Homeowners’ Association Board Members are Public Figures? 

Homeowners’ Association Board Members are Public Figures? 

 

In McCoy, et al. v. Hassen, et al., the Arizona Court of Appeals reviewed a matter involving defamation and false light invasion of privacy (“false light”) of several members of a homeowners’ association board (“HOA”).[i]  The appellate court affirmed the trial court’s ruling granting defendants’ motion to dismiss, concluding HOA members are limited purpose public figures. [ii]

 

Background

 In August 2020, board members (“plaintiffs”) filed a complaint in an Arizona trial court, alleging antecedent and subsequent to a November 2019 HOA election, defendants “engaged in ‘an on-line hate and disinformation campaign against plaintiffs,’” giving rise to a recall, which resulted in two board members being voted off the board.[iii]  To support their claims, plaintiffs provided portions of defendants’ alleged defaming online statements.

In response to plaintiffs’ complaint, defendants filed motions to dismiss for failure to state a claim upon which relief can be granted.[iv]  Defendants attached their “full statements in their motions to dismiss. …”[v]  After plaintiffs’ responsive pleadings and oral argument, the trial court found in favor of defendants.  The trial court reasoned “plaintiffs were limited [purpose] public figures,” requiring plaintiffs to provide:

 

  • Clear and convincing evidence that defendants’ statements were false; and
  • Defendants either had actual knowledge of the falsity; or
  • Defendants acted with reckless disregard for the truth. [vi]

 

The trial court also found defendants’ statements to be opinion statements, which are not actionable as defamation.  The court discarded plaintiffs’ false light claim, as defendants’ alleged statements pertained to plaintiffs’ public lives or duties as limited purpose public figures.  Plaintiffs appealed.

 

What are Limited Purpose Public Figures? 

Limited purpose public figures are persons who “voluntarily injects themselves or is drawn into a particular public controversy and thereby become…a public figure for a limited range of issues.”[vii]  Here, plaintiffs argued the trial court inaccurately concluded them to be limited purpose public figures and should have found they were private citizens as they were members of or running for office for a private HOA board.  Plaintiffs made the following arguments in support:

 

  • HOA board activities are not of general public concern;
  • HOA board does not engage in purposeful activity that would thrust members into a public controversy;
  • HOA board and members are subject to private contract; the board should not be viewed as a “quasi-governmental” agency; and
  • According to the trial court’s ruling, anyone on a private board becomes a limited-purpose public figure.[viii]

 

The appellate court disagreed and provided its reasoning, utilizing Arizona case law based on the Supreme Court of the United States defining limited purpose public figures.  Dating back to the 1930s, Arizona found candidates for public office relinquish some of their rights as private citizens.[ix]

In addition, the appellate court looked to case law in other jurisdictions concerning HOA board members.  The appellate court agreed with the trial court’s partial reliance on a New Jersey case, which held candidates for HOA boards are limited purpose public figures; the court reasoned HOA boards execute “quasi-municipal functions in order to provide the [HOA] with what they sought upon purchasing their [homes]. …”[x]

The appellate court also found the make-up of HOA boards is a matter of public concern; plaintiffs’ participation on the board and candidates running for office puts them in the public eye.  To address plaintiffs’ argument the trial court’s decision makes anyone a part of a private board a limited purpose figure, the appellate court explained private businesses differ from HOA board members, as “First Amendment-type protections” are extended to it through A.R.S. §§ 33-1804 and 33-1808.[xi]  Thus, this made plaintiffs’ arguments ineffective and unfounded.

 

Defamation 

The appellate court did not address plaintiffs’ false light invasion of privacy claims as they conceded.  Instead, the appellate court analyzed plaintiffs’ defamation claim after it concluded plaintiffs are indeed limited-purpose public figures.

Plaintiffs argued the trial court erred in dismissing their defamation claim.  Plaintiffs believe the trial court erred in its ruling, which concluded defendants’ alleged statements were nonactionable opinions.  The appellate court looked to the United States Constitution, specifically the First Amendment, and cases interpreting the same.  It is well settled in Arizona law that the scope of state defamation law is limited and Arizona courts are to make sure that meritorious claims move forward to protect the First Amendment concerning public figures and matters of public concern.

Defamation claims by public officials or public figures have a high burden; they have to overcome defendants’ rights under the First Amendment to speak publicly concerning elections, candidates, and members’ qualifications.  Moreover, public officials and public figures have to prove that a defendant(s) published a defamatory and false statement(s) and that defendant published with knowledge that the statements made were false and with sentient disregard for their falsity.

The appellate court found that defendants’ alleged statements were of public concern, political speech, and “opinions incapable of being objectively characterized as true or false or otherwise not capable of a defamatory meaning, and protected by the First Amendment” regarding the HOA board elections..[xii]

 

Takeaway

Plaintiffs were unsettled by trial court’s unfavorable ruling classifying them as limited purpose public figures and dismissing their claims against defendants in 2021.  Plaintiffs properly appealed the ruling; however, the appellate court affirmed the trial court’s decision to deem plaintiffs limited public figures and dismiss the defamation claim.  The decision recapitulates the main points of the trial court’s decision and examines case law from other states illustrating limited purpose public figures.  The decision also protects individuals’ rights to speak freely politically and express their opinions of public officials and public figures’ character.  It also demonstrates how HOA boards are governing bodies with members carrying out duties for which they were elected in the communities in which they reside.

 

 

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[i] Cheryl Marie McCoy, et al. v. Ken Hassen, et al., 1 CA-CV21-0524, 2022 WL 3754244 (App. August 30, 2022).

[ii] Id. at ¶8

[iii] Id. at ¶5

[iv] Id. at ¶6

[v] Id.

[vi] Id. at ¶8

[vii] Id. at ¶6 (See Gertz v. Robert Welch, Inc., 418 U.S. 323, 361 (1974)).

[viii] Id. at ¶23 – ¶25

[ix] Id. at ¶19 See Connor v. Timothy, 43 Ariz. 517, 523 (1934).

[x] Id. at ¶21 quoting Verna v. Links at Valleybrook Neighborhood Ass’n, 852 A.2d 202, 214 (N.J. Super. Ct. App. Div. 2004).

[xi]McCoy at ¶25; See  https://www.azleg.gov/ars/33/01804.htm and https://www.azleg.gov/ars/33/01808.htm

[xii] Id. at ¶33