Employer Not Liable for Defamation Based on Statements by an Employee Unrelated to the Employer-Employee Relationship

On April 6, 2022, Justice Emerson of the Suffolk County Commercial Division issued a decision in 125 Tuckahoe Lane Corp. v Exit Hospitality Group LLC, 2022 NY Slip Op. 50246(U), holding that an employer was not liable for a defamatory statement made by its employee when the statement was unrelated to the employer-employee relationship, explaining:

Liberally construing the counterclaim, accepting the alleged facts as true, and giving the defendant Zeynal Erdem the benefit of every possible favorable inference, the court finds that he has failed to state a cause of action for defamation against the plaintiff, 125 Tuckahoe Lane Corp. It is basic to a claim of defamation that the allegedly defamatory utterances be connected to the party being sued, and an action must be dismissed if no such connection is demonstrated. There is a presumption of separateness between a corporation and its owners, which is entitled to substantial weight. Thus, a corporation may be liable for torts committed by its officers or agents acting within the actual or implied scope of their employment or in furtherance of the corporation’s business or, if in excess of their authority, when ratified by the corporation. The defendant Zeynal Erdem does not allege, nor does the record reflect, that John Flanagan made the allegedly defamatory statements on behalf 125 Tuckahoe Lane Corp., as an employee or agent, in furtherance of its business, or that the statements were ratified by 125 Tuckahoe Lane Corp. Erdam’s failure to link 125 Tuckahoe Lane Corp. to the alleged defamatory statements is sufficient grounds for dismissal of the counterclaim. Accordingly, the cross motion is granted.

(Internal quotations omitted) (emphasis added).

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