March 18 2013 12:00 AM

Paper did not defame Paul Vlahakis by calling him a tax delinquent, judge rules



    Thursday, Nov. 17 — An Ingham County judge has dismissed a
    libel suit against City Pulse by businessman Paul Vlahakis over a December 2009
    story that reported that he was the county’s second biggest property tax
    delinquent.


    Vlahakis’ main argument was that City Pulse had inaccurately
    reported on its cover that he owed property taxes because the taxes were
    actually owed by various LLCs through which Vlahakis does business as a
    property owner and landlord.


    But in a written opinion issued today, Visiting Circuit
    Judge Richard D. Ball said, “The record in this case shows the description of
    plaintiff on the front cover of the publication, when read with the content of
    the article, is substantially true.” City Pulse had argued that the substantial
    truth doctrine in libel law should prevail in this case. In libel law, truth is
    considered an “absolute defense” against libel claims. The substantial truth
    doctrine provides some defense in cases where published information may not be
    literally true.


    In an earlier ruling on a motion by City Pulse, Ingham
    Circuit Judge Joyce Draganchuk had indicated that Vlahakis had operated his
    LLCs in way that negated his claim that the taxes are owed by the LLCs and not
    him.


    “It shall be taken as true in this case that Plaintiff
    freely paid and managed the LLCs from his personal accounts and as an
    individual,” wrote Draganchuk, who went on medical leave this fall. Ball, who
    is a District Court judge in East Lansing, heard arguments on the motion by
    City Pulse for summary judgment.


    Vlahakis is the managing member of three LLCs that were
    listed as the owners of property on which over $327,000 in taxes were declared
    delinquent in 2009. Most of the money was owed for 101 S. Washington Square, a
    high-rise office and retail building on the southeast corner of Washington and
    Michigan Avenue. The delinquent taxes were paid in spring 2010, avoiding
    foreclosure.


    In his ruling, Ball said the LLCs “amounted to plaintiff’s
    alter-ego.”


    Vlahakis sued Neal McNamara, City Pulse’s former news
    editor, who wrote the story, and To The Max LLC, which owns City Pulse.
    City Pulse and McNamara were represented by Stuart R. Shafer of Lansing, who was assisted by First Amendment attorney John J. Ronayne III of Plymouth, Mich. Vlahakis was represented by Andrew P. Abood and Timothy McCarthy of the Abood Law Firm in East Lansing.
    To read Ball’s ruling, click here.



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