Texas Supreme Court to Decide ‘Fair Report Privilege’ in Closely Watched Libel Case

© 2015 The Texas Lawbook.

By Janet Elliott

AUSTIN (March 7) – Major Texas and national news organizations have urged the Supreme Court of Texas to maintain libel defense protections for journalists who report on government investigations.

The news organizations – including the Associated Press, New York Times, The Dallas Morning News, Hearst Corporation and News Corporation – say a pending case could undermine the “fair reporting privilege” that entitles journalists to rely on official reports from administrative agencies.

“Without this protection, journalists throughout the state will be unable to report on factual information obtained from government reports or official proceedings without fear of being sued for failure to include information not contained in the report and unknown to them,” the media group said in an amicus brief filed by Laura Lee Prather, an Austin partner in Haynes and Boone.

The case, heard by the Supreme Court last fall, involves a Beaumont TV station’s reporting on a Port Arthur physician who was disciplined by the Texas Medical Board for engaging in sexual contact with a patient. The station said it based its 2012 broadcasts on a press release issued by the board and a profile of the physician on the board’s website.

Dr. Minda Lao Toledo claims the broadcast defamed her by reporting that she was a pediatrician, a fact not in the agreed order. Toledo’s lawyer, Joe House, said the station sensationalized its report to suggest that Toledo’s patient was a child, rather than the 60-year-old man she had been dating.

“It gives the wrong impression about Dr. Toledo’s actions, completely wrong and very harmful,” said House, of Houston’s House Perron & House.

He said Toledo soon was inundated with phone calls about the report. House said the station repeated the report three more times but by the fourth broadcast it had dropped the reference to Toledo being a pediatrician.

Michael McCabe, who argued for KBMT Operating Co., said station news personnel did not read the agreed order and did not know the patient’s age, which was not contained in the order.

“We knew we were reporting what the TMB said. The gist is no more damaging than the actual truth would have been because in this case the actual truth is what the TMB said,” McCabe told the court. McCabe is a partner in the Dallas law firm Munck Wilson Mandala.

House said information in the medical board order about Toledo and the patient being engaged in an intimate relationship and the patient being prescribed testosterone “doesn’t ring pediatrics.”

“No, you don’t have to look past what the official report says. All you’ve got to do is not mess it up when you are conveying it to the public so they get the wrong impression,” said House.

Dismissal Sought Under Citizens Participation Act

The station sought to have Toledo’s lawsuit dismissed under the Texas Citizens Participation Act, arguing that the broadcasts were not defamatory and fell within the protection of the fair report privilege.

Beaumont’s 9th Court of Appeals upheld the trial court’s denial of the motion to dismiss. The court said Toledo presented sufficient evidence that the gist of the broadcasts was false, adding “the gist of the broadcasts would warn a reasonably prudent broadcaster of the broadcasts’ defamatory potential.”

McCabe said journalists are not required to merely parrot government reports nor are they required to do their own investigations when state officials report on matters of public concern.

McCabe said the appeal is the first time the Supreme Court has heard arguments involving a case where a media defendant sought dismissal under the Citizens Protection Act.

Court Questions Jurisdiction

Shortly before the arguments, the court wanted supplemental briefing on whether it had jurisdiction to hear the appeal.

McCabe argued that the court of appeals’ legal analysis conflicted with analyses from other courts and the Supreme Court under cases involving similar circumstances.

“The lower court did not apply either the substantial truth doctrine or the fair reporting privilege to the media defendants who were reporting on the actions of a state agency,” McCabe said.

Toledo’s brief on the jurisdictional issue states that the Citizens Participation Act was enacted to dismiss early-stage non-meritorious litigation. “The Texas Legislature never intended the TCPA to constrict or alter the constitutional right to purse a reputational case, or to change the substantive law of defamation, but only to streamline the procedure so as to protect defendants from harassment through the burden of unmeritorious claim,” the brief states.

The case is KBMT Operating Co., et al. v. Minda Lao Toledo, No. 14-0456.

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