                  UNITED STATES COURT OF APPEALS
                       FOR THE FIFTH CIRCUIT



                           No. 98-51030

                          ROBERT M BIRD,

                                             Plaintiff-Appellant,

                              VERSUS

                    CONTINENTAL AIRLINES, INC,

                                                 Defendant-Appellee.



           Appeal from the United States District Court
                 for the Western District of Texas
                         (A-98-CV-55-SC)


                         NOvember 5, 1999
Before JONES and DENNIS, Circuit Judges, and PRADO*, District
Judge.

PER CURIAM:**

     On January 28, 1997, Robert M. Bird, an employee of America

West Airlines, boarded a plane in Las Vegas, Nevada bound for
Lubbock, Texas.   Bird wore black and white zebra-print bikini

underwear, a long-sleeved high collared tee-shirt, blue jean pant

legs from the knees down secured by rubber bands, hiking boots and



     *
     District Judge for the Western District of Texas, sitting by
designation.
     **
       Pursuant to 5TH CIR. R. 47.5, the Court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.

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a long blue overcoat.      After exiting the plane in Lubbock, Bird

opened   his   overcoat   in    view   of    his   girlfriend   and   several

bystanders in the Lubbock International Airport, allegedly as a

practical joke to shock and surprise her as she greeted him.             Bird

was arrested for disorderly conduct by Airport Police Officer

Freddie Salazar.   After taking Bird to the police station, Officer

Salazar returned to the airport and conversed with Continental gate

agent Jennifer McIntire regarding Bird’s arrest.           Salazar informed

McIntire that he wanted to communicate the incident to Bird’s

employer, America West.        Salazar also told McIntire that Bird had

been arrested for indecent exposure, although he had actually been

arrested for disorderly conduct.           Continental Airlines had formed

a business alliance with America West, and McIntire decided to

report Bird’s conduct.         She sent the following Y-mail (internal

email) message first to a single America West division in Nevada,

and after receiving no reply forwarded the message to every America

West terminal in the United States:

     HELLO THERE THIS IS JENNIFER AT THE TICKET COUNTER IN
     [LUBBOCK] AND I HAD A REALLY INTERESTING STORY TO SHARE
     WITH YOU. APPARENTLY ONE OF YOUR CO-WORKERS THAT WORKS
     IN GROUND MAINTENANCE BY THE NAME OF ROBERT M. BIRD
     DECIDED TO FLASH EVERYONE IN OUR AIRPORT AND WAS ARRESTED
     FOR INDECENT EXPOSURE. AS A CONTINENTAL EMPLOYEE I AM
     ASHAMED TO KNOW THAT HE ACTUALLY TOLD PEOPLE HE WORKED
     FOR [AMERICA WEST] AND HE ATTEMPTED TO GET OUT OF THE
     SITUATION BY OFFERING THE POLICE OFFICER TRAVEL VOUCHERS.
     I HAVE THE ATTENDING OFFICER HERE AND HE WOULD LIKE THE
     ADDRESS OF YOUR STATION SO THAT HE CAN SEND A FULL REPORT
     TO THE SUPERVISOR AND OR GENERAL MANAGER.


Bird’s supervisor requested the police report the next day, and

Bird was fired as an alleged result of the Y-mail message.


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     Bird     filed    a   claim    against         Continental        Airlines     for

defamation.    The district court entered summary judgment in favor

of the defendant.      Bird appeals.

                           I. Standard of Review

     The standard of review for the granting of a motion for

summary judgment is de novo.              See BellSouth Telecommunications,

Inc. v. Johnson Bros. Group, 106 F.3d 119, 122 (5th Cir. 1997).

Summary judgment is warranted when “the pleadings, depositions,

answers to interrogatories, and admissions on file, together with

the affidavits, if any, show that there is no genuine issue as to

any material fact”.        Celotex v. Catrett, 477 U.S. 317, 322, 106

S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986).

                                  II. Analysis

     The district court found that Continental Airlines enjoyed a

qualified privilege to distribute the offending Y-mail message to

every America West computer terminal in the country, and in the

alternative    concluded     that     the         content   of   the     Y-mail     was

substantially true.

     Continental       Airlines     has       a    qualified     privilege    for     a

defamatory communication regardless of the statement’s veracity

when comments and remarks are made in good faith to a person having

a business interest in the communication.                   See Free v. American

Homes Assur. Co., 902 S.W.2d 51, 55 (Tex.App.–Houston [1st Dist.]

1995, no writ).       A communication loses its privileged status when

it is made to those outside the interest group in question.                         See

Randall’s Food Markets, Inc. v. Johnson, 891 S.W.2d 640, 646 (Tex.


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1994).    Whether the forwarding of the message to all America West

terminals in an attempt to locate a single supervisor exceeded the

permissible scope of Continental’s qualified privilege involves

disputed questions of material fact not appropriate for summary

disposition.

     The district court also granted summary judgment on the

alternative ground that the statement at issue was substantially

true.     A substantially true statement cannot support a cause of

action for defamation.        See McIlvain v. Jacobs, 794 S.W.2d 14, 15

(Tex. 1990).     Whether the discrepancies between the actual charge

of “disorderly conduct” and the reported charge of “indecent

exposure” and between Bird’s actual conduct and his reported

conduct    of   “flash[ing]    everyone   in   our   airport”   prevent   the

statement from being “substantially true” are also disputed issues

of material fact not appropriate for summary judgment.

     Therefore, we REVERSE the judgement of the district court, and

REMAND the case for further proceedings consistent with this

opinion.




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