Utah State Farm Bureau F. v. National Farm. US Corp., 4374.

• Decision Date: 25 July 1952
• Docket Number: No. 4374.,4374.
• Citation: 198 F.2d 20
• Parties: UTAH STATE FARM BUREAU FEDERATION et al. v. NATIONAL FARMERS UNION SERVICE CORP. et al.
• Court: U.S. Court of Appeals — Tenth Circuit

198 F.2d 20 (1952)

UTAH STATE FARM BUREAU FEDERATION et al. v. NATIONAL FARMERS UNION SERVICE CORP. et al.

No. 4374.

United States Court of Appeals Tenth Circuit.

June 11, 1952.

Rehearing Denied July 25, 1952.

A. H. Nebeker, Salt Lake City, Utah, (C. N. Ottosen, Salt Lake City, Utah, on the brief), for appellants.

Warwick C. Lamoreaux, Salt Lake City, Utah, and Quentin Burdick, Jamestown, N. Dak., for appellees.

Before BRATTON, HUXMAN and MURRAH, Circuit Judges.

MURRAH, Circuit Judge.

National Farmers Union Service Corporation, National Farmers Union Life Insurance Company, and Farmers Educational and Co-Operative Union of America, commonly known and referred to as the "Farmers Union" brought this action in the United States District Court of Utah against the Utah State Farm Bureau Federation, commonly known and referred to as the "Farm Bureau"; Frank G. Shelley, its Executive Secretary; and A. V. Smoot, to recover compensatory damages for an alleged defamatory publication by the Farm Bureau, in which the Farmers Union was referred to as "communist dominated." By answer, defendants admitted the publication but pleaded defensively, fair comment in the public interest and truth. The trial court held as a matter of law that the words "communist dominated" were libelous per se, leaving to the jury the clear-cut issues whether the libelous statement was true or false, and if false, whether its publication resulted in damages to the plaintiffs. The jury resolved the issues in favor of the plaintiffs, awarded damages in the sum of $25,000, and defendants have appealed.

The alleged libelous language published by the Farm Bureau was prompted by its interest in the Utah political campaign of 1950. On October 11 of that year, appellant Frank Shelley, as Secretary of the Farm Bureau, caused a two-page letter with a two-page mimeographed enclosure to be sent to the members of the Farm Bureau's Board of Directors reflecting the action of the Board at a previous meeting. Among other things, the letter stated that "2 — The Board decided to take vigorous action with regard to candidates for election to National, State and County Offices. A Mimeograph copy of this action with explanations is enclosed * * * 8 — Copies of the Congressional Record in which Senator Styles Bridges made his statement concerning Farmers Union and Arthur Gæth were distributed. (Copies of this statement are available at the State Office in any number you desire.)" The mimeographed enclosure was headed "Farm Bureau Position on Election of Senator & Congressman." After referring to the Granger Bill, it stated in opposition thereto that "Representative Granger has exhibited his evident animosity toward farm organizations (except the communist dominated Farmers Union)." Shelley not only caused publication of the mimeographed document by mailing it to the members of the Board of Directors, but he also caused it to be published in certain Utah newspapers.

Utah has statutorily defined libel as "a malicious defamation * * * tending to * * * impeach the honesty, integrity, virtue or reputation * * * of one who is alive, and thereby to expose him to public hatred, contempt or ridicule." Utah Code, Annot.1943, 62-2-2. See also Restatement of Law of Torts, Sec. 559. And, generally, "One who falsely, and without privilege to do so publishes of a corporation for profit matter which tends to prejudice it in the conduct of its trade or business or to deter third persons from dealing with it, is liable to the corporation." Restatement of Law of Torts, Sec. 561. See also Section 558.

The Utah statute also specifically defines communications which are absolutely privileged and not to be considered libelous per se. Utah Code Annot.1943, 62-2-3. Appellants do not claim absolute privilege for their publications. They do claim, however, a qualified or conditional privilege, which they say under the facts entitle them to a directed verdict. The Utah courts, following the great weight of authority, hold that publications dealing with political matters, public officials or candidates for office, are entitled to a measurable privilege because of the public interest involved. As to this class of publications, the law raises a prima facie presumption in favor of the privilege. Williams v. Standard-Examiner Publishing Co., 83 Utah 31, 27 P.2d 1; Derounian v. Stokes, 10 Cir., 168 F.2d 305.

The question whether the comment on or criticism of matters of public concern are fair and privileged, or malicious and libelous, is usually a question to be determined by the jury under all the circumstances, subject of course to the control of the court. Restatement of Law of Torts, Sections 614 and 618.

Appellants do not claim that Mr. Granger's candidacy for Congress in Utah made anything said of the Farmers Union privileged. They take the position, however, that when the challenged statement is considered in connection with the Bridges speech, as it was intended and would have been understood by the reader of the letter and enclosure, the language relating to the Farmers Union was fair comment in the public interest and conditionally privileged. It is said that Senator Bridges' speech on the public activities of the Farmers Union would have been privileged if given outside the protection of the Senate Floor, and the statement of the defendants was equally privileged because it was in effect only a repetition of the Bridges speech. And see Huxman concurring specially in Derounian v. Stokes, supra, 168 F.2d at page 308. On this postulate, appellants argue that the published statement was not libelous per se and the trial court erroneously so instructed the jury.

It is the law of Utah and elsewhere, that matters and things referred to in the alleged libelous publication, as the source of the statement, may be introduced in the libel action for the purpose of showing that the publication or any portion thereof is a fair and true report of the matter referred to. This being so, the publication is privileged to the extent that no malice will be inferred from the mere fact of publication, and the prosecution must affirmatively show express malice to recover. People v. Glassman, 12 Utah 238, 42 P. 956.

Shelley's covering letter did not enclose the Bridges speech, nor did it or the enclosure purport to quote from the speech or refer to it as authority for the statement that the Farmers Union was communist dominated. But even so, "`to state matters which are libelous is not comment or criticism.'" Williams v. Standard Examiner Publishing Co., supra 83 Utah 31, 27 P.2d 15. The law draws a clear distinction between criticism or comment, which may or may not be privileged, depending upon the circumstances in which it was uttered, and publication of an unequivocal and unambiguous fact, the legal import and effect of which is a question of law for the courts to decide, leaving only its truth or falsity for the determination of the jury. Wright v. Farm Journal, 2 Cir., 158 F.2d 976; Spanel v. Pegler, 7 Cir., 160 F.2d 619, 171 A.L.R. 699. If the published statement is libelous as a matter of law, it is no defense that it was repeated from another source. Restatement of Law of Torts, Sections 578, 580 and 581. It follows that the appellants can claim no conditional privilege from a reference to the Bridges speech if the statement is libelous per se.

Adopting the dictionary definition of "dominated," the trial court instructed the jury that "The label of `Communist' today, in these times in which we live, in the minds of average and respectable persons, places the plaintiffs beyond the pale of respectability and makes them a symbol of public hatred, ridicule or contempt. * *" And, "* * * to designate plaintiffs herein as `communist dominated' is to cripple the functioning and damage the reputation of those organizations in the communities in which they do business. * * *."

While the Utah courts have not had occasion to construe the words "communist dominated" under the legislative definition of libel, it is now the generally accepted view that to write or speak of a person or an organization as being "communist" or a "communist sympathizer" is to subject such person or organization to public hatred, odium and contempt, to his immediate harm, and is therefore libelous per se. See Joint-Anti Fascist Refugee Commission v. McGrath, 341 U.S. 123, 71 S.Ct. 624, 95 L.Ed. 817; Spanel v. Pegler, 7 Cir., 160 F.2d 619; Grant v. Reader's Digest, 2 Cir., 151 F.2d 733; Wright v. Farm Journal, 2 Cir., 158 F.2d 976; Cole v. Loew's Inc., D.C., 8 F.R.D. 508; Gallagher v. Chavalas, 48 Cal.App.2d 52, 119 P.2d 408; Toomey v. Jones, 124 Okl. 167, 254 P. 736, 51 A.L.R. 1066. Construing Utah law, we have held that to speak of one as pro-Nazi or pro-Fascist was libelous per se and not within the rule of conditional privilege. Derounian v. Stokes, supra. In the temper...