Suzuki Motor Corp. v. Consumers Union of U.S.
| Decision Date | 25 June 2002 |
| Docket Number | No. 00-56043.,00-56043. |
| Citation | 292 F.3d 1192 |
| 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 | U.S. Court of Appeals — Ninth Circuit |
Robert B. Fiske, Jr., Michael P. Carroll, William C. Komaroff, Davis Polk & Wardwell, New York, NY; George F. Ball, Law Offices of George F. Ball, P.C., Newport Beach, CA; Gene C. Schaerr, David J. Lewis, Paul J. Zidlicky, Michael S. Lee, Sidley Austin Brown & Wood, Washington, DC; James Harris, Sidley Austin Brown & Wood, Los Angeles, CA, for the plaintiff-appellant.
Barry G. West, Corey E. Klein, Sylvia M. Virsik, Gaims, Weil, West & Epstein, LLP, Los Angeles, CA, Joseph W. Cotchett, Frank Pitre, Cotchett, Pitre & Simon, Burlingame, CA, Michael N. Pollet, Pollet & Felleman, LLP, Yonkers, NY, for the defendant-appellee.
John A. Clarke, Washington, D.C., for amicus curiae Accuracy in Media, Inc.; Kieran P. Fallon, Miami, Florida, 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, D.C., 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.
Opinion by Judge TASHIMA; Dissent by Judge FERGUSON.
In 1988, Appellee Consumers Union of United States, Inc. (CU), published a story in its magazine Consumer Reports, in which it rated the Suzuki Samurai "Not Acceptable" based on its propensity to roll over during accident avoidance tests. Since that time, CU has publicly referred to the negative Samurai rating in various fora, most prominently in the 60th Anniversary issue of Consumer Reports, published in 1996. Appellant Suzuki Motor Corporation (Suzuki), the manufacturer of the Samurai, has challenged the validity of CU's Samurai test and, on the heels of the 60th Anniversary issue, brought this action against CU alleging product disparagement. CU's motion for summary judgment was granted by the district court, which held that a reasonable jury could not conclude by clear and convincing evidence that CU had acted with actual malice. We have jurisdiction under 28 U.S.C. § 1291, and we reverse and remand for further proceedings.
CU is a nonprofit corporation that engages in comparative testing and evaluation of consumer products and services, the results of which are published in the magazine Consumer Reports. In order to provide buying and safety advice to automobile purchasers, CU's Automotive Testing Division (ATD) tests approximately 40 cars and other vehicles each year.
CU tested the Samurai in 1988.1 The Samurai, a sport utility vehicle (SUV) manufactured by Suzuki, was introduced in the United States in 1985. By 1988, approximately 150,000 Samurais had been sold. Although it had received some favorable reviews from the automotive press, the Samurai had also been the subject of news stories that highlighted its instability and propensity to tip over. In February 1988, the Center for Auto Safety filed a petition with the National Highway Traffic Safety Administration (NHTSA) to open an investigation into an alleged safety defect of the Samurai. The petition was denied, although the NHTSA emphasized that the denial was not an endorsement of the safety performance of a vehicle.
On April 20, 1988, the ATD tested the Samurai, along with the Jeep Cherokee, Isuzu Trooper II, and Jeep Wrangler, on its standard long course, a double lane-change avoidance maneuver test course that CU had used since 1973.2 The long course was designed to replicate an emergency situation in which a driver suddenly steers a vehicle left into the opposing lane, to avoid an obstacle, and quickly back into the original lane to avoid oncoming traffic. Several CU personnel were in attendance during the April 20 testing, including Robert Knoll, the head of the ATD, Dr. R. David Pittle, CU's Technical Director and Senior Vice-President, and Irwin Landau, the Editorial Director of Consumer Reports, who had been assigned as the initial writer and editor of the Samurai article. Pittle had invited Landau to attend the testing because he thought that they might witness a tip-up of the Samurai.
CU driver Kevin Sheehan drove the Samurai first, putting it through the long course 16 times at speeds reaching over 50 miles per hour. The Samurai that Sheehan drove was equipped with outriggers, which essentially act as training wheels to prevent the car from tipping over completely.3 During Sheehan's runs, the Samurai did not tip over, prompting Sheehan to make the following evaluation of the car: "rubbery, slow response, rocks a bit, but never felt like it would tip over." In the Avoidance Maneuver Data Summary, Sheehan rated the Samurai as highly as or better than other vehicles tested that day.
After Sheehan had completed his testing, CU removed the outriggers. CU driver Rick Small then drove the Samurai through the long course 21 times at speeds similar to those achieved by Sheehan. Again, there were no tip-ups. In his driver log, Small stated: On the basis of his test drives, Small rated the Samurai higher than the other three vehicles tested that day.
According to testimony by former CU employee Ron Denison, at some point during the long-course testing, which had not demonstrated any tip-ups of the Samurai, Landau told Sheehan: "If you can't find someone to roll this car, I will."
After Sheehan and Small had completed their test runs, Pittle, who was not a test driver, began to drive the Samurai through the long course. According to Pittle, he did so because he had never driven a small SUV and wanted to get a feel for how it handled through the course. Pittle took the car though the course 10 times, achieving a top speed of 49 miles per hour. On Pittle's tenth run, the Samurai tipped up on two wheels. Pittle stated that he did not purposefully cause the Samurai to tip up and that it was a startling and unexpected occurrence. When Pittle tipped the car, one onlooker yelled, "yeah!," while another shouted, "I think I got that, I think I got that."
After the long-course testing, Knoll redesigned CU's avoidance course to replicate the situation that caused the Pittle tip-up. This new modified short course had a reduced distance for the first lane change, and the obstacle to be avoided was moved three feet to the left.
Sheehan, who was afraid to drive the Samurai through the short course, was replaced by CU driver Fred Wood. Wood, who drove the vehicle with outriggers made 15 runs through the course. On the fifteenth run, the Samurai tipped up onto the outriggers. After this last run, Knoll is heard on the test videotape saying: Knoll later acknowledged that he was "relieved" that the Samurai tipped up during short-course testing.
Small then drove the car through the short course. On his second run, the Samurai tipped up onto the outriggers at a speed of 40 miles per hour. After the tip-up occurred, CU technician Joseph Nappi can be heard on the test videotape saying, "[a]ll right Ricky baby."4 That same day, CU also put the Jeep Wrangler and Isuzu Trooper II through the short course with no tip-ups reported.
Further testing was scheduled on the short course for May 12, 1988. The parties offer conflicting justifications for why this set of tests was necessary. Suzuki suggests that the additional testing was scheduled for the purpose of shooting video footage of the Samurai for a subsequent press conference, at which it had already been decided that CU would rate the Samurai "Not Acceptable." CU contends that the testing was held to evaluate the performance of the newly released 1988-½ Samurai, which included suspension modifications that distinguished it from the 1988 version tested previously.
Small was the first to drive the Samurai through the short course on this day, tipping over onto the outriggers on his fifth run. Following Small, Wood tipped the Samurai on his second run. Pittle was watching the test runs and, prior to witnessing a tip up, stated: CU also put a Jeep Wrangler, Jeep Cherokee, and Ford Festiva sedan through the short course on May 12. None of these vehicles tipped up.
CU held a press conference on June 2, 1988, at which it announced that the Samurai had shown a propensity to roll over in CU's tests and that it would be rated "Not Acceptable" in an article to appear in the July 1988 issue of Consumer Reports. During the press conference, Pittle stated that, based on CU's testing, the Samurai had an "unusually high propensity to roll over while performing an accident avoidance maneuver that could be demanded suddenly of any driver during routine driving." Pittle further described the short course as "benign," involving only "very limited steering inputs," a characterization he later conceded was "not accurate." Pittle also stated that the other tested vehicles had made it through the short course with a "yawn," a statement that Suzuki contends is at odds with the fact that the Isuzu Trooper II failed the course in three out of four runs by hitting cones.5
CU's negative rating of the Samurai was detailed in an article entitled, "Warning: The Suzuki rolls over too easily,"...
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Suzuki Motor Corp. v. Consumers Union of U.S.
...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 ......