## Facts

- G. Dean Arthaud worked for Mutual of Omaha and was promoted to general manager of the Jefferson City Division Office in 1991.
- He helped arrange Mutual’s sale of Phoenix Home Life insurance products; a dispute arose over whether he would receive all proceeds or only a portion, and his supervisor told him to stop pursuing the matter.
- At a managers’ meeting in Omaha on June 6, 1994, Mutual terminated Arthaud, stating he was discharged for “inappropriate sales practices” and violating a conflict-of-interest policy.
- Arthaud requested a Missouri statutory “service letter,” and Mutual provided a letter repeating those stated termination reasons.
- During his job search, Arthaud repeated the service-letter reasons to prospective employers and experienced multiple rejections before obtaining another position.
- Arthaud later asserted the stated reasons were false and were used to conceal a company-wide workforce reduction.

## Issues

1. Under Missouri law, must a plaintiff asserting compelled self-defamation present evidence that prospective employers actually relied on the repeated termination statements to prove actual damages?
2. Was the trial evidence sufficient to support the jury’s award of actual and punitive damages, or was Mutual entitled to judgment as a matter of law under Rule 50?

## Decision

- The Eighth Circuit reversed the district court’s denial of Mutual’s renewed Rule 50 motion challenging the damages verdict.
- The court held that, even in compelled self-defamation, Missouri requires competent, non-speculative proof of actual damages causally linked to the republication, typically shown by third-party reliance.
- Because Arthaud offered no evidence that any prospective employer relied on the service-letter statements in deciding not to hire him, the record could not support the damages awards.
- The case was remanded for further proceedings consistent with the court’s damages analysis, described as a new trial limited to damages.

## Legal Principles

- Missouri recognizes compelled self-defamation only in limited circumstances, treating a plaintiff’s foreseeable repetition of a defamatory statement as publication attributable to the original speaker.
- Compelled self-defamation does not relax traditional defamation requirements; the plaintiff must prove actual damages with substantial evidence, not conjecture.
- For claimed employment-related losses, proof ordinarily must show that a prospective employer relied on the repeated defamatory statement in making an adverse decision.
- A plaintiff’s subjective belief that he would have been hired sooner, without corroborating evidence of reliance or causation, is insufficient as a matter of law.
- Punitive damages for defamation require an adequate evidentiary basis for actual harm; when actual damages fail for lack of proof, punitive damages cannot stand.

## Conclusion

The court set aside the jury’s damages awards because Missouri compelled self-defamation claims require non-speculative evidence that third parties relied on the repeated statements to cause actual harm, and the plaintiff’s job-search difficulties alone did not establish that causal link.


Arthaud v. Mut. of Omaha Ins. Co., 170 F.3d 860 (8th Cir. 1999)