Recently in Libel Category

Defamatory and Scandalous Material as Grounds to Seal Record

June 27, 2014,

In bankruptcy court, the presumption in favor of public access to judicial records can be overcome if "scandalous or defamatory matter" is contained in a paper filed therein. (See 11 U.S.C. Section 107). Curiously, there is an absolute judicial privilege for statements made in connection with and relevant to a judicial proceeding, so normally one wouldn't expect to find "defamatory matter" in a court filing. Still, there is a relevance requirement to be entitled to the privilege, and there's always a possibility that potentially defamatory or scandalous statements will be made in a court filing that have nothing to do with the underlying merits. And that's exactly what happened in the recent case of Robbins v. Tripp.

Attorney John W. Tripp was handling a case in bankruptcy court when certain issues arose relating to perceived problems with his practice. The court ordered him to prepare and file a report containing details relating to his organization of files, supervision of staff, communication with clients, and related matters. The bankruptcy court instructed that the report be written "candidly and not as an advocate for any party to this matter." Mr. Tripp moved for leave to file the report under seal, based in part on Section 107's "scandalous or defamatory" provision. The motion was granted, and the trustee appealed.

The district court noted that the Fourth Circuit has not yet spoken on the proper interpretation of this language, and observed further that there is a split of authority among other circuits on the issue. Some focus on the word "scandalous" and apply its dictionary definition, sealing material found to be disgraceful, offensive, or shameful. surprise.jpgOthers have focused on the defamation prong and held that "material that would cause a reasonable person to alter his opinion of an interested party triggers the protections of § 107(b)(2) based on a showing that either (1) the material is untrue, or (2) the material is potentially untrue and irrelevant or included within a bankruptcy filing for an improper end." (See In re Gitto Global Corp., 422 F.3d 1 (1st Cir. 2005)).

The court found that the report at issue qualified for Section 107 protection under either of these tests. Observing that the report was not directly related to the underlying bankruptcy matter and that it contained information about Mr. Tripp's representation of all his clients, and not just the particular debtor in the case, the court found that it was proper to seal the report from public scrutiny because (a) a reasonable person could change their opinion of Mr. Tripp based on the report; (b) the Report was potentially untrue or irrelevant; and (c) unsealing the report could harm Mr. Tripp's professional reputation.

Insurer's Duty to Defend Held Triggered by Defamation Claim

May 13, 2014,

Insurance against defamation claims is often found in policies providing coverage for liability arising from "personal and advertising injury." In State Farm Fire and Casualty Co. v. Franklin Center for Government and Public Integrity, for example, the United States District Court for the Eastern District of Virginia examined a business liability insurance policy to determine whether State Farm was required to defend the insured in a lawsuit alleging claims for defamation and tortious interference. The court considered the plain language of the policy and its exclusions and ultimately held that State Farm had an obligation to defend its insured.

Franklin Center for Government and Public Integrity ("FCGPI") operates the Watchdog.org website. GreenTech Automotive, Inc., filed a civil action against FCGPI alleging defamation and intentional interference with business and prospective business relations stemming from two articles posted on Watchdog.org. FCGPI was insured by a State Farm business liability policy, and State Farm brought a declaratory judgment action seeking a declaration of non-coverage based primarily on various policy exceptions.

The policy provided that State Farm would pay what FCGPI was legally obligated to pay as damages because of "personal and advertising injury." The court first considered whether GreenTech's alleged injuries fell within the policy definition of "personal and advertising injury," which the policy itself defined to include injury arising out of "oral or written publication, in any manner, of material that slanders or libels a person or organization or disparages a person's or organization's goods, products or services." The court found that GreenTech's claims for both defamation and tortious interference fell squarely within the policy coverage for personal and advertising injury.

The court then examined whether any of the policy exclusions applied to GreenTech's claims. The policy contained an exclusion for injury caused with knowledge that the act would violate another's rights and inflict defense.jpgadvertising injury. GreenTech's complaint alleged that FCGPI made statements in bad faith and with the intent to harm, but the court found that GreenTech did not necessarily have to prove "knowledge" in order to recover on its defamation claim. Noting that State Farm had a duty to defend FCGFI unless "it clearly appears from the initial pleading the insurer would not be liable under the policy contract for any judgment based upon the allegations," the court held that State Farm had a duty to defend.

The policy also contained an exclusion for injury committed by an insured whose business is advertising, broadcasting, publishing or telecasting. The parties agreed that FCGPI was not in the business of advertising, broadcasting or telecasting, so the court only had examine whether FCGPI was an insured whose business was "publishing," a term not defined by the policy. While recognizing that FCGFI "publishes" information on its website in the sense that it disseminates information to the public, the exception only applied to companies whose "business is...publishing," and not everyone who puts information on the Internet can be regarded as being in the publishing business.

The court examined other provisions of the policy and concluded that within the context of the policy, more than one reasonable meaning of the phrase "an insured whose business is publishing" existed, at least one of which would not cover FCGPI's business. Accordingly, the exclusion failed to give the insured fair notice as to when and under what circumstances the exclusion would apply to defamation or other claims. The court held that because the exclusion did not unambiguously or clearly apply, it could not be enforced to reduce coverage otherwise provided.

The court also examined exclusions relating to injury arising out of an electronic chat room or bulletin board and out of a criminal act and found them inapplicable. The court held that State Farm had a duty to defend FCGPI against the defamation and tortious interference claims but that indemnification issues would be determined following the conclusion of the litigation.

As of this writing, State Farm's Motion for Reconsideration is set for oral argument on May 23, 2014.

Defamation Action Against 50 Cent Unlikely to Get Dismissed Early

May 5, 2014,

If Sally Ferreira's allegations are true, she has a valid claim for defamation per se against rapper 50 Cent which could possibly result in a seven-figure damages award. Ms. Ferreira, an actress, model, and dancer, sued 50 Cent (real name Curtis J. Jackson, III) for defamation and emotional distress in federal court in New York, making the following allegations:

Ms. Ferreira has appeared in music videos for various artists such as 50 Cent, Kanye West, Jay Z, Nicki Minaj, Missy Elliot, and Lil' Kim. In March, Ms. Ferreira participated in 50 Cent's music video for the song "Big Rich Town," filmed on the subway in the Bronx. Shortly after the video shoot, leaked photographs of Ms. Ferreira and 50 Cent taken during the shoot appeared on Hip Hop Weekly and MediaTakeOut.com, along with commentary speculating (erroneously) that the two were spotted riding the subway together and that they were romantically involved.

The complaint alleges that 50 Cent, suspecting Ms. Ferreira as the source of the leak, took to Instagram (where he has 1.8 million followers) to post a picture of Ms. Ferreira with the following direct accusation superimposed over her image: "WARNING: do not attempt to work with this thirsty Video bitch [Her name is Sally Ferreira and she's a model...] she sent photos Of the video shoot to Mediatakeout Saying I'm in a relationship With her Can anyone say RESHOOT." Ms. Ferreira says she did no such thing; that she never possessed any photographs of the event and never claimed to be in a relationship with 50 Cent. Forty minutes after the posting, it had received 6156 likes and over 850 comments.

Ms. Ferreira asserts that three separate entertainment industry projects that she was working on were put on hold as a result of the postings and associated negative publicity.

If New York law is anything like Virginia law, this case could go the distance. To state a claim for defamation, Ms. Ferreira needs to show that 50 Cent's Instagram post contained a false and defamatory statement of fact, and that he made the statement with the requisite level of intent. Her complaint appears to do that. While 50 Cent has a 50cents.jpgFirst Amendment right to call Ms. Ferreira a "thirsty video bitch" should he wish to do so, his accusation that she leaked photos of a video shoot to the media claiming to be his new girlfriend is a statement of fact, not opinion, that is not necessarily protected by free-speech rights. It's defamatory in nature because it's the type of accusation that would tend to deter other artists from hiring her to appear in their music videos, and perhaps also deter others in the entertainment industry from associating with her.

Moreover, because the statement is the type of accusation that could "prejudice" Ms. Ferreira in her line of work, it will likely be considered libel per se, which would make it far more likely she could recover a substantial damages award. If the court finds the statement is of the "defamation per se" variety, the jury would be instructed to presume compensatory damages even if not proven, and they would be authorized to award punitive damages even in the absence of proof of harm to Ms. Ferreira's reputation.

50 Cent may have a defense to the case if he can show justification for making the statement. To be held liable for defamation, a defendant needs to be at fault on some level. The precise level of fault required is going to depend on whether Ms. Ferreira is deemed a "public figure." If the court finds that her multiple appearances in music videos for famous artists make her a public figure herself, than she will not be able to recover unless she can show that 50 Cent made a false statement with knowledge that it was false or with reckless disregard of whether it was false or not.

In any event, at a minimum, Ms. Ferreira will need to prove that she did not send photos of the video shoot to MediaTakeout.com. But if what she is claiming is true, a quick subpoena or deposition should make that pretty easy to do.

Ripoff Report Maintains Section 230 Immunity Despite Lawyer's Novel Challenges

April 7, 2014,

Concerns that freedom of online speech would be chilled if Internet Service Providers were liable for allegedly defamatory remarks made by posters to their sites led Congress to pass the Communications Decency Act (the "CDA"). The CDA shields companies serving as intermediaries for other parties' potentially injurious speech from tort liability arising from users' comments. Section 230 of the CDA provides that "[n]o provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider." Although the CDA is interpreted broadly in light of Congress' intent in passing the statute, an interactive computer service provider remains liable for its own speech.

To benefit from CDA immunity, (1) the defendant must be a provider or user of an interactive computer service; (2) the plaintiff's claim must be based on information provided by another information content provider; and (3) the claim must treat the defendant as the publisher or speaker of the allegedly harmful speech. In Small Justice LLC v. Xcentric Ventures LLC, a federal court in Massachusetts found that Ripoff Report should not lose its CDA immunity even if it was found to have copyright ownership of the allegedly defamatory content, and even if, as the plaintiff alleged, it "intentionally caused...two defamatory per se publications to be prominently and frequently featured on Google...and other search engines."

Ripoff Report is website operated by Xcentric Ventures LLC on which registered users post complaints about companies and individuals. In January 2012, Christian Dupont posted an allegedly defamatory report about Richard Goren's conduct as an attorney and certain behavior outside of professional activities. In February, Dupont posted a second report containing similar allegations. In March, Xcentric got a registered copyright for Ripoff Reports from January to March.

In July 2013, Goren and Small Justice, a company asserting a copyright interest in the reports at issue, sued Xcentric in Massachusetts federal court, stating several causes of action including libel and intentional interference with prospective contractual relations. Xcentric moved to dismiss pursuant to Federal Rules of Civil brickwall.jpgProcedure 12(b)(1) and (6), arguing that Section 230 gave it immunity from these tort claims. Plaintiffs responded that Section 230 immunity was not available because Xcentric (1) asserted ownership of the copyrights in the reports, and (2) intentionally submitted the posts to Google and other search engines, thereby adopting the content of the posts as its own.

The issue here was whether the allegedly defamatory content was provided by "another information content provider" or by Xcentric itself. The CDA defines an information content provider as "any person or entity responsible in whole or in part for the creation or development of information provided through the Internet or another interactive computer service." For Section 230 immunity to apply, the allegedly defamatory postings must have been provided by an information content provider other than Xcentric because Xcentric would be liable for its own speech under the CDA.

Plaintiffs argued that Xcentric's asserted copyright ownership in the Reports transformed it from an intermediary to the actual provider of the disputed content. According to plaintiffs, Xcentric adopted the Reports as its own speech and subjected itself to liability by holding itself out as the copyright owner. The court rejected this argument. Plaintiffs did not cite any authority holding that an Internet Service Provider adopts content by virtue of copyright ownership, and courts that have addressed the issue have held that an Internet Service Provider is not a content provider unless it specifically encourages the development of the offensive content. Xcentric's acquisition of an exclusive license to the content was not sufficient involvement in the development of the content to nullify Section 230 immunity.

Plaintiffs then argued that Xcentric surrendered its immunity by instructing search engines such as Google to make copies of the two reports under its claimed exclusive ownership of the reports and authorizing the search engines to display the copies. Plaintiffs asserted that by doing this, Xcentric adopted the content of the reports as its own and caused them to be republished. The court rejected this argument as well. Although the CDA allows Interactive Service Providers to be held liable for content they create themselves, the court found here that the alleged conduct did not rise to the level of "creation or development" of information that would render Xcentric an information content provider under the CDA. Plaintiffs did not argue that Xcentric augmented or changed the reports' content in any way, and they conceded that Xcentric's actions were designed to maximize the number of times the reports appeared among Google's search results. Merely endeavoring to increase the prominence of its site among search results does not make Xcentric an information content provider under the CDA.

The court held that Section 230 shielded Xcentric from liability based on publication of the allegedly injurious Ripoff Report posts, so it dismissed plaintiffs' claims for libel and tortious interference.

The Importance of Context

December 11, 2013,

To be actionable as libel, a statement must reasonably imply false and defamatory facts when read in context. Context is important because the setting of the speech makes its nature apparent and helps determine how its intended audience would have interpreted the statement. In some cases, a literally false statement will not be actionable because contextual factors demonstrate that the true meaning of the statement is something other than what the words alone might suggest. In other words, the statement that a plaintiff must prove false to prevail in a defamation case is not necessarily the literal phrase published but rather what a reasonable reader would have understood the author to have said. In Farah v. Esquire Magazine, the United States Court of Appeals for the District of Columbia Circuit discussed the importance of these principles in a case involving political satire.

Jerome Corsi is the popular author of several New York Times bestsellers and the book "Where's the Birth Certificate? The Case that Barack Obama is Not Eligible to be President" published by WND Books. Joseph Farah is the Editor and CEO of WND's parent company, WorldNetDaily.com, a competitor of Esquire Magazine. On the day after "Where's the Birth Certificate" was released, Esquire published an online article on "The Politics Blog" entitled "BREAKING: Jerome Corsi's Birther Book Pulled from Shelves!" A copy of the Drudge Siren, a symbol of sensationalistic news, appeared above an image of the book's cover. The article claimed that Farah had announced plans to recall and "pulp" the entire first run of the book and to refund purchaser's money because three weeks earlier, Obama had produced his long form birth certificate indicating he was born in Hawaii. Later, Esquire published an update clarifying that the article was satirical, but the writer of the article referred to Corsi as an "execrable piece of shit" in an interview published on another online publication, The Daily Caller.

Farah and Corsi sued for defamation and other torts. According to the complaint, after the article was published, Farah received numerous requests for confirmation of the story and comment, and consumers began requesting refunds. The plaintiffs also claimed that they were attacked by book supporters and that book stores pulled the book from their shelves or refused to sell it. Farah and Corsi contended that Esquire only published the update after Farah indicated that he was exploring legal options and that the update was likewise false and defamatory. The district court granted Esquire's motions to dismiss under both Federal Rule of Civil Procedure 12(b)(6) and D.C.'s Anti-SLAPP Act, D.C. Code § 16-5501 et seq.

On a de novo review, the Court of Appeals upheld the district court's dismissal of the complaint for failure to state a claim, declining to address the Anti-SLAPP issue. The court held that the article was protected political satire and that the update and writer's comments were non-actionable statements of opinion. The court noted that the United States Supreme Court has repeatedly extended First Amendment protection to statements that do not reasonably state or imply defamatory falsehoods when read in context. Satire is a broad and complex genre that is sometimes funny and other times cruel and mocking or even absurd. The court gave the example of Jonathan Swift's famous jonathanswift.jpgsatire "A Modest Proposal" in which he suggested killing and eating Irish children to solve the problem of Irish poverty. Although satirical speech is literally false, it enjoys First Amendment protection.

To qualify as defamatory, a plaintiff must prove not that the literal published phrase is false but that what a reasonable reader would have understood the author to have said is untrue. Satire is not actionable if it cannot reasonably be interpreted as stating actual facts. Farah and Corsi did not disagree that satire is protected, but they asserted that this attempt at satire was actionable because reasonable readers would take the fictitious blog post literally.

The court held that to determine how a reasonable reader would have understood a particular satirical statement, courts should assess the hypothetical reader's "well-considered view," formed after time for reflection, rather than her "immediate yet transitory reaction." Thus, even if some actual readers don't "get" the satire and mistake it for actual news, satire that, taken in context, would be understood (upon reflection) as satire by a reasonable reader, enjoys First Amendment protection and will not support a defamation action.

The court also noted that an article's "indicia of satire" can be subtle. In this case, for example, the body of the article "did not employ the sort of imitation and exaggerated mimicry that are typical of parody." The court explained that satire can incorporate a wide variety of literary forms and devices to achieve its intended effect, such as "ridicule, derision, burlesque, irony, parody, or caricature." The fact that an article's satirical nature may not be immediately obvious does not remove it from First Amendment protection.

Considering this particular article in context, the court held that a reasonable reader could not understand it to convey real news about the plaintiffs. The intended audience consisted of readers of "The Politics Blog" who would have been familiar with Esquire's history of publishing satire. They were also politically informed readers who would have been familiar with WorldNetDaily and its positions on the birther controversy.

Reasonable readers would have recognized the signs of satire in the article such as the substance of the story itself, i.e., that Farah, a leader of the movement to challenge Obama's eligibility to serve, had suddenly and without warning decided to recall and "pulp" Corsi's book. The humorous and outlandish elements in the article also suggest satire. For example, the article claims Corsi wrote a book entitled "Capricorn One: NASA, JFK, and the Great 'Moon Landing' Cover-Up." Additionally, the article contained quotes using foul language which would not likely appear in a serious news story. Stylistic details such as the exclamatory headline and the use of the Drudge Siren symbol similarly alerted readers that the article was not to be taken seriously.

The court held that because a reasonable reader could not understand the blog post to convey actual facts about the plaintiffs, it was not actionable as defamation. Rather, almost everything about the article indicated that it was political speech aimed at criticizing the plaintiffs' public position on Obama's eligibility to hold office. The article was protected by the First Amendment and the district court properly dismissed the defamation claim.

Yasser Abbas' Defamation Lawsuit Dismissed on Anti-SLAPP Grounds

October 7, 2013,

The District of Columbia's anti-SLAPP act applies to actions that arise from an act in furtherance of the right of advocacy on issues of public interest. It provides that if a party makes a prima facie showing that the case involves the type of claim to which the act applies, the court will dismiss the case--with prejudice--unless the responding party can demonstrate that the claim is likely to succeed on the merits. D.C. Code § 16-5502(a)-(b). Although there has been some uncertainty as to whether D.C.'s anti-SLAPP act applies in federal court, the emerging trend has been to find that it does. On September 27, 2013, Judge Emmet G. Sullivan of the District of Columbia District Court found the statute applicable to a defamation lawsuit brought by Yasser Abbas and granted the defendant's special motion to dismiss made under its terms.

Yasser Abbas is a wealthy businessman and political emissary for his father's regime, the Palestinian Authority ("PA"). He sued Foreign Policy Group, LLC, and journalist Jonathan Schanzer for certain statements Schanzer made in an article he had written about the sons of the Palestinian president. The article was published in the "Argument" section of Foreign Policy Magazine and questioned whether the sons of the Palestinian president were "growing rich off their father's system" and whether they had "enriched themselves at the expense of regular Palestinians" and U.S. taxpayers.

When the defendants responded with a motion to dismiss under the anti-SLAPP act, the first question was whether D.C.'s statute even applied in federal court, a question not yet decided by D.C.'s highest court. The issue boils down to whether the anti-SLAPP statute should be viewed as substantive or procedural, as federal courts sitting in diversity apply federal procedural laws but state substantive laws. Judge Sullivan looked to other circuits and found that many interpret similar state statutes as substantive and do apply them in federal diversity cases. Notably, the D.C. Circuit has upheld a district court decision denying a special motion to dismiss under the anti-SLAPP statute because it was not timely filed. Although that decision did not specifically hold that the anti-SLAPP statute was substantive, it implied as much. With this background, Judge Sullivan was persuaded that the anti-SLAPP law applies in federal court.

To succeed on their special motion, the defendants were required to show that Mr. Abbas' claim arose from "an act in furtherance of the right of advocacy on issues of public interest." The court found that Mr. Abbas was a limited purpose public figure because he had voluntarily thrust himself into a role of prominence in Palestinian DCdistrictcourt.jpgpolitics and in the controversy surrounding his wealth. Further, the question of U.S. aid to the PA and the manner in which the PA used such aid are questions that have been debated at length for years. The court held that the "level of corruption in the PA," whether Mr. Abbas has enriched himself by virtue of his political ties, and whether his wealth can be traced to U.S. tax dollars are issues of public (not private) interest. Accordingly, the court held that the defendants had made a prima facie showing that the defamation claim arose from an act in furtherance of the right of advocacy on issues of the public interest. The burden then shifted to Mr. Abbas to show that he was likely to succeed on the merits.

Mr. Abbas contended that the questions invited his colleagues and the world to wonder if he has enriched himself at the expense of others. He argued that, while posed as questions, the statements could be read as assertions of fact, falsely accusing him of using wrongful and possibly criminal means to accumulate wealth. The defendants responded that the article merely raised unanswered questions, and that even if they could be interpreted as assertions, the statements were pure opinion and therefore non-actionable.

The court agreed with the defendants, finding that the questions posed in the article could not reasonably be interpreted as statements of fact. The court found that the questions merely invite the reader to form an independent opinion as to the relationship between the Abbas family and its wealth, which invitation is "the paradigm of a properly functioning press."

Even if the questions were capable of defamatory meaning, the court held that they were statements of opinion protected by the First Amendment. The factual basis for the article's questions was outlined with statements and hyperlinked source material. This put the reader on notice that the piece was one of opinion. Also, the article appeared in the Argument section of the Foreign Policy Group website--a place where readers expect to find opinion pieces.

The court held that Mr. Abbas failed to meet his burden of proving that he was likely to prevail on the merits. Accordingly, the court granted the defendants' special motion to dismiss.

Erasure Statutes Do Not Erase History

August 9, 2013,

So your criminal record has been erased. Congratulations! Now you're thinking about bringing a libel action against the news agencies who published stories documenting your arrest, because the local "deemer" statute states that you are deemed never to have been arrested and those embarrassing articles are still available online. Good idea? Have those articles, truthful at the time they were first published, become defamatory in light of recent events? Not according to a recent federal-court opinion out of Connecticut, which rejected Lorraine Martin's claims for libel, false light, negligent infliction of emotional distress, and invasion of privacy in a case she filed against Hearst Corporation and other media outlets.

Lorraine Martin and her two sons were arrested in August 2010 and charged with possession of narcotics, drug paraphernalia and a controlled substance. Several news outlets published brief accounts of the arrest and charges in print and online. The charges were dismissed in January 2012 and qualified for erasure under Connecticut's erasure statute which provides that thirteen months after a criminal charge is dismissed, the charge is erased and the person charged is deemed to have never been arrested. Ms. Martin asserted that because she qualified for erasure and had been deemed to have never been arrested, the defendants' statements became false and defamatory. Ms. Martin asked the publications to remove the online articles and, when they refused, sued them.

Precepts of statutory construction dictate that the meaning of a statute be ascertained from its text and its relationship to other statutes. If the text is plain and unambiguous, the court will not consider extra-textual evidence. The "Erasure of Criminal Records" statute requires that court records and police and prosecutor records be erased following final judgment in a case in which the defendant is acquitted or the charge is eraser.jpgdismissed or where a nolle prosequi is entered. Read as a whole, the statute concerns only the records of courts and law enforcement agencies and imposes requirements on them. For example, the statute prohibits the court clerk from disclosing information about erased charges. The court found that nothing in the statute suggests that the legislature intended to impose requirement on persons who work outside of courts or law enforcement.

The court also examined the statute in context of surrounding statutes which likewise focused on court and law enforcement records and the custodians of those records. Given the plain language of the statute when read in context, the court found that legislature intended to ensure that custodians of criminal records treat persons who qualify for erasure as if they have never been arrested in order to minimize the stigma associated with an arrest. The legislature did not intend to silence private persons who might have obtained arrest information nor did it intend "the sweeping, history-altering design" that Ms. Martin perceived.

Furthermore, the court noted that it must construe statutes in a manner that comports with the constitution. If the erasure statute exposed publishers to defamation claims for publishing true and newsworthy statements, it would be unconstitutional.

Continuing, the judge observed that the erasure statute operates "in the legal sphere, not the historical sphere" and does not "purport to wipe from the public record the fact that certain historical events have taken place. Only in a totalitarian system could law purport to have such a sweeping effect." Citing a New Jersey case, the court noted that erasure statutes "cannot banish memories." The bottom line is that Ms. Martin was, in fact, arrested in 2010. That was true at the time it was published and it will always be true.

The court's rejection of Ms. Martin's reading of the erasure statute rendered all of her claims insufficient as a matter of law. Her libel claim required publication of a false and defamatory statement. Because no genuine dispute existed as to the truth of the statements at the time they were first published, her claim failed. Likewise, to prove false light in Connecticut, a plaintiff must show that the published statements are not true and are a major misrepresentation. The First Amendment requires that a media defendant be liable for false light only where it publishes highly offensive material without regard to its falsity. Where the matter is true, a defendant is constitutionally protected. Because there was no genuine dispute that the statements were true, the false light claim failed. Ms. Martin's claim for negligent infliction of emotional distress failed as well because publishing a true article is not negligent. Finally, her invasion of privacy claim failed because the value of a person's name is not appropriated by mere mention of it in reference to legitimate public activities.

Mann's Defamation Suit Survives Anti-SLAPP Motion

July 29, 2013,

Well-known climate scientist Michael Mann made good on his threat to sue the National Review and columnist Mark Steyn for defamation based on statements made online questioning Mann's global warming research. In response, the defendants filed a special motion to dismiss under D.C.'s anti-SLAPP statute, arguing that the online statements were made in furtherance of the right of advocacy on an issue of public interest. The court found that the anti-SLAPP statute did apply but nevertheless denied the motion.

Mann is a professor of meteorology and the Director of the Early System Science Center at Penn State. He is well known for his research on global warming and has published papers and books on the subject. The University of East Anglia's Climate Research Unit (CRU) exchanged emails with Mann which were later misappropriated. In one email, a CRU scientist referred to Mann's "nature trick" of adding in real temperatures for the last twenty years and from 1961 to "hide the decline." Upon discovery of the emails, the University of East Anglia investigated the matter and concluded that the honesty and rigor of the CRU scientists was not in doubt but that the email referencing Mann's "nature trick" was misleading.

In 2010, Penn State initiated an investigation of Mann and the CRU emails. The investigatory committee was comprised entirely of Penn State faculty members. Based on an interview with Mann, the committee cleared Mann of three of four charges against him. The last charge involved an allegation that Mann's research might deviate Mann.jpgfrom accepted norms. The committee interviewed an MIT professor who was critical of Mann's work and later expressed dismay with the scope of the investigation and the committee's analysis of the CRU emails.

At the same time, in response to pressure from the National Review, Steyn and others, the EPA investigated Mann and found no evidence of scientific misconduct. The National Science Foundation also investigated Mann's work and found that Penn State had not adequately reviewed the allegations and failed to interview critics of Mann's work

Two years later, Penn State was in headlines due to the Jerry Sandusky scandal. FBI Director Louis Freeh concluded that the university had failed to properly investigate allegations of misconduct when they arose and suggested that it should undertake a thorough and honest review of its culture which seemed to value the avoidance of bad publicity and its consequences above all else.

The National Review seized on the Sandusky scandal and published Steyn's article "Football and Hockey" on its website in a section called "The Corner." The piece contained an excerpt from and a link to a post by Rand Simberg on OpenMarket.org entitled "The Other Scandal in Unhappy Valley" which compared the Sandusky scandal and the university's failure to handle the matter properly with its investigation into Mann's work. Steyn agreed that Simberg had a point but admitted he might not have "extended the metaphor all the way into the locker-room showers" with quite the zeal Simberg did. Steyn also stated that Mann was the man behind the "fraudulent climate-change hockey stick graph, the very ringmaster of the tree-ring circus," and he concluded by noting the similarities between Penn State's investigation of Sandusky and Mann and questioning its handling of both matters.

Mann demanded a retraction and apology for the accusations of academic fraud. In response, the National Review asserted that the term "fraudulent" was used to mean "intellectually bogus and wrong" rather than criminally fraudulent.

Mann sued in D.C. Superior Court, alleging libel and intentional infliction of emotional distress against the National Review, Steyn, Simberg and the owner of OpenMarket.com, Competitive Enterprise Institute. His complaint was based on the statements that (1) Mann had engaged in data manipulation and scientific misconduct and was the "poster-boy of the corrupt and disgraced climate science echo chamber," (2) Mann was the man behind the "fraudulent climate-change hockey stick graph, the very ringmaster of the tree-ring circus," and (3) Mann's work was intellectually bogus.

The National Review and Steyn moved to dismiss under both D.C.'s Anti-SLAPP Act and Federal Rule of Civil Procedure 12(b)(6). The defendants argued that their comments are protected by the First Amendment and that the Anti-SLAPP Act applies because Mann's claims stem from statements made in a public forum that discusses issues of public interest, i.e., climate change and global warming. Mann asserted that the Anti-SLAPP Act was enacted to deter large private interests from bringing meritless suits to deter common citizens from exercising their political or legal rights and was not intended to apply to cases such as this. The court found that because the defendants' comments were made with respect to climate issues which are environmental issues and issues of public interest, and were made in publications that were available to the public, the Anti-SLAPP Act applies.

The Anti-SLAPP Act provides that if a party filing a special motion to dismiss makes a prima facie showing that the claim at issue arises from an act in furtherance of the right of advocacy on issues of public interest, then the court will grant the motion unless the responding party shows that the claim is "likely to succeed on the merits." The parties disagreed on the level of proof this standard requires. The defendants asserted that "likely" poses a higher burden than "probability," which is the term used in the corresponding California statue upon which the D.C. statute is based. Mann argued that there is no difference between "likely" and probability." The court turned to Black's Law Dictionary which defines the "likelihood of success on the merits test" in the context of a preliminary injunction as requiring the litigant to show "a reasonable probability of success in the litigation." The California statute requires the plaintiff to show a "probability of prevailing on the claim by making a prima facie showing of facts that would, if proved, support a judgment in the plaintiff's favor." The court held that the standard is similar to that used on a motion for judgment as a matter of law and that Mann must present a sufficient legal basis for his claims in order to survive the anti-SLAPP motion.

The defendants argued that Mann would be unable to make a prima facie case for libel because he could not prove the actual malice required where plaintiff is a public figure. They also argued that Mann would be unable to prove the falsity of the statements because the statements were ones of opinion. Mann countered that he could demonstrate actual malice by showing that the defendants entertained serious doubts as to the truth of the statements or acted with a high degree of awareness that the statements were probably false. He argued that the statements were false and defamatory per se and that the defendants made them with knowledge of their falsity or with reckless disregard of the truth. He contended that whether he engaged in fraud is verifiable by analyzing the elements of fraud or considering the investigations conducted regarding his research.

On the issue of malice, the court found that sufficient evidence existed to show at least reckless disregard of truth or falsity, as Mann had been investigated several times, at least once due to the defendants' accusations, and his research has been found to be accurate. The court held that where the defendants consistently claim that Mann's work is inaccurate despite being proven accurate, then there is a strong probability that the defendants disregarded the falsity of their statements and did so with reckless disregard. Although the evidence was not yet sufficient to show clear and convincing evidence of actual malice, the court found sufficient evidence to necessitate further discovery on the matter.

Regarding the fact vs. opinion question, the court noted that opinions may be actionable if they imply a provably false fact or rely upon stated facts that are provably false. To determine whether a statement is actionable opinion, a court must examine the context of the statement. The court found that the statements at issue here questioned facts rather than simply inviting readers to ask questions. The court held that, given the definition of fraud and the common readers' interpretation of the words "fraud" and "fraudulent," the statements were more than brutally honest commentary. The court held that the assertions of fraud rely upon facts that are provably false in light of the fact that Mann has been investigated and his research and conclusions determined to be sound. Evidence indicated that the defendants' statements were not pure opinion but rather were statements based on provably false facts.

The defendants also argued that the statements were rhetorical hyperbole - witty and obvious exaggeration-- which is protected under the First Amendment, and that the statements criticized Mann's work and ideas rather than Mann himself and thus cannot be defamatory. The court found that, when considered in the context of all of the comments and accusations made over the years and the "constant" requests for investigations of Mann's work, the statements appear more as factual assertions.

Finally, the defendants argued that their statements were protected by D.C.'s fair comment privilege, which protects opinions based on facts that are well known to readers. To take advantage of this privilege, a defendant must show that the publication was fair and accurate and that the publication properly attributed the statement to the official source. Here, the court found that the accusations of fraud were provably false as several reputable bodies had found his work sound. Thus, the court held that the fair comment privilege did not apply.

For these reasons, the court denied the motions to dismiss and lifted the discovery stay.

VitaminSpice CEO Files Libel Claim Against DealFlow Media

July 15, 2013,

Edward Bukstel, CEO and majority shareholder of VitaminSpice, Inc., a publicly traded company, has brought a libel action in the Eastern District of Pennsylvania against DealFlow Media and affiliated individuals, claiming that DealFlow knowingly published a false story about VitaminSpice. The complaint alleges the following facts.

DealFlow provides independent research services and analysis for finance professionals such as investment managers, law firms, banks, public and private corporations, hedge funds, and financial companies. It publishes The DealFlow Report for individuals and institutions in the field of business and finance. DealFlow's website asserts that over 6000 institutions rely on it for accurate, comprehensive and timely information about finance.

In early 2013, Bukstel negotiated a deal allegedly worth over $8 million involving the sale of VitaminSpice assets to a New York investor. An article appeared in a March issue of The DealFlow Report, entitled "VitaminSpice CEO Says He Requested Trading Halt Amid Dispute Over Stock Manipulation." The Article went on to report that Bukstel had accused his former attorney of stock manipulation. According to Bukstel, the Article, its title in bold, news.jpgappeared on page one of the issue and was the major headline. Bukstel asserts that the defendants intended the article to be conspicuous so that every reader would be drawn to it.

Bukstel claims he never requested a trading halt on VitaminSpice stock and that defendants deliberately falsified the Article to sensationalize a story for the benefit of its readership and with complete disregard for the harm the statements would cause him. When Bukstel learned about the Article, he contacted defendants and informed them that the Article's title and content were false and that the publication was jeopardizing an $8 million deal. Bukstel told the defendants that VitaminSpice investors were contacting him with concerns, and he asked DealFlow to issue a press release with a retraction and apology. Bukstel hoped such a release would restore investor confidence and salvage the sale.

The complaint alleges that DealFlow acknowledged the falsity of the title but did not issue the requested press release. Rather, the defendants simply changed the title to "VitaminSpice Halted Amid Dispute Between CEO, Attorney Over Stock Manipulation" and the opening line to "The chief executive of the microcap company VitaminSpice Inc. (VTMS) says that he provided a document to the Securities and Exchange Commission..." According to Bukstel, these changes were made only to the online versions of the Article after the print edition had been sent to thousands of subscribers.

Bukstel sued DealFlow, its CEO, Editor and a journalist working for DealFlow for defamation and intentional interference with contractual relations. According to the complaint, Bukstel has more than 18 years of experience in data integration, data security and communications. Bukstel asserts that he was nominated for a humanitarian award by the Department of Defense, has been a national speaker on electronic data interchange and a guest lecturer at The Wharton Business School and holds a B.S. and a PhD. As the CEO of VitaminSpice, Bukstel claims that his professional reputation is essential to maintaining the confidence and morale of his fellow officers, directors, employees and shareholders and is important to potential investors and future shareholders who rely on the reputation of corporate officers in their investment decisions.

Bukstel contends that defendants intentionally published defamatory and libelous statements about him. He argues that the defamatory meaning of the statements is self-evident because the statements are false. Bukstel asserts that the article created skepticism among VitaminSpice investors and potential investors by creating the impression that he was in dereliction of his fiduciary duty to VitaminSpice and that it harmed employee and shareholder confidence and morale. Bukstel claims to have suffered embarrassment, reputational damage and emotional distress as well as the opportunity to complete the $8 million sale of VitaminSpice assets. He contends that the individual defendants acted outside the scope of their duties as officers or employees of DealFlow. As of this writing, the defendants have not yet responded to the suit.

Defamation of Character: Libel and Slander Law in Virginia

February 10, 2013,

Under Virginia law, the necessary elements of the tort of defamation (which includes both libel and slander) are usually expressed as (1) a publication about the plaintiff, (2) of an actionable statement, (3) with the requisite intent. This sounds simple enough, but proper application of these principles is far more complicated than one would expect. This is, in part, due to the fact that the test is circular, as it begs the question of what an "actionable statement" is. It is more useful to think of Virginia law of defamation as encompassing the following eight elements: (1) a factual assertion (as opposed to an expression of opinion); (2) that is false; (3) and defamatory in nature; (4) that is about the plaintiff; (5) and made to a third party; (6) in a setting or context that isn't privileged; (7) with the requisite degree of fault; (8) that causes actual or presumed damages (generally consisting of financial loss, loss of standing in the community, and/or emotional distress).

Element (6) refers to a defense, not an element of the plaintiff's proof, but I've included it in the list to clarify that an otherwise defamatory statement made in a privileged setting will not be actionable in a court of law. Furthermore, element (8)--damages--is presumed (and need not be proven) in those situations deemed to constitute "defamation per se."

Libel and slander will be considered "per se" defamatory if it (1) imputes the commission of a crime involving moral turpitude; (2) imputes that the person is infected with a contagious disease which would exclude the party from society; (3) imputes an unfitness to perform the duties of a job or a lack of integrity in the performance of those duties; or (4) prejudices the party in his or her profession or trade. Statements that might qualify as defamation per se include an allegation that one has acted unprofessionally, an attack on a person's honesty and veracity, a false report of a corporations' profit and earnings, a statement regarding a company's inability to pay bills, and a statement suggesting a person is an incompetent businessman.

To make things more confusing, some courts use "per se" and "per quod" to distinguish between words that are defamatory on their face and words which do not appear to be defamatory, but are defamatory by implication, or that become defamatory when additional facts are made known. (When used in this sense, defamation per se refers not to the list of the four most serious categories described above, but to words defamatory on their face). Whichever definition of "per se" is used, "per quod" is the catch-all phrase that basically means "not per se."

Hundreds of Virginia state and federal cases have struggled to apply the law of defamation in a manner consistent with the United States Constitution, as defamation cases necessarily involve a careful balancing of vital constitutional and common law rights. On the one hand, there is the First Amendment's fundamental protection of free speech. On the other hand, there is a common law obligation not to abuse the First Amendment with unjustified attacks against the reputation and dignity of others. Defamation law attempts to accommodate these seemingly antithetical interests by providing a legal remedy for persons subjected to false and defamatory statements while limiting the range of statements considered defamatory and actionable.

Not every unflattering or critical remark will constitute actionable defamation. Statements that are merely unflattering, annoying, irksome, or embarrassing, or that hurt the plaintiff's feelings, without more, are not actionable. To be defamatory, a statement must be more than merely critical; it must "make the plaintiff appear odious, infamous, or ridiculous." A defamatory statement is one that causes reputational harm to a plaintiff, holding the plaintiff up to scorn, ridicule, hatred, or contempt--in other words, the type of statement that would tend to deter third parties from dealing with the plaintiff. To assert a claim of defamation, a plaintiff must show that a defendant published such a statement, that it was both factual in nature and false, and that it concerns and harms the plaintiff or the plaintiff's reputation. A plaintiff in a Virginia defamation action must plead the statement with particularity, identifying the exact words claimed to be defamatory. Failure to allege the specific words claimed to be defamatory can lead to a dismissal of the case.

Expressions of opinion are also not actionable as defamation. Statements of opinion, as opposed to assertions of fact, are deemed privileged and no matter how offensive, cannot be the subject of an action for libel or slander. This is because a statement of opinion is not an assertion of fact that can be proven false, and falsity is a required element of a defamation claim. Statements of opinion are also protected by the First Amendment's guarantee of freedom of speech. Distinguishing fact from opinion is not always easy. Courts need to examine whether the specific language has a precise meaning, whether the statements are capable of being proven true or false, and whether the context in which the communication was made affects the meaning of the statement.

Statements expressed in factual language but which would not be reasonably understood as an assertion of fact are not actionable. Rhetorical hyperbole, for example, is generally not interpreted literally, and therefore cannot support a defamation action. For example, defamation cases have been dismissed in Virginia where a talk show host said a government contractor had employees in Iraq who were "all over the country, killing people," and where a newspaper article referred to a university official as the "Director of Butt Licking." These statements were not literally true, but could not reasonably be understood as conveying actual facts. Other examples include parody, gross exaggeration, sarcasm, and irony.

Conversely, statements expressed in language suggesting mere opinion may nevertheless be treated as implied statements of fact if the statement suggests the speaker's opinion is based on the speaker's knowledge of undisclosed facts. Such statements may be actionable not because they convey "false opinions," but rather because a reasonable listener or reader would infer that the speaker or writer knows certain facts, unknown to the audience, which support the opinion and are detrimental to the reputation of the person about whom the statement is made. In other words, a statement of opinion that is based on undisclosed facts is potentially actionable because it carries with it an implicit statement of those facts.

Statements that are only partially false may not be sufficient to support a claim of libel or slander. If an allegedly defamatory statement is substantially true, it will usually be enough to defeat a defamation action. Substantial truth turns on the understanding of the reasonable listener or reader. In general, a statement is substantially true if the statement would not have a different effect on the mind of the reader from that which the complete truth would have produced. In other words, it is not necessary to demonstrate complete accuracy to defeat a charge of defamation. It is only necessary that the gist or substance of the challenged statements be true.

Celebrities, politicians, and other public figures have a higher burden in defamation actions. The First Amendment requires that in defamation actions brought by public figures, the plaintiff must prove that the allegedly defamatory statement was made with "actual malice," meaning that it was made "with knowledge that it was false or with reckless disregard of whether it was false or not." Hatfill v. The New York Times Co., 532 F.3d 312, 317 (4th Cir. 2008). Where a statement on a matter of public concern expresses or reasonably implies false and defamatory facts regarding public figures or officials, those individuals must show that such statements were made with knowledge of their false implications or with reckless disregard of their truth.

Virginia defamation law is vast and complex. For more information, or to discuss the application of the law to a particular set of facts, consult a defamation attorney.

How to Lose Your Defamation Case in Three Easy Steps

December 5, 2012,

First, don't hire a lawyer. (What do lawyers know about defamation law, anyway?) Second, refuse to comply with the court's orders and local rules. Finally, file a whole bunch of frivolous and nonsensical motions, such as a "Motion for Declaration All Rulings & Judgments Be Rendered Null & Void," a motion against opposing counsel for engaging in "felonious conspirator tactics," and a "Motion to Declare All Your Base Are Belong to Us." With the exception of the "all your base" example, a defendant recently tried all of these tactics in North Carolina federal court and came away with a judgment against him that included punitive damages.

William Mann, a member of the Professional Golfers Association Hall of Fame, acquired a North Carolina country club but then declared bankruptcy and moved to South Carolina. M. Dale Swiggett sent a letter to hundreds of recipients accusing Mann of fraud and crimes and claiming Mann left North Carolina after declaring bankruptcy and paid cash for his South Carolina house. Swiggett then sent a letter to the judge who had presided over Mann's bankruptcy, accusing Mann of covering up "sludge spreading and spills."

Mann sued Swiggett in the Eastern District of North Carolina for libel, seeking $2 million in compensatory damages and $2 million in punitive damages for injury to his reputation and livelihood. Swiggett, acting pro se, responded by overloading the court's docket with numerous groundless motions, inducing the court to strike his Answer as a sanction. After entering summary judgment in Mann's favor, the only remaining issue was the amount of damages.

Even in a libel per se case like this one, a plaintiff must present sufficient evidence to support an award of compensatory damages. Speculative damages are not recoverable.

The Court found that while Mann demonstrated inconvenience and embarrassment, he failed to present sufficient evidence of damage to reputation, loss of enjoyment of life, or mental suffering. Although Mann feared losing his job and said he missed out on consulting work, his job remained intact and he failed to show actual consulting opportunities he'd lost. The Court, therefore, awarded only $100.00 in compensatory damages. Still, the Court awarded $25,000 in punitive damages in light of the "reprehensibility" of Swiggett's behavior.

Summary Judgment Still Possible in Virginia State Court

October 29, 2012,

On October 4, 2012, the Virginia Supreme Court rejected the appeal of a personal trainer, represented by Virginia Beach lawyer Jeremiah A. Denton III, and allowed to stand the summary judgment order entered by the Norfolk Circuit Court against the trainer on her defamation claim. This shows just how serious the Virginia Supreme Court is about the absolute privilege that extends to defamatory statements made in demand letters preliminary to contemplated litigation and sent in good faith. Summary judgment is appropriate if a defamation claim is based on a privileged statement.

Darryl and Julie Cummings were members of the Norfolk Yacht and Country Club ("NYCC"). Deborah Allison, a personal trainer at NYCC and at Norfolk Academy, pursued and entered into a physical relationship with Julie. Darryl reported Addison's actions to NYCC management. Though the NYCC warned her not to pursue Julie Cummings on NYCC property, Addison disobeyed and was fired. Cummings and his wife ultimately divorced.

Darryl sued Addison for intentional infliction of emotional distress, tortious interference, and professional malpractice. Addison counterclaimed for intentional infliction of emotional distress, tortious interference with norfolk.JPGcontract, tortious interference with a contract expectancy, and defamation. Addison's claims stemmed from Cummings' email to the NYCC president, a draft complaint he sent to NYCC's attorney, and emails he sent to Norfolk Academy's headmaster.

In the NYCC email, Cummings stated, "The Cummings family did not join the club for an employee to become a predator, stalk, and harass them or for an environment that would encourage this kind of behavior." Addison claimed this was libel per se but the Court found it mere opinion and therefore not actionable.

Addison also claimed Cummings' draft complaint defamed her. As the Virginia Supreme Court clarified in June 2012, communications made outside of court but preliminary to proposed judicial proceedings will be absolutely privileged from defamation liability where (1) the statement is made preliminary to a proposed judicial proceeding; (2) the statement is "material, relevant or pertinent" to the proceeding; (3) the proceeding is contemplated in good faith and is under serious consideration; and (4) the communication is disclosed only to persons having an interest in the proposed proceeding.

The court applied an earlier version of this test and found that privilege should apply because the draft complaint had "some relation to a proceeding that is contemplated in good faith and under serious consideration" and because the draft complaint was substantially similar to the actual complaint.


Defamation Case Against Eliot Spitzer and Slate Dismissed

October 8, 2012,

Libel and slander claims depend to a large extent on whom the plaintiff targeted with the allegedly defamatory statement. Defamatory words may not support a cause of action unless they directly or inferentially refer to the plaintiff--this has come to be known as the "of and concerning" test. The defamation case filed against former Governor Eliot Spitzer and Slate Magazine Slate for a column Mr. Spitzer wrote in 2010 about an insurance bid-rigging scandal was recently dismissed by a New York court on the ground that the article did not sufficiently identify the plaintiff--a former insurance executive at Marsh & McLennan--as the subject of the statements.

William Gilman's work for Marsh included negotiating "contingent commissions"--fees paid by insurers to insurance brokers who place insurance business with the insurer. As attorney general, Spitzer took the position that Marsh's use of such commissions was illegal. A lawsuit ensued and Gilman was convicted of one count of restraint of trade and competition. While Gilman's appeal was pending, the trial judge vacated his conviction because exculpatory evidence had not been disclosed during trial. Spitzer wrote an article published on Slate.com in response to a Wall Street Journal article criticizing his handling of the Marsh case. Gilman brought a claim for defamation against Spitzer and Slate based on statements in Spitzer's article.

Gilman's defamation claim was based on (1) a reference to "the many employees of Marsh who have been convicted and sentenced to jail terms" and (2) the statement that Marsh's employees "pocketed ... increased fees and kickbacks." Defendants argued that neither of the challenged statements was "of and concerning" Gilman and therefore could not be defamatory.

Whether a statement is "of and concerning" the plaintiff is a question of law for the court to determine at the pleading stage, considering the challenged words in context and giving the language a natural reading. Because eliot_spitzer.jpgGilman was not mentioned by name in the article, in order to be defamatory, the language must be such that persons reading it would understand that it refers to Gilman. Gilman argued that a reasonable reader would understand the statement to be about him based on preceding sentences referring to the dismissal of two cases after conviction. The court disagreed and found that no reasonable reader of the entire passage would come away thinking both that Gilman's case was dismissed after conviction and that he was convicted and jailed on those charges.

Regarding the statement that Marsh's employees "pocketed ... increased fees and kickbacks," the court noted that statements which refer to an organization do not implicate its members. Gilman argued that the article's preceding references to the two dismissed cases sufficiently tied him to the statement, but the court found that if anything, the preceding sentences tended to weaken any inference to Gilman. The court also rejected Gilman's attempt to characterize the challenged statement as referring to only 20 individuals who were subject to prosecution. Courts have allowed defamation claims to proceed where a statement referred generally to a group numbering 25 people or fewer, but the court here found the argument unsupported by the language which referred broadly to "Marsh" and "its employees" rather than to a subset of employees who were subject to prosecution. Finding that the allegedly defamatory statements could not be reasonably interpreted to be "of and concerning" Gilman, the court dismissed the defamation claims.

Punitive Damages in Libel Case Reduced by 75%

September 17, 2012,

A jury awarded Russell Ebersole $7,500 in compensatory damages and $60,000 in punitive damages on his libel claim against Bridget Kline-Perry in the United States District Court for the Eastern District of Virginia. Ms. Kline-Perry moved for a new trial or, alternatively, a reduction of the punitive damages award, which the court treated as a motion for remittitur. Finding $60,000 to be unconstitutionally excessive, the court remitted the punitive damages to $15,000 and gave Mr. Ebersole the option of accepting the reduced amount or requesting a new trial.

The court agreed with Ms. Kline-Perry that the $60,000 award of punitive damages violated her right to due process. When faced with an excessive verdict, courts will generally order a remittitur. Remittitur is a process by which the court reduces the damages award while giving the plaintiff the option of re-trying the case in lieu of accepting the reduction. The Federal Rules of Civil Procedure do not provide specifically for remittitur, but precedent holds that a court should order remittitur when a jury award is so excessive as to result in a miscarriage of justice.

In determining whether a jury award of punitive damages violates due process, courts consider (1) the degree of reprehensibility of the defendant's misconduct; (2) the disparity between the actual or potential harm suffered by cut-money.jpgthe plaintiff and the punitive damages award; and (3) the difference between the punitive damages awarded and the civil penalties authorized or imposed in comparable cases.

The first factor is the most important. In analyzing the reprehensibility of a defendant's conduct, courts consider whether (1) the harm caused was physical or merely economic; (2) the tortious conduct evinced disregard of the health or safety of others; (3) the target of the conduct was financially vulnerable; (4) the conduct involved repeated actions or was an isolated incident; and (5) the harm was the result of intentional malice, trickery, or deceit.

In this case, the court found that Ms. Kline-Perry's statements accusing Mr. Ebersole of animal cruelty involved only economic harm, did not evince disregard for the safety of others, and was an isolated incident. While Mr. Ebersole was financially vulnerable at the time of the conduct (in the midst of a bankruptcy proceeding) the court found that Ms. Kline-Perry was motivated not by malice but by a desire to protect animals. The court held that, although not extraordinarily reprehensible, Ms. Kline-Perry's conduct was sufficiently blameworthy that the jury was justified in awarding some punitive damages.

The court found a disparity between the harm that Mr. Ebersole suffered and the punitive damages award. Mr. Ebersole recovered $7,500 in compensatory damages yet the jury awarded him eight times that in punitive damages. The court also found a disparity between the punitive damages award and the maximum criminal penalty for slander and libel which in this case would have been $2,500. Here, the punitive damages award was twenty-four times the maximum criminal penalty, an indication of a "grossly excessive" amount of punitive damages.

For these reasons, the court found the punitive damages award to violate Ms. Kline-Perry's due process rights, and it reduced the award by 75% to $15,000. The court gave Mr. Ebersole ten days to accept the remitted amount or request a new trial. On September 5, 2012, he reluctantly accepted.

"Dirtiest Hotels" List is Rhetorical Hyperbole and Not Grounds for Defamation Action

September 11, 2012,

Kenneth M. Seaton, sole proprietor of the Grant Resort Hotel and Convention Center in Pigeon Forge, Tennessee, brought a defamation action against TripAdvisor after the hotel was identified by the travel site as the dirtiest hotel in America. The United States District Court for the Eastern District of Tennessee, however, found that TripAdvisor's list of "2011 Dirtiest Hotels" could not support a defamation claim and dismissed the case on August 22, 2012.

TripAdvisor relies solely on customer reviews to compile its "Dirtiest Hotels" list - it does not conduct an independent investigation of each hotel. Seaton claimed that TripAdvisor attempted to assure the public that its list is factual, reliable and trustworthy by including the following statements along with its list: (1) "World's Most Trusted Travel Advice"; (2) "TripAdvisor lifts the lid on America's Dirtiest Hotels"; (3) "Top 10 U.S. Crime-Scenes Revealed, According to Traveler Cleanliness Ratings"; (4) "Now, in its sixth year, and true to its promise to share the whole truth about hotels to help travelers plan their trips, TripAdvisor names and shames the nation's most hair-raising hotels"; (5) "This year, the tarnished title of America's dirtiest hotel goes to Grand Resort Hotel and Convention Center, in Pigeon Forge, Tennessee." The list quoted a TripAdvisor user: "There was dirt at least ½ inch thick in the bathtub which was filled with lots of dark hair." The list also featured a photograph of a ripped bedspread.

Defamation claims require proof of false statements or false implications. Seaton contended that by publishing its "2011 Dirtiest Hotels" list, TripAdvisor was implying that the Grand Resort Hotel and Convention Center was, in fact, the dirtiest hotel in the United States and that a reasonable person reading the list would consider this supposed fact in making their travel plans. Seaton argued that the list was not mere hyperbole because it dirtyhotels.jpgcontained actual numerical rankings with comments suggesting that the rankings were based in actual fact.

The court agreed that a reasonable person might consider the list when making hotel plans, but found that "propensity to initiate negative mental contemplation on behalf of a potential patron" is not the test for defamation. In determining whether TripAdvisor's list is defamatory, the court would not consider whether the list is compelling but rather whether a reasonable person could understand the language in question as an assertion of fact or instead merely hyperbolic opinion or rhetorical exaggeration.

The court found that neither the fact that TripAdvisor numbered its opinions one through ten nor that it supported its opinions with data converts its opinions to objective statements of fact. A reasonable person would not confuse a ranking system based on consumer reviews for an objective assertion of fact. Rather, a reasonable person would know that the list reflected the opinions of TripAdvisor's online users. Seaton did not plead any facts that would lead the court to find that TripAdvisor made a statement of fact or of opinion that it intended readers to believe was based on facts. Finally, the court found that although unverified online user reviews are a poor evaluative method, the system is not sufficiently erroneous so as to be labeled defamatory. For these reasons, the court held that TripAdvisor's "Dirtiest Hotels" list is unverifiable rhetorical hyperbole and could not form the basis of a defamation action.