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Trials & Litigation

Mortgage Lender Didn’t Show Enough Damages to Sue Law Firm for Defamation Over Marketing Mailer

Posted Jul 10, 2012 3:36 PM CDT
By Martha Neil

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A mortgage lender didn't show enough damages to establish jurisdiction to sue a California law firm for defamation in federal court, a federal judge has ruled.

While Guaranteed Rate Inc. contended that its reputation had been damaged by a mailer sent on behalf of Costa Mesa-based NHT Law Group, there was no proof of the extent to which the advertising was distributed, let alone any concrete damage. Hence, U.S. District Judge John Grady dismissed the suit the company filed against the firm in the Northern District of Illinois, because there was no showing that the $75,000 damages threshold for diversity jurisdiction was surpassed, according to Courthouse News.

"There is no evidence regarding the size of the audience to whom the allegedly defamatory statements were made or the purported lost business opportunities," the judge said in a written opinion (PDF) last week. "There is no evidence that plaintiff has suffered any concrete injury. And as for punitive damages, plaintiff offers no evidence of NHT's alleged 'malice and willfulness' in making the statements, nor does it even cite any cases addressing whether Illinois authorizes punitive damages awards as high as the jurisdictional minimum in the absence of concrete injury."

Paul Nguyen, a principal of the law firm, said he was unable to provide the plaintiff with a list of the potential clients to whom the mailer had been sent, because a third-party marketing group had sent it out. He also said the firm had done so without law firm approval.

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