A Cook County judge refused to completely dismiss a defamation lawsuit in which restaurant owner Philip Tadros accused Crain’s Chicago Business of publishing a “hit piece.”
Tadros, founder of Bow Truss Coffee, is seeking $38 million from Crain’s over a July 2016 Crain’s article published under the headline: “One of Chicago’s most connected entrepreneurs has made more than a few enemies.” Tadros said Crain’s used “the most salacious information they could find” and marketed the pieced as a special report to draw more attention.
In a related 2017 action, Tadros sued investor Alan Matthew, alleging defamation for comments he made in the piece. In that complaint Tadros said the article “was written with reliance on Bow Truss’ confidential financial and accounting information. Only a Bow Truss officer or investor would have had access to this information.”
In an early March opinion, Cook County Judge Scott McKenna said Tadros recently refiled his complaint while also listing his company, Doejo, as a plaintiff. He alleged the article has 15 specific false and defamatory statements supporting claims for defamation, false light, tortious interference with business relations and prospective economic advantage and commercial disparagement.
Crain’s sought to have the entire complaint dismissed, but McKenna only agreed to strike Doejo’s claims for false light and all claims of commercial disparagement, both dismissals were with prejudice. He also noted Tadros conceded four of the 15 challenged statements were not defamatory and struck those from the complaint.
Referencing six other statements, McKenna noted a 2017 opinion rejecting dismissal and said although the current opinion doesn’t rely directly on that ruling, he found “no reason to come to a different conclusion” as the allegations are unchanged.
“When given their natural and obvious meaning in the context of the article, there is no construction of any of these statements which would be innocently interpreted or reasonably interpreted as referring to somebody other than the plaintiffs,” McKenna wrote.
Another statement addressing how Tadros moved money between his various business interests, “cannot be innocently construed to mean anything other than the investors left the companies because of Tadros’ inability to perform or lack of integrity in perform his duty of running these companies,” McKenna wrote.
But statements referring to Tadros making “enemies” don’t reflect on the ability or integrity of Tadros or Doejo and “could be innocently interpreted to indicate that Tadros made ‘enemies’ simply because of his entrepreneurial endeavors, not any potentially defamation reason,” McKenna wrote. He applied the same logic to a statement about investors leaving because of concerns about Tadros’ methods. He also said a photo used in the article isn’t defamatory.
However, McKenna disagreed with Crain’s position that Doejo itself can’t bring defamation claims. The judge said the complaint alleges the company suffered economic hardship, not just Tadros. The judge allowed allegations concerning seven statements to survive based on the content of those statements. Two statements survived Crain’s challenge that Tadros’ filings in earlier litigation established them to be true, saying “Tadros’ responses do not indicate that he admits to the insinuations of unethical practices being made about his business practices.”
McKenna also refused to dismiss Tadros’ allegations of defamation linked to specific economic damage, noting the complaint referenced loss of accounts, investors and vendors. And while McKenna said Tadros’ false light claim can continue along with the surviving defamation claims, Doejo as a limited liability company doesn’t have the same right to privacy under state law.
The tortious interference with business relations claim survived on the same reasoning, McKenna explained, as did those concerning prospective economic advantage because Tadros alleged “Crain knew about Tadros and Doejo’s numerous accounts and investors, and contacted those third parties with whom Tadros and Doejo later lost accounts and prospective business.”
However, a claim of commercial disparagement requires evidence the challenged statements directly addressed the quality of goods or services, McKenna said. That’s not the case here, the judge said, as Tadros’ allegations involve only statements concerning him as a business owner or his corporate strategy.
McKenna gave Crain’s a March 24 deadline for responding to the surviving claims.