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OAH 8-6381-20067-CV |
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STATE OF
OFFICE OF ADMINISTRATIVE HEARINGS
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Jeannette
M. Pahl, Complainant, vs. Nick
Mucciacciaro, Ward 1,
Respondent. |
FINDINGS
OF FACT, CONCLUSIONS AND ORDER |
The above-entitled matter came on for an evidentiary
hearing on January 28, 2009, before a panel of three Administrative Law
Judges: Eric L. Lipman (Presiding
Judge), Manuel J. Cervantes and
Jeannette M.
Pahl (Complainant) appeared on her own behalf without counsel.
Nick Mucciacciaro (Respondent) appeared on his own behalf without counsel, but with the assistance of Kevin Foley.
STATEMENT OF ISSUE
Did Respondent Nick Mucciacciaro violate
Minnesota Statute § 211B.06 by intentionally preparing and disseminating false campaign
material that he knew was false or
communicated to others with reckless disregard as to whether it was false?
The panel concludes that the
Complainant has established by clear and convincing evidence that Respondent violated
Minn. Stat. § 211B.06.
Based upon the entire record, the
panel makes the following:
FINDINGS OF FACT
1.
The Complainant, Jeannette Pahl, is an Afton resident and was
the chair of Patricia Snyder’s successful campaign for mayor of
2.
The Respondent,
Nick Mucciacciaro, served on the Afton City Council as a Councilmember for Ward
1 for several terms. In October of 2008, Mr. Mucciacciaro
was the incumbent City Councilmember for Ward 1. Mr. Mucciacciaro did not seek re-election to
this post in the November 2008 election.
3.
The Afton City
Council meets the third Tuesday of every month.
In preparation for these meetings, council members typically receive a
packet of material on the Thursday before the meeting. Included in the packet are monthly financial reports
prepared by the Afton City Accountant, Tom Niedzwiecki.[2]
4.
A standing item
on the agenda for the monthly Afton City Council meetings is the review of the
monthly financial statements prepared by the Mr. Niedzwiecki.[3]
5.
Although Mr.
Mucciacciaro has a vision impairment that renders him legally blind, he is able
to read printed documents, albeit slowly, with the aid of a hand-held illuminated
magnifier.
6.
It was
undisputed at the evidentiary hearing that Mr. Mucciacciaro was engaged in the
monthly City Council meetings, frequently asked questions regarding Council
agenda items and seemed to have read the staff-developed memoranda that were
circulated in advance of Council meetings.[4] It was likewise undisputed that if
supplemental information was provided to Council members just before, or during,
the Council meetings, Mr. Mucciacciaro would require assistance in order to
access this information; such as having someone read aloud to him the recently-arriving
documents.[5]
7.
In 2004, the
Afton City Council established a “special reserve fund,” which was funded
primarily from savings the City achieved by cutting staff positions,
contracting out services, and instituting other cost savings measures. In its first full year, the Council was able
to put approximately $180,000 into the fund and the fund grew by another
$100,000 the following year.[6] No new money was added to the fund in 2007
and 2008.[7]
8.
The November 2006
election resulted in a politically divided Afton City Council, with Mr. Mucciacciaro
being in the minority on many actions approved by the Council. In 2007, both the City Council meetings and
the process for developing a City budget were more contentious and than in prior
years.[8]
9.
In addition, in
the first eight months of 2007, seven lawsuits were filed against the City; resulting
in the City incurring significant legal fees and other costs.[9]
10.
Throughout 2007,
the cash balance of the special reserve fund was at or near $290,000.[10]
11.
At the November
7, 2007 City Council meeting, Mr. Mucciacciaro made a motion to transfer
$60,000 from the special reserve fund to the general fund to pay for the
Afton-Lakeland Gully Stabilization Project.
The motion was approved.[11] However, the money was not actually transferred
from the special reserve fund to the general fund until October or November of 2008.[12]
12.
On September 30,
2008, the City’s special reserve fund had a balance of $302,757.[13]
13.
Mr. Mucciacciaro was concerned that because the City had
been drawn into a series of lawsuits, each with mounting legal costs, and the
State of
14.
In mid-October 2008, Mr. Mucciacciaro prepared and
disseminated to the residents of
Since this
current council has been in office not one penny has been added to our reserve
fund. In fact, the reserve has been spent down to where it stands at only $60,000. I am not saying that all that money was
completely wasted. But as a member of
the minority on the current council, the majority members were not particularly
interested in alternative points of view as to how to be more prudent,
efficient and cost effective with your tax dollars.[15]
15.
Mr. Mucciacciaro went on in the letter to endorse the
non-incumbent candidates for the Afton Mayoral and City Council elections. Mr. Mucciacciaro warned against continuing
the “irresponsible and wrong-headed policies of the current mayor and council
majority.” Mr. Mucciacciaro signed the
letter: “Nick ‘tell it like it is’ Mucciacciaro.”[16]
16.
In November of
2008, the City Council mailed a copy of its proposed budget for 2009 to
residents of
17.
For example, the
budget estimated $35,000 in legal fee co-payments for 2009, notwithstanding the
fact that its exposure for these litigation costs was likely twice this figure. As a member of the League of Minnesota Cities
Insurance Trust (LMCIT), the City of
18.
As of late
October 2008, the City had incurred $27,552 in litigation costs for which it
was responsible, in one lawsuit, and the overall costs of the defense in this
action had topped $200,000.[19] In a second court case, as of this same date,
the City’s co-payment for litigation costs had reached $10,560.[20]
19.
According to the
November 30, 2008, balance sheet prepared by Mr. Niedzwiecki, the City’s
special reserve fund had a balance of $243,331.[21] This figure reflected the $60,000 transfer to
the general fund that occurred in October or November of 2008.
Based upon the foregoing Findings of
Fact, the panel makes the following:
CONCLUSIONS
1. Minn. Stat. § 211B.35 authorizes the panel of
Administrative Law Judges to consider this matter.
2. Campaign material is defined to mean “any literature, publication, or material that is disseminated for the purpose of influencing voting at a primary or other election, …”[22] The letter prepared and disseminated by Mr. Mucciacciaro is campaign material within the meaning of that statute.[23]
3. Minn. Stat. §
211B.06, subd. 1, provides, in part:
A person is guilty of a gross
misdemeanor who intentionally participates in the preparation, dissemination,
or broadcast of … campaign material with respect to the personal or political
character or acts of a candidate … that is designed or tends to elect, injure,
promote, or defeat a candidate for nomination or election to a public office …,
that is false, and that the person knows is false or communicates to others
with reckless disregard of whether it is false.
4. The burden of proving the allegations in the complaint is on the Complainant. The standard of proof of a violation of Minn. Stat. § 211B.06, relating to false campaign material, is clear and convincing evidence.[24]
5. The Complainant has demonstrated that Respondent, Nick Mucciacciaro, violated Minn. Stat. § 211B.06 by intentionally preparing and disseminating campaign material that was false and that he knew was false or communicated to others with reckless disregard as to whether it was false.
Based upon the record herein, and for
the reasons stated in the following Memorandum, the panel of Administrative Law
Judges makes the following:
ORDER
IT IS ORDERED:
That having been found to have violated
Minn. Stat. § 211B.06, Nick Mucciacciaro pay a civil penalty of $175 by April
30, 2009.[25]
Dated: February 11, 2009
|
/s/ Eric L.
Lipman |
|
ERIC L. LIPMAN |
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Presiding Administrative
Law Judge |
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/s/ Manuel
Cervantes |
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MANUEL CERVANTES |
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Administrative
Law Judge |
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/s/ |
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JENNIFER PATTERSON |
|
Administrative
Law Judge |
Reported: Digitally recorded, no transcript prepared.
NOTICE
This is the final decision in this
case, as provided in Minn. Stat. § 211B.36, subd. 5. A party aggrieved by this decision may seek
judicial review as provided in
MEMORANDUM
Sometime
in mid-October of 2008, Mr. Mucciacciaro prepared and disseminated a letter to
The
fund was reduced by $60,000 in late October or November of 2008, when the
council transferred that amount to its general fund to pay for the Afton-Lakeland Gully Stabilization Project. This transfer was done in accordance with a
motion made by Councilmember Mucciacciaro and approved by the City Council in
November of 2007. After the transfer was
completed in November of 2008, the special reserve fund had a balance of
$243,331.
Minn. Stat. § 211B.06 prohibits the preparation and dissemination of false campaign material. In order to be found to have violated this section, a person must intentionally participate in the preparation or dissemination of campaign material that the person knows is false or communicates with reckless disregard of whether it is false. The term “reckless disregard” was added to the statute in 1998 to expressly incorporate the “actual malice” standard applicable to defamation cases involving public officials from New York Times v. Sullivan.[26] Based upon this standard, the Complainant has the burden at the hearing to prove by clear and convincing evidence that the Respondent either published the statements knowing the statements were false, or that he “in fact entertained serious doubts” as to the truth of the publication or acted “with a high degree of awareness” of its probable falsity.[27]
As the U.S. Supreme Court has noted, there is not one precise definition of “reckless disregard.” Inevitably, its outer limits must be marked through case-by-case adjudication. A respondent cannot automatically ensure a favorable decision by testifying that he published with a belief that the statements were true.[28] A statement may have been made with actual malice if it
is fabricated by the defendant, is the product of his imagination, . . . is based wholly on an unverified anonymous telephone call [or if] the publisher’s allegations are so inherently improbable that only a reckless man would have put them in circulation.[29]
In determining whether a respondent had serious doubts about the truth of his statement, the panel must assess the information available when the statement was made, including the identities of the sources and what those sources said.[30]
The Complainant, Ms. Pahl, argues that because Mr. Mucciacciaro was a councilmember who reviewed and discussed the City’s financial statements at the monthly city council meetings, he knew his claim about the amount of money remaining in the reserve account was false when he disseminated it.
Rather than confess the
error, and maintain that the $60,000 figure followed from an innocent but
regrettable misreading of the city’s spreadsheets,[31]
Mr. Mucciacciaro’s defense of his claim became only more steadfast as the
hearing progressed. The testimony that
he adduced into the record was to the effect that he intended to communicate to
While Mr. Mucciacciaro has a First Amendment right to circulate projections of the City’s actual liabilities that are gloomy, or even improbable, he may not disseminate claims that are demonstrably false.[33] There is no evidence in the record for how Mr. Mucciacciaro arrived at the $60,000 figure – as opposed to $0, a negative number, or any other sum – and no such tabulation is derivable from this record.
Whatever frustration Mr. Mucciacciaro (or others) may feel about the management of the city’s affairs, this frustration is not a license to disseminate campaign material that is factually inaccurate. The panel concludes that a penalty of $175 is appropriate.
E. L. L., M. J. C., J. P.
[1] Ex. 14
[2] Testimony of Peg Nolz.
[3] Testimony of
Nolz and Julia Welter; Ex. E.
[4] Testimony of Welter.
[5] Testimony of Shelly Strauss.
[6] Ex. 13 (The
special reserve fund had a balance of $182,132 on December 31, 2005, and a
balance of $281,854 on December 31, 2006.); Testimony of David Engstrom.
[7] Testimony of
Charles Devine.
[8] Testimony of
Strauss.
[9] Testimony of
Strauss.
[10] Testimony of
Nolz; Exs. A and 13.
[11] Testimony of Nolz; Ex. 11 at 4-5.
[12] Testimony of
Nolz, Welter and Strauss; Exs. 2, 7 and 8.
[13] Ex. C.
[14] Testimony of
David Engstrom.
[15] Letter attached
to Complaint. (Emphasis in original.)
[16] Letter
attached to Complaint.
[17] Testimony of
Devine; Exs. 2, 4 and 8.
[18] Exs. 3, 5 and
6; Testimony of Devine.
[19] Testimony of
Devine; Exs. 3 and 5.
[20] Ex. 3.
[21] Ex. F.
[22] Minn. Stat. §
211B.01, subd. 2.
[23] Ex. J-1.
[24] Minn. Stat. § 211B.32, subd. 4.
[25] The check
should be made payable to “Treasurer, State of
[26] New York Times v. Sullivan, 376
[27] See St. Amant v. Thompson, 390
[28] St. Amant, 390 U.S. at 732; Eastwood v. National Enquirer, Inc., 123
F.3d 1249, 1253 (9th Cir. 1997) (“As we have yet to see a defendant
who admits to entertaining serious subjective doubt about the authenticity of
an article it published, we must be guided by circumstantial evidence.”).
[29] St. Amant, 390
[30] See In
re Charges of Unprofessional Conduct Involving
File No. 17139, 720 N.W.2d 807, 815-16 (
[31] Compare, Ex. C with Ex. 7.
[32] Testimony of Kevin Foley; Testimony of Nick
Mucciacciaro.
[33] Compare, Kennedy v. Voss, 304 N.W.2d
299, 300 (