# Appendix — Consumers Union of United States, Inc. v. Suzuki Motor Corp.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Appendix
- **Published:** January 1, 2003
- **Citation:** 540 U.S. 983

## Text

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APPENDIX A — AMENDED OPINION OF THE
UNITED STATES COURT OF APPEALS FOR THE
NINTH CIRCUIT FILED MAY 19, 2003

UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

No. 00-56043
330 F.3d 1127; 2003 U.S. App. LEXIS 9559
February 12, 2002, Argued and Submitted,
Pasadena, California

May 19, 2003, Filed

SUZUKI MOTOR CORPORATION AND AMERICAN
SUZUKI MOTOR CORPORATION,

Plaintiff-Appellant,
v.

CONSUMERS UNION OF UNITED STATES, INC.,
a non-profit New York Corporation,

Defendant-Appellee.

JUDGES: Before: Warren J. Ferguson, A. Wallace Tashima,
and Susan P. Graber, Circuit Judges. Opinion by Judge
Tashima; Concurrence by Judge Graber; Dissent by Judge
Ferguson.

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Appendix A |
OPINION:
AMENDED OPINION
TASHIMA, Circuit Judge:

In 1988, Appellee Consumers Union of United States,
Inc. (CU), published a story in its magazine Consumer
Reports, in which it rated the Suzuki Samurai “Not
Acceptable” based on its propensity to roll over during
accident avoidance tests. Since that time, CU has publicly
referred to the negative Samurai rating in various fora, most
prominently in the 60th Anniversary issue of Consumer
Reports, published in 1996. Appellant Suzuki Motor
Corporation (Suzuki), the manufacturer of the Samurai, has
challenged the validity of CU’s Samurai test and, on the heels
of the 60th Anniversary issue, brought this action against
CU alleging product disparagement. CU’s motion for
summary judgment was granted by the district court, which
held that a reasonable jury-could not conclude by clear and
convincing evidence that CU had acted with actual malice.
We have jurisdiction under 28 U.S.C. § 1291, and we reverse
and remand for further proceedings.

I. BACKGROUND

CU is a nonprofit corporation that engages in
comparative testing and evaluation of consumer products and
services, the results of which are published in the magazine
Consumer Reports. In order to provide buying and safety
advice to automobile purchasers, CU’s Automotive Testing
Division (ATD) tests approximately 40 cars and other
vehicles each year.

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CU tested the Samurai in 1988.' The Samurai, a sport
utility vehicle (SUV) manufactured by Suzuki, was
introducea in the United States in 1985. By 1988,
approximately 150,000 Samurais had been sold. Although it
had received some favorable reviews from the automotive
press, the Samurai had also been the subject of news stories
that highlighted its instability and propensity to tip over. In
February 1988, the Center for Auto Safety filed a petition
with the National Highway Traffic Safety Administration
(NHTSA) to open an investigation into an alleged safety
defect of the Samurai. The petition was denied, although the
NHTSA emphasized that the denial was not an endorsement
of the safety performance of a vehicle.

A. April 20, 1988: Long-Course Testing

On April 20, 1988, the ATD tested the Samurai, along
with the Jeep Cherokee, Isuzu Trooper II, and Jeep Wrangler,
on its standard long course, a double lane-change avoidance
maneuver test course that CU had used since 1973.” The long

1. As Suzuki points out, around this time CU made a significant
financial outlay in order to secure a new headquarters building in
Yonkers, New York. This outlay of approximately $ 30 million placed
CU in what the district court termed a “financially overextended”
position.

2. The long-course maneuvers followed preliminary testing on
the Samurai. CU notes that during the evaluation and break-in process,
Alan Hanks, the Facilities Manager of the ATD, rolled the Samurai
on a snow-covered gravel road at 15 miles per hour. During the formal
test ride on April 7, 1988, CU driver Kevin Sheehan reported that
the Samurai was “by far the worst ride in my 20+ years at CU.”

(Cont’d)

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Appendix A

course was designed to replicate an emergency situation in
which a driver suddenly steers a vehicle left into the opposing
lane, to avoid an obstacle, and quickly back into the original
lane to avoid oncoming traffic. Several CU personnel were
in attendance during the April 20 testing, including Robert
Knoll, the head of the ATD, Dr. R. David Pittle, CU’s
Technical Director and Senior Vice-President, and Irwin
Landau, the Editorial Director of Consumer Reports, who
had been assigned as the initial writer and editor of the
Samurai article. Pittle had invited Landau to attend the testing
because he thought that they might witness a tip-up of the
Samurai.

CU driver Kevin Sheehan drove the Samurai first, putting
it through the long course 16 times at speeds reaching over
50 miles per hour. The Samurai that Sheehan drove was
equipped with outriggers, which essentially act as training
wheels to prevent the car from tipping over completely.’
During Sheehan’s runs, the Samurai did not tip over,
prompting Sheehan to make the following evaluation of the
car: “rubbery, slow response, rocks a bit, but never felt like
it would tip over.” In the Avoidance Maneuver Data
Summary, Sheehan rated the Samurai as highly as or better
than other vehicles tested that day.

(Cont'd)

Sheehan also took the Samurai on a one-day trip test on April 11,
1988, after which he noted that the Samurai should be raied
“Not Acceptable.” In addition, as Suzuki notes, preliminary research
had been conducted for the Samurai story prior to the initiation of
long-course testing.

3. Suzuki contends that the outriggers allowed CU to achieve
dramatic results during the tests without risking a real rollover.

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Appendix A

After Sheehan had completed his testing, CU removed
the outriggers. CU driver Rick Small then drove the Samurai
through the long course 21 times at speeds similar to those
achieved by Sheehan. Again, there were no tip-ups. In his
driver log, Small stated: “steering is slow, but it works—
responds well and corrects quickly, leans normally, snaps
back. Confidence fairly high. No real problem.” On the basis
of his test drives, Small rated the Samurai higher than the
other three vehicles tested that day.

According to testimony by former CU employee Ron
Denison, at some point during the long-course testing, which
had not demonstrated any tip-ups of the Samurai, Landau
told Sheehan: “If you can’t find someone to roll this Car,
I will.”

After Sheehan and Small had completed their test runs,
Pittle, who was not a test driver, began to drive the Samurai
through the long course. According to Pittle, he did so
because he had never driven a small SUV and wanted to get
a feel for how it handled through the course. Pittle took the
car though the course 10 times, achieving a top speed of 49
miles per hour. On Pittle’s tenth run, the Samurai tipped up
on two wheels. Pittle stated that he did not purposefully cause
the Samurai to tip up and that it was a Startling and
unexpected occurrence. When Pittle tipped the car, one
onlooker yelled, “‘yeah!,” while another shouted, “I think I
got that, I think I got that.”

B. April 26, 1988: Short-Course Testing

After the long-course testing, Knoll redesigned CU’s
avoidance course to replicate the situation that caused the

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Appendix A

Pittle tip-up. This new modified short course had a reduced
distance for the first lane change, and the obstacle to be
avoided was moved three feet to the left.

Sheehan, who was afraid to drive the Samurai through
the short course, was replaced by CU driver Fred Wood.
Wood, who drove the vehicle with outriggers, made 15 runs
through the course. On the fifteenth run, the Samurai tipped
up onto the outriggers. After this last run, Knoll is heard on
the test videotape saying: “That’s it. That looked pretty good.”
Knoll later acknowledged that he was “relieved” that the
Samurai tipped up during short-course testing.

Small then drove the car through the short course. On
his second run, the Samurai tipped up onto the outriggers at
a speed of 40 miles per hour. After the tip-up occurred, CU
technician Joseph Nappi can be heard on the test videotape
saying, “[a]ll right Ricky baby.’* That same day, CU also
put the Jeep Wrangler and Isuzu Trooper II through the short
course with no tip-ups reported.

4. Suzuki emphasizes CU’s submission of what it characterizes
as a “false” affidavit in connection with Nappi’s statement.
CU employees Hanks, Sheehan, Wood, Nappi, and Knoll submitted
an affidavit stating that it was Denison, not Nappi, who could be
heard on the videotape saying “All right, Ricky baby” after Small
tipped the Samurai on April 26, 1988. Nappi later admitted, however,
that he in fact made the statement. Suzuki suggests that the affidavit
was submitted in an effort to discredit Denison, who had testified
that Landau threatened to find someone to roll the Samurai after the
April 20, 1988, long-course testing. CU proffers a benign explanation
for Nappi’s changing his story. Resolution of this dispute, however,
is not critical to our decision.

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Appendix A

C. May 12, 1988: Additional Short-Course Testing

Further testing was scheduled on the short course for
May 12, 1988. The parties offer conflicting justifications for
why this set of tests was necessary. Suzuki suggests that the
additional testing was scheduled for the purpose of shooting
video footage of the Samurai for a subsequent press
conference, at which it had already been decided that CU
would rate the Samurai “Not Acceptable.” CU contends that
the testing was held to evaluate the performance of the newly
released 1988 Samurai, which included suspension
modifications that distinguished it from the 1988 version
tested previously.

Small was the first to drive the Samurai through the short
course on this day, tipping over onto the outriggers on his
fifth run. Following Small, Wood tipped the Samurai on his
second run. Pittle was watching the test runs and, prior to
witnessing a tip up, stated: “Can’t you just see it, we get no
lift off the ground. Oh God.” CU also put a Jeep Wrangler,
Jeep Cherokee, and Ford Festiva sedan through the short
course on May 12. None of these vehicles tipped up.

%

D. June 2, 1988: Press Conference

CU held a press conference on June 2, 1988, at which it
announced that the Samurai had shown a propensity to roll
over in CU’s tests and that it would be rated “Not Acceptable”
in an article to appear in the July 1988 issue of Consumer
Reports. During the press conference, Pittle stated that, based
on CU’s testing, the Samurai had an “unusually high
propensity to roll over while performing an accident

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Appendix A

avoidance maneuver that could be demanded suddenly of
any driver during routine driving.” Pittle further described
the short course as “benign,” involving only “very limited
steering inputs,” a characterization he later conceded was
“not accurate.” Pittle also stated that the other tested
vehicles had made it through the short course with a “yawn,”
a statement that Suzuki contends is at odds with the fact that
the Isuzu Trooper II failed the course in three out of four
runs by hitting cones.°

E. July 1988: Article Publication

CU’s negative rating of the Samurai was detailed in an
article entitled, ““Warning: The Suzuki rolls over too easily,”
published in the July 1988 issue of Consumer Reports. The
article was initially written by Landau, although drafts were
reviewed by Pittle, Knoll, the ATD staff, CU’s President
Rhoda Karpatkin, CU’s Technical Department and Library,
and legal counsel.

The article described the steps CU took to test the
Samurai, Jeep Wrangler, Isuzu Trooper II, and Jeep Cherokee.
It began by recounting the incident in which an ATD staff
member rolled the Samurai over on its side during the
evaluation and break-in process. After detailing other
evidence of the Samurai’s safety problems, the article then
described the long-course testing, noting that Pittle, “a staff
member who does not normally drive the course,” tipped the

5. Suzuki also argues that CU deliberately excised footage of
the Isuzu Trooper II’s runs from the videotape screened at the press
conference to downplay the fact that the Trooper also had trouble
making it through the course.

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Appendix A

Samurai at 45 miles per hour after making “a slight steering
misjudgment” that should not have “put daylight under the
tires of any car.” The article continued by highlighting the
results of both short-course tests, concluding that “that Suzuki
Samurai is so likely to roll over during a maneuver that could
be demanded of any car at any time that it is unfit for its
intended use. We therefore judge it Not Acceptable.”

On June 2, 1988, CU submitted to NHTSA a copy of the
article, the videotape from the press conference, and a
diagram of its short course in support of a petition to establish
a minimum stability standard to protect against unreasonable
risk of rollover.

F. NHTSA Report

On September 8, 1988, NHTSA issued a decision
denying the motor vehicle defect petition filed earlier by the
Center for Auto Safety. In its analysis, the NHTSA stated
that “the rollover crash involvement of the Samurai appears
to be within the range of most other light utility vehicles.”
Denial of Motor Vehicle Defect Petitions, 53 Fed. Reg.
34,866 (Sept. 8, 1988). It concluded that the Ford Bronco II
“was found to have more than 3 times the first event rollover
... Involvement as the Samurai” and that “the Samurai had
a first event rollover involvement corresponding to the
[Chevrolet] S-10 Blazer.” Jd.

NHTSA’s opinion also criticized CU’s testing protocols,
stating as follows: “The existing test procedures for assessing

6. On September 25, 1996, NHTSA denied a second Samurai
defect petition on similar grounds. Denial of Motor Vehicle Defect
Petition, 61 Fed. Reg. 50,372 (Sept. 25, 1996).

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_ Appendix A

the rollover propensity of vehicles are unsatisfactory because
they do not provide for repeatable, reproducible results, and
there are no accepted performance criteria. The testing
appears to rely on the skill and influence of the driver and
the presumption that the vehicle suspension, tire, and road
surface characteristics will remain constant throughout the
testing.” 53 Fed. Reg. at 34,867. NHTSA concluded by stating
that, although the CU testing results were “cause for some
concern,” “the test procedures do not have a scientific basis
and cannot be linked to real-world crash avoidance needs,
or actual crash data. Using the same procedures, probably
any light utility vehicle could be made to roll over under the
right conditions and driver input.”’ Jd. CU issued a
subsequent article in Consumer Reports criticizing the
NHTSA decision.

G. 1988-1996: CU’s Republications of the Samurai
Report and Further Rollover Claims
Between 1988 and 1996, CU republished references to
the 1988 Samurai rating on at least 24 separate occasions in
Consumer Reports, CU’s annual buying guide, and other
editions of CU’s car books. During this time, CU states,
several events bolstered its belief in the correctness of its
“Not Acceptable” rating: a 1988 England-based Consumers’
Association article that buttressed the Samurai rollover claim;

7. In its summary of the test results on multipurpose vehicles,
Britain’s Department of Transport similarly concluded that the
“results from the modified Consumer Union tests were unpredictable”
and that “[d]river influence is greatest in the modified Consumer
Union manoeuvre.” Dep’t of Transp., Stability of Multi-Purpose
4-Wheel Drive Vehicles (Dec. 16, 1988).

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Appendix A

a 1988 lawsuit filed by seven state Attorneys General
charging Suzuki with false and misleading advertising
regarding the Samurai’s rollover potential (the case settled);
the decision in Malautea v. Suzuki Motor Corp., 148 F.R.D.
362, 375 (S.D. Ga. 1991), in which the court suggested that
Suzuki knew of the Samurai’s rollover propensity and did
nothing to correct it; two separate multimillion dollar verdicts
in the case of Rodriguez v. Suzuki Motor Co., where juries
determined that the Samurai was unreasonably dangerous due
to its rollover propensity (both verdicts were reversed and
the case settled); the disclosure of documents from the
Malautea and Rodriguez cases suggesting that Suzuki knew
of the Samurai’s rollover propensity; and eight years of
further SUV testing by CU during which time only the
Samurai in 1988 and Isuzu Trooper in 1996 tipped up.

H. January 1996: 60th Anniversary Issue of
Consumer Reports

In its 60th Anniversary issue of Consumer Reports,
published in January 1996, CU set forth a chronology that
contained a picture uf the Samurai tilted on two wheels, with
the following caption:

1986 CU buys its own auto test track in rural
Connecticut. Two years later, based on tests
conducted there, CONSUMER REPORTS
discovers the Suzuki Samurai easily rolls over in
turns and rates it Not Acceptable. Sales of the
Samurai dwindle away. Since 1936, dozens of
products, from chemistry sets and toasters to

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Appendix A

power mowers and child safety seats, have been
identified as safety hazards and rated Not
Acceptable.

The same January 1996 issue also contained a section entitled
“Memo to Members,” in which CU’s President stated that
“we still find products that are unsafe: From kerosene heaters
to the Suzuki Samurai to child safety seats, CONSUMER
REPORTS has called them out—and our work goes on.””*

I. April 1996: Suzuki Files This Action

On April 11, 1996, Suzuki filed the instant action alleging
that CU’s ongoing publication of the negative Samurai
rating constituted produci disparagement.’ After discovery,
CU moved for summary judgment, challenging the
sufficiency of Suzuki’s evidence that CU had acted with
actual malice in its reporting on the Samurai. The district
court granted CU’s motion and entered judgment in its favor.
Suzuki timely appealed.

8. In November 1995, CU published a car buyers guide on CD-
Rom that also reiterated the “Not Acceptable” rating from its July
1988 Consumer Reports article.

9. After the action was filed, CU continued publicly to refer to
the Samurai test, citing the “Not Acceptable” rating in a June 1996
Consumer Reports article on SUVs; sending out contribution
solicitation cards in August and October 1996 with a photograph
showing the Samurai tipped up on two wheels; and referring to the
Samurai in a 1996 press conference and article about the Isuzu
Trooper.

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Il. STANDARD OF REVIEW

A grant of summary judgment is reviewed de novo.
Devereaux v. Abbey, 263 F.3d 1070, 1074 (9th Cir. 2001)
(en banc). This court’s review is governed by the same
standard used by the trial court under Federal Rule of Civil
Procedure 56(c). Adcock v. Chrysler Corp., 166 F.3d 1290,
1292 (9th Cir. 1999). We must therefore determine, viewing
the evidence in the light most favorable to the nonmoving
party, whether there are any genuine issues of material fact
and whether the district court correctly applied the relevant
substantive law. Devereaux, 263 F.3d at 1074.

Because this case implicates the First Amendment
protections of a media defendant in the context of product
disparagement, “[t]he appropriate summary judgment
question is whether a reasonable jury could find, by clear
and convincing evidence, that [the plaintiff] has shown actual
malice.” Kaelin v. Globe Communications Corp., 162 F.3d
1036, 1039 (9th Cir. 1998). In answering this question, we
“must draw all justifiable inferences in favor of the
nonmoving party, including questions of credibility and of
the weight to be accorded particular evidence.” Masson v.
New Yorker Magazine, Inc., 501 U.S. 496, 520, 115 L. Ed.
2d 447, 111 S. Ct. 2419 (1991). “[T]he plaintiff, to survive
the defendant’s motion, need only present evidence from
which a jury might return a verdict in [its] favor. If [the
plaintiff] does so, there is a genuine issue of fact that requires
a trial.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257,
91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986).

The dissent contends that, by applying the well-
established summary judgment rules to the actual malice issue

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‘

on summary judgment, we offend the “independent
examination” standard of New York Times Co. v. Sullivan,
376 U.S. 254, 11 L. Ed. 2d 686, 84 S. Ct. 710 (1964). This
argument, however, conflates the summary judgment
standard of review with application of the New York Times
standard and, as a result, impermissibly weighs the evidence
at the summary judgment stage. Under the independent
examination rule, we “exercise our independent judgment”
in evaluating the lower court’s opinion, rather than granting
it any deference. See Bose Corp. v. Consumers Union of
United States, Inc., 466 U.S. 485, 514, 80 L. Ed. 2d 502, 104
S. Ct. 1949 (1984). In other words, we review the district
court’s decision de novo. See Hoffman v. Capital Cities/ABC,
Inc., 255 F.3d 1180, 1186 (9th Cir. 2001) (“We review the
district court’s finding of actual malice de novo.”); Eastwood
v. Nat’l Enquirer, Inc., 123 F.3d 1249, 1252 (9th Cir. 1997)
(“First Amendment questions of ‘constitutional fact’ compel
us to conduct a de novo review.” (internal quotation marks
and brackets omitted) (quoting Bose, 466 U.S. at 508 n.27)).
This does not mean, however, contrary to the dissent’s
suggestion, that in the process of exercising our independent
judgment, we jettison the procedural rules governing
summary judgment when reviewing the grant of summary
judgment in First Amendment cases. While it is true that we
must independently examine the record when reviewing the
grant of summary judgment, starting with Anderson v. Liberty
Lobby, the Court has been clear that we apply the
well-established summary judgment rules to review of the
actual malice issue:

Consequently, where the New York Times “clear
and convincing” evidence requirement applies, the

|

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trial judge’s summary judgment inquiry as to
whether a genuine issue exists will be whether
the evidence presented is such that a jury applying
that evidentiary standard could reasonably find for
either the plaintiff or the defendant. Thus, where
the factual dispute concerns actual malice, clearly
a material issue in a New York Times case, the
appropriate summary judgment question will be

. whether the evidence in the record could support
a reasonable jury finding either that the plaintiff
has shown actual malice by clear and convincing
evidence or that the plaintiff has not.

Anderson, 477 U.S. at 255-56. See also Masson, 501 U.S. at
520 (“On summary judgment, we must draw all justifiable
inferences in favor of the nonmoving party, including
questions of credibility and of the weight to be accorded
particular evidence.”). And, as we have noted above, our case
law also recognizes the application of the normal summary
judgment standards to the actual malice issue. See Solano v.
Playgirl, Inc., 292 F.3d 1078, 1082, 1087 (9th Cir.), cert.
denied, 154 L. Ed. 2d 443, 123 S. Ct. 557 (2002); Kaelin,
162 F.3d at 1039. Thus, contrary to the dissent’s suggestion,
the independent examination rule of New York Times is
consistent with our well-established procedural rules
governing review of summary judgment motions on the actual
malice issue and does not require us to discard the procedural
rules designed to preclude the resolution of disputed factual
issues at the summary judgment stage.’

10. The cases cited by the dissent do not require otherwise.
See Andersen v. McCotter, 100 F.3d 723, 725 (10th Cir. 1996)
(Cont'd)

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Thus, although the dissent provides a plausible view of
the evidence—that CU acted in good faith as a skeptical
consumer watchdog should—t is not our role, at this stage,
to take sides in this way. As we discuss below, there is also
another plausible view of the summary judgment record—
that CU “rigged” a test to achieve a predetermined result in
order to serve its own pecuniary interests. Because a jury
would be entitled to believe the latter view of the evidence,
Suzuki’s case survives summary judgment, even applying
the independent examination standard.

(Cont'd)

(affirming that “[s]ummary judgment is appropriate when there is no
genuine issue as to any material fact”); Secrist v. Harkin, 874 F.2d
1244, 1251 (8th Cir. 1989) (“To withstand a motion for summary
judgment, a public official or public figure must present evidence to
support a jury finding that he or she has shown with convincing clarity
that a defendant acted with actual malice.”); Liberty Lobby, Inc. v.
Dow Jones & Co., 267 U.S. App. D.C. 337, 838 F.2d 1287, 1293
(D.C. Cir. 1988) (“The question for the court is ‘whether the evidence
presented is such that a reasonable jury might find that actual malice
had been shown with convincing clarity.’” (quoting Anderson, 477
U.S. at 257)); Herbert v. Lando, 781 F.2d 298, 305 (2d Cir. 1986)
(affirming summary judgment standards).

Similarly, CU also misstates the applicable standard of review,
contending that the normal summary judgment standard does not
apply. The cases on which it relies, however, all involve the review
of a judgment rendered after trial. See Bose, 466 U.S. at 510-11;
Newton v. Nat'l Broad. Co., 930 F.2d 662, 669 (9th Cir. 1991);
Eastwood, 123 F.3d at 1252. Thus, these cases do not, as CU suggests,
require that we aLandon the established standard of review in the
summary judgment context.

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Ill. ANALYSIS

The parties do not dispute that for Suzuki to recover in
this case, it must, as a public-figure plaintiff, prove by clear
and convincing evidence that CU published disparaging
statements about the Samurai with actual malice.'!
See Unelko Corp. y. Rooney, 912 F.2d 1049, 1057-58
(9th Cir. 1990) (stating that claims for product disparagement
“are subject to the same first amendment requirements that
govern actions for defamation”): see also Isuzu Motors Ltd.
v. Consumers Union of United States, Inc., 66 F. Supp. 2d
1117, 1124 (C.D. Cal. 1999); Melaleuca, Inc. vy. Clark, 66
Cal. App. 4th 1344, 78 Cal.Rptr.2d 627, 637 (Ct. App. 1998);
cf. Bose, 466 U.S. at 513 (assuming without deciding that
proof of actual malice is required in a product disparagement
action brought by a public-figure plaintiff against a media
defendant). Actual malice requires a showing that the
defendant made a false statement “with knowledge that the
statement was false or with reckless disregard as to whether
or not it was true.” Hustler Magazine, Inc. v. Falwell,
485 U.S. 46, 56, 99 L. Ed. 2d 41, 108 S. Ct. 876 (1988);

11. Suzuki accepts the actual malice formulation of the product
disparagement standard for the purposes of this appeal, although it
Suggests that the Supreme Court has left this issue open, see Bose,
466 U.S. at 513, and reserves the right to challenge the standard on
further review. Amicus Washington Legal Foundation devotes a
substantial portion of its brief to arguing that the First Amendment
does not demand a Showing of actual malice for product
disparagement claims. We decline, however, to address an issue raised
only by an amicus. See Russian River Watershed Prot. Comm. v. C ity
oj Santa Rosa, 142 F.3d 1136, 1141 n.1 (9th Cir. 1998) (“Generally,
we will not consider on appeal an issue raised only by an amicus.”).

CO

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accord Harte-Hanks Communications, Inc. v. Connaughton,
491 U.S. 657, 667, 105 L. Ed. 2d 562, 109 S. Ct. 2678 (1989).

This Court has interpreted Harte-Hanks as providing two
different tests for proving reckless disregard. Masson v. New
Yorker Magazine, Inc., 960 F.2d 896, 900 (9th Cir. 1992)
(Masson II):

Where the jury has proof that a publisher “actually
had a high degree of awareness of probable
falsity,” that alone will establish that it “in fact
entertained serious doubts as to the truth of [its] -
publication.” Where such direct proof is missing,
the jury may nevertheless infer that the publisher
was aware of the falsity if it finds that there were
“obvious reasons to doubt” the accuracy of the
story, and that the defendant did not act reasonably
in dispelling those doubts .... As Harte-Hanks
points out, “[a]lthough failure to investigate will
not alone support a finding of actual malice, the
purposeful avoidance of the truth is in a different
category.”

Id. (quoting Harte-Hanks, 491 U.S. at 688, 692) (brackets in
the original).

Suzuki argues that the district court erred in concluding
that a reasonable jury could not find that CU’s statements
regarding the Samurai met the actual malice standard.
It contends that the evidence is sufficient to sustain a jury
verdict under either test articulated in Masson II for proving
CU’s reckless disregard of the truth.

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Appendix A

A. Awareness of Probable Falsity

Suzuki first contends that a reasonable jury could find
by clear and convincing evidence that CU had a high degree
of awareness of the probable falsity of its statements about
the Samurai. It argues that there is a sufficient evidentiary
basis showing that CU knew that the Samurai did not tip up
more easily than other SUVs and essentially rigged its testing
to produce a predetermined result.

At the outset, CU raises a general challenge to Suzuki’s
argument, suggesting that the overwhelming weight of the
evidence demonstrates the skill and dedication of CU in
researching and publishing the Samurai Story, and therefore
militates against any finding of actual malice. CU assails
Suzuki for taking ‘“‘a few facts out of context, which it pieces
together in a contrived and inherently implausible fashion
without any supporting evidence.” It argues that this court
Should reject Suzuki’s arguments as conjectural and places
great weight on its own assertions that it absolutely believed
in the truth of its statements.

In the summary judgment context, this argument is
unconvincing. It is true that CU has offered evidence of its
accuracy in reporting the Samurai story—or, at least, in its
subjective belief that it accurately reported the Story. But its
characterization of its own evidence as overwhelming and
its disparagement of Suzuki’s evidence as out of context begs
the question that we must resolve. The fact that CU employees
believed in the truth of their negative statements about
the Samurai cannot, by itself, defeat summary judgment.
See St. Amant y. Thompson, 390 U.S. 727, 732, 20 L. Ed. 2d

20a

Appendix A

262, 88 S. Ct. 1323 (1968) (“The defendant in a defamation
action... cannot. . . automatically insure a favorable verdict
by testifying that he published with a belief that the statements
were true.”); Solano, 292 F.3d at 1087 (“we have yet to see a
defendant who admits entertaining serious doubt about the
authenticity of an article it published’’). Rather, the issue is
whether there is adequate evidence to support the contrary
view—namely, that behind the veneer of accuracy, CU was
disseminating the Samurai story with knowledge, or reckless
disregard, of its falsity. While it may be true that CU’s
evidence of meticulous reporting ultimately has more weight
than Suzuki’s evidence of actual malice, that is not a question
to be resolved here. See Anderson, 477 US. at 249.

Turning to the evidentiary basis for Suzuki’s claims,
Suzuki contends that there is sufficient evidence that CU
“rigged” the tests to produce the rollover result,
demonstrating its awareness of the probable falsity of the
negative Samurai rating. In support of this argument, Suzuki
highlights the testimony of Denison, who stated that Landau,
after witnessing Sheehan and Small’s clean runs through the
long course, said: “If you can’t find someone to roll this car,
I will.” After this comment was allegedly made (and after
Sheehan and Small had taken the Samurai through 37 long-
course runs without incident), Suzuki notes that Pittle, who
was not a CU test driver, decided to drive the Samurai, tipping
the vehicle after 10 runs to a cheer from a CU onlooker.'"
Suzuki also points to the fact that CU modified the long

12. The record does not indicate whether 10 runs was
predetermined by the testing protocol or whether Pittle simply stopped
making further runs after achieving a tip-up.

2la
Appendix A

course, which it had used since 1973, to replicate the Pittle
situation and then resumed its testing of the Samurai until it
tipped up—again eliciting statements that can be construed
as expressions of satisfaction (“That’s it. That looked pretty
good.” “All right Ricky baby.”).

This evidence is adequate to preclude summary
judgment. A reasonable jury. could find by clear and
convincing evidence that CU sought to produce a
predetermined result in the Samurai test. The timing of the
course modification, the fact that the Suzuki was tested
repeatedly until it tipped, and the reactions of CU employees
all support such an inference. A permissible inference of
reckless disregard follows from this evidence of “rigged”
testing—if CU modified the course in order to cause a
rollover, a reasonable jury could find that the truthfulness of
any subsequent reports was Vitiated. |

Although it Suggests that the facts have been taken out
of context, CU does not seriously challenge Suzuki’s
argument of rigging. CU does question Suzuki’s reliance on
the Denison testimony, arguing that he had a high regard for

Denison did testify, however, that while he believed CU was
honest 99.9 percent of the time, the 0.1 percent that he was
excluding was the 1988 test of the Samurai. Moreover,
_although CU has its own interpretation of why it modified
the long course and retested the Samurai, we, of course,
cannot credit that interpretation over Suzuki’s at the summary
judgment Stage. The district court did not give adequate credit
to this evidence of test-rigging.

22a
Appendix A

Suzuki also contends that evidence of CU’s avaricious
motives supports an inference of actual malice. It suggests
that the evidence reveals that CU was financially
overextended due to capital investments in the period leading
up to the Samurai report and needed a blockbuster story to
raise CU’s profile and increase fundraising revenues. It is
not disputed that, at the time of the Samurai story, CU had
incurred substantial debt for a new headquarters and that CU
has used the Samurai story in its fundraising solicitations.

CU characterizes Suzuki’s financial motive argument as
an “unsupported accusation” and states that, instead of
increasing revenues, CU’s pre-publication press conference
about the Samurai test actually decreased its sales of
Consumer Reports. CU further contends that evidence of
financial motive does not support a finding of actual
malice under the relevani case law. See Harte-Hanks,
491 U.S. at 667 (“Nor can the fact that the defendant
published the defamatory material in order to increase its
profits suffice to prove actual malice.”). The district court
adopted this argument in granting summary judgment.

We agree with Suzuki, however, that the district court
erred in this regard. There is sufficient circumstantial
evidence of a financial motive to support the ultimate
conclusion of actual malice. While CU is correct that
financial motive cannot, by itself, prove actual malice, it
nonetheless is a relevant factor bearing on the actual malice
inquiry. See Harte-Hanks, 491 U.S. at 668; Kaelin, 162 F.3d
at 1042. The evidence of financial motive dovetails with the
evidence of test-rigging described above. The fact that CU
needed to boost its revenues to complete its capital campaign

23a
Appendix A

lends credence to Suzuki’s contention that CU rigged the
Samurai testing to produce the predetermined rollover result,

We conclude that the evidence of motive and test-rigging,
in combination, is sufficient to preclude Summary judgment
and therefore requires reversal!

B. Purposeful Avoidance

Suzuki also argues that there was sufficient evidence for
a jury to have concluded under Masson /T that, in the face of
obvious reasons to doubt the accuracy of its Samurai story,
CU did not act reasonably in dispelling those doubts, thereby
raising the inference that CU knew of the story's falsity.
Under this approach, “[i]t is not ... the failure to act
reasonably in itself that establishes malice; that failure is only
a link in the chain of inferences that could (but need not)
lead a jury to conclude that the publisher failed to conduct
an investigation because it was already pretty much aware

and CU’s concealment of evidence contrary to its claim that the
Samurai “rolls over too easily.” Because the analysis set forth above
is dispositive of the first prong of the Harte-Hanks test (“a high degree
of awareness of probable falsity”), we need not reach Suzuki’s
remaining arguments in Support of reversal based on Harte-Hanks’
first prong.

24a
Appendix A

of the falsity.” Masson 11, 960 F.2d at 900. The central inquiry
is whether the evidence discloses that a defendant
purposefully avoided the truth. /d.

First, Suzuki claims that CU had reason to doubt its
assertion that the Samurai’s rollover propensity warranted a
“Not Acceptable” rating. In particular, Suzuki points to the
NHTSA decision issued in September 1988 indicating that
the Ford Bronco II had a three times greater rollover record
than the Samurai, which had a rollover record corresponding
to the Chevrolet S-10 Blazer. Additionally, CU learned in
1989 that the Samurai’s rollover rate was less than the
rollover rate of the Nissan Pathfinder, Toyota 4 Runner, Jeep
CJ-7, and Ford Bronco II. Further, in 1992, the Insurance
Institute for Highway Safety produced a report showing
that the Samurai had a rollover rate lower than that of many
other SUVs.

Second, Suzuki contends that CU had sufficient reasons
to doubt the validity of the testing procedures it used to
determine the negative Samurai rating. Here Suzuki again
relies on the NHTSA study criticizing CU’s testing
procedures for failing to provide a basis for repeatable results
and being overly dependent on driver influence. Suzuki also
emphasizes the British Department of Transport study
echoing these conclusions, as well as statements by Knoll
and Sheehan suggesting that at least some CU personnel
acknowledged that its testing procedures were overly driver-
influenced. Suzuki asserts that, despite these indications that
the Samurai rating rested on questionable data and suspect
methodological premises, CU took no steps to engage in
further investigation, thereby reinforcing the inference of

25a
Appendix A

purposeful avoidance. Suzuki faults CU for failing to
incorporate instruments into its testing that would record how
the driver was steering the vehicle and for never evaluating
its test results against real-world crash data. It suggests that
CU’s failure to do so violated accepted journalistic
standards" and raises the inference that CU ignored contrary
evidence that would confirm the falsity of its claims about
| the Samurai. The district court rejected much of this evidence,
stating particularly that the NHTSA study was not entitled
to greater weight than any other study or opinion regarding
testing methods and therefore could not Support a claim of
actual malice.

In response to the NHTSA report, CU published an article
in the November 1988 issue of Consumer Reports that
addressed the NHTSA’s critique of CU’s negative Samurai
rating. With respect to the issue of the Samurai’s rollover
rate, CU stated:

: According to NHTSA’s own Crash Avoidance
Research Data file, however, the Suzuki Samurai’s
rate of rollover in single-vehicle accidents is more

Stee

14. Relying on expert witness testimony, Suzuki asserts that
CU violated accepted journalistic standards in failing to engage in
further investigation of contradictory evidence. CU responds that
the expert testimony is irrelevant because it is not probative of CU’s
subjective state of mind. See, e.g., Harris v. Quadracci, 856 F. Supp.
513, 519 (E.D. Wis. 1994). Although expert testimony regarding CU’s
departure from accepted professional standards is not sufficient by
itself to establish actual malice, see Harte-Hanks, 491 U.S. at 669,
it does shed light on the propriety of CU’s response to contrary
rollover evidence and, thus, is entitled to be given appropriate weight.

26a

Appendix A

than double the average for all sport-utility
vehicles. In 1986, the most recent year for which
there are figures, the Suzuki rolled over in 64
percent of all single-vehicle Suzuki accidents
reported in this data base. The only vehicle that
came close to the Samurai in rollover involvement
is the now-discontinued Jeep CJ-5 (49 percent).
By contrast, the rollover rate for full-sized sedans
was only 8 percent.

NHTSA appears to have relied not on its
statistics on rollover rates for single-vehicle
accidents but on a different data base, one that
includes only rollovers involving a fatality.
Elsewhere, ... [the NHTSA] notes that the
Samurai was involved in six fatal rollovers per
100,000 vehicles on the road, a record the agency
compares favorably with that of the Ford Bronco
JJ]—19 fatal rollovers per 100,000 vehicles on the
road.

CU has learned that the overall rollover rate
for the Bronco II is high—about the same as that
for the Jeep C/-5—but not nearly as high as the
Suzuki’s. The higher number of fatalities in
Bronco II rollovers could come about for a number
of reasons. The Suzuki rolled over at a relatively
low speed in our accident-avoidance tests;
if Bronco II rollovers occurred at higher speeds,
one would expect more fatalities per rollover.
‘One would also expect more fatalities if the
Bronco II were driven more miles, on average,
than the Suzuki.

27a

Appendix A

Protocols, the article went on to state:

NHTSA did no independent testing of the
Suzuki’s rollover Propensity. Rather, it uncritically
accepted Suzuki’s data, Saying Suzuki
“demonstrated that the Samurai Satisfactorily
completed industry accepted . . . tests which mi ght
be used to assess a vehicle’s rollover propensity.”

But there are no industry-accepted tests for
rollover propensity—a point NHTSA itself makes
elsewhere in its letter . . -

[One] test performed for Suzukj looks
superficially like an avoidance maneuver, since
the car was run through a slalom course. But in a
realistic avoidance maneuver, a car is steered first
to the left and then back to the right immediately.
In the Suzuki test, the car was Steered to the left,
then straightened and allowed to recover before
returning to the right lane. That is a simple
lane-changing maneuver, not an accident-
avoidance maneuver.

NHTSA also adopted as its own another of
Suzuki’s arguments: Using the accident-avoidance
maneuver developed by CU, the agency stated,
“probably any light utility vehicle could be made
to roll over.” But NHTSA offered no evidence or
independent test results to Support such

28a

Appendix A

speculation. In fact, no vehicle other than the
Suzuki has rolled over in the 10 years we’ve tested
for accident avoidance.

The critical inquiry under Masson II] is whether CU failed
to act reasonably in investigating and responding to contrary
studies in a manner that suggested it was attempting
purposefully to avoid discovering the truth of the matter. In
general, the analysis conducted and published by CU in
response to the NHTSA study is not indicative of purposeful
avoidance. To the contrary, in the November 1988 article,
CU challenged the NHTSA report head on, stating its
disagreement in detail and supporting its alternative
conclusions with substantive justifications. To the extent that
there were contrary rollover statistics, CU analyzed them and
explained why they did not warrant a conclusion at odds with
its initial assessment of the Samurai. In response to the
-NHTSA’s critique of CU’s testing, CU argued that the Suzuki
tests upon which the NHTSA relied were flawed. While
Suzuki may disagree with CU’s discussion of the rollover
statistics or its criticisms of Suzuki’s own accident avoidance
tests, such disagreement does not demonstrate CU’s
purposeful avoidance of critical facts.

While we agree with CU, however, that much of Suzuki’s
purposeful-avoidance argument boils down to its disapproval
of CU’s conclusions, there is one issue that nevertheless
precludes summary judgment here. In particular, CU has done
nothing to respond to the criticism of its testing procedures
as overly influenced by driver input. This evidence formed
the basis for the district court’s decision in Jsuzu Motors, in
which the court relied heavily on the NHTSA report to deny

29a
Appendix A

CU’s summary judgment motion, stating that “CU was aware
that its tests were si gnificantly reliant upon driver input and
skill.” Jsuzy Motors, 66 F. Supp. 2d at 1125. Suzuki has
pointed to further evidence that some CU personnel shared
this assessment. The issue is whether CU, armed with the

point, CU’s failure to address this deficiency with its testing
Procedure could lead a jury to conclude that it was aware
that doing so would disclose the falsity of its negative

Therefore, we conclude that Suzuki has also raised a
genuine issue of materia] fact as to whether CU purposefully
avoided information that would have undermined its
assessment of the Samurai’s rollover propensity.

IV. CONCLUSION

For the foregoing reasons, the district court’s grant of
summary judgment is reversed and the case remanded for
further Proceedings.

REVERSED and REMANDED.

etsy _

15. We, of course, intimate no view of the ultimate outcome on
the merits.

30a

Appendix A

CONCUR BY: Susan P. Graber (In Part)
CONCUR: GRABER, J., concurring in part:

I agree with the majority opinion’s theoretical discussion
but agree only in part with its application of our standard of
review.

A. Standard of Review

The majority opinion employs the proper standard of
review. Although the independent examination rule applies
at the summary judgment stage, it does not require us to
abandon all the usual summary judgment procedures. Instead,
we are required to examine independently the entire record
in determining whether the nonmoving party has presented
evidence sufficient to allow a reasonable jury to conclude,
by clear and convincing evidence, that a public figure has
proven actual malice. Anderson vy. Liberty Lobby, Inc.,
477 U.S. 242, 255-56, 91 L. Ed. 2d 202, 106 S. Ct. 2505
(1986); Kaelin v. Globe Communications Corp., 162 F.3d
1036, 1039 (9th Cir. 1998).

At the summary judgment stage, the independent
examination rule does not allow us to end our analysis by
noting that there is “some” or “any” evidence in the record
giving rise to a genuine issue of material fact, as we would
be permitted to do in a run-of-the-mill civil action. The First
Amendment requires us to graft the more demanding “clear
and convincing” standard onto our traditional summary
judgment analysis and requires us to consider independently
whether the non-moving party has presented sufficient

3la

Appendix A

the nhonmoving party, and we are prohibited from deciding
questions such as Credibility, which remain reserved
exclusively for the factfinder. Anderson, 477 U.S. at 255.

the judgment constitutes “a forbidden intrusion on the field
of free expression.” VY Times Co. y, Sullivan, 376 U.S. 254,
285, 11 L. Ed. 24 686, 84 S. Ct. 710 (1964). The dissent
argues incorrectly that we ignore this directive in our
application of the summary judgment Standard.

See Anderson, 477 U.S. at 255 (“The evidence of the non-
Movant is to be believed, and all justifiable inferences are to

32a

Appendix A

be drawn in his favor.”); Masson v. New Yorker Magazine,
Inc., 501 U.S. 496, 520, 115 L. Ed. 2d 447, 111 S. Ct. 2419
(1991) (“On summary judgment, we must draw all justifiable
inferences in favor of the nonmoving party, including
questions of credibility and of the weight to be accorded
particular evidence.”); see also Kaelin, 162 F.3d at 1039,
1041 (holding that the court “must draw all justifiable
inferences in favor of [the nonmoving party], including
questions of credibility and of the weight to be accorded
particular evidence,” and that the court is required to
“Ivjiew[] the facts in the light most favorable to
[the nonmoving party]” (internal quotation marks omitted)).
Thus, it is clear that “at the summary judgment stage the
judge’s function is not himself to weigh the evidence and
determine the truth of the matter but to determine whether
there is a genuine issue for trial.” Anderson, 477 U.S. at 249.

There are good reasons why courts must apply the
independent examination rule differently in the summary
judgment context than when reviewing a judgment entered
after a full trial. The evidence presented at trial often differs
markedly from that which is offered in a party’s summary
judgment papers. The propositions claimed in affidavits may
or may not be proved at trial. Some witnesses turn out to be
credible; some do not.' Some inferences that seemed tenuous

1. In this case, the credibility of a number of CU’s employees
is of paramount importance to the “actual malice” inquiry. Further,
were the jury at trial to disbelieve those employees’ explanations of
statements made during the testing process, this court could not
question the jury’s finding. See Eastwood v. Nat'l Enquirer, Inc.,
123 F.3d 1249, 1252 (9th Cir. 1997) (noting that the independent

(Cont’d)

33a

Appendix A

Our holding that the clear-and-convincing
standard of proof should be taken into account in

determinations, the Weighing of the evidence, and
the drawing of legitimate inferences from the facts
are jury functions, not those of a judge, whether
he is ruling on a motion for summary judgment
or for a directed verdict. The evidence of the non-
movant is to be believed, and all] justifiable
inferences are io be drawn in his favor.

34a

Appendix A

rule differently than we would if we were reviewing an actual-
malice finding made after a full trial.

B. Actionable Statements

I must part company with the majority opinion, however,
on the question of which statements are actionable. There
are dozens of allegedly actionable statements in this case.
Both the majority and the dissent analyze these statements
as a whole, using an all-or-nothing approach. I believe that
each statement must be considered separately against the
standard outlined above.

Under this analysis,” only two of the statements withstand
CU’s motion for summary judgment.

1. The first of these appeared in an August 20, 1996,
CU Background Paper: “In 1988, we developed the “short
course” because we discovered that the Suzuki Samurai, then
undergoing testing, showed a propensity to roll over during
our long course AM maneuver.” (Emphasis added.)
The evidence detailed in the majority opinion is sufficient to
allow a rational jury to find, by clear and convincing
evidence, that CU developed the short course before
discovering a rollover “propensity” and in order to create a
rollover propensity, not because of it.

2. The second potentially actionable statement appeared
in CU’s January 1996 anniversary issue: “1986 CU buys its

2. Suzuki’s claims are untimely with respect to many statements.
Others fail to meet the exacting summary judgment standard used in
a First Amendment case.

35a

Appendix A

For the reasons explained here and in the majority’s
opinion, Suzuki has Presented sufficient evidence to allow a
reasonable jury to conclude, by clear and convincing
evidence, that CU made those two Statements with actual
malice. Summary Judgment with respect to those statements

36a

Appendix A

DISSENT BY: Warren J. Ferguson
DISSENT: FERGUSON, Circuit Judge, dissenting:

I respectfully dissent. By failing to apply the full
procedural protections afforded by the First Amendment, the
majority and concurrence intrude on the field of free
expression in two of its most important contexts: consumer
protection and public safety.

In New York Times v. Sullivan, 376 U.S. 254, 11 L.-Ed.
2d 686, 84S. Ct. 710 (1964), the Supreme Court held that
specific constitutional protections of speech limit the state’s
power to award damages in libel actions brought by public
officials. /d. at 283. One method of protecting speech is the
actual malice standard, which is set forth by the majority
opinion. Majority Op. at 6498-99; see also New York Times,
376 U.S. at 285-86. Another method is the independent
examination rule, which requires an appellate court to
independently review the whole record, “so as to assure
[itself] that the judgment does not constitute a forbidden
intrusion on the field of free expression.” New York Times,
376 U.S. at 285 (citation omitted). In adopting the actual
malice standard and independent examination rule, the
Supreme Court noted the importance of protecting “the
principle that debate on public issues should be uninhibited,
robust, and wide-open ....” Jd. at 270. The Court also
recognized that an “erroneous statement is inevitable in free
debate, and that it must be protected if the freedoms of
expression are to have the breathing space they need [] to
survive.” Jd. at 271-72 (internal quotation marks and
citation omitted).

|

37a

Appendix A ~-———

The majority and concurrence undermine these
procedural protections by erring in their application of both
the actual malice standard and the independent examination
rule.

1. Independent Examination

The majority and concurrence misunderstand the
argument of Consumers Union of United States, Inc.
(“Consumers Union”) that we must conduct an independent
examination of the record under New York Times. Majority
Op. at 6495 & n.10. While purportedly applying the
“independent examination rule,” both the majority and
concurrence fail to grasp how the additional procedural
protection of the independent examination functions and,
thus, are unable to apply the rule properly in this case.
Moreover, both Judge Tashima and J udge Graber overlook
the ongoing debate among courts and legal scholars regarding
the applicability of the “independent examination” rule to
appeals from summary judgment motions, commentary which
clarifies the significance of the independent examination rule
in our analysis at the summary judgment stage.' Because the
majority and concurrence have demonstrated a limited
understanding of the independent examination rule, I provide
a brief overview below.

1. See, e.g., Eugene Volokh & Brett McDonnell, Freedom of
Speech and Independent Judgment Review in Copyright Cases, 107
Yale L.J. 2431, 2432, 2442-45 (1998); Scott Matheson, Jr., Procedure
in Public Person Defamation Cases: The Impact of the First
Amendment, 66 Tex. L. Rev. 21 5, 289-97 (1987); Lee Levine, Judge
and Jury in the Law of Defamation: Putting the Horse Behind the
Cart, 35 Am. U.L. Rev. 3, 50-91 (1985). The debate among the
circuits is discussed further below.

38a

Appendix A

From the outset, it is worth noting that prior to our
decision in Crane v. Arizona Republic, 972 F.2d 1511 (9th
Cir. 1992), it was an open question within our circuit whether -
the independent examination rule applied to appeals from
summary judgment. Even after Crane, the Supreme Court
has recognized that the scope of procedural protections in
First Amendment cases remains unclear. Waters v. Churchill,
511 U.S. 661, 671, 128 L. Ed. 2d 686, 114 S. Ct. 1878 (1994)
(recognizing that, although “some procedural requirements
are mandated by the First Amendment, and some are not[,]”
the Court has not “discovered a general principle to determine
where the line is to be drawn.”).

However, the application of the independent review rule
to a summary judgment determination is the most logical
method to address the concerns regarding the chilling of
speech expressed in New York Times. See 376 U.S. at 278
(“Whether or not a newspaper can survive a succession of
such judgments, the pall of fear and timidity imposed upon
those who would give voice to public criticism is an
atmosphere in which the First Amendment freedoms cannot
survive.”). As a practical matter, the threat and actual cost of
litigation, including attorneys fees, inhibit speech. See id. at
278-79; see also Steaks Unlimited, Inc. v. Deaner, 623 F.2d
264, 280 n.76 (3d Cir. 1980) (“The cost of litigating a libel
action, burdensome on even the largest news organizations,
often can cripple smaller news operations.”). At times, the
costs of a successful defense can be the same or greater than
what the damage awards would have been. See Lee Levine,
Judge and Jury in the Law of Defamation: Putting the Horse
Behind the Cart, 35 Am. U. L. Rev. 3, 38 (1985). Moreover,
the defense costs prior to trial can be extraordinarily high.
See id. at 91.

oO

39a

Appendix A

Because of these costs and their effects on speech, the
procedural protection of the independent examination rule
is necessary not only for appellate review of post-trial
decisions, but also for appellate review of summary judgment
decisions.* The independent examination rule provides an
additional level of protection of the media’s First Amendment
rights. Moreover, it addresses concerns regarding the chilling
effects on speech of successive, costly litigation. See Steaks
Unlimited, Inc., 623 F.2d at 280 (“Regardless whether
particular statements made by consumer reporters are
precisely accurate, it is necessary to insulate them from the
vicissitudes of ordinary civil litigation in order to foster
[the goals of] the First Amendment . . . is

Unfortunately, Crane notwithstanding, the applicability
of the independent review rule to appeals from summary
judgment remains uncertain within our circuit. See, e.g.,
Kaelin v. Globe Communications Corp., 162 F.3d 1036, 1039
(9th Cir. 1998) (failing to discuss the applicability of the
independent review rule). While in the instant case the
majority and concurrence grudgingly concede that the
independent examination rule applies, this concession is

2. In her partial concurrence, Judge Graber contends that
“[t]here are good reasons why courts must apply the independent
examination rule differently in the summary judgment context than
when reviewing a judgment entered after a full trial.” Concurrence
at 6510. However, Judge Graber’s analysis fails to consider the
purpose and intent of a summary judgment motion, particularly in a
First Amendment case. In First Amendment Cases, we must be aware
of the dangers associated with the cost of litigation which can stifle
expression, particularly by those whose interests are in warning of
danger to the public safety.

40a

Appendix A

empty. Their analysis differs in no meaningful respect from
an ordinary summary judgment appeal, thereby stripping the
independent examination rule of its intended purpose and
meaning. I would find that a correct application of the
independent examination rule to the facts before us reveals
that the plaintiff’s case must fail on summary judgment. There
is simply insufficient evidence in the record as a whole that
could support a reasonable jury finding that the plaintiff has
shown actual malice on the part of Consumers Union by clear
and convincing evidence. See Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 255-56, 91 L. Ed. 2d 202, 106 S. Ct. 2505
(1986).

2. Applying the Procedural Protections Mandated by
New York Times

The majority and concurrence incorrectly apply the actual
malice standard and undermine the importance of
independent review. By doing so, Judges Tashima and Graber
permit a forbidden and dangerous intrusion on the field of
free speech.

Both Judges Tashima and Graber fail to contextualize
Consumers Union’s testing of the Samurai within the purpose
and mission of the organization. The District Court
recognized the importance of doing so when it stated: “The
trier of fact could not be expected to disregard the nature of
defendant’s business—testing and reporting on consumer
products—nor would plaintiff so urge, and it would be error
for a court to so instruct. Thus, it is clear that, based on the
information CU had gathered, it was concerned about the
safety of the Suzuki Samurai.” Viewed in this context, the

4la

Appendix A

potentially actionable. With respect to the first Statement,?
Judge Graber notes that “[t}he evidence detailed in the
majority opinion is sufficient to allow a rational jury to find,

made by Consumers Union employees during the testing.
This evidence is insufficient to support a finding of actual
malice, let alone by clear and convincing evidence. At most,

42a

Appendix A

the comments of Consumers Union’s employees give rise to
an inference of bias against the Samurai.‘ Bias alone,
however, cannot support a finding of actual malice. Shoen v.
Shoen, 48 F.3d 412, 417 (9th Cir. 1995).

Moreover, the fact that Consumers Union altered the
course cannot supply the “something more” that is required
by the exacting actual malice standard. Not only is it
undisputed that Consumers Union disclosed the alteration
in the article, it is also undisputed that the Samurai tipped
over prior to Consumers Union developing the short course.
Consumers Union’s proffered reasons for developing the
short course are completely consistent with the benign
explanation that they were simply seeking confirmation of
the existing accusations of rollover propensity against the
Samurai, which it had exhibited in the early stages of testing.’

This is not a case in which Consumers Union contrived
to make the Samurai roll over. Suzuki admits that there had
been four independent lawsuits in which the vehicle rolled
over, including one lawsuit by the Attorneys General of seven
states. Certainly, when choosing to republish references to
the rating, numerous rollover instances such as these
reaffirmed Consumers Union’s opinion that the vehicle was

4. The statements identified by Judge Tashima are as follows:
(1) “If you can’t find someone to roll this car, I will.” (2) “That’s it.
That looked pretty good.” (3) “All right Ricky baby.” Majority Op.
at 6501.

5. It is undisputed that the Samurai tipped during the break-in
period, as well on the long course when it was driven by an
inexperienced driver.

43a

Appendix A

The second Statement that Judge Graber identifies as
potentially actionable is as follows: “1986 CU buys its own

leaving the reader free to draw his own conclusions, those
Statements are generally protected by the First Amendment.”).
Moreover, even if reasonable minds differ about whether the
Samurai tipping over four times on an altered course
constitutes “easy” rollover Propensity, this is evidence only
of a subjective word choice, not of actual malice as the

Judges Tashima and Graber also misconstrue my
argument, contending that | apply the independent

44a

Appendix A

examination rule in a manner that swallows the summary
judgment standard, and thus engage in a forbidden intrusion
on the province of the fact finder. Majority Op. at 6595-97;
Concurrence at 6509-10. Their accusations reveal their lack
of understanding of the way the rule interacts with the
summary judgment standard, and the analysis that the rule
requires that we apply in First Amendment cases. Were we
to apply both standards correctly, we would determine
whether there is a genuine issue of material fact as to actual
malice under the summary judgment standard. However, in
doing so, we would conduct an independent review of the
entire record “to be sure that the speech in question actually
falls within the unprotected category and to confine the
perimeters of any unprotected category within acceptably
narrow limits in an effort to ensure that protected expression
will not be inhibited.” Bose, 466 U.S. at 505; see also Secrist,
874 F.2d at 1251 (stating that a court must “make [its] own
independent review of the record to ensure the principles of
actual malice are constitutionally applied.”). Because the
independent examination rule allows us to view all of the
evidence, and not just that which favors the plaintiff, we give
maximum protection to the First Amendment. Far from
discarding traditional summary judgment rules, my analysis
is consistent with the way the independent examination rule
has been applied at the summary judgment stage by
other circuits. See, e.g., Secrist, 874 F.2d at 1251; Herbert,
781 F.2d at 305, 308. Like in Secrist and Herbert, upon an
independent review, the evidence of actual malice in the case
before us is paltry and unable to survive a summary judgment
motion.

45a

Appendix A

On a broader level, the majority’s decision has troubling
implications. If taken to its logical end, the majority’s

Was acting with actual] malice.°®

The law is certain that in Order to hold Consumers Union
is not protected by the First Amendment, there must be clear

or not a reasonable jury could find by clear and convincing
evidence that Suzuki proved actual malice on the part of

majority, however, chooses to give the NHTSA Study greater weight
and, thus, discourages the non-governmental voices in the fields of
©onsumer protection and vehicle safety, Majority Op. at 6507,

46a

Appendix A

Consumers Union. Here, no reasonable jury could find
clear and convincing evidence of actual malice. See Kaelin, ©
162 F.3d at 1039. After an independent review of the record,
it is unquestionable that the District Court constitutionally
applied the principles of actual malice. The grant of summary
judgment was necessary both to avoid the inhibition of free
speech by the media and to protect public safety and health.
For these reasons, I would affirm the District Court’s
decision.

47a
APPENDIX B — ORDER OF THE UNITED STATES
COURT OF APPEALS FOR THE NINTH CIRCUIT

DENYING PETITION FOR REHEARING
FILED MAY 19, 2003

UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

No. 00-56043

330 F.3d 1110; 2003 U.s. App. LEXIS 9565; 2003 Cal.
Daily Op. Service 4131; 2003 Daily Journal DAR 5336

May 19, 2003, Filed

SUZUKI MOTOR CORPORATION, Plaintiff-Appellant,
v. CONSUMERS UNION OF UNITED STATES, INC., a
non-profit New York Corporation, -

48a

- Appendix B

OPINION:
ORDER

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

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

The petition for rehearing en banc is denied.
DISSENT:

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

For over half a century, Consumers Union has been
testing and rating consumer products and publishing the

* Judge Rawlinson was recused.

49a

Appendix B

Over too easily,” starting with an incident during the vehicle’s
break-in period where the Samurai “flopped over on its side”

far worse than its competitors.

50a
Appendix B

access to independent information about the safety and
usefulness of products they buy with their hard-earned
dollars. The majority sets a dangerous precedent, and the full
court errs grievously by failing to take the case en banc to
correct the error.

1. The majority’s analysis is tainted throughout by its
failure to articulate, much less apply, a coherent theory of
the “independent examination” rule, a key element of the
New York Times regime. When a public figure sues his critics
for defamation, we “must ‘make an independent examination
of the whole record,’ so as to assure ourselves that the
judgment does not constitute a forbidden intrusion on the
field of free expression.” Jd. at 285 (citation omitted).
This rule “assigns to judges a constitutional responsibility
that cannot be delegated to the trier of fact, whether the
factfinding function be performed in the particular case by a
jury or by a trial judge.” Bose Corp. v. Consumers Union of
U.S., Inc., 466 U.S. 485, 501, 80 L. Ed. 2d 502, 104 S. Ct.
1949 (1984). It is “a rule of federal constitutional law” that
“reflects a deeply held conviction that judges ... must
exercise such review in order to preserve the precious liberties
established and ordained by the Constitution.” Jd. at 5 10-11.

_ We have heretofore sensibly assumed that the
independent examination rule calls for us to do something
more than we would normally do. After all, it hardly
“preserve[S] the precious liberties established and ordained

~ by the Constitution” to treat a First Amendment case the same
as a slip-and-fall. When we review a jury verdict under
New York Times, We don’t “independently examine” the
record merely by considering all the evidence—we already

|

Sla

Appendix B

do that in every case anyway. See Reeves v. Sanderson
Plumbing Prods., Inc., 530 U.S. 133, 150, 147 L. Ed. 2d
105, 120 S. Ct. 2097 (2000) (“[I]n entertaining a motion for
judgment as a matter of law, the court should review all of
the evidence in the record.”). Nor do we merely review de
novo the trial judge’s determination whether a jury question
exists—again, we already do that in every case. See Janes v.
Wal-Mart Stores Inc., 279 F.3d 883, 886 (9th Cir. 2002)
(“We review a district court’s denial of a motion for judgment
as a matter of law de novo .. . .”). First Amendment
independent examination is an additional protection that the
Constitution affords publishers.

Where there are genuine evidentiary disputes over
Particular factual predicates of actual malice—such as
questions about a witness’s credibility—the issue is for the
jury. The judge does not weigh the evidence to find those
historical facts, but instead makes a routine sufficiency
determination. See Masson v. New Yorker Magazine, Inc.,
501 U.S. 496, 520, 115 L. Ed. 24 447,111 S.Ct. 2419 (1991);

91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). After resolving
the predicate factual disputes in the plaintiff’s favor, however,
the judge must take the further step of independently
“determin[ing] whether the record establishes actual malice
with convincing clarity.” Bose, 466 U.S. at § 14; see Eastwood
V. Nat'l Enquirer, Inc., 123 F.3d 1249, 1252 (9th Cir. 1997).!
And that process is not a routine sufficiency determination,

—_——__

1. Independent examination is, of course, a one-way street:
If the jury rejects a plaintiff’s claim, a judge may not invoke the rule
to resurrect it.

52a
Appendix B

because it does involve weighing the evidence. If it did not,
the independent examination rule would be meaningless.

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

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

2. The majority’s confusion may stem from the fact that Bose
and Hoffman were appeals from bench trials. Where the district court
is the fact-finder, de novo review of its opinion is also de novo review
in the New York Times sense because it’s effectively de novo review
of the underlying question of actual malice. But where the district
court merely makes a sufficiency determination—whether on
summary judgment or post-verdict—de novo review of its opinion is
not de novo review in the New York Times sense. We always review
sufficiency determinations de novo; independent examination means
doing something more.

53a

Appendix -B

The majority seems willing to concede that independent
examination has some bite after the verdict. But it refuses to
“conflate[]” this post-verdict standard with the summary
judgment one. Am. op. at 6495. By decoupling the two
standards, the majority conflicts directly with Supreme Court
precedent. As the Court explained in Anderson, “[T]here is
no issue for trial unless there is sufficient evidence favoring
the nonmoving party for a jury to return a verdict for that
party.” 477 U.S. at 249. Because the court must ultimately
review a plaintiff’s verdict under the independent
examination rule, it necessarily follows that it must apply
that same standard at summary judgment.

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

3. Judge Graber is of course correct that “(t]he evidence
presented at trial often differs markedly from that which is offered
in a party’s summary judgment papers.” Concurrence at 6510. That
a plaintiff defeats a summary judgment motion doesn’t guarantee
that the evidence at trial will support a verdict in his favor. What’s
novel about the majority’s approach is that it reverses the rule: It lets
a plaintiff defeat summary judgment with a record inadequate to
support a verdict, on the mere speculation that some evidence at
trial—as yet unknown—will materialize to support his case.

S4a

Appendix B

The omnipresent danger in defamation suits is that
“would-be critics ... may be deterred from voicing their
criticism, even though it is believed to be true and even
though it is in fact true, because of doubt whether it can be
proved in court or fear of the expense of having to do so.”
New York Times, 376 U.S. at 279. That a plaintiff’s suit
ultimately fails after trial is little solace to a defendant crushed
by the sheer expense of litigation. For example, in thts suit
and a similar one filed by Isuzu, see Isuzu Motors Ltd. v.
Consumers Union of U.S., Inc., 66 F. Supp. 2d 1117 (C.D.
Cal. 1999), Consumers Union had by September 1999
reportedly spent more than $10 million defending its ratings,
while its two adversaries had spent more than $25 million.
See John O’ Dell, Bruising Tests Await Consumer Reports in
Court, L.A. Times, Sept. 19, 1999, at Al. And these are just
two of the many lawsuits CU has had to contend with—about
a dozen published cases (and who knows how many
unpublished ones) involving disgruntled CU reviewees
seeking revenge through the courts. Good for lawyers, but
not so good for free expression.

It’s no answer to let the chips fall and assume that
insurance will cover the tab. Insurance makes costs more
predictable, but it doesn’t decrease the amount publishers
must pay to do business in the long term. If publishers present
a greater liability risk, insurers will charge higher rates.
The burden on free speech is no less intolerable.

Even when First Amendment values do not hang in the
balance, “[s]ummary judgment procedure is properly
regarded not as a disfavored procedural shortcut, but rather
as an integral part of the Federal Rules as a whole, which are

55a

Appendix B

designed ‘to secure the just, speedy and inexpensive
determination of every action.’” Celotex Corp. v. Catrett,
477 U.S. 317, 327, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986)
(quoting Fed. R. Civ. P. 1). That principle is all the more
vital where a slow and expensive determination will result
in self-censorship.

Where a plaintiff’s evidence is strong enough to support

a verdict, the publisher must stand trial. But there is no
sensible reason to impose such onerous costs on a publisher
i - where the plaintiff is doomed to fail. Allowing a plaintiff to
get to trial on a record that will not support a verdict under
New York Times does not make sense, and if some of the
= Court’s precedents can be read to suggest this result, the Court
a would do us all a great favor by explaining that it intended
B no such absurdity.

2. Had the majority applied the constitutionally
& required standard, it could not have reached the result it did.4
Suzuki’s case is easily summarized. Its first theory is that
. CU knew it was probably lying because its employees tried
to make the Samurai tip and were happy when they ;
succeeded. The second is that CU purposely avoided the truth

by failing to address a potential source of experimental error.

Neither of these theories withstands serious scrutiny.

As to the first, the majority relies heavily on the fact
that CU switched to the short course after the long course
failed to cause any tips. The initial problem with this theory

4. I use the term “majority” loosely because Judge Graber never
tells us which parts of Judge Tashima’s opinion she relies on to find
actual malice.

56a
Appendix B

is that CU fully disclosed this in its article. Just so we’re
clear what we’re talking about, here’s what CU told the

public:

Our regular test program includes a maneuver
designed to see how controllable a car remains
when a driver is forced to steer sharply—to avoid,
say, a child who unexpectedly darted into the road.
To simulate that kind of sudden emergency, our
drivers run each car through a lane-changing
course marked off by traffic cones. The drivers
begin their left turn out of the lane 60 feet before E:
the obstacle. They then must steer sharply enough
to get back into the lane no more than 60 feet
beyond the obstacle.

Under the experienced touch of our drivers,
all four utility vehicles got through the course at F
52 mph or better. The Suzuki Samurai was actually &
more maneuverable than the others, since it’s so
much smaller and lighter.

With concern about a potential rollover
somewhat allayed, a staff member who does not
normally drive the course tried to steer the Suzuki
around the obstacle. All went well for several runs
at moderate speed. Then, on arun at 45 mph, the 3
driver made a slight steering misjudgment: q
He turned wider than necessary to clear the
obstacle, something many ordinary drivers might

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S7a
Appendix B

do in an emergency turn. That forced him to turn
back a bit more sharply than our regular testers
had. As he turned the steering wheel to the right
to get back into lane, the Suzuki teetered to the
left. The two right-side tires lifted about a foot
off the pavement before the driver was able to
bring the vehicle back under control.

Would the other utility vehicles show similar

instability if steered the way the Suzuki had been
steered?

To find out, we put all the vehicles through a
slightly different maneuver. We realigned the
cones so that our test drivers had to start the turn
50 feet from the obstacle instead of 60 feet from
it. That meant they needed to steer around the
obstacle and back into lane in a total! of 110 feet
rather than the usual 120 feet. We also moved the
obstacle three feet farther to the left.

In this more demanding test, the Jsuzu
Trooper, the Jeep Wrangler, and the Jeep
Cherokee began knocking over cones at about
40 mph. But they remained stable. We also tried

the Jeep Wrangler without the outriggers. Still
stable.

58a

Appendix B

The Suzuki Samurai, by contrast, toppled onto
the outriggers when turned through the course at
about 40 mph. Without the outriggers, it would
have rolled over.

During the period we were testing these
vehicles, Suzuki introduced a modified version
of the Samurai, a “1988 1/2” model with a
softened suspension. We acquired the latest
version and ran it through the same accident-
avoidance maneuver. It proved even less stable
than the Samurai we originally tested. The front
right wheel lifted in turns at low speed. And the
vehicle rolled onto the outriggers at 38 mph.°

CU thus thoroughly explained both its track design and
its testing procedure. It acknowledged that the Samurai did
well on the standaid course and alerted the reader that CU
designed a new course specifically to force a maneuver it
had reason to believe the Samurai would fail. Even assuming
CU wanted to make the Samurai tip and designed its short
course to achieve that result, so what? The fact remains that
the Samurai did tip—several times—while every other
vehicle run through the same course did not tip even once.
This is certainly something consumers would want to know
before deciding which of these vehicles to put their
families in.

By exposing CU to liability for basing its negative
opinion of the Samurai on a fully disclosed testing procedure,

5. The introductory explanation to the article is reprinted in
full in the appendix.

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Appendix B

the majority runs head-first into a settled First Amendment
principle: “‘Where a publication sets forth the facts
underlying its statement of opinion ... and those facts are
true, the Constitution protects that opinion from liability for
defamation.’” Standing Camm. v. Yagman, 55 F.3d 1430,
1440 (9th Cir. 1995) (quoting Lewis v. Time, Inc., 710 F.2d
549, 556 (9th Cir. 1983)); see also Partington v. Bugliosi,
56 F.3d 1147, 1156 (9th Cir. 1995) (“[W]hen a speaker
outlines the factual basis for his conclusion, his statement is
protected by the First Amendment.”). The logic behind the
rule is straightforward and unassailable: When a publisher
prints an opinion but doesn’t state the basis for it, the reader
may infer a factual basis that doesn’t exist. See Milkovich v.
Lorain Journal Co., 497 U.S. 1, 20-21, 111 L. Ed. 2d 1, 110
S. Ct. 2695 (1990). But when a publisher accurately discloses
the facts on which he bases his opinion, the reader can gauge
for himself whether the factual basis adequately supports the
opinion.

This is not a case where a defendant fabricates results
and then purports to rely on them—like when NBC secretly
strapped rockets to GM trucks with side-mounted fuel tanks
to make them explode in collisions. See Jane Hall, Chief of
NBC News Quits in Wake of Rigged Crash, L.A. Times, Mar.
3, 1993, at Al. There’s not a shred of evidence that the short
course was clandestinely altered to make it more forgiving
when the other vehicles went through, or that CU’s drivers
intentionally soft-pedaled the runs with the other vehicles to
make the Samurai look worse by comparison. The majority’s
gripe here is not with CU’s reporting of its tests, but with its
experimental design, and that is entirely the wrong focus.
If CU had found the Samurai “Not Acceptable” based on

60a
Appendix B

tests performed with a Ouija board, most consumers would
dismiss its rating as worthless. But, so long as CU disclosed
its method, the report would be protected by the First

Amendment.

Even aside from the fact that CU fully disclosed its
change in course, there is simply nothing improper about
what it did. When CU first tested the Samurai on the long
course, it didn’t tip—a result consistent with the theory that
it is safe, but also consistent with the theory that the long
course is not challenging enough to detect the Samurai’s
design flaw. CU did what any conscientious researcher would
do and redesigned its experiment to focus on the conditions
that seemed more likely to detect a flaw. See, e.g., Karl R.
Popper, The Logic of Scientific Discovery 45 (Hutchinson
rev. ed. 1968) (1934) (noting that a scientist, after first
detecting a condition, “might try to rearrange his experiments
so as to make the effect reproducible’). It then ran the
Samurai and several other vehicles through the course and
found that the Samurai had a dramatically higher propensity
to roll over—it tipped on several occasions while no other

vehicle tipped once.

The opinion makes much of the fact that CU had used
its long course for testing since 1973, but cites no evidence
it was using the course for rollover testing during that time.
In fact, the evidence in the record suggests the contrary: None
of the 500 vehicles CU had previously tested had rolled over,
and it did not even use safety outriggers to protect its drivers
from rollovers until the tests in question. Clearly, CU had
not previously focused on this particular risk, no doubt
because the original test course was designed before SUVs

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Appendix B

and similar vehicles with high centers of gravity had come
into vogue. But after news stories and a NHTSA filing
highlighted the Samurai’s rollover propensity, after the
vehicle rolled over once during break-in, and after it tip»ed
again following formal testing on the long course, CU had
good reason to change focus. Adjusting test procedures to
better detect a risk arising from new consumer preferences
is hardly reprehensible. It is precisely what one would expect
from researchers seriously interested in consumer safety.

Consider an analogy: Assume CU has been testing
clothes dryers using a standard load since 1973. It learns that
a particular brand of dryer occasionally causes fires. CU dries
several standard loads but experiences no adverse results, so
it tries a few loads with more flammable materials—say,
acetate bed-linens. This is not part of its existing testing
protocol, but the materials are ones that consumers have
begun to use more often in recent years. If the materials catch
fire in the one dryer but not the others, is CU’s test a fraud
because it changed its procedure to focus on the new risk?

The relevant question in either case is not whether the
new procedure is different from the old, but whether it
accurately reflects conditions consumers might occasionally
face. And the majority points to no evidence at all on that
score. The short course was not some extraordinary challenge
that no consumer vehicle could be expected to pass—after
all, every other tested vehicle did pass it. CU’s previous use

of the long course has no bearing on whether its short course
results were fraudulent.

62a
Appendix B

By equating CU’s switch to a short course with
knowledge of probable falsity, the majority ignores the
realities of experimental design. Scientific inquiry would
grind to a halt if researchers couldn’t tinker with their
methods as they learned new information about the object of
their study. CU’s switch is not even bad science, let alone
bad journalism, and certainly not journalism so awful that it
loses First Amendment protection. To be probative of actual
malice, evidence must have at least some tendency to exclude
obvious innocuous explanations for the defendant’s conduct.
CU’s switch from a long course to a short course does not.°

That leaves the majority with no direct evidence that
CU’s methods were flawed, and only four contemporaneous
statements of CU employees—” If you can’t find someone to
roll this car, 1 will,” an unspecified cheer, “That’s it.
That looked pretty good,” and “All right Ricky baby”—that,
to the majority, show an unfair bias against the Samurai.
If CU had a negative view of the Samurai going into the
tests, the reasons are not hard to imagine—the Samurai had
already been slammed in the press for its rollover propensity,
had been the target of a safety complaint filed with NHTSA
and had rolled over on its side while a CU employee drove it
at only 15 mph. But even if CU’s preconception were entirely

6. The majority also relies on the fact that the driver who made
the Samurai tip the first time was not one of CU’s regulars. This fact
was also disclosed in CU’s article, see p. 6466 supra, and, in any
case, it’s hard to see why it matters. Presumably, consumers driving
the Samurai are typically not accredited test drivers either. Moreover,
it’s undisputed that the actual short course test runs, in which the
Samurai tipped several times and the other vehicles didn’t tip once,
were all performed by CU test drivers.

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Appendix B

arbitrary, these fleeting remarks—three of which are no more
than inane schadenfreude—would still be insufficient to
support a finding of actual malice.

Actual malice is not bias. “[I]Il will toward the plaintiff,
or bad motives, are not elements of the New York Times
standard.” Nat'l Ass'n of Letter Carriers v. Austin, 418 U.S.
264, 281, 41 L. Ed. 2d 745, 94S. Ct. 2770 (1974) (internal
quotation marks omitted). Speech that is “malicious” only
in the sense that the speaker is biased against his target is
fully protected; the First Amendment extends beyond
“reasoned [and] evenhanded” commentary to the “slashing
and one-sided.” Hustler Magazine v. Falwell, 485 U.S. 46,
54, 99 L. Ed. 2d 41, 108 S. Ct. 876 (1988).

Bias may support a showing of actual malice; if you bad-
mouth someone, the fact that you also don’t like him makes
it marginally more likely you’re lying. But bias evidence is
not sufficient by itself to support a claim: “[A]ctual malice
may not be inferred alone from evidence of personal spite,
ill will or intention to injure on the part of the writer.” Harte-
Hanks Communications, Inc. v. Connaughton, 491 U.S. 657,
666 n.7, 105 L. Ed. 2d 562, 109 S. Ct. 2678 (1989) (internal
quotation marks omitted); see also, e.g., Church of
Scientology Int'l v. Behar, 238 F.3d 168, 174 (2d Cir. 2001);
Shoen v. Shoen, 48 F.3d 412, 417 (9th Cir. 1995). If a tabloid
sends an investigator to dig up dirt on a celebrity, the fact
that it deliberately attempts to find damaging information
and is pleased when it succeeds hardly proves it’s lying.
Forcing CU to stand trial for statements that show nothing

more than bias ignores these settled First Amendment
principles.

64a

Appendix B

We don’t hold participants in public debate to Article II]
standards of impartiality. Nor do we second-guess their
investigations as if we were reviewing administrative action
under the APA. So long as they don’t lie or recklessly
disregard the truth, they can be as unfair and one-sided as
they want. The majority’s clear and convincing evidence
that CU strayed beyond this wide field is shockingly thin.
The Second Circuit requires a plaintiff to show that bias was
coupled with “an extreme departure from standard
~ investigative techniques.” Behar, 238 F.3d at 174 (emphasis
added). For the majority, any departure from past technique
will apparently suffice, even one entirely consistent with
standard experimental methodology.

What ultimately dooms Suzuki’s case is that, no matter
what CU’s motives for choosing the short course, it is
undisputed that the Samurai tipped multiple times on that
course while the other vehicles tested didn’t tip even once.
If the majority has its way, evidence like this—which may
make a life-or-death difference to consumers—will be
suppressed for fear of precisely this type of lawsuit, waged
with gale-force intensity by corporate plaintiffs with
bottomless litigation budgets.

3. The majority’s second ground for reversal is weaker
still. After CU published its initial report, NHTSA criticized
certain aspects of its methodology. CU responded, and the
majority finds its response for the most part satisfactory.
It concludes, though, that CU fell short by failing to address _
NHTSA’s critique of its reliance on driver input.

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Appendix B

The majority’s analysis suffers from familiar flaws.
Even if CU’s reliance on human drivers made its tests less
reliable, it disclosed the relevant facts in its report.
CU explained in detail its use of human test drivers and the
precise maneuvers they performed—right down to the
distance between traffic cones. See pp. 6466-67 supra. Surely
these disclosures provide adequate information for readers
to make a reasonable assessment of CU’s testing. At the very
least, they provide readers familiar with safety testing
mechanics—such as NHTSA and Suzuki engineers—the
information they need to assess CU’s testing and come up
with a public response. CU should not stand trial over a
potential source of experimental error that it fully disclosed.

The majority’s holding is flawed for deeper reasons as
well. It faults CU for failing to “investigate” and ‘“taddress”
a perceived deficiency in its testing procedure. Am. op. at
6508. But what was CU supposed to do? Using human drivers
obviously introduces a potential source of experimental error.
But it also replicates actual driving conditions and thus
captures nuances that might be missed if the experiment were
performed by entirely mechanical means. If CU had built
some stationary rollover machine instead, Suzuki would have
complained that its failure to recreate actual driving
conditions made its results unreliable. If CU had built a car-
driving robot, Suzuki would have complained that the test
didn’t reflect the reactions of a human driver. All experiments
have potential sources of error, and many reputable
experiments rely on human input. That an experiment can
be criticized on these grounds doesn’t make it reckless to
rely on the results, even if the criticisms have some validity.

66a

Appendix B

Failure to explain away or eliminate all potential sources of
error in an experiment cannot be a basis for liability.

What the majority calls “actual malice” is really just one
side of a long-running debate over how to test rollover
propensity most effectively. CU favors “dynamic” tests using
actual drivers, while NHTSA has long preferred “static” tests
based on measurements of a vehicle’s geometry. While the
majority thinks NHTSA has the better of this scientific
debate, Congress was not so sure: In 2000, it passed a
statute requiring NHTSA to develop a dynamic rollover
testing program. Transportation Recall Enhancement,
Accountability, and Documentation (TREAD) Act, Pub. L.
No. 106-414, § 12, 114 Stat. 1800, 1806 (2000) (codified at
49 U.S.C. § 30117(c)); see Consumer Information
Regulations; Federal Motor Vehicle Safety Standards;
Rollover Resistance, 66 Fed. Reg. 35,179, 35,180-81 (request
for comments July 3, 2001) (explaining the statute’s history).
The TREAD Act followed on the heels of CU’s criticism
that NHTSA’s static testing methods, although a “useful
predictor of tripped rollover, ... should be used in
conjunction with a dynamic stability test using vehicle
maneuvers to better predict the risk of untripped rollovers.”
-66 Fed. Reg. at 35,180-81. And as NHTSA concedes, the
Act “reflects CU’s concern.” /d. at 35,181.

As if that weren’t vindication enough, when NHTSA
acted on Congress’s directive, one of the dynamic rollover
tests it initially proposed using was the “CU double lane
change,” id. at 35,183, the very test the majority now finds
so heretical that reliance on it amounts to actual malice.
NHTSA identified both the advantages of CU’s test

WEAR ee nae 52

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Roetst

67a

Appendix B

(“face validity”; “probably a good representation of what the
public expects of a personal vehicle”; “better represents the
dynamics that may result in an untripped rollover”;
“maximum speed through the maneuver can be used as part
of the vehicle score”; “display[s] the operation of electronic
stability control systems’’) and its disadvantages (“‘any vehicle
will pass such a test if equipped with tires of sufficiently
low traction”; “driving style can strongly influence the test
results”; “course layout may cause the steering reversal and
roll momentum effect to be more critical for some vehicles
than for others”; “a course tuned to one vehicle may not be
the worst case for another vehicle to which it is compared”’).
Although NHTSA ultimately opted for a different set of
dynamic rollover tests, those it selected still relied on human
drivers and merely involved a lower number of steering inputs
(one or two, as opposed to four in CU’s test). See Consumer
Information Regulations; Federal Motor Vehicle Safety
Standards; Rollover Resistance (Part II), 67 Fed. Reg. 62,528,
62,537-38 (proposed Oct. 7, 2002). NHTSA thus reduced,

but did not eliminate, this potential source of error.

Surely these legislative and regulatory developments bear
heavily on the disputed issues in the case. Strangely, however,
the majority does not even mention them. That Congress
specifically repudiated NHTSA’s exclusive preference for
static rollover testing shows we cannot blindly accept
NHTSA’s criticism of dynamic testing as evidence of actual
malice. That NHTSA thought CU’s test was an option worth
considering twelve years later shows that it is not so off-the-
scientific-map that reliance on it is tantamount to purposeful
avoidance of the truth. That NHTSA ultimately chose tests
that involve the same source of error, just to a lesser degree,

68a

Appendix B

shows that the issue is not nearly so black-and-white as the
majority paints it. On a more fundamental level, these
developments show that courts have no business wading into
this scientific feud over the best way to test rollover
propensity. Which method gives the optimal mix of
advantages and disadvantages is a point of disagreement
among Congress, NHTSA, CU and others. It should be
resolved by scientists, policymakers and consumers, not
crushing libel verdicts.

The appropriate response to a poorly designed
experiment is to conduct a better one and then convince
people that your method is more accurate—not to sue the
other guy into silence. The point is poignantly made by the
facts of this case. For all its kvetching, NHTSA apparently
never even performed its own tests on the Samurai—it relied
entirely on data from Suzuki. See Am. op. ai 6506. Suzuki’s
test procedures no doubt had plenty of defects of their own
(the most obvious being “company conducting test has
financial stake in outcome”). Can we really say the world is
better off if the only source of Samurai rollover data is the
manufacturer? If consumers are purchasing an SUV they will
trust with their lives, aren’t they entitled to know that the
Samurai tipped repeatedly in human-driven tests while the
other SUVs didn’t tip once?

Rs Bas a Dr Sete s

Groups like CU perform a valuable function in our
consumer society, but they suffer from a constant threat of
litigation. It’s easy for a jury to second-guess experimental
design, and every suit carries the prospect of a massive
damages award because the very purpose of a negative review
is to convince the reader that the plaintiff’s product is not

bil Soe eM i

69a

Appendix B

worth buying. It’s hardly surprising, then, that CU attracts
lawsuits like moths to a lantern. See, e.g., Bose Corp. v.
Consumers Union of U.S., Inc., 466 U.S. 485, 80 L. Ed. 2d
502, 104S. Ct. 1949 (1984) (truly silly dispute over whether
sound from plaintiff’s speakers wandered “about the room”
rather than merely “along the wall” litigated all the way to
the Supreme Court). If Suzuki can get to trial on evidence
this flimsy, no consumer group in the country will be safe
from assault by hordes of handsomely paid lawyers deploying
scorched-earth litigation tactics.

The majority’s decision reaches far beyond consumer
organizations to virtually any research group that criticizes
corporate interests. Many public interest groups are thinly
funded, and their experiments are necessarily full of
imperfections. Their targets can now stuff unflattering results
into a scientific oubliette just by pointing out sources of
experimental error and then threatening to sue if the groups
don’t “investigate” and “address” them. Today it’s Consumers
z Union panning the Samurai; tomorrow it could be Greenpeace
# claiming that some oil refinery is killing fish. The First
Amendment doesn’t allow companies to squelch their
‘scientific detractors on evidence as thin as Suzuki’s.
The majority’s legal regime cannot coexist with our tradition
of robust scientific debate on matters of public concern.

SAS ERR

‘aula gy ee aah PNR ee reer

4. Judge Graber focuses on two particular statements,
but succeeds only in highlighting how deficient Suzuki’s case
is. She first faults CU for reporting that it developed the short
course “because [it] discovered” the Samurai’s rollover
propensity, when in fact it developed it “in order to create”
that propensity. Concurrence at 6512 (emphasis omitted).

70a
Appendix B

I don’t understand how CU could have “create[d]” the
Samurai’s rollover propensity. A propensity is something
innate to the object. Is Judge Graber suggesting that CU
somehow modified the vehicle to make it more likely to tip?
There is no evidence of that whatsoever. What CU did was
put the Samurai through a test that demonstrated its innate
tendency to tip, a propensity it had as a result of the way it
was built. CU designed a course to develop evidence of the
vehicle’s propensity to roll over. It could not and did not
create the propensity itself.

That problem aside, there is simply nothing false about
CU’s statement. There’s no dispute why CU built the short
course: As it thoroughly explained in its article, it was trying
to replicate the conditions that caused the Samurai to tip when
a CU employee turned too sharply on the long course. Suzuki
doesn’t dispute this. CU switched to the short course “because
[it] discovered” a propensity to roll over during that particular
maneuver, a maneuver none of the drivers had previously
performed because they had all driven the long course as
designed. CU’s statement is an entirely accurate description
of its reason for developing the short course.’ ;

7. Even if Judge Graber were right and CU somehow misled
the public about its reasons for building the short course, I can’t see
how it could possibly matter. Whether CU built the short course for
the reasons it gave or because little green men from Mars told it to
do so, the fact remains that it built the course and the Samurai flunked
it while every other vehicle passed. CU’s motives simply are not
germane to Suzuki’s theory of recovery because they do not in any
way defame the Samurai or contribute to any damage it may have
suffered. It’s as if CU claimed it conducted the tests on a Wednesday
when it actually conducted them on a Friday.

eH ORE Migbicsiche sade ties bedseta cor oo Hagan y ees

#
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Tla

Appendix B

Judge Graber also complains that CU said tne Samurai
rolls over “easily” when, in fact, it had to be “coaxed.”
Concurrence at 6512. She apparently fears that readers might
assume the Samurai rolled over with no “coaxing” at all.
But no one could be so misled. Even tremendously unsafe
vehicles roll over only in extreme maneuvers. No one reading
that the Samurai rolls over “easily” would infer it routinely
flops over with no human intervention.

Saying a consumer vehicle rolls over “easily” is like
saying a particular NBA player is “terrible.” The adjective is
inherently relative because the reference group is already
extreme. A “terrible” professional athlete is one who’s terrible
relative to his peers, not relative to the population at large or
a class of third-graders. Likewise, the mental image conjured
up when one hears the Samurai rolls over “easily” is not of
some oopsy-daisy clown car, but a vehicle that rolls over
easily relative to other vehicles in its class. And, since all
vehicles require some coaxing to roll over, Judge Graber’s
fear—that readers might be duped into thinking they’1] come
out of the supermarket to find that their Samurai had flopped
itself over in the middle of the parking lot—is a specter of
her own creation. Even ignoring the rollover during break-
in and the tip on the long course—not to mention the NHTSA
complaint and the media coverage—CU was plainly justified
in concluding that, given the alternatives, the Samurai’s
rollover propensity was more than what safety-conscious
consumers should be willing to bear. And that’s exactly what
any reader would understand it to have said.

Moreover, the word “easily” cannot be plucked out of
context. It must be read in light of CU’s article (to which the

72a
Appendix B

anniversary issue obviously referred). CU explained exactly
how “easily” the Samurai tipped over, and what CU did to
reach its conclusion. It did not secretly put lead weights in
the roof to raise the center of gravity; it did not use narrow
tires to cause instability; it did not jimmy the suspension.
It did exactly what it said it did—it put the Samurai through
the same course as the other vehicles, and the Samurai tipped
while the others did not. CU did not ask consumers to accept
its claim at face value; it gave them the data on which it
based its conclusion so they could decide for themselves
whether or not the Samurai tipped over too easily.

Even if CU’s reporting were somehow inaccurate or
misleading, there are any number of legal doctrines that
protect it. (“Rhetorical hyperbole” comes to mind, see Letter
Carriers, 418 U.S. at 285-86.) But it’s not. CU had adequate
grounds to conclude that the Samurai rolled over easily
compared to similar vehicles, and that’s all it said.

Judge Graber doubtless perused the record with great
care in search of something to support Suzuki’s case. That
she could come up with nothing better than these two
statements speaks volumes about the overall accuracy and
candor of CU’s reporting.

* * *

I have read CU’s review of the Samurai and Suzuki’s
criticism of its methodology. After all that, I can only say I
would long hesitate before letting anyone | care about drive
or ride in one of these vehicles. If Suzuki wanted me to
disregard CU’s conclusions, it should have taken the money

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73a

Appendix B

it spent on this lawsuit and hired an independent agency to
run tests showing that CU’s criticisms are unfounded. It could
also have tried to improve its product to moot criticism in
the future. But, until today, I had thought the one option not
available to a company in Suzuki’s position was to use its
vast financial resources to drag its critics through the gauntlet
of our immensely expensive litigation machine. I continue
to hope I’m right, or this wili be a sad day indeed for
consumer organizations and those who rely on them for
information vital to their health and safety.

[SEE APPENDIX IN ORIGINAL]

74a
APPENDIX C — SUMMARY JUDGMENT OF THE
UNITED STATES DISTRICT COURT FOR THE
CENTRAL DISTRICT OF CALIFORNIA, SOUTHERN
DIVISION DATED AND DECIDED MAY 24, 2000
UNITED STATES DISTRICT COURT FOR THE
CENTRAL DISTRICT OF CALIFORNIA,
SOUTHERN DIVISION
SA CV 96-340 AHS (ANx)
SUZUKI MOTOR CORPORATION,
Plaintiff,
V.
CONSUMERS UNION OF UNITED STATES, INC.,
Defendant. _

May 24, 2000, Decided

JUDGES: ALICEMARIE H. STOTLER, UNITED STATES
DISTRICT JUDGE.

OPINION BY: ALICEMARIE H. STOTLER

OPINION

ORDER GRANTING DEFENDANT’S MOTION FOR
SUMMARY JUDGMENT (APPENDICES AND RELATED
ORDERS OMITTED)

75a
Appendix C
I.
PROCEDURAL BACKGROUND

The Court heard oral argument on defendant’s motion
for summary judgment on June 28, 1999. After complete
review of all declarations and exhibits, as hereinafter
described, review of the Reporter’s Transcript of counsels’
oral arguments, and additional independent research, the
Court, by this Order, grants defendant’s motion.

Consumers Union of United States, Inc. (“CU”’) filed a
Motion for Summary Judgment on May 3, 1999. In support
of its motion, CU filed a number of declarations,' as well as
a Request for Judicial Notice, an Appendix of Extrajudicial
Authorities, the Statement of Uncontroverted Facts and
Conclusions of Law, and a proposed Judgment. Plaintiff
Suzuki Motor Corporation (“Suzuki’’) filed its opposition
on May 24, 1999. In addition to its Memorandum of Points
and Authorities, Suzuki filed opposition to CU’s Request for
Judicial Notice, opposition to CU’s documentary exhibits
attached to the declarations of Baird and Williams, its
Statement of Genuine Issues (“GI’’), as required by Local
Rule 7.14.2, objections to CU’s declarations, and a number
of declarations in support of its opposition.” CU filed its reply

1. The declarations of Karpatkin, Pittle, Knoll, Landau,
Sheehan, Wood, Small, Conkling, Allen, Nappi, Baird (attached to
which are Volumes I through VI containing exhibits 1-148), and
Williams (attached to which are Exhibits 149-182).

2. The declarations of Reichert, McCarthy, Cooperrider,
Yarborough, Edwards, Guthman, Bottomley, Riley, Rudd, Rogers,
(Cont’d)

76a

Appendix C

on June 7, 1999. CU submitted exhibits 393-400 as
attachments to the Supplemental Declaration of Williams.
In addition, CU filed Objections to Suzuki’s declarations, a
Response to Suzuki’s Statement of Genuine Issues, a
Response to Suzuki’s objections to CU’s Request for Judicial
Notice, a Response to Suzuki’s Objections to documentary
exhibits attached to the declarations of Baird and Williams,
and a Response to Suzuki’s objections to declarations. With
leave of Court, Suzuki filed responses to CU’s evidentiary
objections on June 23, 1999.

On July 1, 1999, the parties were requested, via minute
order, to prepare, serve, and lodge proposed orders regarding
their evidentiary objections. The parties then lodged proposed
orders on July 19, 1999. Having read and considered the
parties’ arguments in support of or against admis»: ility, the
Court separately files today those orders which now contain
the Court’s rulings on the evidentiary objections. Generally
speaking, most of the plaintiff’s hearsay objections are
overruled because many statements and documents are not
offered for the truth of the matter stated but as circumstantial
evidence bearing on the issue in controversy. On the other
hand, many of the defendant’s objections to plaintiff’s
declarations are sustained because the witnesses are not
qualified to opir on defendant’s state of mind; to the extent
that the declarants state factual matter, however, their
testimony is accepted.

(Cont'd)
Rasmussen, Murray, Schwartz, Goldie, Gomez, Heywood, Jacobs,

Lundquist, McCloskey, Ouellette, Singley, Smith, Theis, Beasiey, Garcia,
O’Neal, Seidle, Strauss, Tagland, in addition to exhibits 183-392.

77a
Appendix C

In addition, the Court this date separately files, as
Appendix A to Order Granting Defendant’s Motion for
Summary Judgment, a list of all exhibits submitted by
defendant CU in support of its motion as well as its reply.
The Court also separately files, as Appendix B to Order
Granting Defendant’s Motion for Summary Judgment, a list
of all exhibits submitted on behalf of plaintiff Suzuki, all of
which, whether text, photo, or video, have been reviewed by
the Court. The Court has also received, read, and considered
plaintiff’s Notice of Recent Additional Authority Re
Summary Judgment, filed September 23, 1999, and
defendant’s response thereto filed September 24, 1999.
Having considered the parties’ arguments in support of and
against judicial notice, the Court denies Defendant’s Request
for Judicial Notice. Certain court decisions contained in the
Request for Judicial Notice are otherwise admitted in
connection with declarations of witnesses for limited
purposes, as ruled upon in the aforementioned orders on
evidentiary objections. The Court sustains Suzuki’s
objections to CU’s Objections to Evidence Set Forth in
Suzuki’s Statement of Genuine Issues and grants Suzuki’s
request that those objections be disregarded.

Il.

FACTUAL OVERVIEW

This action stems from an article that originally appeared
in the July 1988 issue of Consumer Reports (“CR”), a
monthly magazine published by defendant CU. In the article
(Ex. 105), CU opined that the Suzuki Samurai (““Samurai”’)
was “Not Acceptable” because CU’s tests showed a tendency

78a

Appendix C

for the car to roll over during an accident avoidance
maneuver. Plaintiff Suzuki Motor Corp. Japan is the
manufacturer of the Samurai, a sports-utility vehicle.
American Suzuki Motor Corp., the American distributor of
the Samurai, was, originally a plaintiff but was dismissed in
the order granting defendant’s Motion to Dismiss on February
3, 1997.

In this action, Suzuki asserts that statements referring to
the Samurai’s rollover tendency, which initially appeared in
the 1988 CR article and which have been repeated in various
CU and other publications, are false, disparaged the Samurai,
and caused Suzuki to suffer damages. While the original
complaint and the supplemental complaint contained
22 claims, including defamation and libel claims, the First
Amended Complaint contains only three claims, two product-
disparagement claims and one claim under California
Business & Professions Code § 17200. The Court denied
Suzuki’s Motion for Leave to File a Second Amended
Complaint on April 13, 1999.

In this motion, CU challenges the sufficiency of
plaintiff’s evidence supporting one essential factual element
of its case: whether CU acted with actual malice in reporting
on the Samurai on the basis of its 1988 testing. Suzuki points
to a number of facts, culled from a voluminous record
compiled by both parties, that it contends support a finding
of malice. Suzuki highlights the following:

1. After more than three dozen runs in the Samurai on
CU’s established avoidance maneuver, CU’s professional
drivers rated it highest of all the vehicles, and expressly stated

COE ee ee ethie’

79a
Appendix C

“no tendency to tip up” and “no real problem” in the written
evaluations. See Plaintiff’s Statement of Genuine Issues
(“GI”), PP 440-41;

2. After the Samurai completed the standard testing
without incident, CU’s editor-in-chief, Irwin Landau,
remarked that “If you can’t find someone to roll this car,
I will.” Motion at 23-25; GI P 445;

3. CU’s technical director, R. David Pittle, then asked
to drive the Samurai. After nine more runs and after departing
from the established track, the Samurai tipped up. Motion-at
24-25; GI PP 452-54; ;

4. After the tip-up, Pittle directed the chief of CU’s auto
test division, Robert Knoll, to prepare a new “modified

emergency avoidance maneuver’ and replicate Pittle’s path.
GI PP465-67;

5. When driver Richard Small was able to tip up the
Samurai on the new course after multiple successful runs by
another driver, the test course video and audio tape recorded
CU employees cheering, and someone said “All right Ricky
baby!” Motion at 22; GI PP 478-83;

6. Landau drafted the article reviewing the Samurai as
“Not Acceptable” before the auto test division prepared its
usual report on the testing and before the runs on the modified
course had been completed by the other vehicles, including
one vehicle whose performance was lauded by Landau in
the draft. GI PP 521-26;

80a

Appendix C

7. On the last day of testing, after Landau completed _

the draft and Pittle signed off on it, and CU had begun to
prepare for a press conference to announce the findings, Pittle
saw that the drivers were unable to tip the Samurai and
exclaimed “Can’t you just see it, we get no lift off the ground,
Oh God!” Motion at 22; GI P 487;

8. CU refused to reconsider the validity of its testing
despite the federal government’s conclusion, in September
1988, that CU’s “test procedures . . . do not have a scientific
basis and cannot be linked to real-world crash avoidance
needs, or actual crash data” and similar findings by other
governments. GI P 588;

9. By 1995, CU knew that one of its former test drivers,
Lee Baldrick, purchased a Samurai for his own personal use.
GI PP 636-44;

10. At the time of CU’s testing in 1988, CU was
financially overextended due to capital investments. Motion
at 20-22; GI PP 732-35.

Suzuki maintains that the totality of evidence that it has
presented, and especially the foregoing excerpts, satisfies the
requirements of the malice standard and justifies trial
proceedings.

SBE LIES IIR BR eI iy 04

RG ELLIE LSE OLED

8la
Appendix C
ITI.

DISCUSSION
A. Standard of Review

To avoid an adverse grant of summary judgment, Suzuki
must “set forth specific facts showing that there is a genuine
issue for trial.” Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 250, 91 L. Ed. 2d 202, 212-213, 106 S. Ct. 2505, 2511
(1986) (quoting Fed. R. Civ. P. 56(e)). The plain language of
Rule 56(c) mandates the entry of summary judgment against
a party who fails to make a showing sufficient to establish
the existence of an element essential to that party’s case and
on which that party will bear the burden of proof at trial.
Celotex Corp. v. Catrett, 477 U.S. 317, 322, 91 L. Ed. 2d
265, 106 S. Ct. 2548 (1986). The inquiry involved in a ruling
on a motion for summary judgment necessarily implicates
the substantive evidentiary standard of proof that would apply
at the trial on the merits, 1.e., the “actual quantum and quality
of proof necessary to support liability” at trial. Liberty Lobby,
477 U.S. at 252, 254. The mere existence of a scintilla of
evidence in support of the plaintiff’s position will be
insufficient; there must be evidence on which the jury could
reasonably find for the plaintiff. See id.

There is no disagreement that plaintiff must prove actual
malice by “clear and convincing evidence.” See Plaintiff’s
Opposition to Motion for Summary Judgment on Issue of
Actual Malice at 6. In other words, the Court must determine
whether a reasonable fact-finder could conclude that the
plaintiff has shown actual malice with convincing clarity.

82a

Appendix C

Liberty Lobby, 477 U.S. at 252. Actual malice is a term of
art denoting deliberate or reckless falsification. See Masson
v. New Yorker, 501 U.S. 496, 499, 115 L. Ed. 2d 447, 111 S.
Ct. 2419, 2424 (1991). Malice entails a showing that the
defendant made a false statement “‘with knowledge that the
statement was false or with reckless disregard as to whether
or not it was true.’ Harte-Hanks Communications, Inc. v.
Connaughton, 491 U.S. 657, 667, 105 L. Ed. 2d 562, 109
S. Ct. 2678, 2685 (1989) (quoting Hustler Magazine Inc. v.
Falwell, 485 U.S. 46, 56, 99 L. Ed. 2d 41, 108 S. Ct. 876
(1988)). Put another way, defendant must have made the
decision to publish the relevant information with a “‘high
degree of awareness of .. . probable falsity,’” or defendant
must have entertained “‘serious doubts as to the truth of [the]
publication.’ Harte-Hanks Communications, 491 U.S. at 667
(quoting Garrison v. Louisiana, 379 U.S. 64, 74, 13 L. Ed.
2d 125, 85 S. Ct. 209 (1964) and St. Amant v. Thompson,
390 U.S. 727, 731, 20 L. Ed. 2d 262, 88 S. Ct. 1323 (1968)).

Whether a plaintiff has shown actual malice is
determined on a case-by-case basis, and the courts have a
constitutional duty to “exercise independent judgment and
determine whether the record establishes actual malice with
convincing clarity.” Bose Corp. v. Consumers Union of
United States, Inc., 466 U.S. 485, 514, 80 L. Ed. 2d 502, 104
S. Ct. 1949, 1967 (1984).

B. Application
The merits of CU’s motion for summary judgment do

not turn on the stability of the Samurai or even the soundness
of CU’s testing methodology. Rather, the issue is whether

83a

Appendix C

plaintiff has satisfied its evidentiary burden of showing with
convincing clarity that CU reported on the Samurai
with actual malice. Having viewed all the evidence in the
light most favorable to plaintiff, in making a “case-b

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386015_2016%3A2. Public record. Not legal advice.