Kramer v. Thompson

In 1982, Richard Thompson (defendant) hired Steven Kramer (plaintiff) as his attorney for the purpose of bringing a securities-fraud claim. Thompson was happy with Kramer’s services for a while. However, Kramer accurately told the FBI the purchase price and sales price of certain stocks in question in the case. That information showed that the stocks dramatically decreased in value, from $120,000 to $15,000. However, that information also showed that the stocks had not become totally worthless. Kramer’s answer made Thompson extremely angry, and Thompson fired Kramer. Afterwards, Thompson publicly accused Kramer of throwing the case, deliberately destroying certain documents, using drugs, being connected to organized crime, and committing arson on Kramer’s own car. These accusations were sent out widely to attorneys, judges, law enforcement, and the media. Kramer then sued Thompson for defamation. Kramer obtained a default judgment, and Thompson stopped making any statements for around two years. Then Thompson began making the same accusations again. At that point, Kramer sued Thompson in federal court. The trial court held a trial and ruled that the accusations constituted defamation. The jury awarded damages, and the judge entered an injunction prohibiting Thompson from making similar statements in the future. However, Thompson made a number of additional statements, and the trial court repeated its order. Thompson continued making the same allegations, and the trial court held Thompson in contempt. Thompson appealed.