Diversified Management, Inc. v. Denver Post, Inc., 81SA491

• Decision Date: 15 November 1982
• Docket Number: No. 81SA491,81SA491
• Citation: 33 A.L.R. 193,653 P.2d 1103
• Parties: , 8 Media L. Rep. 2505 DIVERSIFIED MANAGEMENT, INC., a Colorado corporation and Eugene DeWitt, Plaintiffs-Appellants, v. The DENVER POST, INC., a Colorado corporation, and John Toohey, Defendants-Appellees.
• Court: Colorado Supreme Court

Page 1103

653 P.2d 1103

33 A.L.R.4th 193, 8 Media L. Rep. 2505

DIVERSIFIED MANAGEMENT, INC., a Colorado corporation and Eugene DeWitt, Plaintiffs-Appellants, v. The DENVER POST, INC., a Colorado corporation, and John Toohey, Defendants-Appellees.

No. 81SA491.

Supreme Court of Colorado En Banc.

Nov. 15, 1982.

Keller, Dunievitz & Johnson, Alex Stephen Keller, Denver, for plaintiffs-appellants.

Cooper & Kelley, P.C., Thomas B. Kelley, Paul D. Cooper, Denver, for defendants-appellees.

ROVIRA, Justice.

This is an appeal from a jury verdict in favor of defendants-appellees, The Denver Post and John Toohey, a Denver Post reporter, in a libel action brought by plaintiffs-appellants, Eugene DeWitt and Diversified Management, Inc. (DMI). Appellants' contention is that the district court committed reversible error in a number of its instructions to the jury. We disagree.

This litigation arose out of two articles written by Toohey and published by the Post on April 28 and May 12, 1974. The articles dealt with certain financial dealings of the appellants and described the relationship between DeWitt, his company (DMI), and a banker named Saul Davidson. The articles also discussed investigations of DeWitt by the Colorado Real Estate Commission, the U.S. Department of Housing and Urban Development, an Arizona grand jury, the U.S. Postal Service, and "a variety of other federal and state regulatory and law-enforcement agencies."

In 1975 a complaint was filed by appellants which included claims for libel, invasion of privacy, outrageous conduct, and conspiracy to violate civil rights under 42 U.S.C. sections 1983 and 1985. The appellees denied liability and pleaded as defenses that the appellants were public figures and that the publications involved matters of public or general concern. Subsequently, the trial court granted a partial summary judgment in favor of appellees, ruling, as a matter of law, that certain of the challenged statements were not defamatory as a matter of law.

Trial began in October 1979, and at the close of evidence all claims except those of libel were dismissed. After over three weeks of trial, the libel claims were submitted to the jury, which returned a verdict in favor of appellees.

Appellants appealed to the court of appeals. Because constitutional issues were raised, we accepted a transfer of jurisdiction pursuant to section 13-4-110(1)(a), C.R.S.1973. See section 13-4-102(1)(b), C.R.S.1973.

I.

In New York Times v. Sullivan, 376 U.S. 254, 84 S.Ct. 710, 11 L.Ed.2d 686 (1964), the United States Supreme Court began what has been a long process of "constitutionalizing" the law of libel. The Court there held that the first and fourteenth amendments to the United States Constitution prohibit a public official from recovering damages for a defamatory falsehood relating to his official conduct unless he proves with "convincing clarity" that the statement was made with "actual malice"--that is, with knowledge that the statement was false or with reckless disregard of whether it was false or not. The Court found the rule necessary to prevent "self-censorship" on the part of the press, which in the absence of the rule would make only statements that "steer far wider of the unlawful zone." 376 U.S. at 279, 84 S.Ct. at 725-726 (quoting Speiser v. Randall, 357 U.S. 513, 526, 78 S.Ct. 1332, 1342, 2 L.Ed.2d 1460 (1958)). The Court believed the rule to be an appropriate balance between the competing interests of protection of reputation and the ability to engage in "uninhibited, robust, and wide-open" debate on public issues.

The rule of New York Times was extended to include "public figures" in Curtis Publishing Co. v. Butts, 388 U.S. 130, 87 S.Ct. 1975, 18 L.Ed.2d 1094 (1967). The opinion covered two separate libel actions. The first, Curtis Publishing Co. v. Butts, involved an article in the Saturday Evening Post which stated that a college football coach had conspired to "fix" a football game. The second, Associated Press v. Walker, involved a news story that a former army general had led a charge against federal marshals attempting to enforce a desegregation decree at the University of Mississippi. The Court stated:

"Butts may have attained that status by position alone and Walker by his purposeful activity amounting to a thrusting of his personality into the "vortex" of an important public controversy, but both commanded sufficient public interest and had sufficient access to the means of counterargument to be able 'to expose through discussion the falsehood and fallacies' of the defamatory statements."

388 U.S. at 155, 87 S.Ct. at 1991 (quoting Whitney v. California, 274 U.S. 357, 377, 47 S.Ct. 641, 649, 71 L.Ed. 1095 (1927)) (Brandeis, J., dissenting).

The Court in Butts stated that "[t]he guarantees of freedom of speech and press were not designed to prevent 'the censorship of the press merely, but any action of the government by means of which it might prevent such free and general discussion of public matters as seems absolutely essential ....' " 388 U.S. at 150, 87 S.Ct. at 1989 (quoting 2 Cooley, Constitutional Limitations 886 (8th ed.)). Although the issues in Butts differed from those in New York Times, supra, in that the actions could not be analogized to prosecutions for seditious libel, the Court held that the public interest in the circulation of the materials involved was equally important.

The Supreme Court has described two ways that one might become a public figure:

"For the most part those who attain this status have assumed roles of especial prominence in the affairs of society. Some occupy positions of such persuasive power and influence that they are deemed public figures for all purposes. More commonly, those classed as public figures have thrust themselves to the forefront of particular public controversies in order to influence the resolution of the issues involved. In either event, they invite attention and comment."

Gertz v. Robert Welch, Inc., 418 U.S. 323, 345, 94 S.Ct. 2997, 3009, 41 L.Ed.2d 789 (1974).

In Rosenbloom v. Metromedia, Inc., 403 U.S. 29, 91 S.Ct. 1811, 29 L.Ed.2d 296 (1971), a plurality of the Supreme Court adopted a standard which extended the New York Times rule to "all discussion and communication involving matters of public or general concern." The opinion stated that "[f]reedom of discussion, if it would fulfill its historic function in this nation, must embrace all issues about which information is needed or appropriate to enable the members of society to cope with the exigencies of their period." 403 U.S. at 41, 91 S.Ct. at 1818 (quoting Thornhill v. Alabama, 310 U.S. 88, 102, 60 S.Ct. 736, 744, 84 L.Ed. 1093 (1940)). The plurality rejected the idea that the purpose of a free press was only to protect criticism of government, stating that the Founders believed that a free press would advance "truth, science, and morality" as well.

The Rosenbloom plurality criticized a rule that would protect only defamation of public officials and public figures, pointing out that the public interest in the incident at the University of Mississippi at issue in Associated Press v. Walker, supra, would have been the same if the speaker had been an anonymous student and not a well-known retired army general. Moreover, General Walker's fame stemmed from events completely unconnected with the episode in Mississippi. The plurality went on to state:

"If a matter is a subject of public or general interest, it cannot suddenly become less so merely because a private individual is involved, or because in some sense the individual did not 'voluntarily' choose to become involved. The public's primary interest is in the event; the public focus is on the conduct of the participant and the content, effect, and significance of the conduct, not the participant's prior anonymity or notoriety."

403 U.S. at 43, 91 S.Ct. at 1819.

A majority of the Supreme Court declined to adopt the Rosenbloom plurality standard in Gertz v. Robert Welch, Inc., supra, holding that "so long as they do not impose liability without fault, the States may define for themselves the appropriate standard of liability for a publisher or broadcaster of defamatory falsehood injurious to a private individual." 418 U.S. at 347, 94 S.Ct. at 3010.

Following Gertz, we adopted the plurality standard from Rosenbloom, with the limitation that "reckless disregard" for whether a statement is true does not mean that the person must have had serious doubts as to its truth. That is, we adopted Rosenbloom, but without the definition of reckless disregard added by St. Amant v. Thompson, 390 U.S. 727, 88 S.Ct. 1323, 20 L.Ed.2d 262 (1968), to the definition of "actual malice." Walker v. Colorado Springs Sun, Inc., 188 Colo. 86, 538 P.2d 450 (1975). We stated:

"We hold that, when a defamatory statement has been published concerning one who is not a public official or a public figure, but the matter involved is of public or general concern, the publisher of the statement will be liable to the person defamed if, and only if, he knew the statement to be false or made the statement with reckless disregard for whether it was true or not."

188 Colo. at 98-99, 538 P.2d at 457. We reached that result because we believed that a simple negligence rule would have a chilling effect on the press that would be more harmful to the public interest than the possibility that a defamed private individual would go uncompensated. In order to honor the commitment to robust debate embodied in the first amendment and to ensure sufficient scope for first amendment values, we chose to extend constitutional protection to any discussion involving matters of public concern, irrespective of the notoriety or anonymity of those involved.

The considerations which led to our adoption of Rosenbloom now cause us to conclude that first amendment values would be better honored by adopting the same definition of "reckless disregard" in cases involving...