Mainer awarded $3M in defamation case

PORTLAND – A federal jury awarded nearly $3 million to a North Yarmouth woman in what’s believed to be the largest judgment ever in a defamation case in Maine.

Deborah Galarneau’s lawsuit claimed she was defamed by Merrill Lynch after she was fired in January 2004. Merrill Lynch denied any wrongdoing, saying it was legally mandated to explain the firing to the National Association of Securities Dealers.

Galarneau said Merrill Lynch notified the association that she was fired for inappropriate bond trading and for making decisions on trades that she was not authorized to make. She said she had done nothing wrong and that Merrill Lynch’s actions meant she could not find work elsewhere.

“This was the most satisfying verdict I have ever gotten in my life,” said lawyer Rufus Brown, who held Galarneau’s hand when the verdict was read Tuesday evening in U.S. District Court in Portland.

Cash judgments in defamation cases are rare, legal experts said.

Plaintiffs are sometimes successful, but are often awarded no money, or a small, symbolic amount. “Proving actual damage that is caused by defamation can be quite difficult,” said Samuel Lanham, president of the Maine Trial Lawyers Association.

Plaintiffs must prove the actions against them were malicious or motivated by ill-will. In this case, the jury awarded $850,000 for defamation, and $2.1 million in punitive damages against Merrill Lynch.

Merrill Lynch will appeal. “We are perplexed by their award,” said spokesman Bill Halldin. “It is inconsistent with the facts and evidence.”

Galarneau, 57, was a broker with Merrill Lynch in Portland for 15 years, beginning in 1989, according to Mike Nelson, another of her lawyers.

Galarneau sought damages for lost pay, and for future pay that she would have earned if she had continued working to retirement age in 2012.

At least two letters from Merrill Lynch attorneys defended Galarneau’s handling of the account that was in question. And an internal review of her conduct found no wrongdoing, Galarneau’s lawyers said.

Company officials stand behind that decision, Halldin said, and they did not tell state investigators a different story.

“We were particularly pleased for Deborah, because she had gone through a very difficult time,” Nelson said. “She is someone who has standing in the community.”