THE STATE OF NEW HAMPSHIRE SUPREME COURT No. 2008-0723 _________________________________ Green Mountain Realty Corporation v. The Fifth Estate Tower, LLC and Jay Williams, Individually and as Manager ______________________________________ THE THOMAS JEFFERSON CENTER FOR THE PROTECTION OF FREE EXPRESSION BRIEF OF AMICUS CURIAE IN SUPPORT OF DEFENDANT-APPELLANTS ________________________________________ Daniel St. Hilaire, Esq. (Bar No. 12945) St. Hilaire & St. Hilaire, PLLC. 194 North Main Street Concord, NH 03301 Telephone: 603-856-7617 October 30, 2009 Of Counsel: Robert M. O’Neil J. Joshua Wheeler Eisha Jain The Thomas Jefferson Center for the Protection of Free Expression 400 Worrell Drive Charlottesville, Virginia 22911 Telephone: 434-295-4784 TABLE OF CONTENTS QUESTIONS PRESENTED ...................................................................................................1 STATEMENT OF THE CASE AND STATEMENT OF FACTS ......................................1 SUMMARY OF ARGUMENT ...............................................................................................1 I. II. FIFTH ESTATE TOWER’S STATEMENTS AND POSTCARDS CONSTITUTE PROTECTED POLITICAL SPEECH. ..........................................2 A. A speaker’s corporate identity does not diminish First Amendment considerations. ..................................................................................................4 B. The presence of a commercial interest does not render the First Amendment inapplicable.................................................................................5 THE APPLICATION OF THE “ACTUAL MALICE” STANDARD DEVELOPED IN DEFAMATION CASES IS BOTH LOGICALLY WARRANTED IN THIS CASE AND ENTIRELY CONSISTENT WITH U.S. SUPREME COURT PRECEDENT. ..........................................................................8 CONCLUSION ......................................................................................................................13 TABLE OF CASES AND AUTHORITIES Cases Pages Boos v. Barry, 485 U.S. 312 (1988) ...........................................................................................5 Bolger v. Youngs Drugs Products Corp. 463 U.S. 60 (1983)...................................................6 Bose Corp. v. Consumers Union of the United States, Inc., 466 U.S. 485 (1984) ..................12 Central Hudson Gas & Electric Corp. v. Public Serv. Comm’n of New York, 447 U.S. 557, (1980) .........................................................................................................................................6 Compuware v. Moody’s, Inc., 499 F.3d 520 (6th Cir. 2007) ...............................................9, 10 Connick v. Myers, 461 U.S. 138 (1983).....................................................................................3 Consolidated Edison Co. v. Public Serv. Comm’n, 447 U.S. 530 (1980)..................................4 Deupree v. Iliff, 860 F.2d 300 (8th Cir. 1988) .........................................................................10 Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. 749 (1985) ..............................3 Fed. Election Com’n v. Wisconsin Right to Life, Inc., 551 U.S. 449 (2007) .............................5 First Nat’l Bank of Boston v. Bellotti, 435 U.S. 765 (1978) ......................................................4 Food Lion v. Capital Cities/ABC, Inc., 194 F.3d 505 (4th Cir. 1999) .....................................10 Gertz v. Robert Welch, 418 U.S. 323 (1974) .......................................................................9, 11 Greenbelt Coop. Pub. Ass’n v. Bresler, 398 U.S. 6 (1970) .....................................................11 Hustler Magazine, Inc. v. Falwell, 485 U.S. 46 (1988) .......................................................9, 10 Levinsky’s, Inc. v. Wal-Mart Stores, Inc., 127 F.3d 122 (1st Cir. 1997) ...................................3 McIntyre v. Ohio Elections Commission, 514 U.S. 334 (1995) ............................................. 2-3 Meyer v. Grant, 486 U.S. 414 (1988) ....................................................................................2, 8 Milkovich v. Lorain Journal Co., 497 U.S. 1 (1990) .........................................................10, 12 NAACP v. Button, 371 U.S. 415 (1963).....................................................................................9 New York Times v. Sullivan, 376 U.S. 254 (1964).................................................................8, 9 Nike, Inc. v. Kasky, 539 U.S. 654 (2003) ...................................................................................7 Philadelphia Newspapers, Inc. v. Hepps, 475 U.S. 767 (1986) ................................................9 Riley v. Nat’l Fed’n of Blind, 487 U.S. 781 (1988) ...................................................................6 Roe v. City of San Francisco, 109 F.3d 578 (9th Cir. 1997) .....................................................4 Roth v. United States, 354 U.S. 476 (1957) ...............................................................................3 Sandy River Nursing Care Center v. Nat’l Council on Compensation Ins., 798 F. Supp. 810 (D. Me. 1992) .............................................................................................................................6 Snyder v. Phelps, 580 F.3d. 206 (4th Cir. 2009) ......................................................................10 Time, Inc. v. Hill, 385 U.S. 374 (1967)......................................................................................9 Thornhill v. Alabama, 310 U.S. 88 (1940) ................................................................................3 Virginia State Bd. of Pharm. v. Virginia Citizens Consumer Council, 425 U.S. 748 (1976) ....5 Other Authorities U.S. Constitution Amendment I ....................................................................................................... passim Consumer Protection Act (CPA), RSA 358-A ................................................................ passim QUESTIONS PRESENTED Although there are a number of Questions Presented for this Court’s review, this Brief of Amicus Curiae will only address the following: 1. Did the Superior Court err when it decided that the constitutions of the United States and New Hampshire do not protect Fifth Estate’s campaign speech from private-party claims under the Consumer Protection Act (CPA), RSA 358-A, and, therefore, (i) failed to grant summary judgment, a directed verdict, and a judgment notwithstanding the verdict (JNOV) to Fifth Estate on GMR’s CPA claim, and (ii) refused to charge the jury that CPA violations could only be established by clear and convincing evidence of actual malice and by proof that the campaign speech caused actual harm? STATEMENT OF THE CASE AND STATEMENT OF FACTS Amicus curiae hereby adopts the Statement of the Case and the Statement of Facts presented in the Brief of Appellants. SUMMARY OF ARGUMENT There can be little doubt that the expression upon which the Superior Court imposed liability in this case was political speech entitled to the highest degree of First Amendment protection. Conveyed in the context of a political campaign preceding a vote on a public referendum, the speech by Fifth Estate Tower, Inc. (“Fifth Estate Tower”) was intended to influence the choice voters made in an upcoming election regarding a specific issue. Yet the rulings of the court below appear not to recognize the protection accorded such political speech under the First Amendment. Indeed, the jury instructions indicate a view that the 1 First Amendment was not implicated in the case at all despite the fact that liability was premised exclusively on speech. “The First Amendment to the United States Constitution does not preclude the state from regulating speech or conduct that is at issue in this case.” Jury Charge Tr. at 16. While the Superior Court was correct in not permitting the jury to decide the degree of First Amendment protection, it nonetheless failed in its responsibility to ensure sufficient protection for the speech at issue. Specifically, the court erred in applying the Consumer Protection Act (“Act”) to the speech at issue, because the Act lacks the constitutional safeguards necessary for protecting political speech. Alternatively, the court failed to require a showing of clear and convincing evidence that the appellants acted with actual malice before liability could be imposed, thereby providing a safeguard sufficient to comport with the requirements of the First Amendment. Since the Superior Court made no findings in regard to actual malice, nor even recognized the relevance of the First Amendment to speech involving an issue of public concern, amicus curiae urges that this Court reverse the judgment of the Superior Court. I. FIFTH ESTATE TOWER’S STATEMENTS AND POSTCARDS CONSTITUTE PROTECTED POLITICAL SPEECH. The expression by Fifth Estate Tower upon which the jury based liability directly addressed a question placed before area voters. As such, it constituted the very essence of political speech on a matter of public concern. A regulation restricting political speech “trenches upon an area in which the importance of First Amendment protections is at its zenith.” Meyer v. Grant, 486 U.S. 414, 425 (1988) (citations omitted). See also McIntyre v. 2 Ohio Elections Commission, 514 U.S. 334 (1995) (stating that anonymously produced leaflets distributed “in the heat of a controversial referendum vote only strengthens the protection afforded to [the] expression”) (emphasis added); Roth v. United States, 354 U.S. 476, 484 (1957) (affording the highest First Amendment protection to political expression in order “to assure [the] unfettered interchange of ideas for the bringing about of political and social changes desired by the people”); Thornhill v. Alabama, 310 U.S. 88, 101-02 (1940) (holding that “[t]he freedom of speech and of the press guaranteed by the Constitution embraces at the least the liberty to discuss publicly and truthfully all matters of public concern without previous restraint or fear of subsequent punishment…” and further noting, “[f]reedom of discussion, if it would fulfill its historic function in this nation, must embrace all issues about which information is needed or appropriate to enable the members of society to cope with the exigencies of their period.”) As the First Circuit has recognized, political speech inherently involves matters of public concern: [M]atters of public concern … are those that can be “fairly considered as relating to any matter of political, social, or other concern to the community,” and matters of private concern … are those that address “matters only of personal interest.” … A court must determine whether a statement comes within the public concern hemisphere of this formulation by reference to its “content, form and context.” Levinsky’s, Inc. v. Wal-Mart Stores, Inc., 127 F.3d 122, 132 (1st Cir. 1997) (quoting Connick v. Myers, 461 U.S. 138, 146-47 (1983); Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. 749, 761 (1985)). The Levinsky’s court continued: “In order to do so, the relevant community need not be very large and the relevant concern need not be of paramount importance or national scope. Rather, ‘it is sufficient that the speech concern matters in 3 which even a relatively small segment of the general public might be interested.’” Id. (quoting Roe v. City of San Francisco, 109 F.3d 578, 585 (9th Cir. 1997)). A public referendum on the issue of whether a new cell tower may be constructed has aesthetic, economic, and environmental implications for the Wolfeboro community, and, as such, was unambiguously a matter of public concern. A. A speaker’s corporate identity does not diminish First Amendment considerations. The fact that Fifth Estate Tower is a corporation does not diminish the degree of protection accorded to its political speech. “The inherent worth of the speech in terms of its capacity for informing the public does not depend upon the identity of its source, whether corporation, association, union, or individual.” First Nat’l Bank of Boston v. Bellotti, 435 U.S. 765, 777 (1978). In Bellotti, the Court considered the constitutionality of a state statute forbidding certain corporate expenditures in the context of a public referendum. In determining that this restriction did not comport with the First Amendment, the Court noted that speech regarding government affairs “is the type of speech indispensable to decisionmaking in a democracy, and this is no less true because the speech comes from a corporation rather than an individual.” Id. See also Consolidated Edison Co. v. Public Serv. Comm’n, 447 U.S. 530 (1980) (extending political speech protection to privately-owned corporations and government-regulated monopolies). These decisions reflect the central role of the First Amendment in protecting the free flow of information in a public debate. See Bellotti, 435 U.S. at 783 (“[T]he First Amendment goes beyond protection of the press and the self-expression of individuals to 4 prohibit government from limiting the stock of information from which members of the public may draw.”) In light of this principle, even a “commercial advertisement is constitutionally protected not so much because it pertains to the seller’s business as because it furthers the societal interest in the ‘free flow of commercial information.’” Id. (citing Virginia State Bd. of Pharm. v. Virginia Citizens Consumer Council, 425 U.S. 748, 764 (1976)). These precedents make apparent the fact that a corporation’s speech in the context of a public referendum is political, and as such, should receive the fullest protection of the First Amendment. B. The presence of a commercial interest does not render the First Amendment inapplicable. Although the record does not indicate why the Superior Court chose not to incorporate First Amendment protections into its instructions to the jury, the court’s silence creates the perception that its reasoning was influenced by Fifth Estate Tower’s commercial interest in the outcome of the referendum. The ambiguity of the court’s action suggests an analysis directly at odds with U.S. Supreme Court precedent stating that First Amendment considerations remain fully in force, regardless of the speaker’s commercial motivations or other economic intent. In Fed. Election Com’n v. Wisconsin Right to Life, Inc., the Supreme Court cautioned that “an intent-based test would chill core political speech by opening the door to a trial … on the theory that the speaker actually intended to affect an election.” 551 U.S. 449, 468 (2007); see also Boos v. Barry, 485 U.S. 312, 335 (1988) (“any restriction on speech, the 5 application of which turns on the content of the speech, is a content-based restriction regardless of the motivation that lies behind it.”) (Brennan, J., concurring); Bolger v. Youngs Drugs Products Corp. 463 U.S. 60, 67 (1983) (stating that an economic motivation would be “clearly insufficient” to transform non-commercial statements into commercial statements); Central Hudson Gas & Electric Corp. v. Public Serv. Comm’n of New York, 447 U.S. 557, 580 (1980) (“Nor should the economic motivation of a speaker qualify his constitutional protection…”). Lower federal courts have also recognized the principle that First Amendment protection for political speech is not diluted by potential economic gain. E.g. Sandy River Nursing Care Center v. Nat’l Council on Compensation Ins., 798 F. Supp. 810, 815 (D. Me. 1992) (noting that “[i]t is … enshrined in the Free Speech and Petition Clauses of the First Amendment … that concerted efforts to influence legislation ought to be permitted, regardless of motive,” and concluding, “It is neither unusual nor illegal for people to seek action on laws in the hope that they may bring about an advantage to themselves and a disadvantage to their competitors.”). Fifth Estate Tower’s speech – seeking only a particular political outcome in a public referendum – could at most be considered a hybrid form of speech, one in which political and commercial motivations are intertwined. In Riley v. Nat’l Fed’n of Blind, the Supreme Court stated that speech is fully protected where “the component parts of a single speech are inextricably intertwined” because “speech [does not retain] its commercial character when it is inextricably intertwined with otherwise fully protected speech.” 487 U.S. 781, 796 (1988). 6 In Nike, Inc. v. Kasky, 539 U.S. 654 (2003) (per curium), a lawsuit arose after Nike engaged in a campaign to deny allegations of poor employment practices overseas. Nike’s campaign prompted a California resident to sue Nike for deceptive business practices. The Supreme Court’s per curiam majority dismissed the case solely on jurisdictional grounds. Justice Breyer dissented, however, and engaged with the substance of the First Amendment question. The majority’s lack of any First Amendment commentary lends force to the substance of Justice Breyer’s analysis, which is informative in this instance. Justice Breyer asserted that Nike’s speech could not be considered commercial because it “does not propose the presentation or sale of a product or any other commercial transaction . . . [and] concerns a matter that is of significant public interest and active controversy, and it describes factual matters related to that subject in detail.” Nike, 539 U.S. at 677 (Breyer, J., dissenting). Justice Breyer further characterized the language used by Nike as “not purely commercial in nature . . . [and] involving a mixture of commercial and noncommercial (public-issueoriented) elements.” Id. at 676 (Breyer, J., dissenting). As in the Nike case, the fact that Fifth Estate Tower’s speech did not propose a commercial transaction, but related to a matter of significant public interest forecloses any classification as commercial speech. Given that the speech at issue here has only tangential commercial relevance and relates to an important matter of public concern, the Superior Court erred in not assuring sufficient protection for the speech in the jury instructions. More broadly, the Consumer Protection Act cannot be applied to political speech of this variety because the Act does not contain the necessary constitutional safeguards required for political speech. 7 II. THE APPLICATION OF THE “ACTUAL MALICE” STANDARD DEVELOPED IN DEFAMATION CASES IS BOTH LOGICALLY WARRANTED IN THIS CASE AND ENTIRELY CONSISTENT WITH U.S. SUPREME COURT PRECEDENT. Government restrictions on political speech must overcome a burden that “is well- nigh insurmountable.” Meyer, 486 U.S. at 425. Even in legal disputes between private individuals or entities, it is well-established that a high standard must be met if the action is based on speech directed against a public official or figure, or concerns a matter of public concern. If this Court chooses to apply the Consumer Protection Act to the case at hand, then it should only do so only by including constitutional safeguards similar to those that have developed in other areas. The defamation context provides a useful analogy, the application of which is both logically warranted and entirely consistent with U.S. Supreme Court precedent. At least since New York Times v. Sullivan, 376 U.S. 254, 277 (1964), it has been clear that “what a State may not constitutionally bring about by means of a criminal statute is likewise beyond the reach of its civil law of libel.” To guard against the possibility of public officials employing defamation suits to circumvent First Amendment protections, the Court imposed a requirement that a defendant must be shown to have acted with “actual malice” – with knowledge or with reckless disregard of a statement’s falsity – before the underlying claim is actionable. See id. As the Supreme Court later explained: “This standard administers an extremely powerful antidote to the inducement to media self-censorship of the common-law rule of strict liability for libel and slander. And it exacts a correspondingly high price from the victims of defamatory falsehood. Plainly many deserving plaintiffs, including 8 some intentionally subjected to injury, will be unable to surmount the barrier of the New York Times test.” Gertz v. Robert Welch, 418 U.S. 323, 342 (1974). The heightened standard is necessary to ensure robust protection of speech in the context of defamation lawsuits: “[W]e have been especially anxious to assure to the freedoms of speech and press that ‘breathing space’ essential to their fruitful exercise.” Gertz, 418 U.S. at 342 (citing NAACP v. Button, 371 U.S. 415, 433 (1963)). See also Philadelphia Newspapers, Inc. v. Hepps, 475 U.S. 767, 772 (1986) (citing Button, 371 U.S. at 433). Even recognizing that “falsehoods have little value in and of themselves, they are ‘nevertheless inevitable in free debate,’ … and a rule that would impose strict liability on a publisher for false factual assertions would have an undoubted ‘chilling’ effect on speech relating to public figures that does have constitutional value.” Hustler Magazine, Inc. v. Falwell, 485 U.S. 46, 52 (1988) (citing Gertz, 418 U.S. at 339). Although the actual malice standard originally applied only to defamation suits involving public figures, the Supreme Court recognized its potentially broader application to such analogous torts as false-light privacy, Time, Inc. v. Hill, 385 U.S. 374 (1967), and intentional infliction of emotional distress, Falwell, 485 U.S. 46 (1988). The failure of the court below to invoke a protective standard similar to the actual malice standard is not only inconsistent with the Supreme Court’s approach to speech that touches on matters of public concern, but is also inconsistent with the approach of other federal circuit courts. In Compuware v. Moody’s, Inc., 499 F.3d 520, 530 (6th Cir. 2007), the Sixth Circuit determined that the actual malice standard should mitigate a breach of contract claim brought against a rating agency by a company subjected to an unwelcome financial 9 report. That court determined that the contract between the two companies was so “intimately tied to speech, expression and publication” that allowing an untempered judgment for a contractual breach would effectively sanction a “backdoor attempt to recover damages for the harm allegedly caused by [the rating agency’s] protected expression of its opinion of the [rated company’s] financial condition.” Id. at 531. The actual malice standard has served to bar that “backdoor” or at least to make such an alternative route substantially more difficult – and has thus inhibited unfettered damage claims arising from the dissemination of material “intimately tied to speech, expression and publication.” Compuware, 499 F.3d. at 531. Indeed, the Fourth Circuit a decade ago recognized the appropriateness of analogous reasoning in claims for fraud, breach of duty of loyalty, and trespass brought by a corporation. Food Lion v. Capital Cities/ABC, Inc., 194 F.3d 505, 511, 522 (4th Cir. 1999). More recently, the Fourth Circuit held that constitutional limits exist on the type of speech to which state tort liability may attach, regardless of a plaintiff’s status as private or public figure. See Snyder v. Phelps, 580 F.3d. 206, 218 (4th Cir. 2009). See also Milkovich v. Lorain Journal Co., 497 U.S. 1, 20 (1990); Hustler, 485 U.S. at 50; Deupree v. Iliff, 860 F.2d 300, 304-05 (8th Cir. 1988). In Snyder, the Fourth Circuit reversed a lower court’s finding of liability for three tort actions brought by the father of a soldier killed in Iraq against members of a so-called church which protested near the funeral claiming, inter alia, that the soldier’s death was God’s punishment for America’s tolerance of homosexuality in the military. Despite finding that neither the father nor his deceased son were public figures, 10 the Fourth Circuit determined that the First Amendment was implicated because the protestors’ messages were matters of public concern. See Synder, 580 F.3d at 218. The Superior Court should have required a higher standard to overcome First Amendment protection, because the Fifth Estate Tower’s speech addressed a matter of public concern, and because the plaintiff is public figure for the purposes of this litigation. The U.S. Supreme Court has instructed that public figures are “those who, by reason of the notoriety of their achievements or the vigor and success with which they seek the public’s attention.” Gertz, 418 U.S. at 342. The public attention need not be broad and all encompassing, for “commonly, those classed as public figures have thrust themselves to the forefront of particular public controversies in order to influence the resolution of the issues involved [and] … they invite attention and comment.” Id. at 345. In one instance, the Court found that a public figure was one who “was deeply involved in the future development of the city … seeking … favors to permit the construction of housing units of a type not contemplated in the original city plan.” Greenbelt Coop. Pub. Ass’n v. Bresler, 398 U.S. 6, 8 (1970). The Court noted that these qualities placed a person “within even the most restrictive definition of a ‘public figure.’” Id. at 9. Similarly, the plaintiff/appellee deliberately assumed public figure status by initiating and playing a central role in a public referendum. Because the plaintiff/appellee in this case is a public figure for the purposes of this litigation and the issue in this case is a matter of public concern, invoking the actual malice standard is not only logical, but also strongly endorsed by federal precedent. Further, the application of an actual malice standard forecloses the imposition of liability based on the postcards under the Consumer Protection Act, because they contained 11 only statements of opinion. In order to establish actual malice, it must be proven both that the postcards contained false information and that Fifth Estate Tower knew or surmised that they were false. The standard for such proof is high: “The burden of proving ‘actual malice’ requires the plaintiff to demonstrate with clear and convincing evidence that the defendant realized that his statement was false or that he subjectively entertained serious doubt as to the truth of his statement.” Bose Corp. v. Consumers Union of the United States, Inc., 466 U.S. 485, 511 (1984). Yet, the Superior Court dismissed the claim of defamation based on the postcards precisely because they contained only statements of opinion. See Order on Motion for Summary Judgment p. 5 (Appellant’s Appendix p. 414). As such, the Superior Court should have similarly dismissed the Consumer Protection Act claim based on the postcards because “a statement of opinion relating to matters of public concern which does not contain a provably false factual connotation… receive[s] full constitutional protection.” Milkovich, 497 U.S. at 20. 12 CONCLUSION For the foregoing reasons, amicus curiae the Thomas Jefferson Center for the Protection of Free Expression urges this Honorable Court to reverse the decision of the Superior Court. Respectfully submitted, THE THOMAS JEFFERSON CENTER FOR THE PROTECTION OF FREE EXPRESSION By Counsel, St. Hilaire & St. Hilaire, PLLC. By:__________________________________________ Daniel St. Hilaire, Esq. (Bar No. 12945) 194 North Main Street Concord, NH 03301 Telephone: (603) 856-7617 Dated: October 30, 2009 Of Counsel: Robert M. O’Neil J. Joshua Wheeler Eisha Jain The Thomas Jefferson Center for the Protection of Free Expression 400 Worrell Drive Charlottesville, Virginia 22911 Telephone: 434-295-4784 13 CERTIFICATE OF SERVICE The undersigned counsel certifies that, pursuant to Supreme Court Rule 30, an original and seven copies of the foregoing were filed with the court. Undersigned counsel further certifies that, in compliance with Supreme Court Rule 26, a copy of the foregoing has, this day, been sent to the following counsel by first class U.S. mail: Christopher T. Hilson Robert M. Derosier Donahue, Tucker & Ciandella, PLLC 225 Water Street Exeter, NH 03833 William Philpot, Jr. Haughey, Philpot & Laurent, P.A. 816 North Main Street Laconia, NH 03246-2656 Thomas P. Simon Thomas E. McCormick McCormick, Fitzpatrick, Kasper & Burchard, P.C. 40 George Street Burlington, VT 05401 William L. Chapman Orr & Reno, P.A. One Eagle Square Post Office Box 3550 Concord, NH 03302-0550 Michael Delaney, Attorney General New Hampshire Department of Justice Civil Law Bureau 33 Capitol Street Concord, NH 03301 Roy McCandless D’Amante, Couser, Steiner, Pellerin, P.A. 9 Triangle Park Drive Concord, NH 03302 Barbara Keshen New Hampshire Civil Liberties Union 18 Low Avenue Concord, NH 03301 Matthew R. Johnson Joshua M. Wyatt 111 Amherst Street Manchester, NH 03101 _____________________________________ Daniel St. Hilaire, Esq. (Bar No. 12945) 14