Petition for Writ of Certiorari — Gray v. St. Martin's Press, Inc.

ro} ourt, U.S.

"y

00 700 0CI 2729

No. ——4OFHICE OF THE CLERK

In The

Supreme Court of the United States

° ROBERT K. GRAY,

Petitioner,

We

ST. MARTIN'S PRESS, INC.,

and

SUSAN TRENTO,

Respondents.

On Petition For Writ Or CERTIORARI

To Tue Unirep States Court or APPEALS

For Tue First Circuit

PETITION FOR WRIT OF CERTIORARI

JAMES E. HIGGINGs

Counsel of Record

ELIZABETH A. BAILEY

SHEEHAN, PHINNEY, BAss + GREEN,

PROFESSIONAL ASSOCIATION

1000 ELm STREET

P.O. Box 3701 |

MANCHESTER, NH 03105-3701

(603) 627-8136

Counsel for Petitioner

BECKER GALLAGHER LEGAL PUBLISHING, INC.,

CINCINNATI, OHIO 800-890-5001

4~Csv

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OEE

QUESTIONS PRESENTED

Should the Court adopt a new liability standard in

cases in which the plaintiff is a limited purpose public figure?

Should the Court include a temporal component in the

limited purpose public figure analysis under which a person

may lose limited purpose public figure status by the passaze

of time?

In this libel action in which Petitioner claims

Respondents defamed him by publishing in their non-fiction

book The Power House that Petitioner faked his closeness

with President Reagan and other senior Reagan

Administration officials (“Statement (b)”), have the District

Court and the Court of Appeals for the First Circuit reached

decisions which conflict with this Court’s decision in

Milkovich v. Lorain Journal Co. when these lower courts

focused on only isolated words, ignored the tenor and context

of Statement (b) and failed to perform any multi-factored

analysis in determining that Statement (b) was non-actionable

“opinion?”

PARTIES TO THE PROCEEDING

Petitioner

Petitioner is Robert K. Gray. He is an individual and any

corporations to which he may be affiliated are not parties to

this case.

Respondents

Respondents are St. Martin’s Press, Inc. and Susan B. Trento.

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TABLE OF CONTENTS

QUESTIONS PRESENTED ................... i

PARTIES TO THE PROCEEDING ............. il

TABLE OF CONTENTS .................... ill

TABLE OF AUTHORITIES .................. vi

OPINIONS BELOW ....................... l

a Se er rr ]

CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED .............. l

STATEMENT OF THECASE ................ 2

ARGUMENT FOR GRANTING THE WRIT ....... 5

ARGUMENT 1

The Court should adopt a new liability

Standard in cases in which the plaintiff is a

limited purpose public figure.............. 5

ARGUMENT 2

This Court should decide the important and

unsettled federal question of whether the

determination of a defamation plaintiff's

limited purpose public figure status should

include a temporal analysis by finding a person

may lose limited purpose public figure status

by the passage oftime. ................. 13

iil

ARGUMENT 3

Statement (b) that Gray faked his closeness

with President Reagan and senior Reagan

administration officials is actionable because it

contains statements of fact that are objectively

verifiable. By limiting their analysis of

Statement (b) to the words “fake” and

“closeness” and by viewing these words in

isolation, the District Court and the Court of

Appeals for the First Circuit fail to take into

account Statement (b)’s tenor and context as

required by this Court’s holding in Milkovich

v. Lorain Journal Co. The lower courts’

limited analysis of the important federal

question of whether a defamatory statement is

an non-actionable opinion conflicts with

Milkovich and the multi-factored analysis

previously used by the Court of Appeals for |

the First Circuit and other Appeals Courts. .... 17

eT ee ee ee 21

APPENDIX

:

Appendix A

Opinion of the United States Court of Appeals

for the First Circuit dated August 2, 2000... .. la

Appendix B

Judgment of the United States District Court,

GSN as WP oo ove wae oadbcuc. 20a

Appendix C

Order of the United States District Court, -

CR OS Ta ee a os eet kz . . 22a

Appendix D

Order of the United States District Court,

Geeta S, HS go. i 32a

TABLE OF AUTHORITIES

Cases

v .

477 U.S. 242, 106 S.Ct. 2505 (1986)... .... 6-7

Curtis Publishing Co. v. Butts,

388 U.S. 130, 87 S.Ct. 1975 (1967) ........ 6

Vv i ,

691 F.2d 666 (4th Cir. 1982) cert. denied.

460 U.S. 1024, 103 S.Ct. 1277 (1983) ....... 14

Foretich v. Capital Cities/ABC. Inc..

37 F.3d 1541 (4th Cir. 1994) ............. 14

Gertz v. Robert Welch, Inc.,

418 U.S. 323, 94 S.Ct. 2997 (1974) ..... passim

Herbert v. Lando,

441 U.S. 153, 99 S.Ct. 1635 (1979) ........ 11

Hutchi v.P ~*~

443 U.S. 111, 99 S.Ct. 2675 (1979) ........ 10

vi p _ Vv. Wal- ,

127 F.3d 122 (1st Cir. 1997) .......... 18, 19

Milkovich v. Lorain J 1 Co.

497 U.S. 1, 110 S.Ct. 2695 (1990) ...... passim

Monitor Patriot Co. v. Roy.

401 U.S. 265, 91 S.Ct. 621 (1971) ......... 10

vi

376 U.S. 254, 84 S.Ct. 710 (1964) ...... passim

Olilman v. Evans

750 F.2d 970 (D.C. Cir. 1984)

cert. denied 471 U.S. 1127,

105 S.Ct. 2662 (1985) ................. 19

Part itis,

56 F.3d 1147 (9th Cir. 1995) ............. 14

156 F.3d 57 (Ist Cir. 1998) ........... 14, 16

Vv i ications,

953 F.2d 724 (1st Cir. 1992)

cert. denied 504 U.S. 974,

112 S.Ct. 2942 (1992) ............... 4,19

Va V. -

411 F.Supp. 440 (S.D. Ga. 1976)

aff'd 580 F.2d 859 (Sth Cir. ee ee 14

Rosenblatt v. Baer,

383 U.S. 75, 86 S.Ct. 669 (1966) .......... 19

403 U.S. 29, 91 S.Ct. 1811 (1970) ......... 10

Street v. NBC,

645 F.2d 1227 (6th Cir. 1981),

cert. granted 454 U.S. 815,

102 S.Ct. 91 and cert. dismissed

454 U.S. 1095, 102 S.Ct. 667 ............ 14

Vii

627 F.2d 1287 (D.C. Cir. 1980)

cert. denied 449 U.S. 898,

ee ns SE bs io ene ee aS 6wds 14

Wolston v. Reader's Digest Association,

443 U.S. 157, 99 S.Ct. 2701 (1979) .. 13, 15, 16

Zurcher v. Stanford Daily,

436 U.S. 547, 98 S.Ct. 1970 (1978) ........ 11

Statutes

Fee eS Perret r errr rT Terres passim

oe er rer yor re ere |

Rees OE oo Peco ocho Cewen te Cuen 1

Other Authorities

Sheldon W. Halpern, Of Libel, Language and Law:

New York Times v. Sullivan at Twenty-Five,

66 N.C.L. Rev. 273 (1990) ............ 6, 12

Philip L. Judy, The First Amendment Watchdog

Has A Flea Problem, 26 Cap. U.L. Rev. 541

SE <6 bo eres ws Fo ek eee es 9, 10

Alan Kaminsky, Defamation Law: Once a Public

Figure Always a Public Figure?, 10 Hofstra L.

a ere pe 14

OPINIONS BELOW

The opinion of the United States Court of Appeals for

the First Circuit is reported at 221 F.3d 243 (1st Cir. 2000).

A copy of the Opinion is included in the Appendix at

Appendix A at la- 19a. The District Court ordered the entry

of final judgment on June 25, 1999, which is printed in

Appendix B at 20a to 21a. The May 19, 1999 Order of the

District Court is published at 1999 WL 813909 (D.N.H.) and

included in Appendix C at 22a - 31a. The March 5, 1998

Order of the District Court for the District of New Hampshire

is unpublished. It is included in the Appendix at Appendix D

at 32a - 48a.

JURISDICTION

The United States Court of Appeals for the First

Circuit issued its Opinion on August 2, 2000. This Petition

for Writ of Certiorari is filed within 90 days of the August 2,

2000 entry of judgment. Petitioner invokes the Court’s

jurisdiction pursuant to 28 U.S.C. §§ 1254(1) and 2106.

CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED

The First Amendment to the United States Constitution

provides “Congress shall make no law respecting an

establishment of religion, or prohibiting the free exercise

thereof; or abridging the freedom of speech, or of the press;

or the right of the people peaceably to assemble, and to

petition the Government for a redress of grievances.”

STATEMENT OF THE CASE

This defamation action concerns a non-fiction book

entitled The Power House, Robert Keith Gray and the Selling

of Access and Influence in Washington (“the Book”), which

was written by Respondent Susan B. Trento (“Trento”) and,

in July 1992, published by Respondent St. Martin’s Press,

Inc. (“St. Martin’s”). In his June 2, 1995 Complaint,

Petitioner Robert K. Gray (“Gray”) brought a libel claim in

U.S. District Court for the District of New Hampshire against

St. Martin’s and Trento, claiming that at least eight (8)

statements in the Book were defamatory. See Joint Appendix

submitted to Court of Appeals for the First Circuit, at 39-40

(Complaint, ¢ 11 (a)-(h)). Following a two week jury trial,

the jury returned a verdict for St. Martin’s and Trento on

June 22, 1999. The District Court entered judgment on June

25, 1999, and Gray filed a timely Notice of Appeal with the

Court of Appeals for the First Circuit on July 22, 1999.

On appeal, Gray argued that the District Court erred

in several pretrial rulings.' Gray contends that the District

Court erred in its May 19, 1999 Order by, inter alia, finding

that (1) Gray was a limited purpose public figure, and that (2)

Gray had not met his corresponding burden of establishing

that Respondents acted with actual malice in publishing

Statement (c).2 Statement (c), which is a quote from a

' In this Petition, Gray addresses only those District Court rulings,

as affirmed by the Court of Appeals for the First Circuit, to which

Gray now asks this Court to grant certiorari.

In its May 19, 1999 Order, the District Court granted

Respondents’ February 16, 1999 Motion for Partial Summary

Judgment as to Gray’s status as a public figure and ruled that Gray

was a limited purpose public figure (and hence Gray was required

2

disgruntled ex-employee of Gray named Barry Zorthian,

reads:

“‘T think there’s a degree of venality on the

part of [Gray] and lack of integrity which

always took me aback. A lot of it he would

justify as being a businessman, but there was

very little real basic principle and an awful lot,

to me, of overcharging.’” The Power House,

p. 165.

Gray presented evidence to both the District Court and

the Court of Appeals for the First Circuit that would enable

a reasonable trier of fact to conclude Trento and St. Martin’s

each acted with actual malice in publishing Statement (c).

Despite this evidence, the District Court dismissed Statement

(c), reasoning “defendants have demonstrated that no

reasonable trier of fact could conclude that defendants acted

with ‘actual malice’ or with reckless disregard for whether the

statement was false.” Appendix C, at 29a. The Court of

Appeals for the First Circuit affirmed, holding that “[t]here

is no point in our going through this evidence piece by piece

because we agree with the district court’s assessment.”

Appendix A, at 13a.

Gray also contended on appeal that the District Court

erred by finding in its March 5, 1998 Order (Appendix D)

to prove that Respondents acted with actual malice). See Appendix

C, at 27a. Additionally, in ruling on Respondents’ separate

February 16, 1999 summary judgment motion on the issue of actual

malice, the District Court dismissed Statement (c). Id., at 29a.

3

that Statement (b) was a non-actionable opinion. Gray’s

Appellate Brief, at 13-20.* Statement (b) reads:

“A senior Gray and Company executive

insisted that Gray’s closeness to the President

and others was often faked. ‘He completely

faked his closeness with a number of senior

administration officials.’” The Power House,

p. 156.

The District Court dismissed Statement (b) by relying

on the analysis in Phantom Touring, Inc. v. Affiliated

Publications, 953 F.2d 724, 728 (1st Cir. 1992) cert. denied

504 U.S. 974, 112 S.Ct. 2942 (1992) that the adjective

“fake” was unprovable while conducting no analysis of the

tenor or context of Statement (b) in the Book. Appendix D,

at 46a. The Court of Appeals for the First Circuit affirmed,

by focusing on the words “fake” and “closeness” and

concluding that “the statement is protected opinion.”

Appendix A, at 5a-7a. Like the District Court, the Court of

Appeals for the First Circuit acknowledged that whether

Statement (b) was a protected opinion depended very much on

its context, yet provided no meaningful analysis of either the

tenor or context of Statement (b). Id.*

> On March 5, 1998, the District Court partially granted St.

Martin’s June 24, 1997 Motion for Summary Judgment by ruling

that the Statements found at ¥11 (b), (f) and (h) (“Statements (b),

(f) and (h)”) of the Complaint were non-actionable “opinions.”

Gray now appeals the finding of the District Court, as affirmed by

the Court of Appeals for the First Circuit, as to Statement (b).

* In analyzing Statement (b), the Court of Appeals for the First

Circuit only made ihe following passing reference to the Book

“(T]he book made quite clear that Gray did have contacts at the

4

ARGUMENT FOR GRANTING THE WRIT

ARGUMENT 1

The Court should adopt a new liability

standard in cases in which the plaintiff is a

limited purpose public figure.

Respondents quote “a former Gray & Company senior

vice president” on page 165 of The Power House (Barry

Zorthian) as stating that he thought ‘there is a degree of

venality on the part of Bob and lack of integrity which always

took me aback. A lot of it he would justify as being a

business man, but there was very little real basic principle and

an awful lot, to me, of overcharging.’” (Statement (c)). The

District Court granted summary judgment on this statement

finding Gray to be both a limited purpose public figure and

further finding that no reasonable jury could find that the

charge was made by the Respondents with actual malice

(emphasis added). The Court of Appeals affirmed.

Assuming the District Court correctly determined that

Gray was a limited purpose public figure, this Petitioner was

immediately confronted with an impressive roadblock - the

liability standard originating in New York Times Com any V.

Sullivan, 376 U.S. 254, 84 S.Ct. 710 (1964). This actual

malice standard has evolved into a barrier nearly impossible

to overcome. In New York Times, this Court adopted the

highest levels; the word ‘fake’ was used to imply that Gray was

exaggerating his ‘closeness.’” Appendix A, at 6a. The Court of

Appeals for the First Circuit did not, however, analyze Statement

(b) by looking beyond the words that comprised Statement (b) or by

examining Statement (b)’s tenor, its larger context in the Book, or

the context of the Book itself.

actual malice standard to assure “unfettered interchange of

ideas for the bringing about of political and social changes

desired by the people” and the “maintenance of the

Opportunity for free political discussion to the end that

government may be responsive to the will of the people ....”

Id. at 269, 84 S.Ct. at 720 (internal quotations omitted).

While discussing the folly of allowing the defense of

truth, the New York Times Court noted that critics of

“official conduct” would censor themselves rather than run

the risk of unlimited libel judgments. Id. at 279, 84 S.Ct. at

725. The policies justifying New York Times are now

essentially unarguable, including the high price put on robust

public comment and criticism of public officials and the civic

value found in preserving such criticism.

Shortly after New York Times, the actual malice rule

was extended to public figures. Curtis Publishing Co. v.

Butts, 388 U.S. 130, 87 S.Ct. 1975 (1967). Gertz v. Robert

Welch, Inc., 418 U.S. 323, 94 S.Ct. 2997 (1974) determined

that the position of the plaintiff rather than the type of speech

was key in determining the burden of proof placed on

plaintiff. See Sheldon W. Halpern, Of Libel, Language and

Law: New York Times v. Sullivan at Twenty-Five, 68 N.C.L.

Rev. 273 (1990).

The evidence before the District Court on Statement

(c) was compelling and should have been submitted to the

jury. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257,

OE LE —————_ i. ~~” SESS: “ss TT

106 S.Ct. 2505, 2514 (1986).° Neither the District Court nor

the Court of Appeals agreed. The evidence included:

e The fact that the source had been fired by

Gray & Company which the author knew

when she interviewed the source;

e The fact that the source unsuccessfully brought

a discrimination charge against Gray &

Company as a result of his termination which

the author knew when she interviewed the

source (Barry Zorthian);

° The fact that the source expressed his bias

against Gray to the author during the course of

her interview;

° The fact that the source confirmed at his

deposition that his statement about Gray’s lack

of integrity resulted from the manner in which

he was terminated:

e The fact that the source had no personal or

professional background which made him

knowledgeable about business billing practices

and the source had no involvement or direct

knowledge about the billing practices of Gray

& Company in particular, the subject of his

quote;

* Gray stands by his position, which he argued before both the District

Court and the Court of Appeals for the First Circuit, that the cumulative

evidence in this case satisfies the onerous actual malice test set forth in

New York Times and establishes that Trento and St. Martin’s each acted

with actual malice in publishing Statement (c).

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The fact that the author acknowledged her

preference to seek out disgruntled witnesses to

help her make her case against the plaintiff;

The fact that the author disregarded a

statement by a person in a position to know

that he knew of no overcharging complaints

and considered the plaintiff to be a man of

integrity, citing the exculpatory statement as

“a waste of time”;

The fact that the author failed to interview

James Jennings and Charles Crawford, two

people whom she knew to be key witnesses

and knowledgeable about Gray & Company’s

billing practices;

The fact that the author failed to interview

other key insiders at Gray & Company;

The fact that the publisher knew from the

outset that the source was a disgruntled former

employee;

The fact that the publisher through Gray’s

counsel knew that the source could not be

trusted;

The fact that the publisher through Gray’s

counsel knew that Trento should not be trusted

because she had failed to interview sources

who would have accurate details about Gray &

Company;

° The fact that the publisher’s own staff

criticized the author’s sketchy research and

knew of Gray’s ongoing expressed concerns

about the author’s inaccuracies; and

° The fact that the editors of the publisher made

no effort to verify Zorthian’s defamatory

Statement.

On such evidence, the Court of Appeals has held, under the

Current state of the law of defamation, that Gray cannot make

his case to the jury.

The constitutionalization of the law of defamation has

created a body of law which is confusing and difficult to

administer. This body of law has encouraged the violation of

the principles upon which New York Times vy. Sullivan was

based. The malice standard has evolved to the point where its

invocation virtually insures a libel defendant will prevail and

a defamed limited purpose public figure will fail. Thus the

media has the ability to publish inaccurate stories “without

being subject to effective remedial measures.” Philip L.

Judy, The First Amendment Watchdog Has A Flea Problem,

26 Cap. U. L. Rev. 541, 581 (1997). The media’s

publication of inaccurate material, encouraged by the actual

malice standard, can only lead to the erosion of public

confidence in the media.

The Constitution does not value falsehood. Gertz v.

Robert Welch, Inc., at 339, 94 §.Ct at 3007. The current

actual malice standard encourages bad journalism.

For instance,

It is safer to cover people and not issues.

Judy, supra, at 551. Because the status of the

plaintiff and not the issue involved determines

the level of protection, media reports focusing

on a public figure or official must receive a

higher level of protection regardless of the

subject matter reported. See Monitor Patriot

Co. v. Roy, 401 U.S. 265, 273, 91 S.Ct. 621,

626 (1971). In Hutchinson v. Proxmire, 443

U.S. 111, 99 S.Ct. 2675 (1979), a public

figure was not involved and hence the actual

malice standard did not apply despite the fact

the publication concerned wasteful spending of

public funds. Judy, supra at 552. As Justice

Brennan foresaw in Rosenbloom _v.

Metromedia, 403 U.S. 29, 48, 91 S.Ct. 1811,

1822 (1971), creation of a public/private

figure distinction “could easily produce the

paradoxical result of dampening discussion of

issues of public or general concern because

they happen to involve private citizens while

extending constitutionai encouragement to

discussion of aspects of the lives of ‘public

figures’ that are not in the area of public or

general concern.” Casual review of the media

reflects the fact that the pursuit of public

scandal has replaced discussion of issues of

public or general concern as the touchstone of

modern journalism. To the extent the evolved

constitutionalization of the law of defamation

has encouraged this trend, the public good is

not served.

The actual malice standard encourages sioppy

reporting.

10

1. The actual malice standard encourages

reporters to avoid review or verification of the information

contained in their reports. Ironically it is safer to avoid

review of a story then to seek out an editor’s comment. A

reporter adopting the latter course runs the risk of editorial

comment questioning the accuracy of the story or suggestions

for further investigation. Thoughts and comments of

reporters and editors must be open to judicial inquiry on the

issue of actual malice, Herbert v. Lando, 441 U.S. 153, 99

S.Ct. 1635 (1979) and as inspection of reporters’ offices and

files has been allowed, Zurcher v. Stanford Daily, 436 U.S.

547, 98 S.Ct. 1970 (1978), prudence requires shoddy

research.

Certainly public policy favors a media which informs

the public. Practices encouraged by the actual malice rule

undercut this goal.

y & The actual malice standard encourages a

reporter to not investigate a story. Robert Gray’s case offers

a stunning example.

Apparently, the author, Susan Trento, purposely

avoided speaking to witnesses whom she believed would offer

evidence contrary to the biased report she had received from

Barry Zorthian. By pursuing such shoddy journalistic

practices, she succeeded in preventing the issue from ever

being heard by the jury. The salutary goal of New York

Times v. Sullivan that the public be informed by the media so

that intelligent choices can be made in this democracy is not

achieved through such shoddy journalistic practices.

e The actual malice standard and the

constitutionalization of the defamation process

exalts opinion over fact. Hence a reporter will

11

tend to avoid representations of fact in stories

and resort to exaggeration and rhetoric. A

Statement dismissed as an “opinion” in this

case is argued elsewhere in this Petition.

The problem is clear. The constitutionalization of the

defamation process and the adoption of the actual malice

standard in the case of limited purpose public figures has led

to a body of law which runs directly contrary to the principles

of New York Times v. Sullivan. The solution is to adopt a

different standard, at least in limited purpose public figure

cases. The standard has been suggested elsewhere. Injury to

reputation should be compensated consistent with First

Amendment principles. The First Amendment as well as the

interests of damaged defamation victims can be

accommodated with the adoption of a professional negligence

standard. Halperin, supra at 318 et seg. The adoption of

such a standard would still require the proof of fault by the

injured plaintiff, and would allow defamation victims at least

a chance of vindication. Further, the effect on the press —

would be salutary, removing the incentives for sloppy

journalism which exist under the present system and restoring

public confidence in the press.

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ARGUMENT 2

This Court should decide the important and

unsettled federal question of whether the

determination of a defamation plaintiff's

limited purpose public figure status should

include a temporal analysis by finding that

@ person may lose limited purpose public

figure status by the passage of time.

Gray argued both to the District Court and on appeal

that he no longer retained any limited purpose public figure

Status at the time of the Book’s 1992 publication, and noted

that it remains an unsettled issue with this Court whether a

libel plaintiff such as Gray can lose limited public figure

Status through the passage of time. See Gray’s Appellate

Brief, at 28-29. This Court should now avail itself of the

Opportunity to settle this issue and hold, consistent with the

concurrence in W v. 's Di jati '

that a temporal component is relevant and should be included

in any limited purpose public figure analysis. 443 U.S. 157,

170-171, 99 S.Ct. 2701, 2709 (1979). It is imperative that

the Court now decide this issue because lower federal courts

have developed and followed an untenable standard that a

limited purpose public figure always retains that status as to

the public controversy at issue. This standard is inconsistent

with this Court’s concurring opinion in Wolston. It results in

an undue expansion of First Amendment protection to

defamation defendants at the expense of defamation plaintiffs

who, by being permanently relegated to limited purpose

public figure status and thus required to prove actual malice,

often are unable to ever recover for the loss of their good

names.

13

Since Gertz, this Court and lower federal courts have

struggled with the limited purpose public figure definition.

See Rosanova v. Playboy Enterprises, Inc., 411 F.Supp. 440,

443 (S.D. Ga. 1976) aff'd 580 F.2d 859 (Sth Cir. 1978)

(“Defining public figures is much like trying to nail a jellyfish

to the wall”). Lower federal courts have developed different

standards to determine who constitutes a limited purpose

public figure. Compare Waldbaum v. Fairchild Publications,

Inc., 627 F.2d 1287 (D.C. Cir. 1980) cert. denieg 449 U.S.

898, 101 S.Ct. 266 (1980) with Foretich v. Capital

Cities/ABC, Inc., 37 F.3d 1541, 1553 and 1556 (4th Cir.

1994).

The Court of Appeals for the Fourth Circuit has

recognized the perishability of limited purpose public figure

Status, requiring that a plaintiff retain limited purpose public

figure status at the time of the libel. See e.g. Foretich, 37

F.3d at 1553 and 1556; Fitzgerald v. Penthouse International,

Lid., 691 F.2d 666, 668 (4th Cir. 1982) cert. denied. 460

U.S. 1024, 103 S.Ct. 1277 (1983). The vast majority of

federal courts, however, have developed and followed an

arbitrary standard that once a person is deemed a limited

purpose public figure he or she eternally retains that status for

purposes of the same public controversy. See e.g. Partington

v. Bugliosi, 56 F.3d 1147, 1152 n.8 (9th Cir. 1995); Street y.

NBC, 645 F.2d 1227, 1235 (6th Cir. 1981), cert. granted 454

U.S. 815, 102 S.Ct. 91 and cert. dismissed 454 U.S. 1095,

102 S.Ct. 667. This standard has been criticized. See

Pendleton v. City of Haverill, 156 F.3d 57, 70 (1st Cir. 1998)

(“To be sure, there may be a temporal dimension to any

limited purpose public figure analysis. Intuitively, one should

not become fair game for eternity merely by interjecting

oneself into the debate of the moment”); Alan Kaminsky,

W: Ww

Figure?, 10 Hofstra L. Rev. 803 (1982).

14

By relegating a defamation plaintiff to permanent

public figure status and thus curtailing the plaintiff's ability to

recover by requiring the plaintiff to demonstrate actual

malice, the lower federal courts are not following any

precedent of this Court. This Court has not yet decided

whether a limited purpose public figure permanently retains

that status. In Wolston, 443 U.S. at 167, 99 S.Ct. at 2707 fn

7, this Court declined on the facts of that case to then decide

“whether and when an individual who is a public figure may

lose that status by the passage of time.” However, in

concurring in the result reached by the Wolston majority,

Justices Blackmun and Marshall held that temporal factors are

relevant in deciding a person’s limited purpose public figure

Status:

“The passage of time ... often will be relevant

in deciding whether a person possesses these

two public figure characteristics. First, a lapse

of years between a controversial event and a

libelous utterance may diminish the defamed

Party's access to the means of

counterargument.... Second, the passage of

time may diminish the ‘risk of public scrutiny’

that a putative public figure may fairly be said

to have assumed.”

Id., at 170 - 171, 99 S.Ct. at 2709. The Wolston concurrence

noted that although this analysis which includes a temporal

component implies that one may be a public figure for

purposes of contemporaneous reporting of a controversial

event but not for purposes of historical commentary on the

same event, “this result ... does no violence to First

Amendment values.” Id., at 171, 99 S.Ct. at 2709. Justice

Blackmun’s and Justice Marshall’s harmonizing a temporal

component in a limited purpose public analysis and the First

15

Amendment is particularly pertinent in cases such as this one:

“A reporter trying to meet a deadline may find it totally

impossible to check thoroughly the accuracy of his sources.

A historian writing sub specie aeternitatis has both the time

for reflection and the opportunity to investigate the veracity

of the pronouncements he makes.” Id.

The time has come for this Court to squarely decide

whether a limited purpose public figure always remains such.

This is a question which has significant Constitutional

ramifications. The limited purpose public figure test

announced by Gertz imposes on persons who are deemed

limited purpose public figures the almost insurmountable

barrier of proving actual malice. See Gertz, 418 U.S. at 342,

94 S.Ct. at 3008. ({[New York Times “actual malice”

standard] exacts a ... high price from the victims of

defamatory falsehood. Plainly many deserving plaintiffs,

including some intentionally subjected to injury, will be

unable to surmount the barrier of the New York Times test”).

The rigorous actual malice standard already forecloses

otherwise deserving libel plaintiffs from being able to recover

for being defamed. Id. A defamation plaintiff who may have

been a limited purpose public figure at some point in his life

should not be “fair game for eternity” and required to prove

a defendant acted with actual malice when, years later, the

defendant defames the plaintiff. Pendleton, 156 F.3d at 70.

In this case, the Book primarily concerns lobbying in

Washington in the early to mid 1980s during the Reagan

administration. The Book focuses on this same time frame in

its alleged reporting of Gray and his company (Gray and Co.)

which Petitioner sold in 1986. Even if Gray was a limited

purpose public figure during the early to mid 1980s, he

should not be burdened with this status and required to prove

16

Respondents acted with actual malice when they defamed him

in 1992.

By deciding that a temporal component should be

included in a limited purpose public figure analysis, this Court

will resolve an unsettled area of law and fairly and

constitutionally balance the First Amendment concerns which

this Court has outlined in Gertz with a defamation victim's

ability to recover for being defamed.

ARGUMENT 3

Statement (b) that Gray faked his closeness

with President Reagan and senior Reagan

administration officials is actionable because

it contains statements of fact that are

objectively verifiable. By limiting their

analysis of Statement (b) to the words

“fake” and “closeness” and by viewing

these words in isolation, the District Court

and the Court of Appeals for the First

Circuit failed to take into account Statement

(b)’s tenor and context as required by this

Court’s holding in Milkovich vy. Lorain

Journal Co. The lower courts’ limited

analysis of the important federal question of

whether a defamatory statement is an

actionable opinion conflicts with Milkovich

and the multi-factored analysis previously

used by the Court of Appeals for the First

Circuit and other Appeals Courts.

_Any statement that might be labeled an “opinion” does

not automatically receive First Amendment protection.

Milkovich v. Lorain Journal Co., 497 U.S. 1, 17, 110 S.Ct.

17

ee

2695, 2705 (1990). A defamatory statement is actionable if

it contains an objectively verifiable assertion. Levinsky’s,

Inc. v. Wal-Mart Stores, Inc., 127 F.3d 122, 127 (1st Cir.

1997). Even if a statement is couched as an opinion, it is still

actionable if it “presents or implies the existence of facts

which are capable of being proven true or false...”

Levinsky’s, Inc., at 127; see Milkovich, at 18-19, 110 S.Ct.

at 2705-2706.

In Milkovich, this Court declined to “create a

wholesale defamation exemption for anything that might be

labeled ‘opinion.’” Milkovich, at 18, 110 C.Ct. at 2705.

Instead, the Court noted that expressions of “opinion” often

may imply an assertion of objective fact. Id. The Court

analyzed the nine sentences at issue in Milkovich, which

appeared in the text of a sports column, in their broader

context and found:

“This is not the sort of loose, figurative, or

hyperbolic language which would negate the

impression that the writer was seriously

maintaining that petitioner committed the

crime of perjury. Nor does the general tenor

of the article negate this impression.”

Id., at 21, 110 S.Ct. at 2707. In focusing on more than just

the literal words of the defamatory statements in analyzing the

important question of whether the statements were

nonactionable opinion, the Milkovich Court expressly

recognized society’s strong interest in redressing attacks on

reputation. Id., at 22, 110 S.Ct. at 2707.°

® «“The right of a man to the protection of his own reputation from

unjustified invasion and wrongful hurt reflects no more than our

18

Lower courts, including the Court of Appeals for the

First Circuit, also have applied a multi-factor test to determine

whether a statement is an actionable opinion. Levinsky’s,

Inc., at 131 (recognizing that defamatory statement at issue

could not be viewed in isolation and context was an important

aspect of the Milkovich inquiry); in %

Affiliated Publications, 953 F.2d 724, 727 (“Milkovich did

not depart from the multi-factored analysis that had been

employed for some time by lower courts seeking to

distinguish between actionable fact and nonactionable

opinion”); Ollman v. Evans, 750 F.2d 970, 979 (D.C. Cir.

1984) cert. denied 471 U.S. 1127, 105 S.Ct. 2662 (1985).’

Under such an analysis, a court cannot consider only the

definitions of the isolated words that make up a statement. A

court also must examine whether the challenged speech

contains “loose, figurative or hyperbolic language that would

basic concept of the essential dignity and worth of every human

being - a concept at the root of any decent system of ordered

liberty. *** “The destruction that defamatory falsehood can bring

is, to be sure, often beyond the Capacity of the law to redeem. Yet,

imperfect though it is, an action for damages is the only hope for

vindication or redress the law gives to a man whose reputation has

been falsely dishonored.” Milkovich, at 22-23, 110 S.Ct. at 2708

(quoting Justice Stewart’s concurring opinion in Rosenblatt v. Baer,

383 U.S. 75, 86, 86 S.Ct. 669, 676 (1966)).

” The Ollman court analyzed (1) the common usage Or meaning of

the specific language of the challenged statement itself; (2) the

Statement’s verifiability - is the statement capable of being

objectively characterized as true or false?: (3) the full context of the

Statement, e.g. the entire article or column and the unchallenged

language surrounding the defamatory statement; and (4) the broader

context or setting in which the statement appears, i.e. the type of

writing at issue and what it may signal to the reader. Ollman, at

979.

19

negate the impression” that a factual statement was made, and

evaluate the tenor of the speaker’s statement and the overall

context in which it was given. Milkovich, at 21, 110 S.Ct. at

2706.

Here, although the District Court recognized a multi-

factored analysis (which had been used by the Court of

Appeals for the First Circuit), both the lower courts parsed

Statement (b) to isolate two words contained in it, and ignored

Statement (b)’s overall tenor and context. Appendix A, at 5a-

7a; Appendix D, at 46a. The District Court and the Court of

Appeals for the First Circuit isolated the word “fake” and

then construed it as an adjective that could have a variety of

meanings depending on its context. This ignores the fact that

the word “fake” appears as a verb in Statement (b) and its

meaning as a verb is easily ascertainable. It is objectively

verifiable whether Gray faked his close relationship with

President Reagan and top Reagan officials by simply

interviewing Gray, the Reagans and Reagan officials. Either

Gray had a close relationship with these people or he did not.

The lower courts’ focus on the words “fake” and “closeness”

ignores the reality that these words, as used in Statement (b),

would have a readily ascertainable meaning to anyone used to

the commonplace way people communicate with one another.

The District Court and the Court of Appeals for the

First Circuit did not consider the overall tenor of Statement

(b) and the context in which it was made. Statement (b) on its

face is a matter-of-fact statement devoid of hyperbole or

rhetoric. It appears in Chapter 8 of the Book, which details

facts concerning the start up of Gray &Co. and the social

aspects of the business. Trento and St. Martin’s themselves

hold out the Book as a meticulously researched piece of

journalism and not an opinion piece. Gray’s Appellate Brief,

at 17-20.

20

2.

There is nothing in the literal wording of Statement

(b), or in its overall tenor or context, that supports the

conclusion that Statement (b) is an Opinion as opposed to a

fact-based statement. The lower courts analyzed the question

of whether Statement (b) is an opinion by simply analyzing

the meaning of the words contained in the statement in

isolation. This is not what Milkovich envisions, or what the

multi-factored test previously used by the Court of Appeals

for the First Circuit and other Courts of Appeals requires.

This Court should not allow lower courts to conduct such an

abbreviated analysis to determine whether a Statement is a

protected opinion because to do so would conflict with this

Court’s Milkovich decision and the multi-factored analysis

accepted in the lower courts.

CONCLUSION

For these reasons, this Court should grant Gray’s

Petition for Certiorari and decide these important questions

concerning federal defamation law.

/s/

JAMES E. HIGGINS

Counsel of Record

Elizabeth A. Bailey

SHEEHAN PHINNEY BASS + GREEN,

PROFESSIONAL ASSOCIATION

1000 Elm Street

P. O. Box 3701

Manchester, NH 03105-3701

(603) 627-8136

Attorneys for Petitioner

21

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE FIRST CIRCUIT

[Filed August 2, 2000]

Nos. 99-1891 and 99-1892

ROBERT K. GRAY,

Plaintiff, Appellant/

Cross-Appellee,

V.

ST. MARTIN'S PRESS, INC. and

SUSAN TRENTO,

Defendants, Appellees/

Cross-Appellants.

eee ee eee

APPEALS FROM THE UNITED STATES

DISTRICT COURT FOR THE

DISTRICT OF NEW HAMPSHIRE

(Hon. Steven J. McAuliff, U.S. District Judge]

Before: Boudin, Stahl and Lynch, Circuit Judges.

OPINION

BOUDIN, Circuit Judge. Robert K. Gray was for

many years active in Republican politics and a leading figure

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Court of Appeals Opinion - 8/2/00

in public relations in Washington, D.C. He served in the

Eisenhower administration in various roles (e.g., Secretary to

the Cabinet), worked in the 1980 Reagan-Bush presidential

campaign and served between 1961 and 1981 as the head of

the Washington office of, and eventually as vice chairman of,

Hill and Knowlton, a major public relations and lobbying

firm. He founded his own firm in 1981, sold it to Hill and

Knowlton in 1986, and served for a period as a member of the

board of directors and chairman of a division of the latter.

In July 1992, St. Martin's Press, Inc., published a

book by Susan Trento, entitled The Power House: Robert

Keith Gray and the Selling of Access and Influence in

Washington. Focusing on Gray's career, the book sought to

show the influence of powerful and well-connected lobbyists

on the federal government. In June 1995, Gray brought suit

both against St. Martin's Press and Trento in the federal

district court in New Hampshire, claiming that eight separate

statements made in the book were defamatory. The eight

statements are set forth in an appendix to this opinion.

After two years of discovery, St. Martin's Press

moved for summary judgment. On March 5, 1998, the

district court granted partial summary judgment to St.

Martin's Press, ruling that three of the eight statements --

(designated (b), (f), and (h)) -- were non-actionable statements

of opinion. More discovery was conducted and both

defendants filed a second summary judgment motion. On

May 19, 1999, the district court ruled that Gray was a

"limited purpose public figure," requiring Gray to show

"actual malice" in order to prevail. The district court granted

summary judgment for defendants as to one statement

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(statement (c)), finding that there was no basis for the jury to

find actual malice.

The trial on the remaining four statements began on

June 7, 1999. On June 22, 1999, the jury returned special

verdicts in favor of St. Martin's and Trento. As to each of

the four remaining statements in issue ((a), (d), (e), and (g)),

the jury found that Gray had not proved that the defendants

had published to third parties statements that were false and

defamatory as to Gray; separately, the jury found that Gray

failed to prove actual malice by either defendant as to any of

the four statements.

Gray has now appealed. In this court he contests the

dismissal before trial of four of the Statements, a discovery

ruling upholding a claim of privilege asserted by Trento that

pertains to one of the statements considered by the jury, and

the denial before trial of a motion by Gray to amend his

complaint to add twenty additional statements to the eight

already charged. We consider the issues in this order,

applying the standard of review pertinent to the issue in

question. .

Under state law, defendants in this case would be

liable for damages for libel if, as a result of the failure to

exercise reasonable care, they published false and defamatory

facts about the plaintiff to a third party, assuming that no

valid privilege applies.’ Independent Mechanical Contractors,

The district court initially applied New Hampshire law

in ruling on the defendants’ motions for summary judgment, but

just before trial was persuaded that Virginia law applies to this

case. The parties to this appeal do not contend that any issue on

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Court of Appeals Opinion - 8/2/00

Inc. v. Gordon T, Burke & Sons, Inc., 138 N.H. 110, 118

(N.H. 1993); The Gazette, Inc. v. Harris, 229 Va. 1, 8, 15

(1985), cert. denied, 472 U.S. 1032 (1985). See generally

Restatement (Second) of Torts § 558 (1977). However, the

Supreme Court has read the First Amendment, made binding

on the states through the Fourteenth, to impose additional

limitations in defamation cases, whether or not they are also

part of state law. Two of these limitations are significant in

this case--one dealing with scienter and the other with

opinion.

Pertinently, the Court has held that a “public figure"

may recover only if the false and defamatory statement was

made with "actual malice," meaning (in the Supreme Court's

non-literal usage) either that defendant knew that the statement

was false or showed a “reckless disregard" as to its truth or

falsity. New York Times Co. v. Sullivan, 376 U.S. 254,

279-80 (1964); see also Gertz v. Robert Welch, Inc., 418

U.S. 323, 335-37 (1974). A "public figure" may be one of

such fame as to be so in all contexts (e.g., the President) or a

"limited-purpose public figure" as to a particular episode or

subject; in the latter case, only the statements about the person

in that context require a showing of actual malice. Gertz, 418

U.S. at 351-52; Pendleton v. City of Haverhill, 156 F.3d 57,

67 & n.7 (ist Cir. 1998).

The Court has also held that only statements that

present or imply the existence of facts that can be proven true

or false are actionable under state defamation law. Milkovich

this appeal turns on differences between New Hampshire and

Virginia law.

4a

Court of Appeals Opinion - 8/2/00

v. Lorain Journal Co., 497 U.S. 1, 18-20 (1990). But to say

"I think" is not enough to turn fact into opinion, Milkovich,

497 U.S. at 18-19, where what is supposedly "thought" is, or

implies, a proposition of fact, id.; Levinsky's v. Wal-Mart

Stores, Inc., 127 F.3d 122, 127 (1st Cir. 1997). Rather, the

Cases are likely to protect a statement as “opinion” where it

involves expressions of personal judgment, especially as the

judgments become more vague and subjective in character.

See Levinsky's, 127 F.3d at 130 (store was trashy"). As

Chief Judge Posner put the matter in Haynes v. Alfred A.

Knopf, Inc., 8 F.3d 1222, 1227 (7th Cir. 1993):

[I}f it is plain that the speaker is expressing a

subjective view, an interpretation, a theory,

conjecture, or surmise, rather than Claiming to

be in possession of objectively verifiable facts,

the statement is not actionable.

On this appeal, Gray first questions the district court's

March 5, 1998, ruling that statements (b), (f), and (h) are not

actionable because they are not factual statements capable of

being proven false. The determination was made on summary

judgment and in any event the courts treat the issue of labeling

a statement as verifiable fact or as opinion as one ordinarily

decided by judges as a matter of law. Bose Corp. v.

., 466 U.S. 485, 510-

11 (1984). Thus from either vantage, our review is de novo.

As it happens, we agree with the district court's reasoning as

well as its result and so treat this issue briefly.

Statement (b) is the view, attributed to an unnamed

Gray and Company senior executive, that Gray's "closeness

to the President [Reagan] and others was often faked. "He

Sa

Court of Appeals Opinion - 8/2/00

completely faked his closeness with a number of senior

administration officials.'" There are various vantages from

which the statement could be attacked as false (e.g., that no

such view was expressed by the unnamed executive), but the

bite here is in the claim that "closeness" was "faked" and

Gray's position is that he could show at trial that he was quite

close to President Reagan and other senior officials and was

not "faking" these relationships.

Whether calling something a "fake" is or is not

protected opinion depends very much on what is meant and

therefore on context. To say that a dollar bill is a fake would,

in most situations (but perhaps not all), be taken to mean that

it was a counterfeit; and to say that the defendant was

knowingly passing a fake dollar bill would surely be

actionable, if false. At the other extreme, where there were

two productions of Phantom of the Opera, and the defendant

called one of them "fake" and "phony," this court held that

the adjectives were subjective aesthetic judgments protected

as opinion. Phantom Touring, Inc. v. Affiliated Publications,

~ 953 F.2d 724, 728 (1st Cir.), cert. denied, 504 U.S. 974

(1992).

In this case, Gray might have a claim if defendants had

said that Gray claimed to know President Reagan or other

high officials but did not in fact know them; whether or not he

knew them is an objective fact. However, the book made

quite clear that Gray did have contacts at the highest levels; :

the word “fake” was used to imply that Gray was

exaggerating his "closeness." This is just the kind of

subjective judgment that is only minimally about "what

happened" but expresses instead a vague and subjective

6a

/asnsstnemnssnegnediantsbtecamnmnaetansctaipiniadapimnaengscimaenianineiatomet ie

rhein eral

Court of Appeals Opinion - 8/2/00

characterization of what happened. As we read the case law,

the statement is protected opinion.

Statement (f) is in essence several different statements:

in it Trento asserted that a number of Washington lobbyists

said that Gray and Company "ultimately failed because it

offered very little real substance." Gray's quarrel is not with

the claim that lobbyists (quite possibly competitors) had

expressed such views but with the assertions that the company

had "failed" and offered "little real substance." The latter

judgment, where the product is an intangible service like

lobbying and criteria for success are debatable, is surely one

of opinion so we direct our attention to the charge that Gray

and Company "failed."

If the book had said or even implied that Gray and

Company went bankrupt or did not make a profit, these would

be statements of fact that could be proved true or false.

Instead, the book made clear that in 1986 Gray sold his

company to JWT Group, Inc., which made the company part

of its subsidiary, Hill and Knowlton, for about $16 million,

of which Gray himself got at least $9 million (the purchase

price had been $21 million but the buyer withheld about $4.6

million to cover possible liabilities). Gray does not dispute

that the figures are given in the book and those figures make

clear that Gray's company did not fail in any absolute sense.

Indeed, in explaining that Gray and Company "failed,"

Trento said that the sale was "profitable" but it "shattered"

Gray's dream of owning the world's largest public

communications firm. Gray does not Challenge the latter

statement; recall that he left Hill and Knowlton to found Gray

and Company as an independent enterprise to compete with

7a

netting oe tara

Court of Appeals Opinion - 8/2/00

Hill and Knowlton. Some might think it a success, rather

than a failure, that his former employer found him

competitive and competent enough to buy him out for millions

and place him on its board of directors; but what is "success"

in a situation like this one is very much a matter of opinion.

The next statement, designated (h), reads as follows:

Robert Crowley believed that "Casey may

have asked Gray to take on these controversial

clients--for the very purpose of spying on

them." If that were so it would explain why

Gray considered countries like Libya, and took

clients like Angola.

Robert Crowley was a former senior CIA official and William

Casey was the CIA director in the early to mid-1980s. Once

again, Gray does not dispute that Crowley may have so

believed but he does challenge the balance of the statements.

Interestingly, the first disputed proposition--that Casey

may have asked Gray to spy--is not necessarily protected as

to defendants even if they were merely describing Crowley's

view. The reason, which is one of policy rather than strict

logic, is that it would otherwise be too easy for a writer or

publisher to defame freely by repeating the defamation of

others and defending it as simply an accurate report of what

someone else had said. Cianci v. New Times Publ'g Co., 639

F.2d 54, 60-61 (2d Cir. 1980) (Friendly, J.); Cepeda v.

Cowles Magazines & Broad., Inc., 328 F.2d 869, 871 (9th

Cir.), cert. denied, 379 U.S. 844 (1964); Restatement

(Second) of Torts § 578. Thus, the first issue is whether

8a

Court of Appeals Opinion - 8/2/00

Crowley's speculation is actionable once it is attributed to the

defendants.

Statement (h), by its terms, links the possible purpose

to spy to Casey, not Gray; but the second sentence, seemingly

a separate speculation by defendants, suggests that Gray may

have acted on this request. Defendants Say that to spy for

one's country is laudable, not defamatory. Whether a

Statement is capable of a defamatory meaning is an issue of

law for the court, Restatement (Second) of Torts § 614(1);

Harkaway v. Boston Herald Traveler Corp., 418 F.2d 56, 58

(1st Cir. 1969), and thus one we would review de novo; but

the factfinder must ultimately decide whether a statement like

the one here, reasonably capable of both a defamatory and

non-defamatory meaning, was in -fact understood as

defamatory by its recipients.”

We think that the statement's implication of spying on

Clients is capable of bearing a defamatory meaning--it could

easily harm Gray in dealing with clients--and that a reasonable

jury could have found the statement in question defamatory.

See Restatement (Second) of Torts § 559 ("A communication

is defamatory if it tends so to harm the reputation of another

. Restatement (Second) of Torts § 614(2) & cmt. d ("The

jury determines whether a communication, capable of a defamatory

meaning, was so understood by its recipient."); Perk v. Vector

~ Resources Group, Ltd., 253 Va. 310, 316 (1997) (statement must

be sufficiently defamatory on its face before it is sent to the jury);

Thomson v. Cash, 119 N.H. 371, 374 (1979) ("Because the words

are susceptible of more than one meaning, whether they were used

in the defamatory sense is a question of fact for the jury.").

9a -

Court of Appeals Opinion - 8/2/00 ~

as to lower him in the estimation of the community or to deter

third persons from associating or dealing with him.");

Thomson, 119 N.H. at 373 (to be defamatory, a statement

"must tend to lower the plaintiff in the esteem of any

substantial and respectable group, even though it may be quite

a small minority") (internal quotation marks omitted); Carwile

v. Richmond Newspapers, Inc., 196 Va. 1, 8 (1954) (a

statement "which imputes to a business or professional man

conduct which tends to injure him in his business or

profession" is actionable as libel per se).

To determine if the Crowley statement is shielded

because it is conditional ("may have") is a more difficult

question. Here, the statement may be protected "opinion" not

because it is vague or judgmental but because it is speculative.

The test, admittedly a very crude one, is whether the

statement is properly understood as purely speculation or,

alternatively, implies that the speaker or writer has concrete

facts that confirm or underpin the truth of the speculation.

Levin v. McPhee, 119 F.3d 189, 197 (2d Cir. 1997);

Restatement (Second) of Torts § 566, comment (c) at 173.

The former is protected as opinion; the latter is taken as an

indirect assertion of truth.

Like the district judge, we see nothing that suggests

that Crowley or the defendants were relying upon undisclosed

facts. Crowley's own view is couched as a belief as to what

"may have" happened. The defendants add a further

supporting fact that Gray “considered countries like Libya,

and took clients like Angola"; but Gray does not dispute that

this is so, and where the underlying facts are disclosed, it

becomes even more clear that the writer or publisher is

merely speculating ("if so") about the inference. Restatement

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Court of Appeals Opinion - 8/2/00

(Second) of Torts § 566, at 174 ill. 5 ("A says to B about C,

a city official: 'He and his wife took a trip on city business

a month ago and he added her expenses in as a part of his

own.’ B responds: ‘If he did that he is really a thief.’ B's

expression of opinion does not assert by implication any

defamatory facts, and he is not liable to C for defamation. ").

The last statement of the four statements disposed of

before trial--statement (c)--quotes a former "Gray and

Company senior vice president" as Saying that "there's a

degree of venality on the part of [Gray] and lack of integrity

which always took me aback" and "very little real basic

principle and an awful lot, to me, of over charging." During

discovery, the defendants produced a transcript of Trento's

interview with Barry Zorthian, a former Senior Vice President

at Gray and Company, as the source of this statement. The

district court granted summary judgment as to this statement

because it found that Gray was a limited-purpose public figure

with respect to lobbying and that no reasonable jury could

find that the charge was made by the defendants with actual

malice. ;

On appeal, Gray first disputes the limited-purpose

public figure label. This is treated as an issue of law to be

resolved by the district judge and reviewed de novo by us.

Pendleton v. City of Haverhill, 156 F.3d 57, 68 (1st Cir.

1998). We agree with the district court that, prior to and

continuing up to the book's publication--which (to avoid

bootstrapping) is the pertinent time frame, Bruno & Stillman,

Inc. v. Globe Newspaper, Inc., 633 F.2d 583, 591 (1st Cir.

1980)--a public controversy existed as to the methods and

influence of lobbyists in Washington. This was amply

evidenced by materials submitted to the district court showing

—

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Court of Appeals Opinion - 8/2/00

that from the early 1980s onward there has been a tide of

concern and criticism about Washington lobbying.

The record also shows that Gray was a central figure

in this controversy, being identified as one of the best-known

of the high-level Washington public relations experts, an

emblematic figure, and a self-professed defender against

attacks on lobbying. Indeed, Gray's lobbying and in

particular billing practices were themselves the subject of

comment and criticism in mainstream publications like Time,

Newsweek, the Washington Post and the New Republic. This

does not show that he behaved improperly as a lobbyist or

overbilled his clients. It does mean that, in the complex

equation for liability laid down by the Supreme Court, Gray

needed to show actual malice by clear and convincing

evidence. Gertz, 418 U.S. at 351-52; Pendleton, 156 F.3d at

67 & n.7.°

In most cases, as in this one, the plaintiff does not

have any evidence of actual malice in the literal sense but, as

already noted, recklessness suffices. New York Times, 376

U.S. at 279-80; Masson v. New Yorker Magazine, Inc., 501

U.S. 496, 510 (1991). Recklessness is a jury issue so long as

the plaintiff at the summary judgment stage produces evidence

> Gray also argues that the statements were not "germane"

to any controversy over lobbyists and that he was not a limited

purpose public figure by 1992 when the book was published. We

think that the statements are germane to the controversy Over

lobbying, and the record shows numerous articles concerning Gray,

his company, and Hill and Knowlton published between 1986 and

1992.

12a

Court of Appeals Opinion - 8/2/00

that would allow a reasonable jury to find the defendants

reckless by clear and convincing evidence. Anderson v.

Liberty Lobby, Inc., 477 U.S. 242, 257 (1986).

Recklessness, in this context, can be shown by proving "that

the defendant actually had a ‘high degree of awareness of

. . . probably falsity,'" H -Hi mmuns., Inc. v.

Connaughton, 491 U.S. 657, 688 (1989) (quoting Garrison v.

Louisiana, 379 U.S. 64, 74 (1964)), but mere negligence in

conducting an investigation or weighing the evidence is not

enough. Harte-Hanks Communs., 491 U.S. at 688: Masson,

501 U.S. at 510. 3

The defendants assert, and the plaintiff does not

dispute, that actual malice in this case must be shown

separately as to each defendant. But cf. Cantrell v. Forest

City Publ'g Co., 419 U.S. 245, 253 (1974) (referring to

vicarious liability). With respect to Trento, she relied not

only on Zorthian but also on several other sources. They,

too, had connections with Gray and Company and their

Statements tended to back up Zorthian's position. Against

Trento's multiple sources, Gray counters that Zorthian had an

axe to grind (he had parted ways with Gray and later sued

him); that few of Trento's sources had much knowledge of the

billing side of Gray's business; and that Trento failed to

publish one other source's statement that he had "never

heard" about charges of overbilling or to interview others who

would have denied such overcharging.

There is no point in our going through this evidence

piece by piece since we agree with the district court's

assessment. Prejudice or limited knowledge on the part of a

source may suggest caution but does not preclude reliance; the

fact that one witness had "never heard" about the Charges

13a

Court of Appeals Opinion - 8/2/00

counts for little; and while refusing to seek out decisive

witnesses may be a mark of recklessness in some

circumstances, Trento already had multiple sources and was

under no obligation to exhaust every possible witness before

winding up her investigation. Even assuming she was

careless and reached a mistaken conclusion, that is not enough

for actual malice.

Less need be said about St. Martin's. It apparently

had some doubts about the rigor of Trento's book proposal.

But the proposal was followed by more than two years of

research and there is no evidence that St. Martin's employees

doubted the accuracy of Trento's final product. It is true that

Gray protested to St. Martin's prior to publication that some

of the statements were untrue. However, apart from the fact

that in this original protest statement (c) was not specifically

identified as false, simple denials by the subject are

commonplace and, absent more, are normally not enough to

premise a finding of actual malice. Edwards v. National

Audubon Soc'y, Inc., 556 F.2d 113, 120-21 (2d Cir.), cert.

denied, 434 U.S. 1002 (1977).

Gray's next claim of error on appeal is that the district

court erred in upholding a claim of press privilege during the

discovery process. Specifically, Trento declined to reveal the

name of her confidential source for statement (g), which

reads: "One Gray and Company executive in a position to

know said that Gray and Company was making payments to

[Duke] Zeller." According to the book, Duke Zeller had

previously worked for Gray and at the time in question was

the Director of Communications for the Teamsters Union, a

lucrative client of Gray's company. The apparent implication

14a

Court of Appeals Opinion - 8/2/00

is that Gray made secret payments to Zeller in order to retain

the Teamsters account.

The magistrate judge, later sustained by the district

judge, upheld Trento's objection on the grounds that New

Hampshire recognized a qualified confidential source

privilege for reporters, State v. Siel, 122 N.H. 254, 259-60

(1982); Downing v. Monitor Publ'g Co. Inc., 120 N.H. 383,

386-87 (1980), that one requirement to overcome the privilege

was to show that the applicant had made all reasonable efforts

to obtain the identity of the confidential source by other

reasonable means, and that this requirement had not been

satisfied by Gray. On appeal, Gray argues that the district

court misread New Hampshire privilege law, which both sides

now assume to govern the question, and that in any event it

was error to find that Gray had not satisfied the requirement.

New Hampshire law on the privilege in question, an

issue for de novo review, is not a model of clarity; and, while

the "failure to satisfy" finding would be reversed only for

clear error or abuse of discretion, we have some initial

sympathy for Gray's claim that he did all he could to satisfy

the requirement of exhausting other means. And if Gray were

found to have exhausted all reasonable means of identifying

the source and Trento still refused to reveal her source, Gray

would have been entitled to a presumption that no source

existed. Downing, 120 N.H. at 387. This could have helped

Gray persuade the jury that Trento acted with actual malice in

making the payoff charge.

The problem for Gray is that however the matter stood

at the time of the privilege ruling, the jury returned a verdict

as to statement (g) that rested on two alternative grounds: one

15a

Court of Appeals Opinion - 8/2/00

was lack of actual malice but the other was Gray's failure (in

the jury's view) to prove that the statement was false and

defamatory. Defendants say that the verdict thus rested safely

on a ground independent of the no-malice finding. Gray, who

has not independently attacked the jury's alternative ground,

has not provided any very cogent answer to this claim,

beyond saying rather tersely that if the privilege had been

overridden, Trento had still baulked, and the jury been told

that therefore it could presume that the source did not exist,

then the jury might have thought the statement false.

It is hard to see why this is so. Obviously, there was

far better direct evidence available--such as Gray's own

testimony--as to whether the payoff occurred; indeed, on this

issue the source's statement was inadmissible hearsay as to the

truth of the charge. Nor is there all that much basis to doubt

that some source did exist, whether reliable or otherwise;

Trento produced redacted notes of her conversation with the

source and Gray himself got some mileage out of an argument

that this portion of Trento's interview was not taped like the

rest of the interview with the confidential source.

Gray also says that while Trento preserved the claim

of privilege, St. Martin's never asserted the privilege so the

district court had to have erred in upholding the claim as it

did. St. Martin's agrees that it did not assert the privilege but

argues, as it did in the district court, that it did not know the

name of the source and therefore needed no privilege in order

to withhold it. Gray responds that in previous court papers

St. Martin's never affirmatively stated that it had not been

told the name of the confidential source. But Gray himself

does not allege that St. Martin's does actually know the

identity of the source, and without evidence to contradict St.

16a

Court of Appeals Opinion - 8/2/00

Martin's assertion in its brief that it does not know the

identity of the source, Gray's argument does not undermine

St. Martin's commonsense position.

Gray's final argument or appeal, properly placed last,

is that the district court erred in refusing to grant Gray leave

to amend his complaint to add 20 additional statements from

the book now alleged to be defamatory. As earlier noted, the

complaint was filed in June 1995; and the motion to amend

was made three years later, after extensive proceedings

including discovery. The district court found the motion

untimely and unduly prejudicial.

We find no abuse of discretion. Grant v. News Group

Boston, Inc., 55 F.3d 1, 5 (1st Cir. 1995). It is enough to say

that although leave to amend is to be "freely given," Fed. R.

Civ. P. 15(a), Gray had the book for six years before he

moved to amend and at the outset of the litigation could have

easily decided which charges he believed to be false. The

district court amply explained its reasons for finding that

under the circumstances there was undue delay and prejudice.

The judgment is affirmed. The conditional cross-

appeal filed by St. Martin's Press and Susan Trento is

dismissed as moot.

ADDENDUM

a. "As others were cleaning out their desks, looking for

jobs, briefing their successors, and preparing to leave

the White House, Gray was busy dictating his

17a

Court of Appeals Opinion - 8/2/00

memoirs to his White House secretary." The Power

House, p. 53.

"A senior Gray and Company executive insisted that

Gray's closeness to the President and others was often

faked. ‘He completely faked his closeness with a

number of senior administration officials.'" The

Power House, p. 156.

"'l think there's a degree of venality on the part of

Bob and lack of integrity which always took me

aback. A lot of it he would justify as being a

businessman, but there was very little real basic

principle and an awful lot, to me, of over charging."

The Power House, p. 165.

"" |. . at Gray and Company he [Mr. Gray] stage-

managed impressive-sounding calls. A reporter would

walk in and he would instruct his executive assistant

to come in and announce that there was a call from the

White House. Totally fabricated. Absolutely. They

would come in and they would say, ‘Mr. Gray, Mr.

Meese is on the phone,’ and he would pick up a dead

line or a line that was set up by the executive assistant,

carry on a conversation of four or five short rapid

sentences as though he was in constant communication

and hang up. And then, of course, the reporters,

dazzled, would then report that a White House phone

call came in,’ explained one Gray and Company

executive." The Power House, p. 167-8.

"And the Gray and Company employees in Spain were

to be convinced that the office was used as a money

18a

Court of Appeals Opinion - 8/2/00

laundering operation for the Reagan administration's

private intelligence network." The Power House,

p. 273.

"In the end, several Washington lobbyists feel that

Gray and Company ultimately failed because it offered

very little real substance." The Power House, p. 323.

"One Gray and Company executive in a Position to

know said that Gray and Company was making

payments to Zeller." The Power House, p. 202.

"Robert Crowley believed that ‘Casey may have asked

Gray to take on these controversial clients--for the

very purpose of spying on them.' If that were so it

would explain why Gray considered countries like

Libya, and took clients like Angola." The Power

House, p. 260.

19a

APPENDIX B

UNITED STATES DISTRICT COURT FOR THE

DISTRICT OF NEW HAMPSHIRE

[Filed June 25, 1999}

No. 1:95-cv-00285-M

Gray.

V.

St. Martin's Press

a a a a

JUDGMENT

JUDGMENT is hereby entered in accordance with the

orders dated May 19, 1999, and March 5, 1998, by U.S.

District Judge Steven J. McAuliffe and with the jury verdict

entered on June 22, 1999. (Signed by Clerk James R. Starr)

By the Court, -

/s/

James R. Starr, Clerk

Date: June 25, 1999

cc:

James G. Walker, Esq.

Mark D. Baizli, Esq.

20a

Cletus P. Lyman, Esq.

William L. Chapman, Esq.

John C. Lankenau, Esq.

Steven M. Gordon, Esq.

Seth L. Rosenberg, Esq.

APPENDIX C

UNITED STATES DISTRICT COURT

DISTRICT OF NEW HAMPSHIRE

[Filed May 19, 1999]

No. 95-285-M

Robert K. Gray,

Plaintiff

Vv.

St. Martin's Press, Inc. and Susan

Trento,

Defendants.

eee eee eee Ne

ORDER

Robert Gray brings this action seeking damages for

five allegedly defamatory statements contained in The Power

House, Robert Keith Gray and the Selling of Access and

Influence_in Washington ("The Power House"), a book

authored by Susan Trento and published by St. Martin's

Press. The book discusses how members of lobbying and

public relations firms influence federal government operations

and focuses on Gray as one of the most powerful and well-

connected members of that group.

22a

District Court Order - 5/19/99

Pending before the court are two motions for s

judgment filed by defendants. In the first, defendants assert

that plaintiff is a public figure and must, therefore,

demonstrate that they acted with "actual malice" in order to

prevail on his defamation claims. In the second, defendants

assert that they are entitled to judgment as a matter of law

with regard to each of the five allegedly defamatory

statements in suit. On April 20, 1999, the court conducted a

hearing, at which both sides presented argument on the

pending motions. The parties also submitted legal

memoranda and volumes of exhibits in Support of their

respective positions.

Discussion

A. Plaintiff is a Limited Public Figure.

Plaintiff is, at least in Washington, D.C., and

nationally in governmental and lobbying circles, both

Successful and well-known. See, €.g., Affidavit of Robert K.

Gray submitted in Support of motion for enlargement of time

for discovery (dated September 27, 1995), at para. 3 ("I have

a national reputation in the area of public relations.").

Defendants point out that he has also been the subject of a

television documentary and the topic of (or, at a minimum,

discussed in) several hundred newspaper and magazine

articles. Thus, the only real question before the court

concerning plaintiff's status is whether he is a "general

purpose public figure" or a "limited public figure."

In Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974),

the Supreme Court recognized a distinction between these two

types of public figures:

~ 23a

District Court Order - 5/19/99

Some [plaintiffs] occupy positions of such

persuasive power and influence that they are

deemed public figures for all purposes. More

commonly, those classed as public figures

have thrust themselves to the forefront of

particular public controversies in order to

influence the resolution of the issues involved.

Id., at 345. More recently, this court (Devine, J.) addressed

the legal concepts of "general purpose public figures" and

"limited public figures," observing that:

The designation "public figure" may rest on

two alternative bases. First, in some

instances, an individual may achieve such

pervasive fame or notoriety that he becomes a

public figure for all purposes and in all

contexts. Second, persons of lesser fame may

nonetheless qualify as limited public figures if

they "thrust themselves to the forefront of

particular public controversies." Such limited

public figures are subject to the “actual

malice" standard only for defamation arising

out of the public controversy into which they

have thrust themselves.

Fagin v. Kei!v, 978 F.Supp. 420, 426 (D.N.H. 1997)

(citations omitted).

In the wake of the Supreme Court's opinion in Gertz,

supra, the Court of Appeals for the District of Columbia

Circuit summarized the factors that ought to be considered

24a

when determining whether a particular

District Court Order - 5/19/99

purpose public figure.

A court must first ask whether the plaintiff is

a public figure for all purposes. Gertz, as

noted above, held that a plaintiff could be

found to be a general public figure only after

a clear showing "of general fame or notoriety

in the community, and pervasive involvement

in the affairs of society... ." 418 U.S. at

352. He must have assumed a "role of

especial prominence in the affairs of

society. . .” Time, Inc. v. Fi e, 424

U.S. 448, 453 (1976). Accord, Wolston v.

's Di lation, 443 U.S. 157,

165 (1979). In other words, a general public

figure is a well-known "celebrity," his name a

"household word." The public recognizes him

and follows his words and deeds, either

because it regards his ideas, conduct, or

judgment as worthy of its attention or because

he actively pursues that consideration.

Wal v. Fairchild Publicati Inc., 627, F.2d 1287,

1294 (D.C. Cir. 1980).

person is a general

On the record presently before it, the court cannot

conclude that defendants have shown, as a matter of law, that

plaintiff is a general purpose public figure. The record does

not support the conclusion that

that his name was a

25a

plaintiff was a "celebrity" or

"household word." To the contrary, as

plaintiff notes, several editors and other employees at St.

Martin's Press who actually worked on the publication of The

District Court Order - 5/19/99

Power House admitted at their depositions that, prior to their

involvement with the book, they had never heard of Robert

Keith Gray. Nothing presented suggests that the public - in

the District of Columbia or nationally - was better informed

or more aware of Mr. Gray's general involvement in the

affairs of society. Thus, while plaintiff may be

extraordinarily well known in certain Washington, D.C.,

circles, particularly with regard to his ability to influence

public opinion and provide his clients with coveted access to

powerful men and women in American politics, defendants

have failed to establish that he attained that degree of

notoriety or celebrity usually associated with a "general

purpose public figure."

It is, however, equally clear that plaintiff has attained

the status of "limited public figure." As the Court of Appeals

for the Eleventh Circuit has recognized:

The proper standards for determining whether

plaintiffs are limited public figures are best set

forth in Waldbaum v. Fairchild Publications

Inc., 627 F.2d 1287 (D.C. Cir. 1980), ....

Under the Waldbaum analysis, the court must

(1) isolate the public controversy, (2) examine

the plaintiffs' involvement in the controversy,

and (3) determine whether "the alleged

defamation [was] germane to the plaintiffs'

participation in the controversy." Id., at 1297.

Silvester v. American Broadcasting Companies, Inc., 839

F.2d 1491, 1494 (11th Cir. 1988). Here, the "public

controversy" relates to familiar and often discussed public

issues - the influence of, and access provided to political

26a

_ District Court Order - 5/19/99

figures by, powerful Washington, D.C., lobbyists. And, -

there can be little doubt that plaintiff, one of the more

powerful, influential, and successful lobbyists in Washington,

qualifies as a central figure in that controversy. Finally,

notwithstanding plaintiff's efforts to narrowly circumscribe

the scope of the "public controversy" into which he thrust

himself, each of the alleged defamatory statements set forth in

The Power House relates directly to plaintiff's lobbying

activities, his access to powerful and influential Washington

"insiders," and his demonstrated ability to shape public

opinion on various issues of public concern. Accordingly, the

court concludes that plaintiff is a limited purpose public figure

as to each of the statements at issue in this case.

B. The Five Remaining Statements in Suit.

As to each of the five remaining statements at issue in

this case, defendants assert that plaintiff cannot prove, by

Clear and convincing evidence, that they published the

Statements with "actual malice." In order to prevail, plaintiff

must demonstrate that defendants published the statements

"with knowledge that [they were] false or with reckless

disregard of whether [they were] false or not.". New York

Times Co. v. Sullivan, 376 U.S. 254, 279-80 (1964). "Mere

negligence does not ‘suffice. Rather, the plaintiff must

demonstrate that the author in fact entertained serious doubts

as to the truth of [her] publication, or acted with a high degree

of awareness of .. . probable falsity." Masson v. New

Yorker Magazine, Inc., 501 U.S. 496, 510 (1991) (citations

and internal quotation marks omitted).

The five statements contained in The Power House at

issue in this case are:

District Court Order - 5/19/99

Statement A: “As others were cleaning out

their desks, looking for jobs, briefing their

successors, and preparing to leave the White

House, Gray was busy dictating his memoirs

to his White House Secretary." The Power

House, p. 53.

Statement C: "I think there's a degree of

venality on the part of Bob and lack of

integrity which always took me aback. A lot

of it he would justify as being a businessman,

but there was very little real basic principle

and an awful lot, to me, of overcharging."

The Power House, p. 165.

Statement D: "'. . . at Gray and Company

[Robert Gray] stage-managed impressive-

sounding calls. A reporter would walk in and

he would instruct his executive assistant to

come in and announce that there was a call

from the White House. Totally fabricated.

Absolutely. They would come in and they

would say, 'Mr. Gray, Mr. Meese is on the

phone,’ and he would pick up a dead line or a

line that was set up by the executive assistant,

Carry on a conversation of four or five short

rapid sentences as though he was in constant

communication and hang up. And then, of

course, the reporters, dazzled, would then

report that a White House phone call came in, '

explained one Gray and Company executive."

The Power House, p. 167-68.

28a

District Court Order - 5/19/99

Statement E: "And the Gray and Company

employees in Spain were to be convinced that

the office was used as a money laundering

operation for the Reagan administration's

private intelligence network." The Power

House, p. 273.

Statement G: "One Gray and Company

executive in a position to know said that Gray

and Company was making payments to

Zeller." The Power House, p. 202.

As to Statement C, defendants have demonstrated that

no reasonable trier of fact could conclude that defendants

acted with "actual malice" or with reckless disregard for

whether the statement was false. Among other things,

defendants have submitted copies of the transcript of Trento's

tape-recorded interview with Barry Zorthian, former Senior

Vice President in the public relations division of Gray &

Company and the source of the "overbilling" statement.

Deferdants have also submitted statements from former Gray

& Company clients regarding what they perceived as

excessive bills. Finally, they have provided portions of other

publications which generally speak about excessive billing

practices in the public relations industry and, in at least a few

instances, make specific reference to Gray & Company.

Defendants have, therefore, demonstrated that, as a matter of

law, no reasonable trier of fact could conclude that Statement

C was published with actual malice. Accordingly, with

regard to that statement, defendants are entitled to summary

judgment.

29a

District Court Order - 5/19/99

As to the remaining four statements, however, the

presence in the record of genuine issues of material fact

precludes the court from granting defendants' motion for

judgment as a matter of law. As to each such statement, a

jury must resolve the conflicts and determine whether

defendants acted with actual malice in publishing it.

Conclusion

For the foregoing reasons, the court holds that plaintiff

is, as a matter of law, a limited public figure for the purposes

of the statements at issue in this suit. To the extent that

defendants' motion for summary judgment (document no.

173) seeks a legal determination as to that issue, the mvtion

is granted. With regard to defendants' remaining motion for

summary judgment (document no. 175), it is granted in part

and denied in part. As to Statement C, defendants have

demonstrated that they are entitled to judgment as a matter of

law. With regard to all remaining statements, however,

defendants’ motion for summary judgment is denied.

SO ORDERED.

/s/

Steven J. McAuliffe

United States District Judge

May 19, 1999

cc: James G. Walker, Esq.

Mark D. Balzli, Esq.

Cletus P. Lyman, Esq.

William L. Chapman, Esq.

30a

District Court Order - 5/19/99

John C. Lankenau, Esq.

Steven M. Gordon, Esq.

Seth L. Rosenberg, Esq.

3la

APPENDIX D

UNITED STATES DISTRICT COURT

DISTRICT OF NEW HAMPSHIRE

[Filed March 5, 1998]

No. 95-285-M

Robert K. Gray,

Plaintiff

Vv.

St. Martin's Press, Inc. and Susan

Trento,

Defendants.

i i i i i

ORDER

Plaintiff, Robert Gray, brings this action against St.

Martin's Press and Susan Trento, seeking damages for

ategedly Cotemnatory statements contained in TheFowst

Influence in Washin son CT The Po wer H ouse"), a book

authored by Trento and published by St. Martin's. The court

has jurisdiction over Gray's claims pursuant to 28 U.S.C.

§ 1332.

St. Martin's has moved for summary judgment,

asserting that there are no genuine issues of material fact and

32a

District Court Order - 3/5/98

it is entitled to judgment as a matter of law. Specifically, it

claims that: (1) Gray is a pubiic figure and cannot prove by

Clear and convincing evidence that St. Martin's published the

allegedly defamatory statements with knowledge of their

falsity or serious doubts as to their truth; and (2) seven of the

eight allegedly defamatory statements are protected opinions.

Gray objects.

I, FACTUAL BACKGROUND

Early in his career, Gray worked in President

Eisenhower's administration, acting as Secretary of the

Cabinet, Appointments Secretary to the President, and finally

as Special Assistant to the President. In 1962, he authored a

book about his experiences in the White House, entitled

r Glass. Subsequently, Gray was

employed as director of the Washington, D.C. office of Hill

and Knowlton, Inc., a public relations and lobbying firm. In

1981, he founded Gray and Company Public

Communications, International ("G&C"). In 1986, Gray sold

his company to Hill and Knowlton and, until 1993, acted as

Hill and Knowlton's chairman and chief executive officer.

In support of its claim that Gray is a “public figure,"

St. Martin's submitted copies of several articles published

about Gray and his career in Washington, particularly as a

lobbyist. Included are articles from U.S. News & World

Report, Time, The New York Times . Forbes, and The

Washington Post. St. Martin's has also submitted a list of

over 400 newspaper and magazine articles which purportedly

concern or relate to Gray and his activities as a Washington

lobbyist. Gray himself concedes that he has "a national

33a

District Court Order - 3/5/98

reputation in the area of public relations." Gray Affidavit at

para. 3.

In January of 1990, Gray read a portion of Trento's

book proposal.' The proposal apparently opened with the

assertion that, "The story of Robert Keith Gray is a metaphor

for the corruption of power in Washington." Memorandum

in Opposition to summary judgment, at p. 15. Gray notified

both Trento and St. Martin's that, in his opinion, the proposal

contained numerous inaccuracies which defamed both him and

others, including Sarah Brady, William Casey, and J. Edgar

Hoover. Approximately six months later, Gray provided a

detailed specification of each statement which he viewed as

' Statements in Trento's book proposal are not directly at

issue in this litigation. Nevertheless, Gray suggests that they

illustrate Trento's generally sloppy research as well as her tendency

to disregard the truth when necessary to generate a sensational

story. Gray argues that because he specifically notified St.

Martin's that the book proposal contained numerous false

statements and fabrications, it should have recognized that the final

version of The Power House likely contained such elements. He

claims that despite such knowledge, St. Martin's failed to take

reasonable steps to verify the accuracy of Trento's claims. Gray

also claims that Trento's husband, Joseph Trento, contributed

substantially to The Power House. Gray says that because Mr.

Trento was a "highly questionable" author, whose reporting had

been repeatedly questioned in the media as being less-than

accurate, St. Martin's should have undertaken even greater efforts

to confirm the veracity of the statements made in The Power

House.

34a

District Court Order - 3/5/98

false and/or defamatory. Gray claims to have provided

Trento with several sources which contradicted or, at a

minimum, called into question the veracity of many of the

statements set forth in Trento's book proposal. Memorandum

in Opposition to summary judgment, at p. 17. St. Martin's,

on the other hand, says that "[nJeither Mr. Baine [Gray's legal

counsel] nor Mr. Gray ever provided any evidence or

documentation that the contents of the proposal were in any

respect inaccurate." Memorandum in support of summary

judgment, at p. 11.

In July of 1992, St. Martin's published The Power

House. Gray claims that eight statements contained in the

book defame him. Those Statements, the subject of this

litigation, are as follows:

a. "As others were Cleaning out their

desks looking for jobs, briefing their

successors, and preparing to leave the

White House, Gray was busy dictating

his memoirs to-his White House

Secretary." The Power House, w. 33.

b. "A senior Gray and Company

executive insisted that Gray's closeness

to the President [Ronald Reagan] and

others was often faked. "He

completely faked his closeness with a

number of senior administration

officials." The Power House, p. 156.

S. "'I [a Gray and Company Senior Vice

President] think there's a degree of

35a

District Court Order - 3/5/98

venality on the part of Bob and a lack

of integrity which always took me

aback. A lot of it he would justify as

being a businessman, but there was

very little real basic principle and an

awful lot, to me, of overcharging.'"

The Power House, p. 165.

""'. . . at Gray and Company he [Gray]

Stage-managed impressive-sounding

calls. A reporter would walk in and he

would instruct his executive assistant to

come in and announce that there was a

call from the White House. Totally

fabricated. Absolutely. They would

come in and they would say, "Mr.

Gray, Mr. Meese is on the phone," and

he would pick up a dead line or a line

that was set up by the executive

assistant, carry on a conversation of

four or five short rapid sentences as

though he was in_ constant

communication and hang up. And

then, of course, the reporters, dazzled,

would then report that a White House

phone call came in,' explained one

Gray and Company executive." The

Power House, p. 167-68.

"And the Gray and Company

employees in Spain were to be

convinced that the office was being

used as a money laundering operation

36a

District Court Order - 3/5/98

for the Reagan administration's private

intelligence network." The Power

House, p. 273.

"In the end, several Washington

lobbyists feel that Gray and Company

ultimately failed because it offered very

little real substance." The Power

House, p. 32.

"One Gray and Company executive in

a position to know said that Gray and

Company was making payments to

Zeller." The Power House, p. 202.

"Robert Crowley believed that ‘Casey

may have asked Gray to take on these

controversial clients - for the very

purpose of spying on them.’ If that

were so it would explain why Gray

considered countries like Libya, and

took clients like Angola." The Power

House, p. 260.

Complaint, paras. 11(a)-(h) .

Standard of Review

37a

-

Summary judgment is appropriate when the record

reveals "no genuine issue as to any material fact and .

moving party is entitled to a judgment as a matter of law."

Fed. R. Civ. 56(c). In ruling upon a party's motion for

.. the

District Court Order - 3/5/98

summary judgment, the court must "view the entire record in

the light most hospitable to the party opposing summary

"judgment, indulging all reasonable inferences in that party's

favor." Griggs-Ryan v. Smith, 904 F.2d 112, 115 (1st Cir.

1990).

The moving party has the burden of demonstrating the

absence of a genuine issue of material fact for trial. Anderson

v. Liberty Lobby, Inc., 477 U.S. 242, 256 (1986). If the

moving party carries its burden, the party opposing the

motion must set forth specific facts showing that there remains

a genuine issue for trial, demonstrating "some factual

disagreement sufficient to deflect brevis disposition. "

Mesnick v. General Electric Co. , 950 F.2d 816, 822 (1st Cir.

1991). See also Fed. R. Civ. P. 56(e). That burden is

discharged only if the cited disagreement relates to a genuine

issue of material fact. Wynne v. Tufts University School of

Medicine, 976 F.2d 791, 794 (1st Cir. 1992). "Generally

speaking, a fact is ‘material’ if it potentially affects the

outcome of the suit and a dispute over it is ' genuine’ if the

parties’ positions on the issue are supported by conflicting

evidence." Intern'] Assoc'n of Machinists and Aerospace

Workers v. Winship Green Nursing Center, 103 F.3d 196,

199-200 (1st Cir. 1996) (citations Omitted).

Here, provided the court concludes that Gray is a

limited public figure, the inquiry into "whether a genuine

issue exists will be whether the evidence presented is such that

a jury applying [the clear and convincing] evidentiary

standard could reasonably find for either the plaintiff or the

defendant." Anderson, 477 U.S. at'255. In other words, the

question presented at this stage of the litigation is "whether

the evidence in the record could support a reasonable jury

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finding either that the plaintiff has shown actual malice by

Clear and convincing evidence or that the plaintiff has not."

Id., at 255-56.

Discussion

St. Martin's moves for summary judgment on two

grounds. First, it claims that Gray is a limited public figure

and, therefore, in order to prevail, must demonstrate that St.

Martin's acted with actual malice in publishing the allegedly

defamatory remarks. St. Martin's claims, as a matter of law,

that Gray cannot carry that burden. Accordingly, it says it is

entitled to judgment as a matter of law. Alternatively, St.

Martin's moves for partial summary judgment, claiming that

seven of the eight statements at issue in this case are non-

actionable opinions, which are incapable of being verified as

either true or false.

I. Defamation and the Limited Purpose Public Figure.

To prevail at trial on his defamation claim, Gray must

establish that defendants failed to exercise reasonable care in

publishing, without a valid privilege, false and defamatory

Statemenis of fact about him. See Indep. Mechanical

Contractors, Inc. v. Gordon T. Burke & Sons, 138 N.H. 1 10,

.

118 (1993); Nash v. Keene Publishing Corp., 127 N.H. 214,

219 (1985). To the extent he is a public figure, Gray's

burden is augmented because, under the First Amendment,

defamatory statements concerning a “public figure" are only

actionable if they were made with "actual malice." Actual

malice is either knowledge that the Statements in question

were false or a reckless disregard for whether they were false

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or not. New York times v. Sullivan, 376 U.S. 254, 279-80

(1964).

This court (Devine, J.) recently addressed the legal

concept of the "public figure" and observed:

The designation "public figure" may rest on

two alternative bases. First, in some

instances, an individual may achieve such

pervasive fame or notoriety that he becomes a

public figure for all purposes and in all

contexts. Second, persons of lesser fame may

nonetheless qualify as limited public figures if

they "thrust themselves to the forefront of

particular public controversies." Such limited

public figures are subject to the "actual

malice" standard only for defamation arising

out of the public controversy into which they

have thrust themselves.

Faigin v. Kelly, 978 F.Supp. 420, 426 (D.N.H. 1997)

(citations omitted). Here, St. Martin's claims that Gray is a

limited public figure insofar as: (1) there is a "public

controversy" concerning Washington lobbyists; and (2) Gray

purposefully thrust himself into that public controversy.

Whether an individual is a limited public figure

presents a question of law.* Resolution of that issue,

2 Under New Hampshire's law of defamation, "the

determination of public official or public figure status is a jury

question." Nash v. Keene Publishing Corp., 127 N.H. 214, 222

(1985). However, because Gray elected to bring his claims in

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however, requires "a detailed fact-sensitive determination. "

Penobscot Indian Nation v. Key Bank of Maine, 112 F.3d

538, 561 (1st Cir.), cert. denied, 118 S.Ct. 297 (1997).

First, the court must determine whether a "public

controversy" actually existed. Then it must consider whether

"the nature and extent of the person's participation in the

controversy reached some critical mass at which ‘voluntary

injection’ occurred." Id., at 561-62 (quoting Lawrence H.

Tribe, Americar Constitutional Law § 12-13, at 880-81 (2d

ed. 1988)).

Nevertheless, even assuming that Gray is a limited

public figure and must prove, by clear and convincing

evidence, that St. Martin's acted with actual malice, genuine

issues of material fact preclude the entry of summary

judgment in favor of St. Martin's. As the court of appeals for

this circuit has noted:

The subjective determination of whether [a

defamation defendant] in fact entertained

serious Goubts as to the truth of the statement

may be proved by inference, as it would be

rare for a defendant to admit such doubts. A

court typically will infer actual malice from

federal court, federal law, rather than state law, governs resolution

of this issue. And, “[uJnder federal law, the public official and

public figure questions are ones for the court." Kassell v. Gannett

Co., 15 Med. L. Rep. 1205, 1206 (1st Cir. 1988). See also

Marshall v. Perez Arzuaga, 828 F.2d 845, 849 (1st Cir. 1987)

("[I]t is federal law that must control the division of responsibility

between judge and jury... .").

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evidence of negligence, motive, and intent

such that an accumulation of the evidence and

appropriate inferences support[] the existence

of actual malice.

Bose Corp. v. Consumers Union of United c., 692

F.2d 189, 196 (1st Cir. 1982). Here, the facts of record and

the reasonable inferences which can be drawn from them

support Gray's claim that St. Martin's acted with actual

malice. At a minimum, they are sufficient to preclude the

entry of summary judgment in favor of St. Martin's.

Among other things, Gray asserts that neither Trento

nor St. Martin's has provided a list of all sources for the

Statements at issue. Without access to those purportedly

confidential sources and a detailed account of the information

which they allegedly provided to Trento and/or St. Martin's,

the court cannot conclude, as a matter of law, that St.

Martin's acted without malice. Moreover, in light of the

evidence submitted by Gray which calls into question the

accuracy and thoroughness of Trento's research -(e.g., the

book proposal and its numerous allegedly false, fabricated,

and/or defamatory statements; Gray's detailed analysis of

Trento's claimed sources for the statements at issue and

cogent discussion of why those sources do not support the

allegedly defamatory comments in The Power House; etc.),

a jury might reasonably conclude that St. Martin's had good

Treason to doubt the accuracy of Trento's reporting and,

therefore, should have taken additional Steps to corroborate

her claims. See, e.g., McFarlane v. Sheri e s

Inc., 91 F.3d 1501, 1510 (D.C. Cir. 1996) ("[I]f a defendant

has reason to doubt the veracity of its source, then its utter

failure to examine evidence within easy reach or to make

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obvious contacts in an effort to confirm a story would be

evidence of its reckless disregard.").

Based upon the record as it presently exists, a

reasonable trier of fact could conclude that: (1) one or more

of the statements at issue was false; and (2) St. Martin's acted

with knowledge of the falsity, or with reckless disregard as to

the truth or falsity, of such Statement(s) . Consequently, on

that issue at least, St. Martin's is not entitled to judgment as

a matter of law.

II. Protected Expressions of Opinion.

The Supreme Court has recognized that, "[u]nder the

First Amendment there is no such thing as a false idea.

However pernicious an opinion may seem, we depend for its

Correction not on the conscience of judges and juries but on

the competition of other ideas." Gertz v. Robert Welch, Inc.,

418 U.S. 323, 339-40 (1974). Subsequently, the Court of

Appeals for the First Circuit observed that:

The doctrine of constitutionally protected

opinion is an attempt to reconcile the conflict

between defamation law, which has as a major

purpose the compensation of individuals for

speech that harms them, and the first

amendment, which has among its purposes the

protection of free speech.

McCabe v. Rattiner, 814 F.2d 839, 841 (1st Cir. 1987).

Nevertheless, while some constitutional protection is

afforded to "opinions," that protection is not unbounded.

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[W]e do not think this passage from Gertz was

intended to create a wholesale defamation

exemption for anything that might be labeled

"opinion." Not only would such an

interpretation be contrary to the tenor and

context of the passage, but it would also ignore

the fact that expressions of "opinion" may

often imply an assertion of objective fact.

If a speaker says, "In my opinion John Jones is

a liar," he implies a knowledge of facts which

lead to the conclusion that Jones told an

untruth. Even if the speaker states the facts

upon which he bases his opinion, if those facts

are either incorrect or incomplete, or if his

assessment of them is erroneous, the statement

may still imply a false assertion of fact.

Simply couching such statements in terms of

opinion does not dispel these implications; and

the statement, "In my opinion Jones is a liar,"

can Cause as much damage to reputation as the

Statement, "Jones is a liar." As Judge Friendly

aptly stated: "[It] would be destructive of the

law of libel if a writer could escape liability

for accusations of [defamatory conduct] simply

by using, explicitly or implicitly, the words 'I

~ think.'"

Milkovich v. Lorain Journal Co., 497 U.S. 1, 18-19 (1990).

See also Levinsky's v. Wal-Mart Stores, Inc., 127 F.3d 122,

127-28 (1st Cir. 1997) ("The First Amendment does not

inoculate all opinions against the ravages of defamation suits.

A statement couched as an opinion that presents or implies the

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127-28 (1st Cir. 1997) ("The First Amendment does not

inoculate all opinions against the ravages of defamation suits.

A statement couched as an opinion that presents or implies the

existence of facts which are capable of being proven true or

false can be actionable.").

Numerous courts have wrestled with this "fact-

opinion" dichotomy. In an effort to assist trial courts in their

efforts to resolve that issue, Chief Judge Posner of the Court

of Appeals for the Seventh Circuit has opined that:

A statement of fact is not shielded from an

action for defamation by being prefaced with

the words 'in my opinion, ' but if it is plain that

the speaker is expressing a subjective view, an

interpretation, a theory, conjecture, or

surmise, rather than claiming to be in

possession of objectively verifiable facts, the

Statement is not actionable.

Haynes v. Alfred A. Knopf, Inc., 8 F.3d 1222, 1227 (7th Cir.

1993). Nevertheless, the question over how best to separate

actionable statements from mere opinions has been, and likely

will continue to be, a topic of debate. Compare Lewis v.

Time, Inc., 710 F.2d 549, 553 (9th Cir. 1983) ("three factors

[are] important in determining whether a statement is [one of]

fact or opinion") with Ollman v. Evans, 750 F.2d 970, 979

(D.C. Cir. 1984) (utilizing four factors in the same analysis).

This circuit appears to have adopted the multi-factor

analysis articulated by Court of Appeals for the District of

Columbia in Ollman. See Phantom Touring, Inc. v. Affiliated

Publications, 953 F.2d 724, 727 (1st Cir. 1992); McCabe v.

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distinction between statements that are actionable and those

that are not." Levinsky's, 127 F.3d at.127.

Against that backdrop, St. Martin's claims that

statements (b), (c), (e), (f), and (h) are not actionable because

they are not the type of factual statements that can be proved

false. Defendant's memorandum at p. 45. With regard to

Statements (b), (f), and (h), St. Martin’s is correct; as a matter

of law, those statements are not actionable. Among other

things, they contain language that makes it clear that they are

speculative expressions of opinion (e.g., "Crowley believed"

and “if that were so"). Moreover, statement (f) contains

language ("offered very little real substance") which, by its

vague and ambiguous nature, does not lend itself to proof as

being either true or false. See generally Milkovich v. Lorain

Journal Co., 497 U.S. at 17 (recognizing that "rhetorical

hyperbole" and “imaginative expression" are not normally

actionable); Levinsky’s, 127 F.3d at 129 ("a particular word

or phrase ordinarily cannot be defamatory unless in a given

context it reasonably can be understood as having an easily

ascertainable and objectively verifiable meaning. The vaguer

a term, or the more meanings it reasonably can convey, the

less likely it is to be actionable. "). The same is true with

regard to statement (b) (Gray "faked his closeness" with

President Reagan). See, e.g., Phantom Touring, 953 F.2d at

728 (holding that the words "fake" and "phony" are

unprovable adjectives, which lend themselves to numerous

interpretations).

In the end, no reasonable trier of fact could conclude

that any of those statements implies a defamatory statement of

fact. Accordingly, St. Martin's is entitled to

judgment with regard to statements (b), (f), and (h). The

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remaining statements could reasonably be iiiterpreted to imply

false assertions of fact (e.g., that Gray overcharged clients,

that the Spain office of G&C was a money laundering

operation, etc.). Consequently, St. Martin's is not entitled to

judgment as a matter of law with regard to Gray's claims as

to those statements.

Ill. Statements “of or Concerning" Gray.

Finally, St. Martin's claims that statements (e), (f),

and (g) refer only to the corporate entity G&C and not to

Gray personally. Accordingly, it says that Gray cannot

recover for those allegedly defamatory statements. Having

previously ruled that statement (f) is not actionable, the court

will address only statements (e) and (g) .

St. Martin's correctly points out that, to be actionable,

the alleged defamatory statements must be "of or concerning"

Gray. See, e.g., Indep. Mechanical Contractors, 138 N.H.

at 118; Keene Publishing Corp., 127 N.H. at 219. However,

it erroneously concludes that statements about G&C cannot,

as a matter of law, defame Gray. Even though statements (e)

and (g) do not specifically refer to Gray, he may prevail if a

reader of The Power House would, based upon his or her

understanding of Gray's role in G&C, reasonably believe that

those statements refer to him. See Restatement (Second) of

Torts, § 564A. See also Caudle v. Thomason, 942 F.Supp.

635, 638 (D.D.C. 1996); Winn v. United Press International,

938 F.Supp. 39, 43-44 (D.D.C. 1996).

During the periods referenced in comments (e) and

(g), Gray was the chairman of G&C. Based upon Gray's

substantial role in the corporation, the court cannot conclude,

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as a matter of law, that a reasonable reader of The Power

House would not infer that Gray was responsible for or

involved in the conduct referenced in those comments.

Conclusion

For the foregoing reasons, St. Martin's motion for

summary judgment (document no. 93) is granted in part and

denied in part. St. Martin's is entitled to judgment as a matter

of law with regard to Gray's claims as to statements (b), (f),

and (h), as alleged in paragraph 11 of plaintiff's complaint.

In all other respects, St. Martin's motion is denied.

SO ORDERED. *

/s/

Steven J. McAuliffe

United States District Judge

March 5, 1998

cc: James G. Walker, Esq.

Mark D. Baizli, Esq.

Cletus P. Lyman, Esq.

William L. Chapman, Esq.

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