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South Carolina appeals court upholds jury’s award in lobbyist’s defamation case


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jcrews

By Jordan Crews

The jury’s verdicts against a reporter and a newspaper publisher in a defamation case stands, a South Carolina court of appeals ruled last month.

In 2010, an investigative reporter for a South Carolina newspaper received information that a South Carolina gubernatorial candidate and other local politicians received large campaign contributions from multiple limited liability companies. While investigating these contributions, the reporter learned of a lunch meeting in 2009 that involved the candidate, a local lobbyist, and the local Chamber of Commerce president. At the meeting, the chamber president delivered $84,000 in campaign contributions to the candidate.

The reporter wrote three articles for the newspaper that discussed the lunch meeting. In the first article, the reporter wrote that the lobbyist attended the lunch meeting and that “[t]here are strict rules that forbid lobbyists from facilitating campaign donations for statewide candidates.” In the second article, the reporter wrote that the chamber president, “along with [the lobbyist], delivered about $84,000 of those contributions to [the candidate] in June.” 

Each of the articles stated that the contributions were, or appeared to be, legal. After publication of the articles, the newspaper published an editorial in which it admitted that it had little evidence supporting its allegations that the chamber of commerce made illegal campaign contributions. It did, however, attempt to defend itself by opining that the contributions appeared improper.

The lobbyist filed a lawsuit against the reporter and the newspaper publisher for defamation. In particular, the lobbyist claimed that the reporter and the publisher had accused him “of violating state ethics laws by delivering campaign contributions to [the candidate].” 

The reporter and the publisher asked the court for a directed verdict (i.e., an order from the judge to the jury to return a particular verdict). The judge denied their request, and the jury awarded the lobbyist $400,000 in actual damages and $250,000 in punitive damages. 

After the jury returned the verdict, the reporter and the publisher asked the court for a judgment notwithstanding the verdict (i.e., asking the judge to overrule and reverse the jury’s verdict), which the judge also denied. The reporter and the publisher appealed.

False and defamatory statement
The reporter and the publisher’s first argument on appeal was that the trial court should have granted their motions to reverse the juries’ verdict because the lobbyist presented no evidence that they made a false and defamatory statement. The appellate court disagreed for two reasons. First, there was plenty of evidence showing that the lobbyist did not deliver campaign contributions to the candidate. In fact, even the reporter himself admitted at trial that he had no evidence that the money came from the lobbyist.

Second, the court believed a jury could reasonably determine that the articles written by the reporter—in particular, the statement in the second article that the chamber president, “along with [the lobbyist], delivered about $84,000 of those contributions to [the candidate] in June”—accused the lobbyist of delivering campaign contributions to the candidate and thus accused him of committing a crime. 

In addition, the lobbyist presented several witnesses who testified that they believed the reporter had accused the lobbyist of committing a crime by delivering campaign contributions. Thus, the court of appeals held that a reasonable jury could find the articles false and defamatory.

Actual malice
The reporter and the publisher next argued that the trial court should have granted their motions to reverse the verdict because the lobbyist did not present enough evidence that the reporter wrote the articles with actual malice. A public figure in a defamation case, like the lobbyist, is required to prove that the defendant made the defamatory statement with actual malice—that is, that the defendant made the statement with knowledge of its falsity or with reckless disregard for its truth.

Here, the court of appeals particularly addressed the statement in the second article that the chamber president, “along with [the lobbyist], delivered about $84,000 of those contributions to [the candidate] in June.” The court of appeals had to determine whether there was sufficient evidence that the reporter knew, or recklessly disregarded, that he was making a false accusation against the lobbyist. 

In light of the fact that the reporter diligently pursued a story about the lobbyist making illegal campaign contributions and found no evidence to support the claim, the court found it difficult to believe that the reporter did not recognize that the statement would be read as an accusation against the lobbyist. In addition, the reporter admitted at trial that both the chamber president and the candidate told him that the chamber president—not the lobbyist—delivered the contributions. He also admitted that he had no evidence showing the lobbyist delivered campaign contributions. 

Based on these facts, the court found there was plenty of evidence showing that the reporter knew the statement was an accusation that the lobbyist committed a crime, and the reporter knew the lobbyist did not commit the crime. Thus, the court upheld the jury’s determination that the reporter acted with actual malice when making the statement.

Accordingly, the court of appeals affirmed the jury’s verdicts against the reporter and the publisher.



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