Suzuki Motor Corp. v. Consumers Union of U.S., 00-56043.

• Citation: 330 F.3d 1110
• Decision Date: 19 May 2003
• Docket Number: No. 00-56043.,00-56043.
• Parties: SUZUKI MOTOR CORPORATION and American Suzuki Motor Corporation, Plaintiff-Appellant, v. CONSUMERS UNION OF UNITED STATES, INC., a non-profit New York Corporation, Defendant-Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (9th Circuit)

330 F.3d 1110 SUZUKI MOTOR CORPORATION and American Suzuki Motor Corporation, Plaintiff-Appellant,
v.
CONSUMERS UNION OF UNITED STATES, INC., a non-profit New York Corporation, Defendant-Appellee. No. 00-56043. United States Court of Appeals, Ninth Circuit. Argued and Submitted February 12, 2002. Filed May 19, 2003.

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Robert B. Fiske, Jr., Michael P. Carroll, William C. Komaroff, Davis, Polk & Wardwell, New York, NY, Gene S. Schaerr,

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David J. Lewis, Paul J. Zidlicky, Michael S. Lee, Sidley & Austin, Washington, DC, James Harris, Sidley & Austin, Los Angeles, CA, George F. Ball, Newport Beach, CA, for the plaintiff-appellant.

Michael N. Pollet, Pollet & Felleman, Yonkers, NY, for the defendant-appellee.

John H. Clarke, Washington, DC, for amicus curiae Accuracy in Media, Inc.; Kieran P. Fallon, Miami, FL, for amici curiae Bill Seidle Suzuki, Bob Lewis Suzuki, David O'Neal Suzuki, Five Star Suzuki, Jim Hudson Suzuki, and Roger Beasley Suzuki; and Richard A. Samp, Washington, DC, for amicus curiae Washington Legal Foundation, all seeking reversal.

Appeal from the United States District Court for the Central District of California; Alicemarie H. Stotler, District Judge, Presiding. D.C. No. CV 96-00340 AHS.

Before FERGUSON, TASHIMA, and GRABER, Circuit Judges.

ORDER

The opinion and dissenting opinion, filed June 25, 2002, slip op. at 9009, 292 F.3d 1192, are withdrawn and replaced by the amended opinion, concurring opinion, and dissenting opinion filed concurrently with this order. With these amendments, the panel has voted to deny the petition for rehearing en banc, with Judge Ferguson recommending that the petition be granted.

The full court was advised of the petition for rehearing en banc. A judge of the court called for a vote on whether to rehear the matter en banc. On such vote, a majority of the nonrecused active judges failed to vote in favor of en banc rehearing.^*

The petition for rehearing en banc is denied.

KOZINSKI, Circuit Judge, with whom PREGERSON, REINHARDT, T.G. NELSON, MICHAEL DALY HAWKINS, THOMAS, McKEOWN, WARDLAW, WILLIAM A. FLETCHER, FISHER and BERZON, Circuit Judges, join, dissenting from denial of rehearing en banc.

For over half a century, Consumers Union has been testing and rating consumer products and publishing the results in its magazine, Consumer Reports. A significant portion of the American public relies on CU's ratings on a regular basis, and almost everyone consults Consumer Reports now and then before making a significant purchase — whether a sound system, a dishwasher or a car. What makes CU's ratings particularly useful is the thorough explanation of the testing procedures employed, which lets consumers judge whether the ratings fairly represent the product.

The Suzuki Samurai article, the subject of this lawsuit, is no exception. Running some 6500 words, it tells readers precisely how CU came to conclude that "The Suzuki rolls over too easily," starting with an incident during the vehicle's break-in period where the Samurai "flopped over on its side" during a low-speed maneuver. The explanation is not written for morons; like other CU reviews, it is geared to an intelligent, informed consumer. Yet the careful reader will not fail to understand the central facts that undergird Suzuki's claim in this lawsuit, namely, that the Samurai did well on CU's standard course, that CU then modified the course to make it more challenging and, as a result, the Samurai did far worse than its competitors.

I find it incomprehensible that a review truthfully disclosing all this information could be deemed malicious under New York Times Co. v. Sullivan, 376 U.S. 254, 84 S.Ct. 710, 11 L.Ed.2d 686 (1964). If CU can be forced to go to trial after this

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thorough and candid disclosure of its methods, this is the death of consumer ratings: It will be impossible to issue a meaningful consumer review that a band of determined lawyers can't pick apart in front of a jury. The ultimate losers will be American consumers denied access to independent information about the safety and usefulness of products they buy with their hard-earned dollars. The majority sets a dangerous precedent, and the full court errs grievously by failing to take the case en banc to correct the error.

1. The majority's analysis is tainted throughout by its failure to articulate, much less apply, a coherent theory of the "independent examination" rule, a key element of the New York Times regime. When a public figure sues his critics for defamation, we "must `make an independent examination of the whole record,' so as to assure ourselves that the judgment does not constitute a forbidden intrusion on the field of free expression." Id. at 285, 84 S.Ct. 710 (citation omitted). This rule "assigns to judges a constitutional responsibility that cannot be delegated to the trier of fact, whether the factfinding function be performed in the particular case by a jury or by a trial judge." Bose Corp. v. Consumers Union of U.S., Inc., 466 U.S. 485, 501, 104 S.Ct. 1949, 80 L.Ed.2d 502 (1984).¹ It is "a rule of federal constitutional law" that "reflects a deeply held conviction that judges ... must exercise such review in order to preserve the precious liberties established and ordained by the Constitution." Id. at 510-11, 104 S.Ct. 1949.

We have heretofore sensibly assumed that the independent examination rule calls for us to do something more than we would normally do. After all, it hardly "preserve[s] the precious liberties established and ordained by the Constitution" to treat a First Amendment case the same as a slip-and-fall. When we review a jury verdict under New York Times, we don't "independently examine" the record merely by considering all the evidence — we already do that in every case anyway. See Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150, 120 S.Ct. 2097, 147 L.Ed.2d 105 (2000) ("[I]n entertaining a motion for judgment as a matter of law, the court should review all of the evidence in the record."). Nor do we merely review de novo the trial judge's determination whether a jury question exists — again, we already do that in every case. See Janes v. Wal-Mart Stores Inc., 279 F.3d 883, 886 (9th Cir.2002) ("We review a district court's denial of a motion for judgment as a matter of law de novo. ..."). First Amendment independent examination is an additional protection that the Constitution affords publishers.

Where there are genuine evidentiary disputes over particular factual predicates of actual malice — such as questions about a witness's credibility — the issue is for the jury. The judge does not weigh the evidence to find those historical facts, but instead makes a routine sufficiency determination. See Masson v. New Yorker Magazine, Inc., 501 U.S. 496, 520, 111 S.Ct. 2419, 115 L.Ed.2d 447 (1991); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). After resolving the predicate factual disputes in the plaintiff's favor, however, the judge must take the further step of independently "determin[ing] whether the record establishes actual malice with convincing clarity." Bose, 466 U.S. at 514, 104 S.Ct. 1949; see Eastwood v. Nat'l Enquirer, Inc., 123 F.3d 1249, 1252 (9th Cir.1997).² And that process is not a routine sufficiency determination, because it does involve weighing the evidence. If it did

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not, the independent examination rule would be meaningless.

The majority ignores these principles and instead treats the rule as nothing more than de novo review of the trial judge's sufficiency ruling. On this theory, independent examination is exactly what we do whenever we consider a trial judge's determination that a case does not present a triable issue. Of course, de novo review in this sense actually hurts CU because the district court sided with it below.

The majority relies on Bose and Hoffman v. Capital Cities/ABC, Inc., 255 F.3d 1180, 1186 (9th Cir.2001), for the point that independent examination means the same thing as de novo review. But those cases involved a very different use of the term: not de novo review of the lower court's sufficiency-of-the-evidence determination, but de novo review of the underlying question whether the defendant acted with actual malice. The former type of review is what we do in every case where a party appeals a grant of summary judgment or a denial of judgment as a matter of law. It's the latter type — weighing the evidence on the ultimate question of actual malice — that constitutes independent examination.³

The majority seems willing to concede that independent examination has some bite after the verdict. But it refuses to "conflate[ ]" this post-verdict standard with the summary judgment one. Am. op. at 1132. By decoupling the two standards, the majority conflicts directly with Supreme Court precedent. As the Court explained in Anderson, "[T]here is no issue for trial unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party." 477 U.S. at 249, 106 S.Ct. 2505. Because the court must ultimately review a plaintiff's verdict under the independent examination rule, it necessarily follows that it must apply that same standard at summary judgment.

The practical effect of the panel's decision is that our review for sufficiency at summary judgment is now governed by one standard, while our review after a jury verdict is governed by another. Cases will now often proceed to trial, even though the court can tell ahead of time that the plaintiff's evidence will not support a jury verdict under New York Times. What possible purpose is served by conducting such mock trials? Are they held just in case new evidence materializes midway through trial? Or merely to give the lawyers trial experience? I know of no other context where we allow a plaintiff to get to trial with a factual record that will not support a verdict in his favor.⁴

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