                            In the
 United States Court of Appeals
              For the Seventh Circuit
                         ____________

No. 04-2152
KARLA K. KNAFEL,
                                              Plaintiff-Appellant,
                                v.

CHICAGO SUN-TIMES, INC.
and SUN-TIMES ONLINE,
                                           Defendants-Appellees.
                         ____________
         Appeal from the United States District Court for
        the Northern District of Illinois, Eastern Division.
             No. 03 C 6434—Amy J. St. Eve, Judge.
                         ____________
      ARGUED APRIL 15, 2005—DECIDED JUNE 29, 2005
                     ____________




  Before FLAUM, Chief Judge, and BAUER and EVANS,
Circuit Judges.
  EVANS, Circuit Judge.         Michael Jordan, erstwhile
North Carolina Tar Heel and Chicago Bulls star, had an
affair with a woman named Karla Knafel, an affair he
wanted her to keep mum about. To that end, she alleges in
her complaint in this action, he promised to pay her
$5 million; he denies it (not the affair, just the promise to
pay hush money). To put the matter to rest, Jordan filed a
preemptive suit in the circuit court of Cook County accusing
2                                              No. 04-2152

Knafel of extortion. Or, as columnist Richard Roeper of the
Chicago Sun-Times put it:
      In two days, a Cook County judge will rule on motions
    in the dispute between Knafel, who says Michael
    Jordan promised to pay her $5 million not to discuss
    their affair, and MJ, who wants the case to bounce off
    the rim and go out of bounds like a Kwame Brown
    jumper from the top of the key.
Roeper also reported that when a ruling in the lawsuit was
delayed, Knafel said she was disappointed; she wanted to
move on with her life. Roeper again:
      Right. After all, what better way for Knafel to put
    this all behind her than to appear in a courtroom in an
    effort to extort—I mean receive—$5 million from one of
    the most famous personalities since Jesus? Once the
    case is over, the would-be pop vocalist can continue her
    quest for privacy by auditioning for “Mid-Life American
    Idol,” posing nude for Playboy and then running for
    office.
  Unflattering as they are, it is not these remarks that
Knafel objects to. She has sued the Chicago Sun-Times and
the Sun-Times Online (the article appeared both in the
print version and the online version of the Sun-Times and
we will refer to both as the Sun-Times) for defamation, al-
leging that other statements can only be interpreted to
state falsely that she committed the crime of prostitution
and thus are defamatory per se under Illinois law.
United States District Judge Amy J. St. Eve dismissed the
lawsuit for failure to state a claim, pursuant to the Sun-
Times’ motion. Knafel appeals.
  Roeper began his column by recounting what he observed
one night when a well-known celebrity appeared in a
Los Angeles bar. Women threw themselves at the celebrity
and were “behaving in a way that indicated they’d be will-
ing to have a physical encounter with the movie star after
No. 04-2152                                               3

an unusually short courtship.” Roeper wonders what female
groupies expect to get from such encounters. One possibility
is that
    there are some women who see a famous horny guy,
    blink their eyes and hear the ka-ching of a cash regis-
    ter.
    Women like Karla Knafel.
Later in the column, Roeper explains his take on something
Knafel said in court:
      In other words, you had sex with a famous, wealthy
    man, and you claim he promised to pay you $5 million
    to keep quiet about it, and now you want your money.
Roeper sums it up:
      Knafel was once an aspiring singer. She’s now re-
    portedly a hair designer. But, based on the money she’s
    been paid already and the additional funds she’s
    seeking in exchange for her affair with Jordan, she’s
    making herself sound like someone who once worked in
    a profession that’s a lot older than singing or hair
    designing.
  The issue for us is whether the latter statements consti-
tute defamation per se under Illinois law and, intertwined
with that issue, whether the case was properly resolved
pursuant to a motion to dismiss the complaint. Our review
is de novo. Hickey v. O’Bannon, 287 F.3d 656 (7th Cir.
2002). Illinois substantive law and federal procedural law
apply to our analysis. Muzikowski v. Paramount Pictures
Corp., 322 F.3d 918 (7th Cir. 2003).
  Defamation actions provide redress for false statements
of fact that harm a plaintiff’s reputation. Brennan v.
Kadner, 351 Ill. App. 3d 963, 286 Ill. Dec. 725, 814 N.E.2d
951 (2004). A statement is defamatory if it tends to cause
harm, which lowers the reputation of a person in the com-
4                                                No. 04-2152

munity or deters others from associating with her. Kolegas
v. Heftel Broad. Corp., 154 Ill. 2d 1, 180 Ill. Dec. 307, 607
N.E.2d 201 (1992); Dubinsky v. United Airlines Master
Executive Council, 303 Ill. App. 3d 317, 236 Ill. Dec. 855, 708
N.E.2d 441 (1999). To prove defamation, Knafel must show
that the defendant made a false statement about her; that
the defendant caused an unprivileged publication of the
statement to a third party; and that the publication of the
statement harmed her. Parker v. House O’Lite Corp., 324
Ill. App. 3d 1014, 258 Ill. Dec. 304, 756 N.E.2d 286 (2001).
Illinois recognizes two types of defamation—defamation per
se and defamation per quod. This case is based on a claim
of defamation per se.
  Defamation per se involves statements so harmful to
reputation that damages are presumed. Van Horne v.
Muller, 185 Ill. 2d 299, 235 Ill. Dec. 715, 705 N.E.2d 898
(1998). Five categories of defamatory statements are
actionable as defamation per se, including the one relevant
here—a statement which imputes to the plaintiff the com-
mission of a criminal offense. Knafel contends that state-
ments in the Roeper column impute to her the crime of
prostitution.
  However, even a statement which falls into a category
supporting a claim for defamation per se will not be found
to be defamatory if it is “reasonably capable of an innocent
construction.” Kolegas, 607 N.E.2d at 206. Courts must con-
sider statements in context, “giving the words, and their
implications, their natural and obvious meaning.” Bryson v.
News America Publ’ns, Inc., 174 Ill. 2d 77, 220 Ill. Dec. 195,
672 N.E.2d 1207, 1215 (1996); see also Harrison v. Chicago
Sun-Times, Inc., 341 Ill. App. 3d 555, 276 Ill. Dec. 1, 793
N.E.2d 760 (2003). If the complained-of statement “may
reasonably be innocently interpreted, it cannot be action-
able per se.” Harrison, 793 N.E.2d at 772. Illinois courts
emphasize that the interpretation must be reasonable. Both
the courts of Illinois and our court have said, to quote our
No. 04-2152                                               5

case, that “[w]hether a statement is reasonably capable of
an innocent construction is a question of law for the court
to decide.” Republic Tobacco v. North Atlantic Trading, 381
F.3d 717, 727 (7th Cir. 2004).
  With the substantive law in mind, we will turn to the
procedural posture of the case. As we noted, Knafel’s law-
suit was dismissed pursuant to the newspaper’s motion to
dismiss the complaint. Knafel claims that the dismissal was
improper. She asserts that in Muzikowski we held that
because of the different standards of pleading in Illinois
courts versus federal courts, the innocent construction rule
cannot be applied on a motion to dismiss in federal court.
She also contends that Judge St. Eve looked to matters
outside the pleadings in making her decision, thus convert-
ing the motion to a motion for summary judgment without
giving notice and allowing Knafel time to engage in discov-
ery.
  Knafel’s support for her contention that matters outside
the pleadings were considered is Judge St. Eve’s use of the
phrases “non-disclosure agreement” and “non-disclosure
contract” to describe the agreement between Knafel and
Jordan; the argument seems to be that the Cook County
judge used the phrases; therefore, because Judge St. Eve
also used the phrases, she must have considered the Cook
County decision—a matter outside the pleading—in her
evaluation of this case. The argument is an air ball. A
nondisclosure agreement is what was involved between
Knafel and Jordan. How else was the district judge to refer
to it? We’re quite sure the judge could have come up with
the language all by herself. As to the need for discovery,
Knafel fails to tell us what sort of relevant evidence she
might “discover.” At one point she says, “As a hypothetical
example, Ms. Knafel might be able [to] produce evidence
that no one could think that the Article’s statements
referred to anything but prostitution.” That is certainly a
tall order. More importantly, the truly relevant evidence
6                                               No. 04-2152

in this case is Roeper’s column, which was attached to the
complaint and therefore properly considered on a motion to
dismiss. And at least one of the statements in the column,
the reference to the “profession that’s a lot older than
singing . . . ,” would seem to allude to prostitution. The
issue here, though, is not whether Roeper alluded to
prostitution, but whether he necessarily implied that Knafel
committed the crime of prostitution. We cannot see how
discovery helps Knafel prove that he did.
  Knafel also misapprehends our decision in Muzikowski.
It does not baldly stand for the proposition that motions
to dismiss can never be granted on the issue of innocent
construction. The facts of that case, recounted very briefly,
are that Robert Muzikowski devoted years of his life to
establishing and coaching Little League Baseball in two
of Chicago’s poorest neighborhoods. In 1992, Daniel Coyle,
an editor at “Outside” magazine, spent a season as an
assistant coach of a little league team in one of
Muzikowski’s leagues. Based on that experience, Coyle
wrote a book called “Hardball: A Season in the Projects.”
Paramount Pictures then made a movie based on the book;
the movie, titled “Hardball,” starred Keanu Reeves as a
character called Conor O’Neill. Muzikowski contended that
O’Neill was a portrayal of him, and an unflattering and
defamatory portrayal of him at that. A lawsuit and an
appeal followed, which led to our discussion of pleading
requirements, specifically in defamation lawsuits in which
the person defamed is not actually named in the publica-
tion—a situation in which defamation is, quite naturally,
harder to prove.
   We noted that Illinois may have a heightened pleading
requirement for complaints based on publications that do
not literally name the plaintiff. However, we pointed out, an
Illinois pleading rule does not apply in a federal court, and
in federal court Muzikowski was entitled to the usual rules
for notice pleading in Federal Rule of Civil Procedure 8.
No. 04-2152                                                 7

Looking at his complaint, we were not convinced that there
was no possibility that Muzikowski might be able to prevail
on his claim. Therefore, on those facts, Muzikowski’s
complaint was adequate and dismissal was improper. The
general principle established in the case is that federal
pleading rules apply to defamation suits in federal court;
the specific holding was that under Federal Rule of Civil
Procedure 8, Muzikowski’s complaint was adequate to avoid
dismissal. We see no impediment, especially in a less
complex case such as the one before us, to a judge evaluat-
ing, in context on a motion to dismiss, the natural and
obvious meaning of the accused language and then deter-
mining whether a statement may reasonably be innocently
interpreted. That is what Judge St. Eve did in this case and
what we will now consider de novo.
  First, we need to know what exactly the crime of prostitu-
tion is. In Illinois, the crime is as follows:
    Any person who performs, offers or agrees to perform
    any act of sexual penetration as defined in Section 12-
    12 of this Code for any money, property, token, object,
    or article or anything of value, or any touching or fondl-
    ing of the sex organs of one person by another person,
    for any money, property, token, object, or article or
    anything of value, for the purpose of sexual arousal or
    gratification commits an act of prostitution.
720 ILCS 5/11-14(a). As relevant to our analysis, prostitu-
tion is an “act,” a discrete event, which, we suspect, is what
most people would assume.
  Our inquiry, then, is whether there is a reasonable, inno-
cent construction of Roeper’s words, other than that he is
accusing Knafel of prostitution. We start with the obvious:
Roeper is highly critical of Knafel’s actions. One of his
statements that Knafel objects to is that she is the type of
woman who looks at a wealthy man and sees dollar signs.
That, as Roeper wisely and accurately points out, is not un-
8                                                No. 04-2152

common. Money and power turn toads into princes in some
eyes. So, is it reasonable to read Roeper’s words and not
think of prostitution? We think so. In fact, we think the
most likely interpretation of the words is that Knafel is a
gold digger, a woman who wants a longer term relationship
with a man because of his money, not one who would look
at a wealthy man and see a chance to make a few quick
bucks (or even quite a few quick bucks) for a one-time
encounter.
   Roeper also says that Knafel has been an aspiring singer
and is now a hair designer, but based on the money she
wants “in exchange for her affair with Jordan, she’s making
herself sound like someone who once worked in a profession
that’s a lot older than singing or hair designing.” We see two
significant concepts in this passage. Roeper says Knafel was
having an “affair” with Jordan. It is reasonable to interpret
that word to imply a longer term relationship than is
contemplated in the Illinois definition of prostitution.
Secondly, as we said, despite the reluctance of counsel for
the Sun-Times to concede the obvious at oral argument,
Roeper almost certainly refers to prostitution when he talks
about an “older” profession. But it is reasonable to read the
passage as saying that although Knafel was having an affair
(i.e., a longer term relationship) with Jordan, by demanding
so much money from him she is demeaning herself. Roeper
does not say Knafel has committed the crime of prostitution
but, rather, she is making herself sound like she has. The
words “sound like” imply similarity, but not identity. In
short, Roeper is hard on Knafel as revealed by the headline
of the column: “Is Karla Knafel’s affection really worth $5
million?” But his words are reasonably (and easily) subject
to an innocent construction; i.e., one that stops short of
saying she committed a crime.
  Our conclusion is supported by other Illinois cases. For
example, in Antonelli v. Field Enterprises, Inc., 115 Ill. App.
3d 432, 71 Ill. Dec. 188, 450 N.E.2d 876 (1983), a news
No. 04-2152                                                9

article was titled “Mobster v. Media” and referred to the
plaintiff as a “reputed mobster.” The court found those
words subject to an innocent construction. The headline had
to be read in conjunction with the rest of the story in which
the plaintiff was referred to as a “reputed mobster,” or one
about whom the word “mobster” had been “supposedly,”
perhaps “erroneously imputed.” Similarly, in Salamone v.
Hollinger International, Inc., 347 Ill. App. 3d 837, 283 Ill.
Dec. 245, 807 N.E.2d 1086 (2004), a Chicago Sun-Times
headline said, “Mob links hurt Rosemont casino bid.”
Reading the headline in conjunction with the full text of the
article, the court found that the defendant characterized the
plaintiff not as a mobster, but as a person who is believed,
possibly erroneously, to be an organized crime figure. In
another case, a newspaper article said a woman “kid-
napped” her daughter. The court found an innocent con-
struction, in part because “the word ‘kidnapped’ does not
necessarily denote a criminal offense, but is also used in
custody contexts to describe a wrongful taking of a child.”
Harrison, 793 N.E.2d at 773. If these examples are subject
to an innocent construction, the statements of which Knafel
complains certainly are. The judgment of the district court
is AFFIRMED.

A true Copy:
      Teste:

                        ________________________________
                        Clerk of the United States Court of
                          Appeals for the Seventh Circuit




                   USCA-02-C-0072—6-29-05
