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The Internet exploded in umbrage last week when a federal court ruled that blogger Crystal Cox doesn't qualify for protection as a journalist under the Oregon shield law. But a close examination of the judge's opinion reveals that the online anger over his interpretation of the shield law is largely misplaced. ASNE counsel Kevin Goldberg explains.

Bad cases make bad law.

The wisdom of that old adage was demonstrated again last week with the decision in Obsidian Finance Group, LLC v. Crystal Cox, the now-famous case in which a Montana blogger was held liable for defamation and ordered by a federal court in Oregon to pay $2.5 million in damages.

The Internet exploded in umbrage over the ruling by United States District Court Judge Marco Hernandez (PDF) that the blogger does not qualify for protection under the Oregon shield law. But a close examination of the judge's opinion reveals that the online anger over his interpretation of the shield law is largely misplaced. It's actually another part of his opinion that is most troubling.

The case began when Montana real estate agent and blogger Crystal Cox accused Kevin Padrick and his Oregon-based finance and investment firm of acting unethically and illegally as a trustee in bankruptcy for Summit Accommodations, a company whose executives have been accused of committing fraud and laundering money. Despite Cox's allegations, there is no evidence that Padrick or anyone else from Obsidian Finance Group assisted these illegal activities or even knew about them. 

In her motion to dismiss the ensuing defamation complaint, Cox claimed that only her source could demonstrate the truth of the allegations against Padrick and his firm, and that the source was protected under Oregon's shield law. Judge Hernandez ruled that she didn't qualify as a "journalist" under that law. The Internet meltdown followed.

The judge's ruling is clearly frustrating. As more news and information is distributed via the Internet, the idea that journalists must be defined only by the medium in which they operate doesn't make sense. That's why ASNE and its coalition partners in the federal shield law battle have consistently advocated for a legislative test that eschews the job status of individuals invoking the privilege and relies instead on the functions they undertake. Unfortunately, the Oregon shield law is primarily focused on status, which is why so much of the anger toward the Obsidian opinion is misplaced. By its plain language, the Oregon shield law doesn't protect Internet-only bloggers; it applies only to "any newspaper, magazine or other periodical, book, pamphlet, news service, wire service, news or feature syndicate, broadcast station or network, or cable television system".

One could argue that a blog should be considered a "periodical" since it is literally published periodically. However, Judge Hernandez may not have been inclined to stretch the statute that far for a defendant who called Padrick a "thug, thief and a liar" and who, as New York Times' columnist David Carr noted, "has some 500 URLs at her disposal and (is) not afraid to use them" to sharply criticize those she deems her enemy.

But Judge Hernandez isn't the first jurist to hew to the literal meaning of a shield law. Nor is this the most egregious example of a would-be journalist being denied the protections of a state shield law. In 2005, the United States Court of Appeals for the Eleventh Circuit ruled (PDF) that Sports Illustrated magazine wasn't covered by the Alabama shield law after it was sued by Mike Price, who was relieved of his duties as head coach of the University of Alabama football team before he ever coached a game. A story in Sports Illustrated revealed that Price spent a weekend partying with strippers at a golf tournament and, on at least one occasion, made advances toward female students. When SI sought the refuge of Alabama's shield law to protect their sources, the Eleventh Circuit ruled the law applied only to newspapers, radio stations and television stations. 

The recourse, in that case, as in Obsidian Finance Group, LLC v. Crystal Cox, was to the legislature.

While most of the attention on the Obsidian case has focused on the shield law ruling, Judge Hernandez was forced to grapple with the issue of whether Cox is a journalist at several other points in his opinion.

In one instance, he had to decide whether Padrick and Obsidian could recover more than just actual (i.e., provable, economic) damages despite the fact that they did not demand a retraction from Cox.  Under the Oregon Retraction Statute, only publishers of newspapers, magazines, and other printed periodicals, and radio, television or motion picture producers, can limit their damages by publishing a retraction demanded by a libel plaintiff. Judge Hernandez ruled that Cox didn't fit any of the itemized media categories and therefore wasn't protected by the statute. 

As with the state's shield law, it is Oregon's legislature, not Judge Hernandez, who has the authority to remedy the situation by amending the statute to include online-only publications. This part of the case, which has received almost no attention, raises some really interesting issues. What would be the effect of requiring retraction of an online article, given that it can be published and republished, as well as mirrored and cached, in its original form, almost instantaneously? Would the policy considerations supporting libel retraction statutes -- i.e., that the law should promote restoration of reputation over financial compensation -- apply in an online environment?  This is really heady stuff, completely ripe for discussion in the journalism community, but largely ignored in most discussions that I've seen. 

Even if, like me, you are inclined to cut Judge Hernandez some slack for his rulings on Oregon's shield and retraction laws, another part of his opinion should concern you.

Judge Hernandez had to decide whether Cox qualifies as a "media defendant" for purpose of limiting damages. Under Oregon case law, media defendants are required to pay non-economic damages (e.g., to compensate for emotional distress) if there is evidence that they published defamatory statements with malice. To decide that issue, Judge Hernandez engaged in the functional review of whether Cox is a "journalist" that bothered so many people. 

Judge Hernandez ruled that Cox isn't a journalist because neither she nor her work exhibited any of the following attributes:

  1. journalism education; 
  2. credentials or affiliation with any recognized news entity;
  3. adherence to journalistic standards such as editing, fact-checking, or disclosures of conflicts of interest; 
  4. maintenance of notes of conversations and interviews; 
  5. mutual understanding of or agreement of confidentiality with her sources; 
  6. publication of an independent product rather than assembling writings and postings of others; or 
  7. contacting "the other side" to get both sides of a story.

It is always troubling when a judge is required to define whether an individual is a journalist. This case is a prime example of why that is true.

One of the beautiful things about journalism, especially in the U.S., is that anyone can do it.  We have no licensing process or other barriers to entry, which is a significant component of the concept of "freedom of the press". So when Judge Hernandez makes a legal distinction between journalists based on whether they have a formal education, it tends to undermine that freedom.

Requiring journalists to be affiliated with a "recognized" news entity is also a mistake, especially at a time when individuals have the technological means to publish important news without the support of a media company. Under Judge Hernandez's interpretation of Oregon law, freelance journalists would find themselves on the outside looking in unless they hitched their wagon to a news organization, which should be a choice, not a requirement.

The judge also erred in his consideration of the issue of whether Cox published an "independent product." Although "aggregation" has received more attention with the rise of the Internet, there has always been an editorial and creative component to selecting, assembling and summarizing others' work. Do we really want the courts to serve as the arbiter of how much aggregation is enough to qualify as "journalism"?  Will judges want to see an individual's notes and raw materials before deciding that an act of journalism has been committed? 

Perhaps most interesting to me is the outrage engendered by this decision by people who otherwise never considered who qualifies as a "journalist", most of whom probably don't feel strongly that reporters deserve a privilege at all. Granted, I'm working from a rather small sample size consisting mainly of my own friends, but I received more inquiries and saw more Facebook/Twitter references to this case in my friends' feeds than just about anything related to my work over the past 16 years. Numerous individual responses convinced me that I had to write more broadly about this case, to put it in its proper perspective -- because I think it's been completely overblown. 

Many people were up in arms because they thought that Judge Hernandez ruled that bloggers aren't journalists. But what he really said is they aren't journalists under the Oregon state shield law, which is consistent with the letter of that statute.    

He also said that Crystal Cox is not engaged in activities worthy of the protections offered to media defendants in limiting damage awards in defamation cases under Oregon case law. Although we didn't like his reasoning on this issue, he didn't say that every blogger would be denied this classification on the same issue. In fact, his answer in most cases would most likely be more in line with our understanding that bloggers are capable of being journalists. 

So while Judge Hernandez's decision clearly presented interesting issues, it wasn't novel. Nor was it so egregiously flawed to merit the widespread attention it received. When we look back in a few years, Obsidian Finance Group, LLC v. Crystal Cox will be a minor footnote in the development of libel law and its adaptation to the digital era.

Kevin M. Goldberg is special counsel at Fletcher, Heald & Hildreth, P.L.C.