Howard v. Antilla

• Decision Date: 28 June 2002
• Docket Number: No. 01-1643.,01-1643.
• Citation: 294 F.3d 244
• Parties: Robert HOWARD, Plaintiff, Appellee, v. Susan ANTILLA, Defendant, Appellant.
• Court: U.S. Court of Appeals — First Circuit

294 F.3d 244

Robert HOWARD, Plaintiff, Appellee, v. Susan ANTILLA, Defendant, Appellant.

No. 01-1643.

United States Court of Appeals, First Circuit.

Heard February 5, 2002.

Decided June 28, 2002.

Jonathan M. Albano, with whom Bingham Dana LLP, William L. Chapman and Orr & Reno were on brief, for appellant.

Robert A. Bertsche, Zick Rubin, Stuart Svonkin and Hill & Barlow were on brief, for ABC, Inc., Bloomberg L.P., CBS Broadcasting, Inc., Dow Jones & Company, Inc., The National Broadcasting Co., Inc., NYP Holdings, Inc., Time Inc., Ziff Davis Media, Inc., The Association of American Publishers, Inc., and The Newspaper Association of America, Inc., amici curiae.

Charles G. Douglas, III, with whom C. Kevin Leonard, V. Richards Ward, Jr. and Douglas, Leonard & Garvey, P.C. were on brief, for appellee.

Before TORRUELLA and LIPEZ, Circuit Judges, and SARIS,^* District Judge.

TORRUELLA, Circuit Judge.

The plaintiff, chairman of a publicly-traded company, brought suit against the defendant, a newspaper reporter, for defamation and false light invasion of privacy. At the end of the trial, the jury returned a sizeable verdict in favor of the plaintiff on his claim for false light invasion of privacy, but a take-nothing verdict on the defamation claim. For the reasons stated below, we vacate the jury's verdict on the false light claim and order an entry of judgment in favor of the defendant.

I.

Defendant-appellant Susan Antilla ("Antilla") was a business reporter for The New York Times ("The Times"), where her writing focused mostly on explaining the financial world to the average investor. At the time of the events in this case, Antilla had approximately 18 years of experience reporting on business news for a variety of publications. Her experience included stints as a reporter at Dunn's Review, as a stock market reporter at USA Today, and as the financial news bureau chief in New York for the Baltimore Sun. Antilla was also an adjunct professor at New York University, teaching business journalism in the graduate journalism department.

In the fall of 1994, Antilla learned of a rumor circulating on Wall Street concerning plaintiff-appellee Robert Howard ("Howard"), who was then the chairman of two publicly-traded companies, Presstek, Inc. and Howtek, Inc. The substance of the rumor was that Howard was in fact Howard Finkelstein ("Finkelstein"), a convicted felon. Finkelstein, who had been known to use the name Robert Howard as an alias, had prior convictions for securities fraud, violation of the White Slave Act conspiracy to defraud, and interstate transportation of stolen property.

Antilla learned of the rumor from confidential sources whom she knew to be "short sellers" of Presstek stock. "Short selling" is a transaction in which an investor borrows shares of stock, sells them, and later buys an equivalent amount of shares to return the borrowed shares. The potential for profit in short selling lies in the possibility that the stock price will decline between the time the short seller sells the borrowed stock and the time he must purchase replacement shares to repay the borrowed stock.

Antilla perceived a newsworthy correlation between the circulation of the short sellers' "dual identity" rumor and recent fluctuations in the price of Presstek stock. In order to generate a story on the topic, she investigated the rumor for over a month, interviewing roughly thirty people including Howard himself, Howard's son, and officials from the Securities and Exchange Commission ("SEC").

The article was published on October 27, 1994. Headlined "Is Howard Really Finkelstein? Money Rides on It," the article begins with the question "Is Robert Howard really Howard Finkelstein? A lot of investors in Mr. Howard's Presstek Inc. would like to know. But not even the Securities and Exchange Commission can say for sure. And the lingering mystery has roiled a hot stock and left the S.E.C. blushing."¹

A significant portion of the article details Antilla's efforts to obtain confirmation of the rumor's truth or falsity from the SEC. None of the three SEC officials with whom she spoke could definitively resolve the short sellers' rumor, in part because the agency had failed to input aliases into its computer record-keeping system. However, one SEC official stated that the SEC's "records don't indicate that [Howard] is anyone [other than who he claims to be]."

The article goes on to report that Howard had unequivocally denied the rumor and, further, that Howard's son, Dr. Lawrence Howard, had supplied "extensive documents" to show both his father's addresses at various times and that Howard and Finkelstein had different birth dates. However, the article also casts doubt on Dr. Howard's effort's to clear his father's name by noting his "reluctance ... to be forthcoming about several questions." In particular, the article recounts that, when asked to supply names of his father's children and stepchildren, Dr. Howard "would entertain the question only if first supplied with the names of Mr. Finkelstein's children and stepchildren." The article also states that Dr. Howard had declined to provide a full copy of testimony his father had given in a proceeding before the SEC earlier that year.

At the same time, the article also casts doubt on the credibility of short sellers who were pushing the rumor and who stood to profit from a decline in Presstek stock. For example, a separate side bar (under the headline "Wall St. Story: Jumbled Fact") detailed false information that the short sellers had provided to Antilla, including an erroneous report that Howard had earlier admitted to going by the name Finkelstein and a bogus tip that directory assistance gave the same telephone number for both Robert Howard and Howard Finkelstein.²

On the day of publication, lawyers for Howard met with senior management for The Times as well as Antilla. During that meeting Howard's representatives provided additional information, including passports not previously shown to Antilla, that corroborated Howard's denial of the rumor. Howard's representatives also disclosed that Howard would be returning to the United States from France to be fingerprinted by the SEC in order to conclusively refute the rumor.

That same day, Antilla received a phone call from Fred Newman ("Newman"), a lawyer who previously had represented Finkelstein. Before the article's publication, Antilla had tried to reach Newman unsuccessfully to obtain independent confirmation of the truth or falsity of the rumor.³ Newman had not returned Antilla's calls, but after reading the article he telephoned her to say that, based upon the picture of Howard in The Times, the men were not the same person.

Based upon the information provided by Howard's representatives during the October 27 meeting, Howard's willingness to be fingerprinted, and the information received from attorney Newman, The Times published a correction and a front page business section article on October 28, 1994, stating that it had found "no credible evidence" to support the rumor and expressing regret that the rumor had been published.⁴

The SEC continued to take no public position on the truth of the rumor until November 1, 1994, when, on the basis of a fingerprint analysis conducted by the FBI, the SEC formally announced that Howard is not Finkelstein.

Almost three years later Howard filed the present action, naming Antilla, but not The Times, as a defendant. Howard's complaint contained counts for negligent defamation, libel, and false light invasion of privacy. After determining at the summary judgment phase that Howard is a limited public figure, the district court pared Howard's claims down to defamation and false light, and the case proceeded to trial.

At the end of the trial the jury returned a verdict in favor of Antilla on the defamation claim, but found in favor of Howard on the false light claim. The jury awarded Howard $480,000 in compensatory damages and nothing for "enhanced compensatory damages."⁵ Despite the seeming inconsistency in the jury's verdict, Antilla made no objection prior to the discharge of the jury.⁶ Instead, after the jury's discharge, she moved for judgment as a matter of law or, in the alternative, for a new trial or remitittur. The district court denied the motion, Howard v. Antilla, 160 F.Supp.2d 169 (D.N.H.2001), and Antilla's appeal of the false light verdict followed.

II.

A.

It is rare that the pedigree of a whole breed of common law tort claims can be traced with pinpoint accuracy. But in the case of common law claims for invasion of the right of privacy, most sources agree that the broad contours of these legal theories were first outlined by Samuel Warren and Louis Brandeis in the pages of the Harvard Law Review. See Samuel D. Warren & Louis D. Brandeis, The Right to Privacy, 4 Harv. L.Rev. 193 (1890); see also Harry Kalven, Jr., Privacy in Tort Law—Were Warren and Brandeis Wrong?, 31 Law & Contemp. Probs. 326, 327 (1966) (hailing Warren and Brandeis's article as the "most influential law review article of all"). Warren and Brandeis called generally for the recognition of an individual's legal right to control dissemination of information about himself when that information relates to nonpublic aspects of his life. See Warren & Brandeis, supra, at 214-16.

Later, as Warren and Brandeis's theories took root, Dean William Prosser distilled the amorphous legal protection of privacy into four distinct causes of action: (1) intrusion upon solitude; (2) public disclosure of embarrassing facts; (3) appropriation of an individual's name or likeness; and (4) publicly casting a person in a false light. See William Prosser, Privacy, 48 Cal. L.Rev. 383, 389 (1960). Dean Prosser's conception of the tort of false light invasion of privacy was ultimately accepted by the American Law Institute and set forth in the Restatement (Second) of Torts (1977) as follows:

One who gives publicity to a...