Defendant distributed a false credit report indicating that plaintiff’s company was declaring bankruptcy. Plaintiff sued defendant for defamation.
In a defamation suit, a plaintiff may recover presumed and punitive damages in defamation cases in the absence of a showing of actual malice.
Dun & Bradstreet, Inc. (“Dun & Bradstreet”) (defendant) was a credit reporting agency that supplied reports to its subscribers. Dun & Bradstreet sent a report to five subscribers, indicating that Greenmoss Builders, Inc. (“Greenmoss Builders”) (plaintiff) had filed for bankruptcy. The report and its declaration were false. The error was attributed to Dun & Bradstreet’s use of a 17-year-old high school student to review Vermont bankruptcy proceedings. After learning about the error, Dun & Bradstreet sent out a notice of the mistake. Greenmoss Builders found the notice to be inadequate, and brought suit for libel.
Whether a plaintiff may recover in the absence of a showing of actual-malice rule when the defamatory statements do not involve matters of public concern?
Yes, a plaintiff may recover presumed and punitive damages in defamation cases in the absence of a showing of actual malice. The judgment of the Vermont Supreme Court is affirmed.
Gertz made it clear that the First Amendment requires restrains on presumed and punitive damages awards. Greenmoss Builders should be required to show actual malice to receive presumed or punitive damages. Accordingly, this case should have been reversed and remanded.
The case is one of first impression. The Court has never previously considered whether the holding of Gertz v. Robert Welch, Inc. applies when the defamatory statements involve no issue of public concern. To make this determination, the Court must balance the interest of the state to compensate injured private individuals against the First Amendment interest in protecting certain types of speech. Given the reduced constitutional value of speech that does not involve matters of public concern, the state interest supports damages awards even absent a showing of actual malice. Here, there is no credible argument that the credit report requires special First Amendment protection. Therefore, there is no matter of public concern at stake and Greenmoss Builders is entitled to damages.