Jessica Simpson’s Rep Scores Defamation Award

(CN) - A fitness guru defamed Jessica Simpson's business manager by releasing an edited version of a conversation he had secretly recorded, a New York appeals court ruled.

Speedfit and its owner, Alex Astilean, hired Jessica Simpson's management company, With You Inc., to have the pop singer appear in a workout video.

Simpson's team ultimately terminated the contract, and the parties went to arbitration.

During these proceedings, Astilean released portions of a secretly recorded telephone conversation he had with Simpson's manager, David Levin. When Levin added a counterclaim in their dispute for defamation, an arbitrator awarded him $50,000. The arbitrator found that Astilean's manipulation of the recording was slander per se.

A Manhattan judge confirmed the $50,000 arbitration award for defamation, as well as the award of costs and attorneys' fees amounting to more than $357,000.

On Tuesday, the court's appellate division affirmed.

"We find no basis to disturb the arbitrator's finding that With You properly terminated the contract based on Speedfit's failure to present a video for final approval within a

reasonable time' after filming of the video," the unsigned opinion states.

"Here, the arbitrator's decision to address and award damages for the injury to Levin's reputation was not totally irrational or against a strong public policy and therefore was properly confirmed," the appellate justices added.

Astilean had claimed that the arbitrator should not have handled the defamation issue since the arbitration agreement was with his company.

The appellate justices noted, however, that Astilean "actively sought arbitration in his individual capacity."

"Despite being a nonsignatory to the agreement, Astilean nevertheless commenced the arbitration and brought claims against petitioners, not only on Speedfit's behalf, but also in his individual capacity," the decision states. "By this conduct, Astilean manifested a clear intent to arbitrate. Having availed himself of the arbitral forum in his individual capacity and lost, Astilean cannot now be heard to complain that the arbitrator found against him personally and is thus estopped from challenging the award on this basis."

Reuters reportedthat the 2010 arbitration award also barred Astilean from promoting the video, which was filmed in the summer of 2005.

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