A $2.5 million defamation award against blogger Crystal Cox could discourage Web users from engaging in legitimate speech online, the digital rights group Electronic Frontier Foundation argues in new court papers.
In a friend-of-the-court brief filed this week, the EFF asserts that the “excessively high” award, combined with other errors in the case, sends a “speech-chilling message” to Web users.
The organization is asking U.S. District Court Judge Marco Hernandez in Portland, Ore. to vacate the jury's verdict, order a new trial, and to reconsider a controversial ruling that bloggers are not entitled to the same shield law protections as reporters for traditional media outlets.
The lawsuit grew out of a series of posts by Cox, a Montana resident, criticizing Obsidian Finance Group and its co-founder, Kevin Padrick, whom she called “a thug and a thief.”
Padrick and Obsidian responded by filing a defamation lawsuit against Cox in federal court. Hernandez dismissed counts related to numerous posts that he determined were merely opinions, which can't be defamatory. But the judge said that one post on the site bankruptcycorruption.com appeared to contain assertions of fact, and therefore, could be the basis of a libel finding.
Last November, a jury ruled against Cox, who had represented herself at trial. The jurors ordered her to pay $1 million to Obsidian and $1.5 million to Padrick.
When the verdict came out, the case drew a huge amount of press attention, resulting in some high-profile legal assistance for Cox, who is now represented by UCLA law professor and free speech expert Eugene Volokh. He recently filed a motion for a new trial.
Among other arguments, he says that Hernandez should have told the jury to consider Cox's state of mind -- including whether she acted with negligence -- before awarding damages. Without that type of instruction, the jury could find that Cox defamed Obsidian simply by publishing a false statement -- even if she reasonably believed the statement to be true.
Volokh argues that the U.S. Supreme Court ruled in 1974 that people suing for defamation aren't entitled to damages without proving that the defendants were at least negligent. (When public figures sue, or if the statements deal with a matter of public concern, defendants can't be held liable unless they acted with “actual malice,” defined as reckless disregard of the truth.)
Those standards -- negligence and actual malice -- apply regardless of whether defendants are affiliated with a news organization, Volokh argues. “The principle that the institutional press and others who speak to the public have the same First Amendment rights has been applied by the court in case after case since the 1930s,” he writes in a brief filed last week. Volokh also argue there was no evidence that Obsidian and Padrick suffered $2.5 million in damages from a single blog post.
The EFF also raises those points. The organization also focuses on the most highly publicized aspect of the case -- a pre-trial opinion by Hernandez focusing on whether Cox was entitled to the protections of Oregon's shield law.
Before trial, Obsidian demanded to learn the source for Cox's post on bankruptcycorruption.com. Cox said she didn't need to disclose that under Oregon's journalist shield law, which allows reporters to keep certain information confidential. Hernandez disagreed and said in a written opinion that Cox was not entitled to the shield law because she was not “affiliated with any newspaper, magazine, periodical, book, pamphlet, news service, wire service, news or feature syndicate, broadcast station or network, or cable television system.”
That ruling drew widespread press attention. Ultimately, however, it was irrelevant because Oregon's shield law doesn't protect journalists in civil defamation cases. In fact, the law has an exception for journalists who are sued for defamation.
Still, the EFF says that portion of the ruling -- combined with the $2.5 million award and the failure to instruct the jury to consider Cox's beliefs about whether the statement was true -- “paint an increasingly and unnecessarily hostile landscape for online speech."
The group adds that Hernandez “should have refrained from issuing its controversial [statements] regarding whether Cox’s status as an Internet publisher precluded her from the shield law’s protection.”