Mortg. Specialists, Inc. v. Implode-Explode Heavy Indus., Inc.

• Decision Date: 06 May 2010
• Docket Number: No. 2009–262.,2009–262.
• Citation: 160 N.H. 227,999 A.2d 184
• Court: New Hampshire Supreme Court
• Parties: The MORTGAGE SPECIALISTS, INC. v. IMPLODE–EXPLODE HEAVY INDUSTRIES, INC.

160 N.H. 227

999 A.2d 184

The MORTGAGE SPECIALISTS, INC.

v.IMPLODE–EXPLODE HEAVY INDUSTRIES, INC.

No. 2009–262.

Supreme Court of New Hampshire.

Argued: Nov. 4, 2009.

Opinion Issued: May 6, 2010.

Devine, Millimet & Branch, P.A., of Manchester (Alexander J. Walker and another on the brief, and Mr. Walker orally), for the petitioner.

Orr & Reno, P.A., of Concord (Jeremy D. Eggleton and William L. Chapman on the brief, and Mr. Eggleton orally), for the respondent.

Drummond Woodsum & MacMahon, of Portsmouth (Paul L. Apple on the brief), for Citizen Media Law Project and Reporters Committee for Freedom of the Press, as amici curiae.

Public Citizen Litigation Group, of Washington, D.C. (Paul Alan Levy on the brief), and Backus, Meyer & Branch, LLP, of Manchester (Jon Meyer on the brief), for Public Citizen, as amicus curiae.

CONBOY, J.

The respondent, Implode–Explode Heavy Industries, Inc. (Implode), appeals an order of the Superior Court (McHugh, J.) granting injunctive relief to the petitioner, Mortgage Specialists, Inc. (Mortgage Specialists). We vacate in part, reverse in part, and remand.

The record supports the following facts. Mortgage Specialists is a mortgage lender. Implode operates a website, www.ml-implode.com, that ranks various businesses in the mortgage industry on a ranking device that it calls "The Mortgage Lender Implode–O–Meter." On its website, Implode identifies allegedly "at risk" companies and classifies them as either "Imploded Lenders" or "Ailing/Watch List Lenders." The website allows visitors who register on the site and create usernames to post publicly viewable comments about lenders.

In August 2008, Implode published an article that detailed administrative actions taken by the New Hampshire Banking Department against Mortgage Specialists. In this article, Implode posted a link to a document that purported to represent Mortgage Specialists' 2007 loan figures (Loan Chart). In response to the article, an anonymous website visitor with the username "Brianbattersby" posted two comments regarding Mortgage Specialists and its president.

After Mortgage Specialists became aware of the article and postings, it petitioned for injunctive relief, alleging that publication of the Loan Chart was unlawful because it violated RSA 383:10–b (2006) (mandating confidentiality of all investigative reports and examinations by the New Hampshire Banking Department) and that Brianbattersby's postings were false and defamatory. Mortgage Specialists requested that Implode immediately remove the Loan Chart and postings from its website. Mortgage Specialists further demanded that Implode disclose both the identity of Brianbattersby and the source of the Loan Chart.

The trial court granted the requested relief and ordered as follows:

1. [Implode], and all of its agents, servants, employees, and representatives, are enjoined from displaying, posting, publishing, distributing, linking to and/or otherwise providing any information for the access or other dissemination of copies of and/or images of a 2007 Loan Chart and any information or data contained therein, including on the website operated at www.ml-implode.com and any other websites under [Implode's] ownership and control;

2. [Implode] is ordered to immediately disclose the identity of the individual and/or entity that provided it with the 2007 Loan Chart;

3. [Implode] is ordered to immediately produce all documents that concern petitioner that it received from the individual or entity that provided it with the 2007 Loan Chart;

4. [Implode] is ordered not to re-post or re-publish the October 4, 2008, and October 7, 2008, false and defamatory postings by "Brianbattersby," and

5. [Implode] is ordered to immediately disclose the identity of "Brianbattersby," including his full name, address, email address, phone number, and any other personal information [Implode] possesses.

On appeal, Implode argues that the trial court erred in ordering the disclosure of the sources of the Loan Chart and Brianbattersby's postings, ordering production of all documents concerning Mortgage Specialists received from the Loan Chart source, and enjoining the republication of the Loan Chart and Brianbattersby's postings.

I. Disclosure of Sources

Implode first asserts that the trial court erred in ordering it to disclose the identities of the Loan Chart source and Brianbattersby's postings because the First Amendment to the Federal Constitution and Part I, Article 22 of the New Hampshire Constitution protect a speaker's right to anonymity. The trial court did not analyze Mortgage Specialists' disclosure requests under either constitutional provision. We first address Implode's claims under the State Constitution, and cite federal opinions for guidance only. State v. Ball, 124 N.H. 226, 231–33, 471 A.2d 347 (1983).

A. Loan Chart

Implode argues that the newsgathering privilege under Part I, Article 22 of the New Hampshire Constitution protects the identity of the source of the Loan Chart. Mortgage Specialists disputes that Implode is a news organization, and therefore argues that this constitutional protection is unavailable to Implode. It also argues, in the alternative, that its right to disclosure of the Loan Chart source outweighs any potential harm to the free flow of information.

In Opinion of the Justices, 117 N.H. 386, 389, 373 A.2d 644 (1977), we considered whether a news reporter could be ordered to disclose the sources of information utilized in preparing a series of articles. In holding that the reporter could not be so ordered, we recognized the existence of a reporter's privilege in civil proceedings involving the press as a non-party. Id. at 389–90, 373 A.2d 644; see Associated Press v. State of N.H., 153 N.H. 120, 128, 888 A.2d 1236 (2005) ; Petition of Keene Sentinel, 136 N.H. 121, 127, 612 A.2d 911 (1992).

Our constitution quite consciously ties a free press to a free state, for effective self-government cannot succeed unless the people have access to an unimpeded and uncensored flow of reporting. News gathering is an integral part of the process. One study showed that more than ninety percent of the reporters surveyed believed protection of identity was more important than protection of contents.

Opinion of the Justices, 117 N.H. at 389, 373 A.2d 644. However, we did "not decide the scope of the privilege, whether it was absolute, who is a reporter, what qualifies as ‘press,’ ... or whether libel actions would require disclosure." Id. In Keene Publishing Corp. v. Keene District Court, 117 N.H. 959, 961, 380 A.2d 261 (1977), we acknowledged that the right of the press to gather news is "not unlimited."

Although our cases discussing the newsgathering privilege have involved traditional news media, such as newspapers, see, e.g., Keene Pub. Corp., 117 N.H. at 960, 380 A.2d 261, we reject Mortgage Specialists' contention that the newsgathering privilege is inapplicable here because Implode is neither an established media entity nor engaged in investigative reporting. The trial court implicitly found that Implode is a "legitimate publisher of information" and a member of the press. The court further noted that it "has every reason to believe that [Implode] is a reputable entity desirous of only publishing legitimate information about the mortgage industry to various interested parties." Moreover, we observe that:

Freedom of the press is a fundamental personal right which is not confined to newspapers and periodicals.... The press in its historic connotation comprehends every sort of publication which affords a vehicle of information and opinion. The informative function asserted by representatives of the organized press ... is also performed by lecturers, political pollsters, novelists, academic researchers, and dramatists. Almost any author may quite accurately assert that he is contributing to the flow of information to the public, that he relies on confidential sources of information, and that these sources will be silenced if he is forced to make disclosures.

Branzburg v. Hayes, 408 U.S. 665, 704, 92 S.Ct. 2646, 33 L.Ed.2d 626 (1972) (quotations and citations omitted). The fact that Implode operates a website makes it no less a member of the press. In light of the trial court's implicit findings, we conclude that Implode's website serves an informative function and contributes to the flow of information to the public. Thus, Implode is a reporter for purposes of the newsgathering privilege.

We also reject Mortgage Specialists' alternative argument that if Implode is considered a reporter, then Downing v. Monitor Publishing Co., Inc., 120 N.H. 383, 415 A.2d 683 (1980), is controlling and disclosure is warranted. In Downing, the issue was whether the defendant-newspaper in a libel case should be required to disclose the source of allegedly defamatory information it published.

Id. at 384, 415 A.2d 683. In holding that it should, we also held that "there is no absolute privilege allowing the press to decline to reveal sources of information when those sources are essential to a libel plaintiff's case." Id. at 386, 415 A.2d 683. We established that a "plaintiff must satisfy the trial court that he has evidence to establish that there is a genuine issue of fact regarding the falsity of the publication." Id. at 385–87, 415 A.2d 683. Critical to our ultimate ruling that source disclosure was required was the fact that as a public official, the plaintiff was required to prove that the defendant-newspaper acted with actual malice. Id. at 385, 415 A.2d 683. Here, Mortgage Specialists does not seek damages against Implode for libel. As the trial court found,

[Mortgage Specialists] does not "blame" [Implode] for the publishing of the unauthorized and allegedly defamatory website postings, and it asks for no sanctions or money damages as against the respondent. [Mortgage Specialists] does not claim that [Implode] had some duty or responsibility to verify the information with respect to either the

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