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Defamation Lawsuit against CPI dismissed
Internal Administrator
Posted: Friday, August 12, 2011
Joined: 10/12/2010
Posts: 5779

Posted: 10/8/2005 4:52:19 PM

By: Hunter


A federal judge recently ruled that a watchdog group could not be held liable for defamation based upon its report of allegations that two Russian oligarchs and Russia’s largest private bank were involved in money laundering. (OAO Alfa Bank v. Center for Public Integrity, Sept. 27, 2005.) This case underscores the importance of the principle that public figures must prove that journalists acted with "actual malice" -- knowledge that they published false facts or reckless disregard about their truth or falsity -- in order to prevail in a libel suit.

This case was especially significant because it pitted some of the world's wealthiest individuals and institutions against a small watchdog organization. The Center for Public Integrity conducts investigations and issues reports relating to government ethics and publishes an Internet report called "The Public I."

The story at issue in this case began in 2000 when CPI began investigating the relationship between Halliburton and the federal government after it became apparent that former Halliburton CEO Richard Cheney would be the Republican candidate for vice president.

Looking into Halliburton's connections to a Russian oil company led CPI reporters to allegations of criminal activity by the Russian company and two of its owners, Mikhail Fridman and Pyotr Aven. Fridman and Aven are considered two of the most powerful Russian oligarchs -- men with immense wealth and influence in Russia’s post-Soviet economy and government.

In their investigation, the CPI reporters obtained a report of a Russian law-enforcement official alleging that Fridman, Aven and companies they owned were involved in drug trafficking and money laundering and had ties to organized crime. They also found several news reports making similar assertions. Several sources, including current and former American intelligence agents and an expert on Russian business practices, supported these claims.

CPI published an article on the Internet reporting these allegations in August 2000, and Fridman, Aven and two Russian companies sued for defamation in federal court in Washington, D.C.

In dismissing the case last month, Judge John Bates first concluded that all of the plaintiffs were public figures required to show actual malice. The actual malice test, the court emphasized, looks at what the CPI journalists personally believed about the truth or falsity of the report not what a "reasonable" reporter or publisher would have done, nor whether the defendant's investigation was sufficiently thorough.

The judge concluded that the journalists' reporting -- and corroboration with sources they considered reliable -- showed that they did not publish with actual malice.

Given the notoriety surrounding post-Soviet Russian oligarchs, the allegations themselves were not so "inherently improbable" that actual malice could be presumed. The court also noted that the journalists did not rely on a single source whom they had obvious reasons to doubt.

While the court did suggest that CPI should have researched some points more carefully, any shortcomings spoke to what a reasonable reporter might have done, it concluded, not the journalists' actual state of mind about the truth of the article. Because there was no actual malice, the court did not need to reach the question of whether the allegations against the plaintiffs were in fact true or false.

While libel plaintiffs always will be able to argue that reporters could have pursued other leads and sources, reporting on matters of public concern would be hampered if the law required such endless research. Judge Bates' decision is welcome in that it recognizes the real-world requirements of news deadlines in reporting on public figures.


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