A Federal Judge in Seattle Says That Crystal Cox, A Blogger, Isnt A Journalist And Finds Her Guilty Of Defamation
?A U.S. District Court judge in Portland has drawn a line in the sand between "journalist" and "blogger." And for Crystal Cox, a woman on the latter end of that comparison, the distinction has cost her $2.5 million....Cox was sued for defamation by the investment firm Obsidian Finance Group earlier this year after she posted several highly-critical articles about the company and co-founder Kevin Padrick. ?In classic over-the-top blogspeak Cox had called Padrick a liar, a thief, a fraud and just about everything else bad under the sun. And to this day, a Google search for Kevin Padrick brings up a multiple-page-long list of negative stories written about him by Cox--an unfortunate state of affairs given that Padrick is a lawyer and people often Google their lawyers (or anyone these days) before they hire one.
Crystal Cox, Oregon Blogger, Isn't a Journalist, Concludes U.S. Court--Imposes $2.5 Million Judgement on Her
By Curtis Cartier Tue., Dec. 6 2011 at 6:00 AM
?A U.S. District Court judge in Portland has drawn a line in the sand between "journalist" and "blogger." And for Crystal Cox, a woman on the latter end of that comparison, the distinction has cost her $2.5 million.
Speaking to Seattle Weekly, Cox says that the judgement could have impacts on bloggers everywhere.
"This should matter to everyone who writes on the Internet," she says.
Cox runs several law-centric blogs, like industrywhistleblower.com, judicialhellhole.com, and obsidianfinancesucks.com, and was sued by investment firm Obsidian Finance Group in January for defamation, to the tune of $10 million, for writing several blog posts that were highly critical of the firm and its co-founder Kevin Padrick.
Representing herself in court, Cox had argued that her writing was a mixture of facts, commentary and opinion (like a million other blogs on the web) and moved to have the case dismissed. Dismissed it wasn't, however, and after throwing out all but one of the blog posts cited by Obsidian Financial, the judge ruled that this single post was indeed defamatory because it was presented, essentially, as more factual in tone than her other posts, and therefore a reasonable person could conclude it was factual.
The judge ruled against Cox on that post and awarded $2.5 million to the investment firm.
Now here's where the case gets more important: Cox argued in court that the reason her post was more factual was because she had an inside source that was leaking her information. And since Oregon is one of 40 U.S. states including Washington with media shield laws, Cox refused to divulge who her source was.
But without revealing her source Cox couldn't prove that the statements she'd made in her post were true and therefore not defamation, or attribute them to her source and transfer the liability.
Oregon's media shield law reads:
No person connected with, employed by or engaged in any medium of communication to the public shall be required by ... a judicial officer ... to disclose, by subpoena or otherwise ... [t]he source of any published or unpublished information obtained by the person in the course of gathering, receiving or processing information for any medium of communication to the public[.]
The judge in Cox's case, however, ruled that the woman did not qualify for shield-law protection not because of anything she wrote, but because she wasn't employed by an official media establishment.
From the opinion by U.S. District Judge Marco A. Hernandez:
. . . although defendant is a self-proclaimed "investigative blogger" and defines herself as "media," the record fails to show that she is affiliated with any newspaper, magazine, periodical, book, pamphlet, news service, wire service, news or feature syndicate, broadcast station or network, or cable television system. Thus, she is not entitled to the protections of the law
Cox tells Seattle Weekly that she plans to appeal the ruling by proving her assertion that Obsidian co-founder Kevin Padrick is guilty of bankruptcy fraud--a statement that, as Cox is quite proud of, is abundantly advertised if one simply Googles Padrick's name and sees the dozens of Cox's posts that spring up about him.
At this point Cox says that she still has no plans to get a lawyer.
We think that's a bad idea.
UPDATE: Attorney Bruce E. H. Johnson, the man who wrote the media shield laws in Washington state, has weighed in on whether Cox's fate would fly here. Read more here.
ANOTHER UPDATE: Kevin Padrick, the defamed co-founder of Obsidian Finance Group, has responded to the story. Read more here.
Read the full opinion
In Obsidian V. Cox, it is not so much the Shield Law at Issue as the Fact that I have no Actual Malice and Retraction Laws should Apply
Kevin Padrick, Defamed Attorney, Responds to Crystal Cox 'Blogger-Isn't-Journalist' Story
By Curtis Cartier, published: Wed., Dec. 7 2011 @ 3:54PM
?A federal judge's ruling that bloggers are not journalists has created a huge stir in the news and legal world since we broke the story yesterday. But behind the legal distinction is a man who quite successfully proved that he had been defamed by a blogger. That man responded to the story today.
Speaking to Seattle Weekly by phone, Obsidian Finance Group co-founder Kevin Padrick says that what's being lost among all the news coverage of his case is the harm that certain bloggers can inflict--both upon the people they write about and on the field of online journalism as a whole.
"I don't think there should be any lesser or any greater standard on the medium of the message," Padrick says. "But just because it's on the Internet you shouldn't be able to hide behind that."
In case you missed it, Crystal Cox was sued for defamation by the investment firm Obsidian Finance Group earlier this year after she posted several highly-critical articles about the company and Padrick.
?In classic over-the-top blogspeak Cox had called Padrick a liar, a thief, a fraud and just about everything else bad under the sun. And to this day, a Google search for Kevin Padrick brings up a multiple-page-long list of negative stories written about him by Cox--an unfortunate state of affairs given that Padrick is a lawyer and people often Google their lawyers (or anyone these days) before they hire one.
Obsidian's attorney's had submitted dozens of Cox's blog posts as evidence in the trial, but the judge threw out all but one, saying that the others were clearly opinion pieces and therefore cannot be viewed as defamatory.
One post, however, was singled out as admissible because the judge said it was more factual in tone than others. And it was this post that a jury unanimously ruled was defamatory, leading to a judgement against Cox for $2.5 million.
In the ruling the judge noted that Oregon's media shield laws do not extend to people that are not employed by a newspaper, magazine, TV station, radio station or other "official" media outlet.
. . . although defendant is a self-proclaimed "investigative blogger" and defines herself as "media," the record fails to show that she is affiliated with any newspaper, magazine, periodical, book, pamphlet, news service, wire service, news or feature syndicate, broadcast station or network, or cable television system. Thus, she is not entitled to the protections of the law.
Padrick says he understands why that distinction might rub bloggers and journos the wrong way, but he says there's a more complicated story to tell.
He sends the following statement that details his general response to the entire case and to the issues it brings up.
So the discussion comes full circle to the definition of "media." Let me reiterate that our case did not turn in any way on the Oregon Shield Law. And even if Cox was entitled to heightened First Amendment protection we are confident the jury would have found in our favor using a higher standard given the lack of any proof of the truthfulness of Cox's statements.
However, for societal purposes the definition of media is important (even if it wasn't for our case). Should someone be able to self-proclaim themselves to be "media?" How should media be defined? I fully agree that the medium shouldn't define who is and who is not media. However, if anyone can self-proclaim themselves to be media, then the concept of media has been rendered worthless. What some reporters writing on this topic are missing is that cheapening the definition of media is far more of an attack on true media (and the First Amendment) than anything else. When everyone is media the concept of media is gone for all purposes. The real threat here is not defining media too narrowly, but defining it too broadly. (As to our case remember that Cox presented no evidence that she was media regardless of how it was defined unless the definition is that anyone with a computer is media.) The same standards should apply regardless of the medium, be it internet, print, radio, tv, etc.
Cox's response to Padrick's response is that the real issue in this case is whether bloggers have the same rights as "real" journalists.
". . . it is has nothing to do with this post or me being press, having actual malice or the true merits of this case," Cox writes to Seattle Weekly. "This will distort the issue and if that's what you want that is fine. If i don't win my appeal, we all lose."
We agree that the blogger-versus-journalist distinction is vastly important.
But it's also important to note that even if Cox had been awarded shield-law protections in the lawsuit, she still most likely would have lost her case, because she was never able to prove her accusations against Padrick were true, with or without her secret source.
So while Cox's fate has and should send ripples of concern throughout the blogging and journalism community, the flip side of that coin is that if bloggers are able to post defamatory articles all over the Internet where they will permanently remain, it can have an ill effect on the entire medium of Internet journalism.
December 11, 2011
When Truth Survives Free Speech
By DAVID CARR, NY TIMES
Last week, a story came across my desk that seemed to suggest that a blogger had been unfairly nailed with a $2.5 million defamation award after a judge refused to give her standing as a journalist. A businessman who was the target of the blogger’s inquiries brought the suit.
I went to work on a blog post, filled with filial umbrage, saddened that the Man once again had used a boot heel to crush truth and free speech. But after doing a little reporting, I began to think that what scanned as an example of a rich businessman using the power of the courts to silence his critic was actually something else: a case of a blogger using the Web in unaccountable ways to decimate the reputation of someone who didn’t seem to have it coming.
The ruling on whether she was a journalist in the eyes of the law turned out to be a MacGuffin, a detail that was very much beside the point. She didn’t so much report stories as use blogging, invective and search engine optimization to create an alternative reality. Journalists who initially came to her defense started to back away when they realized they weren’t really in the same business.
On the surface, it seemed that the blogger, Crystal Cox, was doing the people’s work. A blogger and real estate agent in Montana who spent a lot of time fighting with the National Association of Realtors, Ms. Cox took an interest a few years ago in the bankruptcy of Summit Accommodators, an intermediary company in Bend, Ore., that held cash to complete property exchanges. The company went belly up and a federal grand jury indicted three senior executives — a fourth pleaded guilty — charging them with conspiring to defraud clients of millions.
Kevin D. Padrick, a lawyer in Oregon, was appointed as trustee in the case after the company entered bankruptcy. Prompted by the postings of someone whom Mr. Padrick was going after to recover assets — the daughter of one of the men who was indicted — Ms. Cox began suggesting in her blog posts that Mr. Padrick had used inside information and illegal measures to take control of the remaining assets and enrich himself.
In a long-running series of hyperbolic posts, she wrote that Mr. Padrick and his company, the Obsidian Finance Group, had engaged in bribery, tax fraud, money laundering, payoffs and theft, among other things. Her one-woman barrage did not alter the resolution of the Summit affair, but it was effective in ruining Mr. Padrick.
In a phone interview, he told me his business as a financial adviser had dropped by half since Ms. Cox started in on him, and any search of his name or his company turned up page after page on Google detailing his supposed skullduggery, showing up under a variety of sites, including Bend Oregon News, Bankruptcy Corruption, and Northwest Tribune.
As it turned out, all of the allegations and almost all of the coverage in the case were coming from Ms. Cox, who churned URL’s and cut-and-pasted documents to portray Mr. Padrick as a “thug,” and a “thief” who “committed tax fraud” and who may have “hired a hit man” to kill her while engaging in “illegal and fraudulent activity.”
Here’s the problem. None of that was ever proved, nor was it picked up by other mainstream media outlets.
Even a broken clock is right twice a day, but there is nothing in Mr. Padrick’s professional history or the public record that I found to suggest he is any of those things. He was appointed as a trustee by the court, he was subjected to an F.B.I. background check, and there have been no criminal investigations into his conduct. About 85 percent of the funds have been returned to the creditors, which seems to be a good result.
Annie Buell, the chairwoman of the Official Unsecured Creditors Committee who was appointed by the United States Trustee’s Office, said in an interview by phone that there was no basis in fact for Ms. Cox’s scabrous postings about Mr. Padrick.
“He did a very good job for the creditors,” she said. “He was above-board, had all of his cards on the table and was competent and fair. If I ever was in the same situation again, he would be my first choice.” Lawyers I spoke with who had done business with Mr. Padrick used similar adjectives to describe him.
Mr. Padrick, a lawyer who is a member of the bar in four states and has never been disciplined or investigated from anything I could find, said he spent a lot of sleepless nights wondering how he ended up as Ms. Cox’s bête noire.
“A woman who I did not know, who had no connection to me or my company or with this case she has been making statements on, has turned my business life and personal life upside down,” he said. “Companies who are considering doing business with us do a routine search on Google and there is page after page of these allegations. If it can happen to me, it can happen to anybody.”
And it has. Ms. Cox, who calls herself an “investigative blogger,” has a broad range of conspiratorial/journalistic interests. She has written that Bruce Sewell, the general counsel of Apple, “aids and abets criminals”; that Jeffrey Bewkes, the chief executive of Time Warner, is “a proven technology thief”; and that various Proskauer Rose lawyers have engaged in a pattern of “conspiracy.” And don’t get her started on the local officials in and around her hometown, Eureka, Mont.
When she gets in a fight with someone, she frequently responds by creating a domain with the person’s name, some allegation of corruption, or both. Many of the negative posts about Mr. Padrick appeared on obsidianfinancesucks.com and there are many more like it. In order to optimize visibility to Web crawlers, she often uses the full name and title of her target, and her Web sites are filled with links to her other sites to improve their search ranking. She has some 500 URLs at her disposal and she’s not afraid to use them.
“I have a gift for getting on top of search engines and I want to give voice to victims of the corrupt judicial system,” she said in an interview by phone. “The system wants to shut me up and they have been trying to for years.”
“I’m glad I lost the case, because it gives attention to what I have been doing,” she added, saying she doesn’t have money to hire an attorney — she represented herself in the defamation case — let alone $2.5 million to pay in damages. She plans to appeal.
She said she remained convinced that Mr. Padrick would be indicted, “even if I have to stay on it for the next decade.” But, as Forbes first pointed out following the verdict, she had been willing to negotiate a cease-fire.
“At this Point in my Life it is Time to Think of Me,” she wrote in a letter to Mr. Padrick’s lawyer, David Aman. “So I want to Let you know and Obsidian Finance that I am now offering PR Services and Search Engine Management Services starting at $2,500 a month,” she wrote, to promote “Law Firms” and “Finance Companies” and “to protect online reputations and promote businesses.”
What looked to be an unsubtle offer to holster her gun in exchange for a payoff was signed, “In Love and Light, Crystal Cox.”
Ms. Cox said that she sent that note in response to a request from Mr. Padrick’s attorney — Mr. Aman said he made no such inquiry — and that she was “not on trial for writing e-mails.”
In the pre-Web days, someone like Ms. Cox might have been one more obsessive in the lobby of a newspaper, waiting to show a reporter a stack of documents that proved the biggest story never told. The Web has allowed Ms. Cox to cut out the middleman; various blogs give voice to her every theory, and search algorithms give her work prominence.
Mr. Padrick, who had never met Ms. Cox and had no idea why she seemed intent on destroying him, sued her last January. Judge Marco Hernandez of United States District Court in Portland, Ore., threw out most of his claims of defamation, ruling that Ms. Cox’s posts were so over-the-top that no reasonable reader would conclude that she was making allegations of fact.
But Judge Hernandez did allow that a single post published on Christmas Day in 2010 charging all manner of criminal conduct could be read as containing “provable assertions of fact.” A one-day trial took place on Nov. 29, and after deliberating for 75 minutes, the jury awarded Obsidian $1 million and Mr. Padrick $1.5 million.
“I view our case as a blow for the First Amendment,” said Mr. Padrick. “If defamatory speech is allowed just because it is on the Internet, it cheapens the value of journalism and makes it less worthy of protection.”
Mr. Padrick signed off by reminding me that those who have been in conflict with Ms. Cox frequently find their names showing up in newly registered Web addresses. I’m thinking of buying RottenScoundrelDavidCarr.com as soon as I’m done typing.
Then again, I’ve got some institutional muscle when it comes to how I’m perceived on the Web. All Mr. Padrick had was his good reputation. Too bad there’s no algorithm to measure truth.
OBSIDIAN FINANCE GROUP, LLC, and KEVIN D. PADRICK, Plaintiffs,
CRYSTAL COX, Defendant.
United States District Court, D. Oregon, Portland Division.
November 30, 2011.
Steven M. Wilker, David S. Aman, TONKON TORP LLP, Portland, Oregon, Attorneys for Plaintiffs.
Crystal L. Cox, Eureka, Montana, Defendant Pro Se.
MARCO A. HERNANDEZ, District Judge.
Plaintiffs Obsidian Finance Group, LLC and Kevin Padrick bring a claim of defamation against defendant Crystal Cox. Trial in this case was conducted on Tuesday, November 29, 2011. On November 28, 2011, the day before trial, I orally ruled on several legal issues involved in the case. This Opinion contains the reasoning supporting those rulings.
I. Oregon's Retraction Statutes
Oregon Revised Statutes §§ (O.R.S.) 31-200 — 31.225 preclude a plaintiff from obtaining general damages on account of a defamatory statement being published in certain forms unless a correction or retraction is demanded, but not published as provided in O.R.S. 31.215. Defendant contends that because plaintiffs did not seek a correction or retraction, they may not obtained general damages.
These statutes apply, however, only to actions for damages on account of a defamatory statement published or broadcast in a newspaper, magazine, other printed periodical, or by radio, television, or motion picture. O.R.S. 31.205, 31. 210. The Oregon Legislature has not expanded the list of publications or broadcasts to include Internet blogs. Because the statements at issue in this case were posted on an Internet blog, they do not fall under Oregon's retraction statutes.
II. Oregon's Shield Laws
O.R.S. 44.510 — 44.540 provide certain protections to "Media Persons as Witnesses." O.R.S. 44.520 provides that
[n]o person connected with, employed by or engaged in any medium of communication to the public shall be required by . . . a judicial officer . . . to disclose, by subpoena or otherwise . . . [t]he source of any published or unpublished information obtained by the person in the course of gathering, receiving or processing information for any medium of communication to the public[.]
O.R.S. 44.520(1). "Medium of communication" is broadly defined as including, but not limited to, "any newspaper, magazine or other periodical, book, pamphlet, news service, wire service, news or feature syndicate, broadcast station or network, or cable television system." O.R.S. 44.510(2).
Defendant contends that she does not have to provide the "source" of her blog post because of the protections afforded to her by Oregon's Shield Laws. I disagree. First, although defendant is a self-proclaimed "investigative blogger" and defines herself as "media," the record fails to show that she is affiliated with any newspaper, magazine, periodical, book, pamphlet, news service, wire service, news or feature syndicate, broadcast station or network, or cable television system. Thus, she is not entitled to the protections of the law in the first instance.
Second, even if she were otherwise entitled to those protections, O.R.S. 44.530(3) specifically provides that "[t]he provisions of O.R.S. 44.520(1) do not apply with respect to the content or source of allegedly defamatory information, in [a] civil action for defamation wherein the defendant asserts a defense based on the content or source of such information." Because this case is a civil action for defamation, defendant cannot rely on the media shield law.
III. Anti-SLAPP Statutes
Defendant contends that the claim against her must be dismissed under Oregon's Anti-SLAPP (Strategic Lawsuit Against Public Participation) statute, O.R.S. 31.150. That statute provides that a defendant may make a special motion to strike a claim in a civil action that arises out of a written statement presented in a place open to the public or a public forum in connection with an issue of public interest. O.R.S. 31.150(2)(c). Procedurally, the moving defendant must make the motion within sixty days after the service of the complaint. O.R.S. 31.152(1). The motion must be denied if the court determines there is a probability that the plaintiff will prevail on the claim. O.R.S. 31.150(1), (3).
As previously explained in the July 7, 2011 summary judgment Opinion, defendant failed to timely move to strike under the Anti-SLAPP statute. July 7, 2011 Op. & Ord. at p. 15 n.3 (citing Horton v. Western Protector Ins. Co., 217 Or. App 443, 448-51, 176 F.3d 419, 422-24 (2008) (a special motion to strike under the Anti-SLAPP statute in O.R.S. 31.150 must be filed as part of a defendant's first appearance in the case)). Moreover, even if I allowed her to make such a motion now, it would be futile because I have already determined on summary judgment that plaintiffs are entitled to proceed to trial on one of the subject blog posts, effectively disposing of any argument that the claim could be dismissed under O.R.S. 31.150.
IV. "Absolute Privilege"
In her trial memorandum, defendant argues that her statements in the subject blog post are absolutely privileged because they are based on statements made in a judicial proceeding. Deft's Trial Mem. at pp. 6-7. While it is true that statements made in a judicial proceeding are absolutely privileged, Wallulis v. Dymowski, 323 Or. 337, 348, 918 P.2d 775, 761 (1996), a person who republishes a defamatory statement may be liable even though the original publication was privileged. See Cushman v. Edgar, 44 Or. App. 297, 302-03, 605 P.2d 1210, 1212-13 (1980) (union official's letter to governor was absolutely privileged, but its republication in union periodical was not). Here, defendant's statements were not made in a judicial proceeding. Moreover, the statements in the subject blog post do not appear to be republications of a statements previously published in a judicial proceeding. That is, while defendant provides links to other documents and discusses them in the post, the statements regarding Padrick's failure to pay taxes on taxable gain obtained by the bankruptcy estate, are not simply republications of statements that initially appeared in a judicial proceeding. Regardless, the statements posted on defendant's blog are not privileged.
IV. First Amendment Issues
Defendant raises several issues implicating the First Amendment.
A. "Actual Malice" Standard
Defendant argues that under New York Times Co. v. Sullivan, 376 U.S. 254 (1964), plaintiffs are "public figures" and as such, they must prove by clear and convincing evidence that defendant published the defamatory statements with "actual malice," meaning with knowledge that the statements were false or with a reckless disregard of whether they were false or not. See Flowers v. Carville, 310 F.3d 1118, 1129-30 (9th Cir. 2002) ("A public figure plaintiff must show that the defendant acted with `actual malice'-that is, knowledge that a statement was false or reckless disregard of whether it was false or not"; plaintiff can meet that burden by showing either that defendant knew the statements were probably false or that he disregarded obvious warning signs of falsity; burden must be satisfied by clear and convincing evidence) (internal quotation and brackets omitted).
Whether a plaintiff is a public figure is a question of law for the court. Wheeler v. Green, 286 Or. 99, 111 n.7, 593 P.2d 777, 785 n.7 (1979) (when the facts are not in dispute question of whether the plaintiff is a public figure is a question for the court). It is defendant's burden to establish plaintiffs' status as public figures. Carr v. Forbes, Inc., 259 F.3d 273, 278 (4th Cir. 2001).
A plaintiff is a public figure in one of two ways: (1) as an "all-purpose" public figure, meaning a "public figure for all purposes and in all contexts" Gertz v. Robert Welch, Inc., 418 U.S. 323, 351 (1974), or (2) by "thrusting (himself) to the forefront of (a) particular public controversy in order to influence the resolution of the issues involved." Id. at 345; see also Id. at 345, 351 ("(s)ome occupy positions of such persuasive power and influence that they are deemed public figures for all purposes; . . . more commonly, an individual voluntarily injects himself or is drawn into a particular controversy and thereby becomes a public figure for a limited range of issues.").
Neither plaintiff in this case is an "all purpose" public figure. The question is whether either plaintiff may be seen as a "limited" public figure. The leading cases make clear that they are not.
In Gertz, the plaintiff had served as an officer of professional organizations and had published several books on leading subjects. He was well known in certain legal circles but had achieved no general fame or notoriety in the community. Although he had been hired by the family of a murder victim to pursue a civil action against the police officer convicted of the murder, and although the murder and the officer's conviction had become a matter of public concern, the Supreme Court held that the plaintiff was not a limited public figure because he had not thrust himself into the "vortex of this public issue, nor did he engage the public's attention in an attempt to influence its outcome." 418 U.S. at 351. In Time, Inc. v. Firestone, 424 U.S. 448 (1976), the Court found that the plaintiff was not a limited public figure despite her social prominence and despite her divorce having become a "cause celebre." Id. at 454-55. The Supreme Court held that dissolution of marriage through judicial proceedings was not the sort of public controversy referred to in Gertz. The plaintiff had not chosen to publicize issues as to the propriety of her married life but was compelled to go to court regarding the divorce. Id.
In Wheeler, a professional racehorse trainer brought a defamation action against his former employers for statements made after he had been discharged. The Oregon Supreme Court concluded that the plaintiff was not a public figure:
There was evidence that, because of his success as a trainer, he was very well known to that portion of the public which follows Appaloosa horse racing. There was also evidence that there was, among those engaged in and interested in that sport, a current controversy about the adequacy of the rules and practices governing that sport, and the potential for abuse and dishonest activity. There was, however, no evidence that plaintiff had attempted in any way to influence that controversy or that he had taken any public part in it whatsoever. Until the statements by defendants which are the subject of this case were made public, the only publicity which plaintiff had received, so far as the record shows, was attributable solely to and concerned only his success as a trainer. There was no showing that he had voluntarily engaged in any activities of the kind the Court indicated in Gertz and Firestone were significant, nor had he been drawn into any public controversy.
286 Or. at 116-17, 593 P.2d at 788-89.
In Bank of Oregon v. Independent News, Inc., 298 Or. 434, 693 P.2d 35 (1985), the bank and its president brought an action against the defendant newspaper for publishing allegedly defamatory statements about the manner in which the bank dealt with a certain customer. The court examined the leading federal cases on the "public figure" issue and noted, inter alia, that the public controversy into which the plaintiff may thrust his or her personality must preexist the defamatory publication; it cannot be created by the publication. Id. at 443, 693 P.2d at 41 (citing Hutchinson v. Proxmire, 443 U.S. 111 (1979)). Additionally, merely because events involving a private individual attract public and media attention does not transform that private individual into a public figure. Id. at 443, 693 P.2d at 41-42.
In regard to a business entity, the court explained that "merely opening one's doors to the public, offering stock for public sale, advertising, etc. even if considered a thrusting of one's self into matters of public interest, is not sufficient to establish that a corporation is a public figure." Id. at 443, 693 P.2d at 42. The court concluded that the Bank of Oregon was not a public figure because first, there was no public controversy in the case and second, the bank did not have general fame or notoriety in the community nor did it exhibit pervasive involvement in the affairs of society. Id. at 443-44, 693 P.2d at 42.
The record does not support a conclusion that Obsidian Finance or Padrick are limited public figures. While Summit Accommodators may have received attention by its failure and may have caused a controversy for its investors who lost money, the alleged defamatory statements concern Padrick's handling of the bankruptcy estate's taxes. Even assuming Padrick volunteered for his position as the bankruptcy trustee, I do not view such an act as "injecting" or "thrusting" oneself into a controversy. There is no evidence that the bankruptcy filing itself was controversial. Additionally, Summit Accommodators was not a public entity and its liquidation is primarily of interest to its creditors and others whose economic interests may be impacted by the trustee's work. If the attorney plaintiff in Gertz was not a limited public figure based on his status as an attorney in a controversial civil case, Padrick's role as bankruptcy trustee would similarly not be a basis for finding him a limited public figure. See Gertz, 418 U.S. at 351. Finally, as Bank of Oregon noted, the public controversy into which the plaintiff may thrust him or herself must preexist the defamatory publication. The record here suggests that defendant created the controversy over Padrick's role as trustee and specifically, over the alleged tax fraud he committed. Public figure status may not be manufactured this way. The actual malice standard does not apply because neither Padrick nor Obsidian Finance are public figures.
B. "Media" Defendant
Defendant next argues that she is "media" and thus, plaintiffs cannot recover damages without proof that defendant was at least negligent and may not recover presumed damages absent proof of "actual malice." Gertz, 418 U.S. at 347; see also Bank of Oregon, 298 Or. at 445-46, 693 P.2d at 43-44 (when plaintiffs were not public figures, but defendant was "media," plaintiffs had to prove that defendants were negligent in publishing the challenged article).
Defendant cites no cases indicating that a self-proclaimed "investigative blogger" is considered "media" for the purposes of applying a negligence standard in a defamation claim. Without any controlling or persuasive authority on the issue, I decline to conclude that defendant in this case is "media," triggering the negligence standard.
Defendant fails to bring forth any evidence suggestive of her status as a journalist. For example, there is no evidence of (1) any education in journalism; (2) any credentials or proof of any affiliation with any recognized news entity; (3) proof of adherence to journalistic standards such as editing, fact-checking, or disclosures of conflicts of interest; (4) keeping notes of conversations and interviews conducted; (5) mutual understanding or agreement of confidentiality between the defendant and his/her sources; (6) creation of an independent product rather than assembling writings and postings of others; or (7) contacting "the other side" to get both sides of a story. Without evidence of this nature, defendant is not "media."
C. Issue/Matter of Public Concern
Defendant contends that the blog post referred to a matter or issue of public concern, further implicating First Amendment protections. "(W)hether speech addresses a matter of public concern must be determined by the expression's content, form, and context as revealed by the whole record." Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. 749, 761 (1985) (internal quotation, ellipses, and brackets omitted). In Dun & Bradstreet, the plaintiff, a construction contractor, brought a defamation action against a credit reporting agency which issued a false credit report to the contractor's creditors. The Court concluded that the credit reports concerned no public issue. Rather, the reports were speech solely in the individual interest of the speaker and its specific business audience. Id. at 761-62.
In contrast, in a Ninth Circuit case, the court analyzed statements made in a letter to the county by a physician protesting physician layoffs at a county hospital. Ulrich v. City & County of San Francisco, 308 F.3d 968, 978 (9th Cir. 2002). The court concluded that the plaintiff's challenges to the allocation of budgetary resources by questioning the ability of the hospital to care effectively for patients in the face of physician layoffs fell within the line of cases recognizing that "public import in evaluating the performance of a public agency to assess the efficient performance of its duties" was speech on a matter of public concern. Id. (internal quotation omitted). In another Ninth Circuit case, the court found certain statements by celebrity George Michael regarding an officer who had previously arrested him, to be in regard to a matter of public concern because the statements alleged an act of misconduct by a police officer and because Michael's status as a celebrity had already drawn significant public attention to and interest in the details of his arrest. Rodriguez v. Panayiotou, 314 F.3d 979, 985 n.7 (9th Cir. 2002).
The Ninth Circuit has also recognized that statements made about the safety or effectiveness of products readily available to consumers may be statements related to issues of public concern. See Metabolife Int'l, Inc. v. Wornick, 264 F.3d 832, 840 (9th Cir. 2001) (statements made regarding the safety of products intended for human consumption were statements related to a matter of public concern); Unelko Corp. v. Rooney, 912 F.2d 1049, 1056 (9th Cir. 1990) (statements about a product's effectiveness were on matter of public concern because they were of general interest and made available to the general public).
In Oregon, a leading case on the issue held that statements made by the defendant's manager to the plaintiff's employer, which was a contractor of defendant's hired to provide maintenance at a nuclear power plant, regarding plaintiff's ineligibility for clearance to work at the power plant, were not statements made on matter of public concern. Cooper v. PGE, 110 Or. App. 581, 587-88, 824 P.2d 1152 (1992). The court explained that while security at the power plant was generally a matter of public safety and welfare, the statements involved a question of personnel management, not a publicly debatable question concerning security policies at the power plant, the statements were not published in a way that made them available to the general public, and they were not a subject for public discussion or comment.
Here, although the statements were available to the public at large by being posted on the Internet, the content of the statements does not implicate a matter of public concern. Similarly to the plaintiff's status as a lawyer in Gertz, Padrick's status as a bankruptcy trustee does not make statements about his actions in that role a matter of public concern. See Gertz, 418 U.S. at 351 (Court rejected the argument that the plaintiff's status as a lawyer made him a public official because that would "sweep all lawyers" under the New York Times standard simply by being an officer of the court). Padrick was not a public employee or a public official. Summit Accommodators was not a public body or public corporation. Thus, in contrast to the statements made in Ulrich, the statements here did not relate to the evaluation of the performance of a public agency or official. In contrast to Rodriguez, the handling of the bankruptcy of Summit Accommodators had not, at least on the record in this case, generated public concern, controversy, or interest. Additionally, the subject matter did not, in contrast to Metabolife and Unelko, affect or relate to products available to the public at large.
Again, while presumably Summit's collapse generated news stories, the content of the statements at issue here concern Padrick's role as a bankruptcy trustee. There is no evidence that any public attention was paid to the Summit bankruptcy proceedings other than the attention defendant gave to the issue. Thus, although defendant made her statements in a forum available to the general public, without more, her statements regarding Padrick's conduct in his role as a bankruptcy trustee in the bankruptcy proceedings of a private corporation, are not statements made on a matter of public concern.
Based on the evidence presented at the time of trial, I conclude that plaintiffs are not public figures, defendant is not "media," and the statements at issue were not made on an issue of public concern. Thus, there are no First Amendment implications. Defendant's other defenses of absolute privilege, Oregon's Shield Law, Oregon's Anti-SLAPP statute, and Oregon's retraction statutes, are not applicable.
IT IS SO ORDERED.