Libel

Reporting on Lawsuit—but Not Mentioning It Was Settled—Is Not Libelous

So the New Jersey Supreme Court held this morning, in Petro-Lubricant Testing Laboratories, Inc. v. Adelman.

|The Volokh Conspiracy |

You publish something on your blog reporting about a lawsuit. You accurately report the factual claims alleged in the complaint, which means you're protected by the so-called "fair report" privilege even if the allegations prove to be false. But you don't mention that the case was settled—does that make your report so incomplete that it is libelous?

No, said the New Jersey Supreme Court today in Petro-Lubricant Testing Laboratories, Inc. v. Adelman (link added):

[Plaintiff John] Wintermute argues that Adelman should be stripped of the privilege because the modified article failed to report that Wintermute and Laforgia had settled the case. A settlement of the lawsuit, however, is not an adjudication of the truth or falsity of a complaint's allegations. The fair report privilege may not protect a publication that only reprints the allegations but not the favorable verdict.

A settlement, however, is different from a favorable verdict. A settlement generally "reflects ambiguously on the merits of the action" and is not a determination of whether the allegations are true or false.

Here, the parties agreed that the terms of the settlement would remain confidential, and therefore the settlement terms were not made available to the public. Nothing in the record suggests that the settlement, which resulted in a dismissal of the complaint, constituted a judgment on the merits or on the truth or falsity of the allegations. In the mind of some readers, reference to a settlement might even have suggested an admission of fault.

In short, we conclude that the modified article is a full, fair, and accurate account of a court-filed complaint alleging gender discrimination, workplace harassment, and retaliation and is protected by the fair report privilege.

Of course, it is probably good practice to mention that a case was settled when writing about the complaint, just because it offers more information to readers. But neglecting to do so is not libelous. (The result may be different, as the court points out, if one fails to mention a defense verdict, that may not satisfy the fair report privilege's precondition that the story be a "full, fair, and accurate" summary of court documents.)

This is particularly important because, in some situations, a publisher might be liable for a post that was privileged when first posted, but that becomes libelous later. That could happen when the story is updated enough to be treated as a new publication (which the court held happened here). It could also happen if the state generally takes the view that there is a duty to take down one's recent defamatory allegations, once one knows they are false. But even in such situations, the New Jersey Supreme Court concludes, it's not libelous to fail to mention the settlement.

Disclosure: My students Nate Barrett, Charles Linehan and Michael Smith and I filed a friend of the court brief in the case, via my Scott & Cyan Banister First Amendment Clinic, on behalf of the Reporters Committee for Freedom of the Press, and I also argued on behalf of amici in the Appellate Division and before the New Jersey Supreme Court; many thanks to our invaluable pro bono local counsel, Daniel Schmutter of Hartman & Winnicki.

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  1. An anti-Bob Menendez PAC is currently running ads against him which cite, in excruciating detail, the corruption charges against him but make no mention of his acquittal on those charges. All’s fair, I guess…

    1. As the court’s opinion suggests, and as I mention, mentioning an allegation without mentioning a defense verdict might — depending on the circumstances — be libelous. (I can’t speak about the details of the Menendez prosecution, or the ads you mention.) This case dealt just with failure to mention settlements, which is a different matter.

      1. Interesting issue. A criminal acquittal only means that there was not proof beyond a reasonable doubt. The defendant may yet be guilty, even probably guilty and still be acquitted. So not clear how that factors into a collateral libel case.

        1. An prosecutions means that the prosecutor believed that there was proof beyond a reasonable doubt. An acquittal means that the jury said, no, no there isn’t.

          Even though an acquittal in the Anglo-Saxon system isn’t necessarily an absolute exoneration, it’s still a strong counter-argument to the belief represented by the indictment.

      2. I was trying to find the ad on YouTube, but I found a very similar official Hugin ad which describes in passing that Menendez “avoided prison,” which I guess is close enough? https://www.youtube.com/watch?v=1gWzMfmwMs8

        1. That seems a “captain sober today” sort of defamation. Most of us avoid prison most days.

  2. As far as the statement in the reasoning that some readers may interpret a settlement as admissjon of fault, how feasible/common is it to obtain a public admission of wrongdoing as part of a settlement?

    1. Superficially ? ianal ? it seems settlements are more likely to exclude admissions of guilt than they are to include apologies.

      1. Right, but they seem the sort of thing angry plaintiffs would insist on.

        1. …and don’t get if they settle (if they’re angry enough, they can go to trial).

  3. I am opposed to confidentiality agreements once the courts get involved. If you want to use the courts as a bludgeon to get to a settlement, the settlement should be public knowledge. We paid for the courts, we should have access to the results.

    1. But one purpose of a settlement is to end the court’s involvement before judgement–that’s the result.

      If the court is not involved in the settlement of a civil dispute between two private parties, why is it that you believe the two parties shouldn’t be allowed to execute a simple private-party contract?

  4. As one of the plaintiff’s in the case, it is my opinion that failure to report on the known status of the case leaves the reader with a misleading impression and therefore the Fair Report Privilege should not be applied to the article. A settlement does not connote that there has been an admission of guilt. Rather, there are many reasons to settle any litigation, including, what many insurance companies do regularly – weigh the costs of litigation against the cost of the settlement. Failing to indicate that the settlement occurred implies that the litigation is on-going and a jury could still conclude that the allegations in the complaint are true; whereas, noting in the article that a settlement has been reached and case dismissed shows that no findings will ever be made. In fact, the original trial judge, Judge McGovern, reached this conclusion and initially ruled in favor of Petro. Regardless of whether reference to the settlement itself should render the article not a full fair and accurate accounting, we believe the Supreme Court was incorrect because it ignored Plaintiff’s evidence showing the report was not full, fair, and accurate. Among other things, there was evidence that the Ebosswatch post falsely accuses John Wintermute of “telling employees to lie to investigators” which is not an allegation contained in the complaint on which Asher Adelman was reporting.

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