2d at 1220.Even taken in context with the other statements, accusing plaintiff ofsoliciting SLS customers has no bearing on her competence while shewas employed at SLS, and nothing in the Paller letter suggests thatplaintiff was bound by any agreement to refrain from such competitionafter she left SLS. Additionally, her refusal to sign a non-disclosure agreement was a personal choice as stated by Paller. Accordingly, these statements could not be deemed to have imputed alack of integrity in her employment or prejudiced her post SLSbusiness.

We next address the allegations with respect to the Gruberletter. The body of the letter purports to encourage potentialcustomers to purchase SLS software and to show that its software issuperior to that of its competitors. The alleged defamatory languageis found in the postscript wherein Gruber states,

"A law suit will be filed shortly against LyndaGardner and Answers on Demand alleging softwarepiracy and industrial espionage related to theft oftrade secrets. This will likely affect any clientthat does business with them."

Plaintiff contends that the postscript is defamatory per se because itimputed the commission of a crime and prejudiced her in her business. Defendants maintain that the statement was merely one of intent tofile a civil lawsuit, is devoid of specific factual context, does notpositively identify plaintiff as having committed a criminal offense,and is absolutely privileged as a communication made preliminary tocontemplated litigation.

While merely expressing an intent to file a lawsuit is notnecessarily defamatory per se, the Gruber postscript extends beyond amere generalized intent by directly naming the plaintiff and accusingher of specific offenses, namely "software piracy," and "industrialespionage related to theft of trade secrets." Piracy is, "in essence,the theft of software royalties from those who are entitled to them. Theft is a crime in Illinois. 720 ILCS 5/16-1 (1996)." Langford v.County of Cook, 965 F. Supp. 1091, 1101 (N.D. Ill. 1997). Theft oftrade secrets is a federal offense for which a person may beimprisoned for up to 10 years. 18 U.S.C.A.