An Absence of Malice

By Janice Castro

The Supreme Court rules in favor of Consumers Union

It's time for a feast," So declared New York Lawyer Floyd Abrams last week after the Supreme Court handed the U.S. press its first major libel victory in more than a decade. The case involved Consumers Union, the publisher of the product-rating magazine Consumer Reports (estimated circ. 3 million). The nonprofit organization had lost a $210,000 libel judgment to Bose Corp., a Massachusetts electronics manufacturer, for a 1970 article that criticized one of the firm's loudspeakers. A federal appeals court overturned the award in November 1982. The Supreme Court upheld that decision by a 6-to-3 vote and in doing so underscored the vital role of appellate courts in reviewing libel actions. Writing for the majority, Justice John Paul Stevens argued that judges must satisfy themselves that "the record establishes actual malice with convincing clarity."

In defending the right of free expression in published criticism, the court reassured journalists and lawyers who feared that the Justices might undermine their 1964 ruling in New York Times vs. Sullivan. That decision established that to sue journalists for libel, public officials--later extended to public figures--must prove "actual malice," meaning that statements were made with the knowledge that they were false, or with reckless disregard for the truth. Said Rochester, N.Y., Libel Attorney John McCrory: "We were all terribly worried that the court was ready to repudiate Sullivan by abandoning it as a standard, or eroding it." That, says Lawyer Abrams, would have "changed the world in terms of libel." Instead, he said, the court has produced a "landmark decision" preserving a law that "seemed in jeopardy."

The ruling was also a relief for reviewers. Last December a Manhattan jury awarded libel damages to a restaurateur who sued a publisher over an article that criticized his food. That verdict seemed to threaten all critics whose reviews are less than glowing. Had last week's Supreme Court decision gone the other way, says William Rice, editor of Food & Wine magazine, "it would have caused us a great deal of hesitation and soul searching in terms of what we could and should print."

The Justices may have helped discourage arbitrary libel actions against the press by reaffirming the right of appellate judges to conduct their own reviews in such cases. Said Washington Libel Lawyer Bruce Sanford: "This sends a message to libel plaintiffs that they can't go out and inflame the antinews bias of jurors and expect the appeals courts to wink." According to the Libel Defense Resource Center, journalists who are sued for libel lose 83% of jury trials, but win at the appeals level in 70% of the cases.

In the Consumer Reports article, an evaluation of several loudspeaker systems, the Bose model 901 was criticized for producing sounds that "tended to wander about the room." Bose Corp. sued in federal court in Boston, claiming product disparagement. After extensive testimony from the engineer responsible for the choice of words, the judge hearing the case ruled that the published statement had been false, since the sound actually wandered "along the wall." He further held that Consumers Union was guilty of malice because the engineer was too intelligent to have made the error inadvertently.

The U.S. Court of Appeals for the First Circuit rejected that reasoning. "Consumers Union was guilty of using imprecise language in the article," the court conceded in throwing out the award, but "this does not support an inference of actual malice." Bose went to the Supreme Court, where its attorneys argued that the appeals court had exceeded its authority by weighing the basic facts of the case--whether or not there was falsehood and malice--which is the responsibility of the trial court. Not so, concluded Stevens for the majority, ruling in effect that First Amendment guarantees of free speech are so important that appellate courts' right of review in such cases should not be limited to just legal issues. Judges, wrote Stevens, "must exercise such review in order to preserve the precious liberties established and ordained by the Constitution." As for the appellate court decision in the Consumers Union case, he wrote: "We agree with the Court of Appeals that the difference between hearing violin sounds move around the room and hearing them wander back and forth fits easily within the breathing space that gives life to the First Amendment."

Consumers Union's victory has cost several hundred thousand dollars in legal fees. Even so, if the Consumers Union decision helps weed out libel actions of little merit, the public interest will have been served. Said Consumers Union Executive Director Rhoda Karpatkin: "Our determination to go to the wall on this case rather than settle it anywhere along the way has been vindicated."

--By Janice Castro. Reported by Anne Constable/Washington and Raji Samghabadi/New York

With reporting by Anne Constable/Washington, Raji Samghabadi/New York