Opposition Brief — Ziemke v. Almog

No. 97-1910

In The

Supreme Court of the United States

te

October Term, 1997

MARILYN ZIEMKE, CELIA SHAR and ISRAEL TRAVEL

ADVISORY SERVICE, INC.,

Petitioners,

VS.

SHALOM ALMOG, IRIT ALMOG and BEN AMI GELLER,

Respondents.

On Petition for Writ of Certiorari to the

Superior Court of New Jersey, Appellate Division

BRIEF IN OPPOSITION FOR RESPONDENTS

SHALOM ALMOG AND IRIT ALMOG

DAVID FEINSILVER

Counsel of Record

THE FEINSILVER LAW GROUP, P.C.

Attorneys for Respondents

Shalom Almog and Irit Almog

215 Millburn Avenue

ag P.O. Box 312

On the Demag: Millburn, New Jersey 07041

-4

DAVID FEINSILVER aia tei ls

JAIME R. PLACEK

DANIEL V. SOLLECITO

ervices, inc

147580 (800) 274-332" + (800) 359-6859 UA ellate

A DIVISION OF COUNSEL PRESS S

QUESTIONS PRESENTED FOR REVIEW

Respondents Shalom and Irit Almog respectfully submit

that, when the hyperbole is stripped from the Petition, the real

issues presented are:

I.

II.

Il.

IV.

Whether there is not a First Amendment concern, where

the defamation arises in the context of private commercial

speech that was uttered maliciously for the sole purpose

of injuring potential trade rivals, and where no media

coverage, public official or public figure is involved?

Whether the Petition should be denied where the

Petitioners failed to raise before the New Jersey Appellate

Division the issue of whether the punitive damages verdict

violated the free speech clause of the First Amendment?

Should this Court entertain a Petition predicated upon an

assertion that a punitive damage award was excessive in

light of their alleged financial condition, where the

Petitioners did not challenge the quantum of the punitive

damage award before the New Jersey Appellate Division

and steadfastly refused below to furnish the jury and the

Court with the necessary financial records and information

to determine the issue?

Did the New Jersey Appellate Division properly determine

that the New Jersey law applied to this private defamation

suit where New Jersey’s interest in deterring egregious

and tortious conduct of its citizens is not outweighed by

any substantial Israeli interests?

Did the New Jersey Appellate Division correctly determine

that the jury charge and jury interrogatories, which

permitted individual allocations of liability but did not

VI.

ul

require them, were not plainly erroneous, where Petitioners

presented themselves as one “unit”, jointly conspired to

defame respondents, presented one unified defense

through one law firm, furnished the jury with no

information to enable it to make an allocation, and failed

to object thereto?

Did the New Jersey Appellate Division properly determine

that the jury was not advisory, where the lawyers

proceeded tactically on the understanding that this was a

jury trial, as did the court; the jurors had no idea during

their deliberations (or at any other time) that their status

was anything but that of the ultimate finders of the facts,

and nothing said by the trial judge tainted the way that

the lawyers tried the case to the jury, or the way that the

jury deliberated?

ull

TABLE OF CONTENTS

Page

Questions Presented for Review ................... 1

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Reasons for Denying the Writ .............0.25%-: 9

I. Where Defamation Arises In The Context Of

Private Commercial Speech, Uttered Maliciously

For The Sole Purpose Of Injuring Potential Trade

Rivals, And Where No Media Coverage, Public

Official Or Public Figure Is Involved, No Possible

First Amendment Concerns Are Implicated, Nor

Does The Imposition Of Punitive Damages Under

State Law In Such A Case Raise Any Unique Due

Process Or Other Constitutional Concerns. ... 9

A. The First Amendment In The Ordinary Non-

Media, Non-Public Interest Case. ....... 9

B. The Constitutionality Of Punitive Damages

As Imposed By State Law In Non-Media,

Non-Public Interest Defamation Cases, And

I rn eee ceo hei tse vee Oe he oe 14

Il.

III.

iv

Contents

C. The New Jersey Courts In This Matter

Consistently Applied New Jersey’s Own

Choice Of Law Rules In Concluding That

New Jersey Law Should Be Applied On The

Question Of Punitive Damages. That Choice

Of Law In No Way Violates Petitioners’ First

Amendment Or Due Process Rights.

Petitioners Had A Full Jury Trial Below Which

Resulted In A Verdict, And Although The Trial

Judge Elected Not To Enter Judgment On That

Verdict, The Appellate Division Reversed Him

And, After Review, Reinstated The Verdict And

Directed That Judgment Be Entered On It.

Petitioners Suffered No Denial Of Due Process

In This Procedure, Nor On The Basis Of Any Of

The Other Matters Raised In The Petition. ....

Based On The Unique Facts Presented Herein, It

Was Not Violative Of Due Process For The Trial

Court Not To Require Individualized

Determinations From The Jury As To The Liability

And Damages Attributable To Each Defendant.

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To The Extent That Concepts Of Substantive Due

Process Under The Fourteenth Amendment Can

Have Any Possible Application To A Civil Tort

Judgment In State Court, No Known Due Process

Rights Of Defendants Were Violated In The

PRUSEOEIE TONG 3b 6k koko hi ee ees

Page

17

20

22

24

Contents

A. Degree of Reprehensibility .............

a rr In eee ye ary erase arly

C. Comparative Legislative Sanctions ......

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TABLE OF CITATIONS

Cases Cited:

Abebe-Jira v. Negewo, 72 F.3d 844 (11th. Cir. 1996) .

Aetna Life Ins. Co. v. Lavoie, 475 U.S. 813 (1986)...

Almog v. ITAS, 298 N.J. Super. 145 (App. Div. 1997)

at

28

25

eae

7a wk RRR ek eek Are hy Dy 07, 18, FR, 22, 25

Bereda v. Pickering Creek Industrial Park, Inc., 865 F.2d

OP 4G CW TE ak os Ch ae a ee eee erie ees

Colley v. Harvey Cedars Marina et al. 422 F. Supp. 953

(D.N.J. 1976, footnote omitted) ................

Corporate Training Unlimited, Inc. v. National

Broadcasting Co., Inc., 981 F. Supp. 112 (E.D. N.Y.

RED eu RRA ane ba aed ee LOS CE Reha

Dun & Bradstreet, Inc. v. Greenmoss Builders, 472 U.S.

Fee ER a 5 hid kb a aa ee ee 9,

vi

Contents

Page

Filartiga v. Pena-lrala, 577 F. Supp. 860 (E.D. N.Y.)

PT ee Pe re ee re pr Te Te ee ar 25

Food Lion, Inc. v. Capital Cities/ABC, Inc., et al., 984 F.

mui. SES CEE. TNS ROPES ein cies wwii vcs 11

Gantes v. Kason Corp., 145 N.J. 478 (1996) ........ 18, 19

Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974) ...9, 10, 12

Honda Motor Co. Ltd. v. Oberg, __ U.S.__, 114 S. Ct.

BR CEE. cok we'd an ke Ro omar 16

J.S. and M.S. v. R.T.H. and R.G.H., 301 N.J. 150, 693

R26 TEST CE. AO. TP ED on ve da en ees ewuaes 25

New York Times v. Sullivan, 376 U.S. 254 (1964) .... 9, 10

Pacific Mutual Life Insurance Co. v. Haslip, 499 U.S. |

CQRPER ew heivice iia seaeuerereeeetem mcs 14, 15, 16

Philadelphia Newspapers, Inc. v. Hepps et al., 475 U.S.

767, 89 L. Ed. 783, 106 S. Ct. 1558 (1986) ...... 10

Refuse & Env. Systems v. Industrial Serv. of Am., 932

Pie Se CA Ga TOD 6 xa sa skein ee 23, 24

Rosenbloom v. Metromedia, 403 U.S. 29 (1971) ..... 13, 14

Thompson v. Parks, 963 F.2d 885 (6th Cir. 1992) .... 21

Vil

Contents _

Page

TXO Productions Corp. v. Alliance Resourses Corp., 509

Shits Doky CS ees Wels TEE COORD Sak Cees awe Ves 15, 16

Waters v. Churchill, 511 U.S. 661, 128 L. Ed. 686, 114

ie Sas RS CE 0 oe oe ee hee boa Crs 10

Wilson v. Savino, 10 N.J. 11, 89 A.2d 399 (1952) ... 24

Xuncax v. Gramajo, 886 F. Supp. 162 (D. Mass. 1995) 25

Statutes Cited:

N.J. Stat. Ann 2A:15-5.9 et seg. (West 1998) ........ 27

Picks. GO FO REM EMED, nu eke ena eck weenah 27

United States Constitution Cited:

Pa Pe ig sis re eb he CS hb ba eda Rh ou i, 9, 10

FOUPUSOIT AMIONGINIORE 0 ooo okies ib ekewseadacuce 24 es

Rule Cited:

Peide HE Ae EIOAS eivs 0k avs cl eae awe 5

Other Authorities Cited:

New Jersey Practice, Vol. 24 § 742, 2nd edition ..... 27

Restatement (second) Chapter 25 ........0..0.2000> 21

i

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STATEMENT OF THE CASE!

The factual recitations set forth in the Petitioners’ Statement

of the Case bears very little resemblance to the truth, or to the

record herein. Due to space limitations, Respondents refer this Court

to the factual recitation set forth at pages 149 through 155 of the

February 25, 1997 opinion? rendered by the Superior Court of

New Jersey, Appellate Division (the Honorable Sylvia B. Pressler,

P.J.A.D. writing for a unanimous Court), which recitation was

predicated upon that Court’s careful review of the entire record

below.

BACKGROUND

As a result of a 1993 Jury verdict arising out of a5 1/2 week

trial in a lawsuit filed on October 8, 1989, Shalom Almog, Irit

Almog and Ben Ami Geller (hereinafter, the “respondents’’) hold a

judgment in defamation against Celia Shar, her adult daughter,

Marilyn Ziemke, and their wholly owned Corporation, Israel Travel

Advisory Service, Inc., (“ITAS”). The jury awarded the Almogs

compensatory damages of $1,524,000 and $4,500,000 in punitive

damages for a total of $6,024,000; and awarded Geller $40,000 in

compensatory damages and $1,000,000 in punitive damages.

Pursuant to special interrogatories, the jury expressly found that

the defamatory statements were made by the Petitioners with actual

knowledge that the statements were false.

1. Citations to the record below will be in the following form: “Pet.#”

refers to defendants’ petition for a writ of certiorari to this Court; “Da#’ refers to

a page in defendants’ Appendix to their brief filed in the Superior Court of New

Jersey, Appellate Division; “Pa#” refers to a page in the Almog Respondents’

Appendix to their brief filed in the Superior Court of New Jersey, Appellate

Division; “Raa#” refers to a page in the Almog Respondents’ Appendix to their

Brief filed with the Supreme Court of New Jersey; “Tr.#” refers to the trial

transcript.

2. Almog v. ITAS, 298 N.J. Super. 145 (App. Div. 1997).

2

Contrary to petitioners’ assertion that an accounting firm

substantiated their claims made against Respondent Almog for

alleged misappropriation of monies, petitioners never provided

any evidence to support such a claim.

Respondents Shalom and Irit Almog did not file suit in the

New Jersey Court to preempt a potential suit by the petitioners in

Israel. On November 23, 1989, the petitioners filed a retaliatory

sham lawsuit in Israel against Mr. Almog seeking $550,000 in

damages for fraud, embezzlement, misrepresentation and negligence,

which was enjoined.’ These Respondents dismissed their claims

against Respondent Geller, as the same were not proven at trial.

Petitioners Shar and Ziemke, New Jersey residents working

through Petitioner ITAS, are in the business of organizing tours to

Israel for American travelers. During the period in controversy,

the business was highly successful, ITAS, controlled 30% of the

Untied States’ Bar-Bat Mitzvah market.* ITAS subcontracts all the

Israeli arrangements-hotels, meals, sightseeing, entertainment,

transportation, and the like-to a licensed Israeli land tour operator.

The groups are then conducted by a licensed Israeli tour guide

acting as an independent contractor under arrangement with the

land tour operator. Geller, who worked as a guide, frequently

guided ITAS groups.

Sometime in 1984 Geller solicited Almog, then a colonel in

the Israeli Defense Forces, to enter the travel business upon his

3. Petitioners brought the same claim against Mr. Almog by way of

counterclaim. However, Petitioners solely offered proofs with respect to one

$39,000 transaction and limited their counterclaim thereto at the conclusion of

the case (Raa60[21 }-62[16]). Both the jury and the trial court found in favor of

Mr. Almog on Petitioners’ counterclaim. The sham alleged Israeli accounting

report which was the basis for said suit was never produced or made part of the

record herein. The Appellate Division ordered the Petitioners to delete all

references thereto (Pal 83).

4. At trial it was established that ITAS’ tax returns bore no relation to

reality.

3

retirement from the army and introduced him to Shar and Ziemke.

In August 1985, when Almog retired from the army, he worked

for the land tour operators assigned exclusively to the ITAS account.

A close working relationship developed between Almog and Shar

and Ziemke, who were extremely pleased with his performance.

In October 1988, the land tour operator and Geller advised

the Petitioners that they believed that Almog charged ITAS for

some services not actually rendered the touring groups and by not

remitting certain rebates; i.e. relatively minor matters involving

the cost of box lunches, the use of hostesses, the quality of buses

engaged, and a small hotel prepayment discount. However, Almog’s

disposition of these matters was perfectly proper and in accord

with industry standards and practices.

In any event, the Petitioners created their own allegations of

wrong doing, which took on a life of their own, and increased in

magnitude with the passage of time, accusing him of embezzling

sums up to $500,000; calling him an embezzler, thief, schizophrenic

and adulterer, etc., (all without any basis in fact). As a result, Almog

was unable to find employment either in the tourist industry or in

any other industry in Israel because of the savage campaign of

slander and libel that Shar and Ziemke maliciously undertook

against him, both in the United States and in Israel. It was not until

1990 that Almog was finally able to find work at a greatly reduced

salary as a plant manager in the Dominican Republic. They

published these stories to anyone who would listen, including

Almog’s former commanding officer, who advised him to leave

Israel as his reputation and prospects were finished there. The

Almogs suffered substantial physical and emotional harm as a result

of Petitioners’ actions.

Geller continued in Petitioners’ good graces until the summer

of 1990, when Geller was hospitalized after suffering a stroke.

When he was released from the hospital, he entered into an

agreement with a land tour operator when he was not required to

work exclusively on ITAS tours and his per-tourist fee was increased

4

to $15. When the land tour operator’s principal advised Shar and

Ziemke of this agreement, they became enraged, vowed to “punish”

Geller, called him a thief and refused to permit him to guide the

tour scheduled for October. The land tour operator thereupon

severed its relationship with ITAS and entered into a relationship

with an American competitor of ITAS and Geller continued to

work both for the land tour operator and other companies. The _

Petitioners mounted a retaliatory defamatory campaign against

Geller, accusing him of having seduced the daughter of a major

Israeli restaurant owner and causing Geller and his wife to be subject

to criminal investigation by the Israeli tax authorities, and to suffer

impairment of reputation, and emotional distress.

The Honorable Douglas Hague, J.S.C., who presided over

the trial found:

I find that the conduct of the defendants ... was

outrageous ... I think it was vicious: I think it was

unnecessary ... I think that they defamed,

outrageously, these two plaintiffs . . . I find it to be a

fact that the defendants also — unnecessarily impugned

his private life with no reason and no necessity to do it

— it had nothing to do with their business — by

indicating that he had affairs with other women ...

insofar as the Colonel is concerned . . . somehow along

the line they became disoriented. Somehow along the

line their zeal became misguiding — misguided and I

think that their actions thereafter were unwarranted,

violent and vicious, and they conducted some ...

indiscriminate broadsides against Colonel Almog .. .

I think that the damage to his reputation ... was

stupendous — was terrible. And the word that I’m

searching for, I think, is odious.

(Tr. 8/13/93 112:15-115:7)

5

The Hon. Sylvia Pressler, PJ.A.D., writing for a unanimous

panel of the Appellate Division, stated:

In summary, we are satisfied from our review of this

record that the jury had an ample evidential basis

from which to conclude that defendants Shar and

Ziemke and their company took concerted, malicious

and purposeful action over a significant period of

time to destroy both Almog and Geller as respected

members of their community, that they did so with

total disregard of the truth or of the personal

consequences to them and their families, and that in

large measure they succeeded. (Emphasis added).

The Appellate Division of the Superior Court of New Jersey

further found that the “evidence of defendants’ intentional,

malicious and egregious wrongdoing was overwhelming” Almog

v. Itas, 298 N.J. Super 145 at 153, 160 (App. Div. 1997).

The compensatory damages phase of the trial commenced on

July 12, 1993, with closing arguments on August 13, 1993. On

August 16, 1993, the jury answered special interrogatories

consented as to form by defendants’ counsel (Da 461 et seq.). The

jury determined that punitive damages should be awarded. Due to

the trial court’s vacation schedule, the trial court, with the consent

of the parties and jury, suspended the trial until September 20,

1993, at which time the trial reconvened for the second (punitive

damage) phase (conducted on September 20 and 21, 1993).

On August 16, 1993, following the jury’s initial verdict, the

trial court, inter alia, ordered the petitioners to furnish respondents’

counsel with all of the petitioners’ 1991 and 1992 personal and

corporate tax returns (Raa 74[4-7]). On August 17, 1993,

respondents served upon defense trial counsel notices to produce

in lieu of a subpoena pursuant to N.J. Rule of Court 1:9-2. When

documents were not timely received, respondents moved to compel

production thereof.

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On September 16, 1993, the trial court ordered the petitioners

to produce 1991, 1992 and 1993 profit and loss statements for

petitioner ITAS; ordered that the personal 1991 and 1992 tax returns

of petitioners Shar and Ziemke be produced; and cautioned

petitioners’ trial counsel that the petitioners’ non-production of

financial information might result in a large verdict.’ (See, generally,

Raa 75(9]}-110[4]). Petitioners’ trial counsel represented to the court

on September 16, 1993, inter alia, that petitioners’ accountant

(Leonard Harris, C.P.A., who was noticed by the respondents to

appear at trial) would appear for trial® (Raa 107[15-17]).

In contrast to Petitioners’ description of the trial, Judge Hague

took considerable time and care in explaining to the jury the reason

for the few brief interruptions during the 5 1/2 week trial, which

did not affect the outcome herein.

Contrary to the false assertion that Judge Hague stated on

August 13, 1993 (while charging the jury) that he had in fact only

listened with“... half an ear. . .”, what Judge Hague actually said

was:

As I told you before, you have eight minds and 16

eyes and you see much more than I could ever hope

to see in this case . . . and I think that because of my

over three decades of experience as a trial attorney, /

can listen with half an ear, but I can’t do it as well as

you can...

Raa 66[19]-67[7]. Clearly, Judge Hague was merely stressing to

the jury the importance of their role, and expressing his confidence

in them to reach a proper verdict. Judge Hague never left the

5. See resume of petitioners’ failures to produce court ordered documents

and information. (Pal 78).

6. However, contrary to petitioners’ representation, petitioners did not

produce their accountant, claiming that he was on vacation and would not be

returning until after trial. Raa 131{13]-133{10}.

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courtroom during proceedings, nor was he interrupted by another

matter, as all counsel out of respect for the Court, immediately

stopped and refused to continue until the interruption was over. At

no time did the trial proceed without the Judge, or without the

Judge’s attention.’

Contrary to the petitioners’ assertions, this was not an advisory

jury as the jury had already begun deliberations in the jury room

when the trial judge announced to trial counsel (emphasizing to

counsel that this was to remain in the courtroom) that he would

decide the case as an Israeli Judge — as the petitioners had requested.

With regard to petitioners’ complaint that they were treated as

one by the trial court, petitioners were, and are, truly inseparable.

Based on the unique facts presented at the trial below, individual

determinations of guilt were not required (and would have served

no purpose).* Petitioners Shar and Ziemke (Shar’s only child),

who continue to reside in the same home and who are the sole

principals of ITAS: (a) wrote every libelous letter jointly; (b) jointly

participated in every meeting where they slandered Mr. Almog; (c)

jointly conducted all aspects of their business; (d) conducted every

slanderous phone conversation jointly’; and (e) are truly

inseparable. (Raa 37[13-25]). In fact, the testimony (which was

largely uncontradicted, and found to be credible and overwhelming

by the jury, trial judge and Appellate Division), was that both

petitioner Shar and petitioner Ziemke, in each instance, actively

7. Petitioners’ present counsel was not petitioners’ trial counsel, while

respondents’ present counsel was also trial counsel in this matter.

8. Furthermore, petitioners offer no authority (governing at the time of

trial) for their proposition that when an award is made jointly and severally against

defendants, the individual financial circumstances of each defendant must be

taken into account.

9. Petitioner Shar testified that the petitioners participated jointly in writing

letters and making telephone calls. Raa 56{3}-57[17].

8

participated in the defamatory statements. '° Therefore, the trial court

properly denied the petitioners’ untimely request to split them into

three individual defendants for the purpose of determining

liability.’ As noted by the trial court, the entire case was presented

by one law firm on behalf of all three defendants, they operated as

one unit, and the petitioners presented no evidence to the jury to

enable it to make an allocation, and that he did not believe that

under the circumstances that there should be separate punitive

damage awards. Nevertheless, the court did draft special

interrogatories for the jury to decide whether there should be

individual assessments or a joint award (Raa 69[13-17]; Raa 112;

Raa 166[20]-168[14]). The jurors found that the defendants had

indeed acted jointly,’* and awarded punitive damages against the

petitioners jointly."

Finally, contrary to petitioners’ assertion, the United States

Bankruptcy Court for the District of New Jersey in not “awaiting

the response of this court before acting further”.'* ITAS has not

filed for bankruptcy, and continues as a profitable business.

10. See, e.g., the testimony of Tommy Haendler, Pamela Cohen, Benny

Sivan and Ben Ami Geller (Raa 19[{7]-20[4], Raa 20[9]-21[20]; Raa 10[5}-15[6};

Raa 24{1]-34(6)).

11. Judge Hague did instruct the jury that they could either find the

petitoners individually liable or jointly and severally liable (Raa 172{10]-173{3)).

12. A review of the transcript reflects that both respondents’ and petitioners’

trial counsel, as well as the Court, worked from petitioners’ proposed

interrogatories until a final joint submission was reached. Raa 173.

13. As noted by the Appellate Division, the petitioners have recourse

available through claims for contribution or indemnification. Almog, at 161.

14. The respondents are preparing a motion to dismiss the bankruptcy

petition, as a bad faith filing, in what is essentially a one creditor case, filed after

exhaustion of state court remedies.

9

REASONS FOR DENYING THE WRIT

I. WHERE DEFAMATION ARISES IN THE CONTEXT OF

PRIVATE COMMERCIAL SPEECH, UTTERED

MALICIOUSLY FOR THE SOLE PURPOSE OF INJURING

POTENTIAL TRADE RIVALS, AND WHERE NO MEDIA

COVERAGE, PUBLIC OFFICIAL OR PUBLIC FIGURE

IS INVOLVED, NO POSSIBLE FIRST AMENDMENT

CONCERNS ARE IMPLICATED, NOR DOES THE

IMPOSITION OF PUNITIVE DAMAGES UNDER STATE

LAW IN SUCH A CASE RAISE ANY UNIQUE DUE

PROCESS OR OTHER CONSTITUTIONAL CONCERNS.

A. The First Amendment In The Ordinary Non-Media,

Non-Public Interest Case.

Petitioners cite, without much focus, cases such as New York

Times v. Sullivan, 376 U.S. 254 (1964) and Gertz v. Robert Welch,

Inc., 418 U.S. 323 (1974), and invoke sweeping generalizations

as to free speech and public policy, none of which are applicable.

New York Times, supra, Gertz, supra, and similar cases, involve

newspapers or other public media, or public officials, or matters of

public concern, or both. In Dun & Bradstreet, Inc. v. Greenmoss

Builders, 472 U.S. 749 (1985) the Court’s holding made clear

that absent such public concerns, there were no First Amendment

limitations on the ordinary common law concepts of libel and

Slander, including the awarding of punitive damages when

appropriate:

We conclude that permitting recovery of presumed

and punitive damages in defamation cases absent a

showing of “actual malice” does not violate the First

Amendment when the defamatory statements do not

involve matters of public concern. Accordingly, we

affirm the judgment of the Vermont Supreme Court.

Id. 472 U.S. at 763.

10

Although the main opinion by Powell, J. in Dun & Bradstreet,

is correctly referred to as a plurality opinion, the two Justices who

concurred in the result, would have restricted the application of

the First Amendment in non-media cases even more severely than

the plurality opinion. Burger, C.J., 472 U.S. at 749-64, and White,

J., 472 U.S. at 765-74. Both of the concurring opinions argue,

inter alia, for the total reversal of the Gertz requirement for proof

of actual malice, and its prohibition against punitive damages, in

media and “public figure” cases. (e.g. Justice White: “First, I am

unreconciled to the Gertz holding and believe it should be

overruled. Second, as Justice Powell [plurality opinion] indicates,

‘... the defamatory publication in this case does not deal with a

matter of public importance.’ Consequently, I concur in the Court’s

judgment.” Jd. 472 U.S. at 774).

rica ameedioe

Thus a clear, solid, five justice majority of this Court was

strongly opposed to extending First Amendment based restrictions

to ordinary non-media, non-public figure, non-public official

defamation cases. That ruling has neither been overruled, nor

questioned, by any subsequent majority opinion of this Court.

e.g.: Philadelphia Newspapers, Inc. v. Hepps et al., 475 U.S. 767,

89 L. Ed. 783, 106 S. Ct. 1558 (1986), “In sharp contrast to New

York Times, Dun & Bradstreet involved not only a private-figure

plaintiff, but also speech of purely private concern.” 472 U.S., at

751-752, 105 S. Ct., at 2941. A plurality of the Court in Dun &

Bradstreet was convinced that, in a case with such a configuration

of speech, “... the showing of actual malice needed to recover

punitive damages under either New York Times or Gertz was

unnecessary .. .” 475 U.S. at 774, 106 S. Ct. at 1562-63; Waters

v. Churchill, 511 U.S. 661, 128 L. Ed. 686, 114 S. Ct. 1878

(1994), “Likewise, the possibility that defamation liability would

chill even true speech has not led us to require an actual malice

standard in all libel cases.” 661 U.S. at 670, 114 S. Ct. at 1885,

citing to Dun & Bradstreet.

Dun & Bradstreet continues to be cited for the lack of

heightened First Amendment concerns in private, non-media

:

3

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defamation cases in some of the most recently reported Federal

District Court cases: E.g. Food Lion, Inc. v. Capital Cities/ABC,

Inc., et al., 984 F. Supp. 923, 932 (M.D. N.C. 1997):

[ijn light of the reduced constitutional value of

speech involving no matters of public concern, we

hold that state interest adequately supports awards

of presumed and punitive damages—even absent a

showing of “actual malice.”

(quoting Dun & Bradstreet), Corporate Training Unlimited,

Inc. v. National Broadcasting Co., Inc., 981 F. Supp. 112,

118, n.2 (E.D. N.Y. 1997): “In cases not involving matters of

public concern and therefore not implicating heightened First

Amendment protections for defendants, a plaintiff need not

prove ‘actual malice’.” (citing Dun & Bradstreet).

The petitioners here, and at the New Jersey Supreme Court,

have never claimed, nor could they claim, that this was a media or

public figure or public official case. In footnote 8 on page 13 of

their petition, however, they make the bizarre claim that this is not

a commercial speech case. All parties to this case were involved in

the United States to Israel bar/bat Mitzvah tour business; all did

business with each other, and all are competitors in some aspects

of this business. The only conceivable reason the defamations were

uttered was to injure potential (or actual) commercial rivals. There

is considerable evidence that the defamations, and the dispute that

lead up to them, arose totally in the context of the business dealings

among all the parties to this action.

Petitioners, on page 9 of their brief state:

This Court has held that in a defamation case,

compensation for damage to reputation is the only

legitimate governmental interest. Gretz v. Welch, Inc.,

418 U.S. 322, 349 (1974).

12

This statement so completely ignores the media versus private

speech issue, as to be totally disingenuous, if not deliberately

misleading. The Court in Gertz clearly stated at the outset:

The principal issue in this case is whether a

newspaper or broadcaster that publishes defamatory

falsehoods about an individual who is neither a

public official or a public figure may claim a

constitutional privilege against liability for the injury

inflicted by those statements.

Gretz v. Welch, Inc., 418 U.S. 322, 332 (1974) (emphasis added).

In its holding the Court again clearly indicated that it was dealing

only with the media issue:

We hold that, so long as they do not impose liability

without fault, the States may define for themselves

the appropriate standard of liability for a publisher

or broadcaster of defamatory falsehoods injurious

to a private individual. This approach provides a

more equitable boundary between the competing

concerns involved here. It recognizes the strength

of the legitimate state interest in compensating

individuals for wrongful injury to reputation, yet

Shields the press and broadcast media from the

rigors of strict liability for defamation.

Id. 418 U.S. at 347-48 (emphasis added).

The petitioners next cite Aetna Life Ins. Co. v. Lavoie, 475

U.S. 813, 818 (1986) for the proposition that “[t]his Court has

recognized that constitutional challenges to punitive damages raise

‘important issues’ ”. Petition, p. 10. The Aetna case involved a

State statute penalizing the bad faith refusals of insurers to pay

health claims. However, the Court in Aetna declined to pass on the

propriety of punitive damages and the penalty imposed below

under a new Alabama statute, as it had decided to vacate and remand

13

the judgment of the Alabama Supreme Court on procedural

grounds’. A full quotation of the language referred to by petitioners

(which appears at 475 U.S. 828-29 not at 475 U.S. 818)

demonstrates that: (a) the language quoted is on its face clearly

dicta; and (b) even as dicta, the Court did not intend to comment

on the general Constitutional propriety of punitive damages in all

cases, let alone punitive damages in defamation cases, but merely

upon the unique issues raised by Alabama’s new cause of action:

Appellant also argues that the retrospective

imposition of punitive damages under a new cause

of action violates its rights under the Contracts

Clause of Article I, s10; that a $3.5 million punitive

damages award is impermissible under the Excessive

Fines Clause of the Eighth Amendment; and that

lack of sufficient standards governing punitive

damages awards in Alabama violates the Due Process

Clause of the Fourteenth Amendment ... These

arguments raise important issues which, in an

appropriate setting, must be resolved; however, our

disposition of the recusal-for-bias issue makes it

unnecessary to reach them.

Id. 475 U.S. at 828-29.

Petitioners next refer to comments by two dissenters in

Rosenbloom v. Metromedia, 403 U.S. 29 (1971) in which,

according to petitioners, “... two justices expressed disapproval

with the status of punitive damages in defamation law.” Not only

was Rosenbloom obviously a media case, but both dissenting

justices, Marshall and Stewart, J.J., expressly based their comments

on free press concerns:

And fear of the extensive awards that may be given

under the doctrine [punitive damages] must

15. Finding that one of the Alabama Court’s justices should have recused

himself.

14

necessarily produce the impingement on freedom of

the press recognized in New York Times.

Id. 403 U.S. at 83; 91 S. Ct. at 1839;

The only constitutional caveat should be that

absolute or strict liability, like uncontrolled damages /

and private fines, cannot be used.... Clearly, is

inconsistent with concepts of freedom of the press.

Id. 403 U.S. at 87; 91 S. Ct. at 1841 (footnotes omitted,

emphasis added).

In a private suit involving no public issues, no public figure,

press or other media, there simply is no free speech justification

for a private defendant to falsely utter statements intending to

damage another’s commercial reputation, anymore than there would

be a free speech interest in shouting “fire” in a crowded theater.

B. The Constitutionality Of Punitive Damages As Imposed |

By State Law In Non-Media, Non-Public Interest '

Defamation Cases, And Generally.

In Pacific Mutual Life Insurance Co. v. Haslip, 499 U.S. 1 lj

(1991), this Court again asserted its acceptance of the common 1

law concept of punitive damages. The Court in Pacific Mutual :

Life, facing a due process challenge to a punitive damage award of

$840,000 (added to a compensatory verdict of $200,000), held:

In view of this consistent history [of punitive damage

awards in the common law], we cannot say that the

common-law method for assessing punitive damages

is so inherently unfair as to deny due process and

be per se unconstitutional.

Although Petitioners quote from the concurring opinion of

Justice Scalia, they omitted that Justice’s concluding comments

on punitive damages at the final two paragraphs of that opinion:

3

:

x

en

15

... But punitive damages assessed under common-

law procedures are far from a fossil, or even an

endangered species. They are (regrettably to many)

vigorously alive. To effect their elimination may well

be wise, but is not the role of the Due Process Clause.

Its function is negative, not affirmative, and it carries

no mandate for particular measures of reform.

We have expended much ink upon the due-process

implications of punitive damages, and the fact specific

nature of the Court’s opinion guarantees that we and

other courts will expend much more. Since jury-

assessed punitive damages are a part of our living

tradition that dates back prior to_1868, / would end

the suspense and categorically affirm their validity.

Id. 499 U.S. at 38.

The Court again reaffirmed its confidence in the concept of

punitive damages in TXO Productions Corp. v. Alliance Resourses

Corp., 509 U.S. 433, 113 S. Ct. 2711 (1993), where it affirmed a

judgment in which a compensatory damage award of $19,000

was accompanied by a punitive damage award of $10 million,

noting, inter alia:

Thus, both State Supreme Courts and this Court have

eschewed an approach that concentrates entirely on

the relationship between actual and punitive

damages. It is appropriate to consider the magnitude

of the potential harm that the defendant’s conduct

would have caused to its intended victim if the

wrongful plan had succeeded, as well as the possible

harm to other victims that might have resulted if

similar future behavior were not deterred.

16

We agree with TXO that the emphasis on the

wealth of the wrongdoer increases the risk that the

award may have been influenced by prejudice

against large corporations. ... We note, however,

that in Haslip we referred to the “financial position”

of the defendant as one factor that could be taken

into account in assessing punitive damages... .

Id. at 113 S. Ct. 2711, 2721 and 2723.

Honda Motor Co. Ltd. v. Oberg, __ U.S.__, 114 S. Ct. 2331

(1994) essentially dealt with the narrow procedural issue of a state

constitutional amendment purporting to cut-off judicial review of

punitive damage awards in jury verdicts, which provision the Court

struck as violative of due process. The Court expressly cited and

quoted from Haslip, supra, and TXO, supra, reaffirming its general

position that common law punitive damage verdicts are not

violative of due process.

In this matter, the New Jersey Superior Court, Appellate

Division, specifically reviewed the punitive damage awards herein,

both as to reasonableness and due process:

There is one last matter we address. Defendants

have not challenged the quantum of punitive

damages allowed by the jury. Nonetheless, and

because of the [New Jersey] Supreme Court's

expressed concern with runaway punitive damage

verdicts in Herman v. Sunshine Chemical

Specialties, Inc., 133 N.J., 329, 338, 627 A.2d 101

(1993), we have carefully examined the awards were

commensurate with the evidence of defendants’

wealth and represent, considering the egregious

nature of the torts, an acceptable ratio between

compensatory and punitive damages. Most

significantly, however, following the jury’s return

of the punitive damages verdict, the trial judge, in

17

an abundance of caution, afforded defendants an

opportunity to demonstrate by way of discrete

financial records any alleged excessiveness.

Defendants failed in the end to take advantage of

that opportunity. We are satisfied that they thereby

waived their right to complain of the quantum."

Almog v. Israeli Travel Service, Inc., 298 N.J. Super 145, 161,

704 A.2d 158, 161. It should be noted that the Appellate

Division first made its own independent assessment as to the

reasonableness of the awards in light of all the circumstances,

and only then turned to the procedural question of petitioners’

bad faith refusal to produce financial records to challenge the

reasonableness of the awards.

C. The New Jersey Courts In This Matter Consistently

Applied New Jersey’s Own Choice Of Law Rules In

Concluding That New Jersey Law Should Be Applied On

The Question Of Punitive Damages. That Choice Of Law

In No Way Violates Petitioners’ First Amendment Or Due

Process Rights.

At page 16, the petition concedes that the state court properly

utilized the governmental interest test in determining the choice of

law to be applied, yet fault the state court’s application of the court’s

own public policy of deterrence:

Defendants do not quarrel with New Jersey's use of

the governmental interest test, and do not seek review

by this Court of that state issue. Defendants do,

however, contend that New Jersey's application of

that test, and its explicit declaration that deterring

16. After consenting to the post judgment appointment of an accountant

by the court (to report on the petitioners’ actual financial condition), the petitioners

refused to furnish the financial records requested by the accountant, and chose

to abandon remittitur considerations.

speech is the overriding state interest, collides with

the First Amendment and, therefore, demands the

intervention of this Court.

The Appellate Division logically applied New Jersey’s equally

logical and Constitutionally sound choice of law rules and came

to the conclusion that under New Jersey’s choice of law rules New

Jersey law should be applied on these facts:

First as to choice of law. As we have noted, egregious

misconduct was committed in New Jersey, elsewhere

in the United States, and in Israel by New Jersey

residents. Malicious defamation was published in

and from this State. Key events occurred in New

Jersey, including the two fateful meetings in

Livingston we have already described. Underlying

contracts and agreements were made here. A fuller

remedy is available to the victims under New Jersey

law than in Israel in respect of the scope of damages.

The question is whether these significant contacts

with New Jersey weight the application of the

governmental interest test in favor of New Jersey

law or Israeli law. We have no doubt in light of the

totality of the circumstances that New Jersey's interest

in the controversy as a whole is paramount to Israel’s.

Almog v. Israel Travel Advisory Service, Inc., 298 N.J. Super.

145, 158 (App. Div. 1997). Clearly many facts and

circumstances, contacts and interests, were taken into account

by the Appellate Division in reaching its choice of law decision.

Gantes v. Kason Corp., 145 N.J. 478 (1996) is the case

principally cited by the Appellate Division in coming to its choice

of Law decision. Almog, supra 298 N.J. Super. at 158. In Gantes,

Georgia's ten year statute of repose in products liability cases would

have prevented Georgia plaintiffs from recovering for a recent injury

caused by a machine manufactured in New Jersey more than ten

19

years ago. In allowing the Georgia resident who suffered injuries

in Georgia to sue in New Jersey, the New Jersey Supreme Court in

Gantes held that New Jersey has a legitimate interest in deterring

tortious behavior of its citizens, whereas Georgia’s policy (designed

to cut off old claims against its manufacturers) is in no way

compromised by New Jersey applying its more stringent rule against

its own manufacturers, on behalf of a Georgia plaintiff. The Gantes

Court noted that a state has no real governmental interest in seeing

that its citizens do not recover for tortious conduct, but New Jersey,

however, has a strong interest in deterring “. . .egregiously wrongful

conduct. . .”"’, i.e. intentional tortious behavior, by its citizens.

There is no real conflict between the interests of New Jersey

and those of Israel on this issue. As the New Jersey Federal District

Court, sitting in diversity, and applying these New Jersey choice

of law rules noted:

At the heart of interest analysis is the realization that

often the interest of only one state will be furthered

by application of its law ona particular issue. This

presents a “false” conflict aad a court should apply

the law of the only interested jurisdiction.

Colley v. Harvey Cedars Marina et al. 422 F. Supp. 953, 955

(D.N.J. 1976, footnote omitted). Similarly, the Appellate

Division here observed:

By the same token, we do rot see how Israeli law

can reasonably be regarded as offended by one of

its citizens being fully vindicated in the courts of

another jurisdiction. In sum, New Jersey’s strong

deterrent interest does not aopear to collide in any

appreciable way with the policy of Israeli law.

Almog, supra 298 N.J. Super. at 59.

17. Almog v. ITAS, 298 NJ. Super. 145, 159 (A.D. 1997).

20

Il. PETITIONERS HAD A FULL JURY TRIAL BELOW

WHICH RESULTED IN A VERDICT, AND ALTHOUGH

THE TRIAL JUDGE ELECTED NOT TO ENTER

JUDGMENT ON THAT VERDICT, THE APPELLATE

DIVISION REVERSED HIM AND, AFTER REVIEW,

REINSTATED THE VERDICT AND DIRECTED THAT

JUDGMENT BE ENTERED ON IT. PETITIONERS

SUFFERED NO DENIAL OF DUE PROCESS IN THIS

PROCEDURE, NOR ON THE BASIS OF ANY OF THE

OTHER MATTERS RAISED IN THE PETITION.

The jury in this matter heard all the evidence, was properly

charged, and rendered a verdict which to its knowledge was the

only verdict in this matter. The trial judge, unbeknownst to the

jury, had misgivings as to his choice of law decision during their

deliberations which he expressed only to counsel, and not to the

jury. After the verdict was announced, the trial judge decided not

to enter judgment on the jury verdict which was based on

application of New Jersey law, but rather to enter his own judgment,

based on his application of Israeli law.'* The Appellate Division,

the next highest intermediate appellate court, decided thai the trial

court’s final choice of law decision was erroneous and reinstated

the jury verdict after thoroughly reviewing same. See discussion,

infra, at page 17, et seq. The New Jersey Supreme Court, after

both sides thoroughly briefed and argued an appeal to them,

apparently concluded that petitioners did not have any appealable

issue, and withdrew certification as improvidently granted, and

later denied petitioners’ motion for reconsideration.

Had the trial judge simply entered the jury verdict, and the

Appellate Division affirmed same, the result to the petitioners, in

terms of their procedural rights, or the ultimate outcome, would

have been no different. Petitioners had one jury trial, a post trial

revision of that verdict by the trial judge (which had the same

effect as a judgment notwithstanding the verdict), an appellate

review of both, resulting in the reinstatement of the jury verdict,

18. At no time did the jury ever learn of this disposition.

21

and a full briefing and oral argument before the highest court of

the state, which only thereafter declined to upset the rulings below.

The petitioners did not suffer any denial of procedural due process.

The procedure did not differ in effect from any civil case where a

judgment notwithstanding the verdict is ordered by a trial judge,

but reversed by an appellate court, which after review elects to

reinstate the original jury verdict.

The trial court did not erroneously characterize the jury as

“advisory”"’ until after the jury had already been charged and sent

out to commence deliberations; nor was the jury, itself, ever told

that it would merely be acting in an “advisory” capacity.

In Thompson v. Parks, 963 F.2d 885 (6th Cir. 1992), the

court, in reinstating the jury verdict, held that where the trial court

failed to determine that the jury would be advisory until after the

trial was completed, the jury verdict was valid. The court in Bereda

v. Pickering Creek Industrial Park, Inc., 865 F.2d 49, 53 (3rd Cir.

1989), found that “. . . as a matter of law . . .”, where the trial court

had not decided that the jury would act in an advisory capacity

until “... after the verdict had been rendered . ..”, the jury was

then in fact not an advisory jury.

As noted by the Hon. Sylvia B. Pressler, P.J.A.D., in writing

for the Appellate Division:

. It was not until the jury retired to deliberate,

after summations and charge, that its status as the

19. The trial court indicated its intent was to present the Appellate Division

with all foreseeable options, to avoid a remand. Prior to the trial court advising

that he would decide the matter sitting as an Israeli Judge, the defendants had

already submitted their proposed jury charges based on New Jersey law and

positions of the Restatement (second) Chapter 25 (which the defendants asked

the trial court to follow). See Pa85S et seq., and Pa-116 et seq., in particular.

Thus, when the trial Judge explained that the punitive damage phase would be

submitted to the jury to decide under the law of New Jersey, the defendants

(who had three attorneys at their side, and were given 40 days advance notice)

did not then (or at any other time during the remaining three days of trial) object.

Raa 70-72 et seq.

22

final arbiter was challenged. The lawyers proceeded

tactically on the understanding that this was a jury

trial, as did the court. Nor did the jurors have any

inkling during their deliberations that their status

was anything but that of ultimate finders of the facts.

That was what the judge had told them, and that is

how they proceeded. The same is true of the later

punitive damages trial. Thus, nothing to the contrary

said by the trial judge entered into or affected or

tainted the way the lawyers tried the case to the jury

or the way the jury deliberated. In effect, this jury

never functioned or was constituted or denominated

as an advisory jury. Consequently, there is no

prejudice we can perceive in accepting the jury’s

fact-finding as the final verdict.

Id. 298 N.J. Super. at 160.

Based On The Unique Facts Presented Herein, It Was Not

Violative Of Due Process For The Trial Court Not To Require

Individualized Determinations From The Jury As To The

Liability And Damages Attributable To Each Defendant.

Based on the unique facts presented at the trial below,

individual determinations of guilt were not required (and would

have served no purpose).” The defendant mother and daughter:

(a) wrote every slanderous letter jointly; (b) jointly participated in

every meeting where they slandered Mr. Almog; (c) jointly

conducted all aspects of their business; (d) conducted every

slanderous phone conversation jointly *'; (e) even reside together;

20. Furthermore, defendants offer no authority (governing at the time of

trial) for their proposition that when an award is made jointly and severally against

defendants, the individual financial circumstances of each defendant must be

taken into account.

21. See, e.g., testimony of petitioner Shar. Raa 56{3]-57[17].

23

and (f) are truly inseparable. (Raa 37[13-25]). In fact, the testimony

(which was largely uncontradicted, and found to be credible and

overwhelming by the jury, trial judge and Appellate Division),

was that both ladies, in each instance, actively participated in the

defamatory statements.” Therefore, Judge Hague properly denied

the defendants’ untimely request to split them into three individual

defendants for the purpose of determining liability.” As noted by

the trial court, the entire case was presented by one law firm on

behalf of all three defendants; they operated as one unit; and that

no information was presented to the jury by the defendants to

enable it to make an allocation; and that he did not believe that

under the circumstances that there should be separate punitive

damage awards. Nevertheless, the court did draft special

interrogatories for the jury to decide whether there should be

individual assessments or a joint award (Raa 69[13-17]; Raa 112;

Raa 166[20]-168[14]). Because the jurors found that the petitioners

had indeed acted jointly, it awarded punitive damages against the

petitioners jointly.

In Refuse & Env. Systems v. Industrial Serv. of Am., 932 F.2d

37, 40 (1st Cir. 1991)**, the trial court instructed the jury that:

(1) if the jury “found joint and several liability on

the various counts, damages should be assessed

jointly and severally”; and that

(2) The law does not require the injured party to

establish how much of the injury was done by one

22. See, e.g., the testimony of Tommy Haendler, Pamela Cohen, Benny

Sivan and Ben Ami Geller (Raa 19[7]-20[4], Raa 20[9]-21[20]; Raa 10[5}-15[6);

Raa 24[1]-34[6)).

23. Judge Hague did instruct the jury that they could either find the

defendants individually liable or jointly and severally liable (Raa 172[10]-173[3)).

24. Which the defendants cite to (out of context) in their brief.

24

person and how much ... was done by another ...

[it] permits the injured party to treat all concerned in

the injury jointly, and all are liable to respond to the

plaintiff in the total sum you find to be damages.

Id. The First Circuit found both instructions to be proper. /d.

The only New Jersey “authority” to which petitioners cite,

Wilson v. Savino, 10 N.J. 11, 89 A.2d 399 (1952), is clearly

distinguishable in that Wilson was decided on post trial motion as

to liability. The New Jersey Supreme Court specifically held therein

that there was a question of fact as to whether or not each of the

alleged owners was actively involved in the running of the defendant

newspaper. Liability in the matter sub judice was decided by the

jury; and the record reflects that the only evidence presented to the

jury was that the two individual defendants, and their wholly

owned corporation, acted in concert, in all respects.

Ill. TO THE EXTENT THAT CONCEPTS OF

SUBSTANTIVE DUE PROCESS UNDER THE

FOURTEENTH AMENDMENT CAN HAVE ANY

POSSIBLE APPLICATION TO A CIVIL TORT

JUDGMENT IN STATE COURT, NO KNOWN DUE

PROCESS RIGHTS OF DEFENDANTS WERE

VIOLATED IN THE PROCEEDINGS BELOW.

While petitioners lead this Court to believe that the verdict

was excessive and arbitrary, a review of the record clearly shows

that the evidence supports the unanimous decision of the Superior

Court of New Jersey, Appellate Division. Thus, the punitive damage

award was not “grossly excessive” and in no way violates the Due

Process Clause of the Fourteenth Amendment.

A. Degree of Reprehensibility

Petitioners reference numerous unrelated cases in an attempt

to support their argument that the punitive damage awards herein

25

are excessive. However, this sidetracking put forth by the petitioners

simply provides no support for this Court to grant the writ.

In the case of Filartiga v. Pena-Irala, 577 F. Supp. 860 (E.D.

N.Y.), while faced with the wholly unrelated issue of human torture,

the Court, some 14 years ago, awarded a total of $10,000,000 in

punitive damages (not $5,000,000 as represented by petitioners).

In the matter of Abebe-Jira v. Negewo, 72 F.3d 844 (11th. Cir.

1996), the Eleventh Circuit Court of Appeals, again presented with

the unrelated issue of human torture, affirmed a total punitive

damage award of $900,000 (not $300,000 as represented by

petitioners). In citing to Xuncax v. Gramajo, 886 F. Supp. 162

(D. Mass. 1995), petitioners focus on the levying of punitive

damages for the unrelated issue of human torture, and fail to

mention the separate $1,000,000 compensatory and punitive

damage awards based upon defamation. Finally, petitioners cite to

J.S. and M.S. v. R.T.H. and R.G.H., 301 N.J. 150, 693 A.2d

1191 (N.J. App. 1997), in which a punitive damage award was

given based upon the unrelated issue of sexual abuse.

Petitioners claim that the compensatory damage award is greater

than the combined net worth of all three defendants. As noted by

Judge Pressler, “... we have carefully examined the evidence

adduced at the punitive damages trial. Suffice it to say that the

awards were commensurate with the evidence of defendants’ wealth

...> The petitioners chose to refuse to comply with notices to

produce highly relevant financial and business records” and chose

not to present any expert testimony on the related issues of damages,

their income, the value of ITAS, or of the individual petitioners’

25. Almog at 161.

26. Resulting in the trial court taking judicial notice that documents

requested by respondents were not produced by the defendants (Raa 64{11]-

65[10]). See also the trial court’s post verdict October 1, 1993 letter ruling referring

to“. . . the defendants’ flagrant and cavalier violation of the Court’s discovery

orders concerning their financial condition . . .” and “. . . defendant's almost

laughably transparent failure to produce financial information.” (Pa 130).

26

personal holdings. As a result, the respondents had to rely upon

admissions made by petitioner Ceil Shar, financial statements

petitioners furnished to a bank in /987 (obtained by subpoena)

(Pal87), inconsistent factual representations as to their sales and

profits made by the petitioners in a contemporaneous lawsuit of

which the trial court was asked to take judicial notice (Pa73), and

upon certain calculations and projections made by respondent

Shalom Almog and by respondents’ expert accountant at trial

(Pa377, Pa401).”’ Furthermore, petitioners refused to take

advantage of the trial court’s October 1, 1993 sua sponte offer to

petitioners to cooperate with a Court appointed accountant to assist

the trial court in determining whether the jury’s award of punitive

damages was excessive based on petitioners’ true financial situation

(to be ascertained) (see Pal30, Pal37, Pal38), and informed the

Court that they would not provide any of the financial documents

requested by the court appointed accountant (Pal38).” At trial,

petitioner Shar blithely testified to giving away hundreds of

thousands of dollars to petitioner Ziemke’s husband and children

prior 10 trial.” Raa 162 [10]-163 [6]; Raa 164 [3-15]. As noted

supra, the extent of the malicious injury caused by the petitioners,

coupled with the petitioners’ blithe indifference, if not arrogance,

in refusing to make disclosure of their assets and income, were

undoubtedly considered by the jury, which relied upon the

competent proofs presented by the respondents. Simply stated, the

petitioners did not obtain an unjust result.

2’. E.g., ITAS grosses approximately $6.1 million per year (Raa 122[21-

25]; RAA 123[17]-124[9}; RAA 125[11-15)]; and Pa84) and earns $1.642 million

per yea (Raa 126[6-20]; Raa 127[6-13); Raa 128(8}-129(11)).

2. By letter to counsel dated February 23, 1994, the trial Judge noted that

there hid been a“. . . flagrant lack of cooperation. . .” by the defendants with

the cout appointed accountant (Pa 137).

2). On September 21, 1993, petitioner Shar testified that within the past

year she gave her granddaughter $164,000; she gave her son-in-law approximately

$200,000; that she gave each of her grandchildren about the same amount; and

that she gave her other granddaughter $100,000 as a wedding gift three months

prior tc the trial (Raa 136[18]-162{21)}).

27

B. Ratio

Clearly, the 3:1 ratio of punitive damages to compensatory

damages which were awarded to the Almog Respondents is not

“grossly excessive”.

C. Comparative Legislative Sanctions

Petitioners refer this Court to the Punitive Damages Act enacted

by the State of New Jersey (N.J. Stat. Ann 2A:15-5.9 et seq. (West

1998)) subsequent to the completion of the trial of this matter.

While Petitioners concede that the act does not apply in this matter,

Petitioners claim that the Act “illustrates the concern of the New

Jersey legislature that punitive damage verdicts are often excessive

and unreasonable”.

However, the punitive damages award entered in favor of the

Almog Respondents falls within the provided 5:1 ratio (between

punitive and compensatory damages, respectively). Furthermore,

said Act sets forth that the purpose is to “. . . punish the defendant

and to deter that defendant from repeating such conduct. . .” (N.J.

Stat. Ann. 2A:15-5.14(a)).

Indeed, at the time of the trial of this matter in 1993, the law

of New Jersey was:

The amount of punitive damages is a matter of

resting in the sound discretion of the jury or other

triers of the facts, since there is no established

standard by which the amount of punitive damages

may be fixed.

New Jersey Practice, Vol. 24 § 742, 2nd edition. _

28

CONCLUSION

The malicious conduct of the petitioners, as well as the extent

of damages caused thereby, has been well documented. The

respondents’ proofs thereof have been accurately characterized by

the New Jersey Appellate Division as being “overwhelming”.

Respondents Shalom and Irit Almog filed their suit in October

1989. Throughout 9 years of litigation, the petitioners have been

the perpetrators of pre-trial, trial and post-trial discovery abuse,

and bad faith litigation tactics. It is not at all surprising that they

complain of the result. However, they received a fair trial. The

Respondents are entitled to repose.

WHEREFORE, for all the reasons set forth herein, the petition

for writ of certiorari to the Superior Court of New Jersey, Appellate

Division should be denied.

Respectfully submitted,

DAVID FEINSILVER

Counsel of Record

THE FEINSILVER LAW GROUP, P.C.

Attorneys for Respondents

Shalom Almog and Irit Almog

215 Millburn Avenue

P.O. Box 312

Millburn, New Jersey 07041

(973) 376-4400

On the Brief:

DAVID FEINSILVER

JAIME R. PLACEK

DANIEL V. SOLLECITO