Freeport resident Paul Kendrick has rejected the possibility of an out-of-court settlement in the defamation lawsuit against him, leaving the fate of the case uncertain while his appeal of a $14.5 million verdict against him is on hold.

Kendrick lost at trial in U.S. District Court in Portland last summer, but an appellate court in Boston issued a ruling last month that put the entire case in question by asking whether it ever belonged in federal court at all.

Kendrick said in an email Tuesday that he wants a scheduled two-day hearing to go forward on Wednesday and Thursday before U.S. District Judge John A. Woodcock Jr., who presided over the trial, to decide whether the federal court trial venue was correct.

Kendrick was accused of defamation after he began a widely disseminated email campaign in January 2011 in which he accused the American founder of an orphanage in Haiti of sexually abusing the boys in his care. Kendrick widened the campaign against the founder, Michael Geilenfeld, to include Hearts with Haiti, the North Carolina charity that raises donations to fund his orphanage.

The Portland jury did not believe seven former orphanage residents in Haiti who testified about sexual abuse, and found that Kendrick was reckless and negligent in making the accusations. It awarded actual damages of $7.5 million to Hearts with Haiti, and $7 million to Geilenfeld.

The 1st U.S. Circuit Court of Appeals is still considering Kendrick’s appeal, but sent the unanswered question of whether federal court was the correct venue back to Woodcock to decide. If Woodcock decides the venue was correct, the appellate court would resume its review of the case.

Woodcock made an unusual move this month, ordering all parties in the case to appear before him on March 4, when he lectured them, telling all sides to “take a hard look at themselves” and consider negotiating a settlement rather than let the uncertainty of the case continue.

Docket entries in U.S. District Court in Portland indicate that Magistrate Judge John Nivison held three telephone conferences with the lawyers in the case and one sit-down conference over the possibility of a settlement. The court records don’t indicate what they discussed in those conferences.

Woodcock said at the March 4 hearing that either his ruling on the venue question or the appellate court’s eventual ruling on the verdict could change the outcome of the case. Kendrick could win on appeal. Geilenfeld and Hearts with Haiti could emerge with their victory intact. Or the federal case could be dismissed, leaving Geilenfeld and Hearts with Haiti with the prospect of trying the case all over again in state court.


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