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Monday, March 18,2013

City Pulse wins libel suit

Paper did not defame Paul Vlahakis by calling him a tax delinquent, judge rules

by City Pulse Staff

Thursday, Nov. 17 — An Ingham County judge has dismissed a
libel suit against City Pulse by businessman Paul Vlahakis over a December 2009
story that reported that he was the county’s second biggest property tax
delinquent.


Vlahakis’ main argument was that City Pulse had inaccurately
reported on its cover that he owed property taxes because the taxes were
actually owed by various LLCs through which Vlahakis does business as a
property owner and landlord.


But in a written opinion issued today, Visiting Circuit
Judge Richard D. Ball said, “The record in this case shows the description of
plaintiff on the front cover of the publication, when read with the content of
the article, is substantially true.” City Pulse had argued that the substantial
truth doctrine in libel law should prevail in this case. In libel law, truth is
considered an “absolute defense” against libel claims. The substantial truth
doctrine provides some defense in cases where published information may not be
literally true.


In an earlier ruling on a motion by City Pulse, Ingham
Circuit Judge Joyce Draganchuk had indicated that Vlahakis had operated his
LLCs in way that negated his claim that the taxes are owed by the LLCs and not
him.


“It shall be taken as true in this case that Plaintiff
freely paid and managed the LLCs from his personal accounts and as an
individual,” wrote Draganchuk, who went on medical leave this fall. Ball, who
is a District Court judge in East Lansing, heard arguments on the motion by
City Pulse for summary judgment.


Vlahakis is the managing member of three LLCs that were
listed as the owners of property on which over $327,000 in taxes were declared
delinquent in 2009. Most of the money was owed for 101 S. Washington Square, a
high-rise office and retail building on the southeast corner of Washington and
Michigan Avenue. The delinquent taxes were paid in spring 2010, avoiding
foreclosure.


In his ruling, Ball said the LLCs “amounted to plaintiff’s
alter-ego.”


Vlahakis sued Neal McNamara, City Pulse’s former news
editor, who wrote the story, and To The Max LLC, which owns City Pulse.
City Pulse and McNamara were represented by Stuart R. Shafer of Lansing, who was assisted by First Amendment attorney John J. Ronayne III of Plymouth, Mich. Vlahakis was represented by Andrew P. Abood and Timothy McCarthy of the Abood Law Firm in East Lansing.
To read Ball’s ruling, click here.



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