BILL ANALYSIS Ó
AB 998
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Date of Hearing: April 7, 2015
ASSEMBLY COMMITTEE ON JUDICIARY
Mark Stone, Chair
AB 998
(Wagner) - As Introduced February 26, 2015
As Proposed to be Amended
SUBJECT: Civil law: libel: damages
KEY ISSUE: SHould existing rules limiting defamation damages
when a newspaper or radio station issues a retraction also apply
to defamatory statements published in an online publication that
Publishes news on matters of public concern at least five days
per week?
SYNOPSIS
Under existing law, in any action alleging defamation in a
newspaper or radio broadcast, the plaintiff is limited to
"special damages," unless the newspaper or radio station refuses
a demand to publish or broadcast a correction. This bill would
extend this damage limit to cases involving magazines and
periodicals, whether in electronic or print form. While courts
have extended First Amendment protections and certain statutes
to online publications, a 2014 California appellate court
expressly declined the opportunity to extend California's
retraction statute to online publications. This bill would
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expand the retraction statute's reach to any daily news
publication, as defined, whether published in print or online.
The bill, as proposed to be amended, is consistent with the
underlying purpose of the retraction statute: to protect those
engaged in the "immediate dissemination of news," because such
enterprises cannot, as a practical matter, verify every claim or
allegation and still meet daily publication deadlines.
Reflecting this underlying purpose, the courts have refused to
extend the retraction statute to weekly publications, whether in
print or electronic form, because those publications have time
to verify their statements before going to press. However, an
appellate court recently refused to extend the retraction
statute to an online news publication - even one that publishes
news on a daily basis - because the express language of the
statute is restricted to "newspapers" and "radio broadcasts."
The bill would amend that language so as to make it clear the
statute applies to online publications, so long as they publish
news on matters of public concern at least five days a week.
SUMMARY: Extends a statutory damage limitation rule that
applies to cases involving libel in a newspaper or slander in a
radio or television broadcast to a daily news publication, as
defined. Specifically, this bill:
1)Provides that in any action for damages for publication of a
libel in a daily news publication, the plaintiff shall recover
no more than special damages, as defined, unless the plaintiff
demands a correction and the publisher refuses the demand.
2)Defines "daily news publication" to mean a publication, either
in print or electronic form, that contains news on matters of
public concern and that publishes at least five days a week.
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EXISTING LAW:
1)Provides that in any action for damages for publication of
libel in a newspaper or slander by a radio (or television)
broadcast, the plaintiff is limited to recovery of special
damages, as defined, unless a correction is demanded and the
correction is not published or broadcast. If a correction is
requested and the defendant refuses to publish or broadcast a
correction, then the plaintiff may recover general, special,
and exemplary damages, as specified. (Civil Code Sections
48a, 48.5. All further statutory references are to the Civil
Code, unless otherwise indicated.)
2)Defines, for purposes of defamation actions, the following
categories of damages:
a) "General damages" are damages for loss of reputation,
shame, mortification and hurt feelings.
b) "Special damages" are all damages which the plaintiff
alleges and proves that he [sic] has suffered in respect to
his property, business, trade, profession or occupation,
including such amounts of money as the plaintiff alleges
and proves he has expended as a result of the alleged
libel, and no other.
c) "Exemplary damages" are damages which may in the
discretion of the court or jury be recovered in addition to
general and special damages for the sake of example and by
way of punishing a defendant who has made the publication
or broadcast with actual malice. (Section 48a.)
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FISCAL EFFECT: As currently in print this bill is keyed
non-fiscal.
COMMENTS: Under the traditional common law, defamation was a
strict liability tort, meaning that a plaintiff could usually
recover without showing fault on the part of the defendant. In
addition, damages for reputational harm were presumed and thus
did not need to be proved. A plaintiff recovered merely by
showing (1) a defamatory statement (2) about the plaintiff (3)
that is published. A defamatory statement is a factual
assertion (not an opinion, obvious joke or figurative
exaggeration) that tends to harm a person's reputation by
holding that person up to scorn, ridicule, or contempt. A
defamatory statement is deemed "published" if it reaches one
person other than the plaintiff. Although the common law
traditionally distinguished between libel (written defamatory
statements) and slander (oral defamatory statements), the advent
of radio and other recording technologies diminished the
original rationale for that distinction and most jurisdictions,
including California, combine libel and slander under the single
tort of defamation for most purposes. (Section 44.)
Under the traditional common law, truth was a defense. However,
under the influence of modern constitutional law, falsity is
more often considered an element of the tort. At first glance
whether truth is a defense, or whether falsity is a required
element, may not seem terribly significant. In either case,
after all, the statement must be false in order for the
plaintiff to recover. The critical difference, however, goes to
the burden of proof. If falsity is an element of the offense,
then the plaintiff bears the burden of showing that the
statement is false. But if truth is a defense, on the other
hand, the burden shifts to the defendant to show that the
statement is true. The U.S. Supreme Court has held that when
the defamatory statement involves a public figure or a matter of
public concern it implicates the First Amendment, and as such
the burden should be on the plaintiff to prove falsity as part
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of his or her prima facie case. (Philadelphia Newspapers, Inc.
v. Hepps (1986) 475 U.S. 767.)
Damages and Defamation Law. In most defamation cases, as
previously noted, a plaintiff's damages are presumed and the
plaintiff may recover without providing any proof beyond the
defamatory nature of the statement. However, in some
situations, courts and legislatures have created exceptions to
this rule and require a plaintiff to show "special damages."
For example, some early courts held that libel (because it could
last forever) warranted general or presumed damages, whereas
slander (which ceased to exist once it was uttered) might
require the plaintiff to show "special damages." Some courts
hold that a statement that is defamatory "on its face" permits
general damages, but a statement that is facially neutral and
only defamatory in context requires the plaintiff to prove
special damages. California has codified this latter rule,
requiring a plaintiff to prove special damages where defamatory
language is "not libelous on its face." (Section 45a.) As a
general rule, "special damages" require the plaintiff to show
some specific, usually pecuniary, harm, whereas "general
damages" (loss of reputation, shame, etc.) are presumed by
virtue of the publication of a false and defamatory statement.
California law also requires a plaintiff to plead and prove
special damages in some cases if the defendant publishes a
retraction of the defamatory statement. Specifically,
California's so-called "retraction statute" (Section 48a) -
which this bill seeks to amend - limits a plaintiff's recovery
to special damages for "libel in a newspaper, or of a slander by
radio broadcast," unless a retraction is demanded by the
plaintiff and refused by the defendant. Only if the plaintiff
requests a retraction and the defendant refuses is the plaintiff
entitled to general damages and, where appropriate, exemplary
(or punitive) damages. The statute defines "special damages" as
"all damages which plaintiff alleges and proves that he [sic.]
has suffered in respect to his property, business, trade,
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profession or occupation, including such amounts of money as the
plaintiff alleges and proves he has expended as a result of the
alleged libel, and no other." Although the statute still only
expressly mentions a newspaper and radio broadcast, an adjacent
statute amended the definition of "broadcast" to include "both
visual and sound radio broadcasting," effectively extending the
statute's application to television broadcasts. (Section 48.5.)
The Purpose of the Retraction Statute. California's retraction
statute reflects, at least in part, the value traditionally
placed on freedom of the press in a democracy and the unique
role that newspapers (and later radio and television) have
played in the dissemination of news on matters of public
concern. In upholding the retraction statute against a
constitutional due process challenge, the California Supreme
Court held that "the Legislature may reasonably conclude that
public interest in the dissemination of news outweighs potential
injury to a plaintiff from the publication of a libel, and [the
Legislature] may properly encourage and protect news
dissemination by relieving newspapers and radio stations from
all but special damages resulting from defamation, upon the
publication of a retraction." (Werner v. Southern California
Associated Newspapers (1950) 35 Cal. 2d 121, 128.) More recent
cases have opined that the statute was intended to protect, in
particular, enterprises engaged "in the immediate dissemination
of news [because such enterprises] cannot always check their
sources for accuracy and their stories for inadvertent
publication errors." Because short "lead times" (the time
between initial assignment and submission deadline) justified
the retraction rule, the courts have refused to apply the
retraction statute to weekly magazines and periodicals, because
those publications had time to verify the truthfulness of
statements before publishing them. (Condit v. National Enquirer
(2002) 248 F. Supp. 2d 945, 955, citing Burnett v. National
Enquirer (1983).)
Extending Laws Affecting Print Media to Online Media. It is
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instructive to compare California's retraction statute to the
reporter's shield law (Cal. Const. Article I Section 2 (b);
Evidence Code Section 1070). The reporter's shield law -
similarly rooted in free press concerns - exempts journalists
from contempt of court charges when they refuse to reveal their
sources. This policy reflects the belief that, in order for the
press to continue gathering news of public importance,
journalists must sometimes promise to keep the identity of
informants confidential. Most important for purposes of this
analysis, the shield law applies to information that appears in
a "newspaper, periodical, or other medium." (Evidence Code
Section 1070; emphasis added.) By contrast, the retraction
statute more narrowly applies to "libel in a newspaper" or
"slander by a radio [or television] broadcast." (Civil Code
Section 48a and 48.5.) In O'Grady v. Superior Court (2006) 139
Cal. App. 4th 1423, the court held that the reporters' shield
law applied to online publications because they were "other
medium" that served the same function as a printed newspaper or
periodical. Notably, the O'Grady court warned that its decision
did not apply to everything posted online, pointing out that the
shield law would not necessarily protect any "information,
opinion, or fabrication" posted by "a casual visitor" to a
chatroom or bulletin board. The court considered but expressly
refused to say whether the shield law applied to bloggers
because of the "rapidly evolving" and "amorphous meaning" of the
word "blog." In short, one could say that, with the reporters'
shield law, the courts have looked to the function of the
publication rather the medium in determining whether the
reporter or publisher is protected by the shield law.
More recently a California appellate court, in an unpublished
opinion, had the opportunity to extend the retraction statute to
online publications, but unlike O'Grady, it declined to do so.
The court noted that, unlike the shield law considered in
O'Grady, which applied to any "newspaper, periodical, or other
medium," the retraction statute narrowly and quite expressly
applied to newspapers and radio broadcasts (and later
television.) The court concluded that if "the Legislature
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intended the statute to apply to defamatory material published
on an online website, it could have amended the statute to say
so, or add a statute to include such websites within the
definition of 'newspaper,' as it did when it enacted Civil Code
Section 48.5 in 1949 to expand the term 'radio broadcast' to
include both visual and sound recording." (Thieriot v. The
Wrapnews, Inc., 2014 Cal. App. Unpub. LEXIS 2690.)
This bill follows the lead of the Thieriot opinion and seeks to
do for the retraction statute what the O'Grady decision did for
the reporters' shield law: extend its protections to online
publications, so long as they are engaged in the daily - or near
daily - dissemination of news on matters of public concern. The
author's background material suggests that the primary purpose
of this bill is to update the law by recognizing that
Californians, like most other people around the world, are as
likely to get their news from the Internet as they are from
print newspapers, radio, or television. As such, if our policy
preference is that the media, as essential providers of the
news, deserve protection in the form of damage limitations, then
there is no logical reason to deny the same protections to
enterprises that provide the same important function, albeit
online.
The bill appropriately limits the protection of the retraction
statute to a "daily news publication," which in turn is defined
as a publication, either in print or electronic form, that
"contains news on matters of public concern and that publishes
at least five days per week." As noted above, the courts have
consistently held that the legislative intent of the retraction
statute was to protect those enterprises engaged in the
"immediate dissemination of news," and they have expressly
refused to extend the statute to weekly or monthly publications.
The policy rationale for this restriction, as noted, is that a
publication should verify factual allegations before publishing,
unless they operate under deadline pressures that make verifying
every fact and correcting every inadvertent error impractical.
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Even then, daily newspapers and broadcasters are not absolved of
liability; rather, the amount of damages that the publication
owes will be limited if, and only if, it honors a retraction
request. This bill, fully consistent with the reasoning of the
courts, will expressly state that a covered daily news
publication includes both print and electronic publications, and
it usefully replaces the outdated term "newspaper" (which, read
literally, suggest only print or "paper" publications) with the
more apt "daily news publication."
Proposed Author Amendments. In order to better clarify that the
purpose of this bill is extend the retraction statute to online
news publications, without also extending the statute to cover
publications not engaged in the daily (or near daily)
dissemination of news, whether in print or online, the author
will take the following amendments in this Committee:
- On page 1 line 3, on page 2 line 10, and on page 2 line
23-24, delete "newspaper, magazine, or other periodical
publication, either in print or electronic form" and
insert: daily news publication
- On page 3 after line 9 insert (and re-number
accordingly):
For purposes of this section, a "daily news publication" means
a publication, either in print or electronic form, that
contains news on matters of public concern and that publishes
at least five days a week.
- On page 1 line 1 create a new SECTION 1 which reads as
follows (and re-number accordingly):
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It is the intent of the Legislature to ensure that online
publications are afforded the same protection under Section
48a of the Civil Code as is afforded to a printed newspaper to
the extent that the online publication performs the same
news-disseminating function as a printed newspaper. The
Legislature finds and declares that the rulings in Burnett v.
National Enquirer (1983) 144 Cal. App. 3d 991 and Condit v.
National Enquirer (2002) 248 F. Supp. 2d 245 correctly state
that the purpose of Section 48a of the Civil Code is to
protect enterprises engaged in the immediate dissemination of
news on matters of public concern, insofar as time does not
reasonably permit such enterprises to check sources for
accuracy and stories for inadvertent errors. It is not the
intent of the Legislature that Section 48a of the Civil Code
should apply to periodicals that publish at weekly or longer
intervals, nor is it the intent of the Legislature that
Section 48a of the Civil Code should apply to casual postings
on a social networking website, chatroom, electronic bulletin
board, discussion group, online forum, or other related
website.
REGISTERED SUPPORT / OPPOSITION:
Support
None on file
Opposition
None on file
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Analysis Prepared by:Thomas Clark / JUD. / (916) 319-2334