Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-95-07201/USCOURTS-caDC-95-07201-0/pdf.json

Parties Involved:
Ari Ben-Menashe

Robert C. McFarlane
Appellant
National Book Network

Sheridan Square Press, Inc.
Appellee

Document Text:

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued April 18, 1996 Decided August 16, 1996

No. 95-7201

ROBERT C. MCFARLANE,

APPELLANT

v.

SHERIDAN SQUARE PRESS, INC.,

APPELLEE

Appeal from the United States District Court

for the District of Columbia

(No. 93cv01304)

Forrest A. Hainline, III argued the cause and filed the briefs for appellant.

Melvin L. Wulf argued the cause for appellee, with whom Daniel M. Kummer was on the brief.

Before: WILLIAMS, GINSBURG, and ROGERS, Circuit Judges.

Opinion for the Court filed by Circuit Judge GINSBURG.

GINSBURG, Circuit Judge: In September 1992 Sheridan Square Press published Ari BenMenashe's Profits of War, a book concerning the involvement of the United States and of Israel in

the international trade in arms. In the part here relevant, the book sets out Ben-Menashe's

controversial allegations of an "October Surprise"a Byzantine conspiracy involving candidate

George Bush, high-ranking Republicans working on the 1980 Reagan-Bush campaign, and officials

of the Government of Iran. The purpose of the alleged conspiracy was, on the Republican side, to

delayuntil after the U.S. election the release ofthe American hostages held in Iran, thereby increasing

the probability that Ronald Reagan would defeat then-President Jimmy Carter. In exchange, the

Iranians would receive cash, promises of future arms sales, and the release of Iranian funds that had

been frozen in U.S. banks. Included in Ben-Menashe's account of this elaborate conspiracy is the

allegation that former National Security Adviser Robert C. McFarlane not only played an important

role in the October Surprise negotiations but was an Israeli spy to boot.

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Four months after the book was published, the entire October Surprise story wasthoroughly

discredited in the Joint Report of the Task Force to Investigate Certain Allegations Concerning the

Holding of American Hostages by Iran in 1980, H.R. REP. NO. 1102, 102d Cong., 2d Sess. (1993).

When Sheridan Square failed to publish a retraction based upon the conclusions of the Task Force,

McFarlane filed this defamation suit against both Ben-Menashe and Sheridan Square. The district

court granted summary judgment in favor of Sheridan Square on the ground that McFarlane could

not show that the defendant published the book with actual malice. We affirm the decision of the

district court.

I. Background

Sheridan Square received the manuscript for Profits of War in January 1992. William H.

Schaap, who isin effect the co-chief operating officer of Sheridan Square, assumed responsibility for

the project. By his own account, Schaap "personally took part in every stage of the publication of

Profits of War from its very inception, including the decision to publish the book, working with the

author,seeing the book through the editorial process, and seeing the book through its publication and

distribution."

McFarlane figures prominently in Ben-Menashe's account of the alleged October Surprise

negotiations: he appears at four critical meetings with Iranian officialsin Tehran, Madrid,

Washington, and Paris, all in 1980that supposedly led to an agreement to delay the release of the

hostages. PW at 53-55, 59-60, 71-72, 73-76. According to Ben-Menashe's account, McFarlane had

a "special relationship" with Rafi Eitan, id. at 105, 169, an Israeli intelligence officer who had

allegedly built a network of spies in the United States, id. at 313. McFarlane is described as "an

Israelimole," id. at 176, who providedEitanwith intelligence about U.S. activitiesin and negotiations

with Iran, id. at 55, 69, 174-75. The book also identifies McFarlane as the senior U.S. officialthe

notorious "Mr. X"who "had been providing computer access codes of intelligence reports" to

Israeli intelligence, thereby facilitating Jonathan Pollard's espionage activities. Id. at 174. According

to Ben-Menashe, McFarlane "came under FBI counterintelligence investigation in early 1991

regarding his relationship with Rafi Eitan and Israeli intelligence and his involvement in the Pollard

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case," but "the results of that investigation have never been made public." Id. at 345. Finally, the

authorsuggeststhat McFarlane'ssuicide attempt during the 1987 congressional hearings on the IranContra affair was brought on by McFarlane's fear that "his role with the Israelis would surface." Id.

at 194.

Schaap acknowledges being aware from the outset that Ben-Menashe was a controversial

figure: "At every stage of the publication of the book ... I was alert to the question of the credibility

of Ari Ben-Menashe ... because I had learned he was a controversial figure, and that there were

different opinions about his credibility." When Schaap was reviewing the manuscript, there were in

circulation a number of articles casting doubt upon Ben-Menashe's credibility. McFarlane contends

that Schaap must have had at least a passing familiarity with the widespread skepticism about the

author. See, e.g., Tim Weiner, Deathly Arsenal: How Israel Built the Bomb, PHILADELPHIA

INQUIRER, Nov. 10, 1991, at H1 (book review) (Ben-Menashe's "reputation among most reporters

is, to put it politely, not of the highest order"); Who Did It?, PHOENIX GAZETTE, July 27, 1991, at

A10 (Ben-Menashe referred to as "a proven fraud and imposter").

AlthoughBen-Menashe had been the subject ofmuch criticismwhen Schaap was considering

the manuscript of Profits of War, his claims had nonetheless attracted a great deal of attention, both

from the media and from government investigators. Ben-Menashe had been the source for

information explored in several television programsshown as part of PBS's Frontline series. In 1991

Gary Sick, a member of the National SecurityCouncilstaff under President Carter, published a book

entitled October Surprise: America's Hostages in Iran and the Election of Ronald Reagan, which

set out at length the alleged Republican-Iranian conspiracy and relies to a large extent upon BenMenashe as a source ofinformation. During that same year Pulitzer prize-winning journalist Seymour

Hersh published The Samson Option whichagain relying in large part upon BenMenashepurportsto describe Israel's nuclear capabilities and to implicate the late publisher Robert

Maxwell as an Israeli spy. The allegations about McFarlane that appear in Profits of War were also

repeated in a 1991 article written by Craig Unger for Esquire Magazine; that article, too, relies

extensively upon Ben-Menashe. See McFarlane v. Esquire Magazine, 74 F.3d 1296 (D.C. Cir.

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1996). In a later article, which Schaap says he read before the book was published, Unger claimed

to have corroborated many of Ben-Menashe's October Surprise allegations; he also confirmed that

Ben- Menashe worked for Israeli intelligence, quoting a high-ranking Israeli military intelligence

officer as saying, "Ben-Menashe served directly under me. He worked for the Foreign Flow desk in

ExternalRelations. He had access to very, very, sensitive material." Craig Unger, The Trouble with

Ari, VILLAGE VOICE, July 7, 1992, at 33, 35. Moreover, the Congress took an interest in BenMenashe's stories; the Senate Foreign Relations Committee held hearings on the October Surprise

allegations, and the House ofRepresentatives convened the aforementionedTask Force to investigate

the charges. Ben-Menashe testified before both bodies under oath.

In an affidavit submitted to the district court in support of Sheridan Square's motion for

summary judgment, Schaap swearsthat to ensure that the book was "factually accurate and safe from

a libel point of view," he "went to great lengths to look into Mr. Ben-Menashe's reputation and to

verify his manuscript as well as [he] could," devoting in excess of 100 hours to the task. Schaap's

research included efforts to confirm some of the specific allegations in the book (those about

McFarlane not among them) through books and articles on the subject and discussions with experts;

reading articles by reputable journalists who had relied upon and to some degree verified BenMenashe's knowledgeability; and discussing Ben-Menashe and his credibility with a number of these

journalists. Schaap's research was limited for the most part to secondary sources, though he did

telephone a former Iranian Defense Minister and confirm that he knew Ben-Menashewho claimed

the man was one of his contacts for arms sales and the exchange of intelligence. Following BenMenashe's acquittal in a criminal prosecution for illegal arms dealing, Schaap obtained the trial

transcript, a series of documents confirming Ben-Menashe's association with Israeli military

intelligence, and copies of Ben-Menashe's civilian passports for 1985 to 1989, which showed that

Ben-Menashe had traveled frequently to many of the locations involved in the October Surprise

allegations. (Schaap did not, however, have access to Ben-Menashe's passport for 1980, which might

have cast doubt upon his claim to have been in Paris during the alleged 1980 meeting there.) Schaap

also served as Ben-Menashe's attorney at the closed hearings of the House Task Force and of the

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Senate Foreign Relations Committee in June and August 1992. In that capacity, Schaap contends,

he was able to observe Ben-Menashe's demeanor and to hear Ben-Menashe repeat, under oath, the

allegations about McFarlane that were in the manuscript of his book.

Based upon his observations and his research, Schaap concluded that Ben-Menashe's story

was credible, and he proceeded to publish even those allegations that he could not verify. He

declares, "I did verify so many of the controversial passages and so many of Ben-Menashe's factual

assertions, and wasso assured by the large number of journalists I had consulted that they had found

Ben-Menashe'sinformation credible, I felt confident about leaving in the book material that could not

be further verified because of my belief, based on all of my inquiries and checking, that Ben-Menashe

was overall entirely reliable." Schaap did not, however, attempt to discuss the allegations with

McFarlane himself, nor did he inquire about Ben-Menashe's sources for the allegations about

McFarlane or contact Rafi Eitan or others who might have had first-hand knowledge of the truth or

falsity of Ben-Menashe's specific allegations.

As he readied Profits of War for publication, Schaap received two memoranda prepared by

attorneys who had reviewed the manuscript for potential libel problems; McFarlane contends that

these memoranda put Schaap on notice that there were "problems with the accuracy" of the book.

The first of these memoranda, prepared by Sheridan Square's counsel Melvin Wulf, identified

passages with respect to which he considered "the risks of legal action ... high." The second

memorandum was prepared by David Hooper of Biddle & Co., a firm of English solicitors; Hooper

emphasized Ben-Menashe's "credibility problem" and suggested that there were some "inaccuracies"

(most of them minor) that should be corrected in consultation with an expert. Hooper noted

specifically that "[t]he evidence relating to the Ritz [in Paris] and other meetings needsto be carefully

evaluated, particularly as [Ben-Menashe] was not there." Finally, he identified the passages in the

book, including those pertaining to McFarlane, that he considered "potential libel problems," and

advised that "where there is no realistic prospect of obtaining corroborative evidence" of the most

serious allegations, they "must be removed."

After the book was printed but before it was distributed, Sheridan Square learned of one

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unarguable error in the text: the leader of a Peruvian revolutionary group said in the book to be dead

had turned up alive in a Peruvian prison. Sheridan Square corrected this error by inserting an erratum

slip in every copy of the book. No such correction was inserted, however, when the Task Force

issued its findings four months after the book was published.

McFarlane filed thissuit againstBen-Menashe, the National Book Network (which distributed

the book), and Sheridan Square in June 1993. The district court granted the distributor's motion for

summary judgment on the ground that no one at the company had ever read the book, and McFarlane

has not appealed that ruling. The district court denied Sheridan Square's motion for summary

judgment, on the ground that the following evidence would support a finding that Schaap had serious

doubts about McFarlane's veracity: (1) Schaap knew that McFarlane disputed the allegations; (2)

the two lawyers' memoranda put Schaap on notice of the potential for a libel action based upon the

allegations concerning McFarlane; (3) Schaap knew that Ben-Menashe was a person of questionable

credibility; and (4) Schaap never sought direct confirmation of the allegations about McFarlane from

people who mayhave had first-hand knowledge. Moreover, the court concluded that because Schaap

had acted as Ben-Menashe's attorney during the Task Force hearings, Schaap must have had access

to informationspecifically, to Ben-Menashe's passport for the period of the alleged October

Surprise meetingsthat would have enabled him to reach the same conclusion that the Task Force

ultimately reached, namely, that there was no credible evidence to support the October Surprise

allegations. According to the court, these factors, taken together, "would permit a jury to find that

[Schaap] purposefully avoided the truth."

Upon Sheridan Square's motion for reconsideration, the district court reversed itself and

granted summary judgment for the publisher. "Although Schaap's original summary judgment

affidavit implied that he had access to all of Ben-Menashe's passports," the court found, in fact he

only had access to Ben-Menashe's civilian passports covering the period from 1985 to 1989;

therefore, "Schaap could not have discovered that Ben-Menashe's passports did notreflect anytravels

to Paris in October, 1980, as the Task Force had found after a more complete review." Because

Schaap did not have access to the other evidence presented to the Task Force, the court held, there

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is no basis upon which a jury could conclude that Schaap blinded himself to the truth that the Task

Force was able to discover. Nor is there evidence that Ben-Menashe's congressional testimonythe

only testimony that Schaap heardwas internally inconsistent, so despite the Task Force's ultimate

conclusion that Ben-Menashe's story was not credible, Schaap could not have known, based solely

upon Ben-Menashe's testimony, that he was lying. Because a publisher has no duty to investigate

unless he has "obvious reasons" to doubt the veracity of his source, Schaap had no duty to seek out

those who may have had first-hand knowledge of the October Surprise in order to confirm the

allegations about McFarlane. Even if Schaap did have a duty to investigate, the court found that he

did not have in his possession the documents he would have needed in order to prove that BenMenashe did not travel to Parisin 1980. Therefore, the evidence could not support a finding of actual

malice on the part of the publisher.

McFarlane appealsthe grant ofsummary judgment for Sheridan Square. Meanwhile, his case

against Ben-Menashe is pending before the district court.

II. Analysis

In a libel case against a public figure, summary judgment for the defendant is appropriate

unless the plaintiff produces the clear and convincing evidence that a reasonable jury would need in

order to find that the defendant published the defamatory material with actual malice. Anderson v.

Liberty Lobby, Inc., 477 U.S. 242, 257 (1986); Clyburn v. News World Comm., Inc., 903 F.2d 29,

33 (D.C. Cir. 1990). A publisher acts with "actual malice" if it either knows that what it is about to

publish is false or it publishes the information with "reckless disregard" for its truth or falsity. New

York Times Co. v. Sullivan, 376 U.S. 254, 279-80 (1964) (establishing "actual malice" standard for

defamation of public officials); Wolston v. Reader's Digest Ass'n, Inc., 443 U.S. 157, 163-64 (1979)

(actual malice standard extends to defamation of "public figures"). Accordingly, in order to survive

Sheridan Square's motion for summary judgment McFarlane must show, as the Supreme court has

since glossed Times v. Sullivan, that the defendant "entertained serious doubts as to the truth of [its]

publication" or acted "with a high degree of awareness of ... [its] probable falsity." St. Amant v.

Thompson, 390 U.S. 727, 731 (1968).

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The actual malice standard is subjective; the plaintiff must prove that the defendant actually

entertained a serious doubt. Tavoulareas v. Piro, 817 F.2d 762, 776 (D.C. Cir. 1987) (en banc)

(defendant must have "come close to wilfully blinding itselfto the falsity of its utterance"). Although

thisfact may be proved by circumstantialrather than direct evidence, "the plaintiffmust establish that

even in relying upon an otherwise questionable source the defendant actually possessed subjective

doubt." Secord v. Cockburn, 747 F. Supp. 779, 794 (D.D.C. 1990) (plaintiff cannotsurvive summary

judgment merely by showing that some of defendant'ssources were convicted felons); see St. Amant,

390 U.S. at 730 (when defendant had implicated sheriff and union leader in alleged wrongdoing,

actual malice could not be inferred from defendant's having relied solely upon affidavit of union

dissident of unknown veracity and having failed to verify allegations with sources who might have

known). Moreover, because the actual malice inquiry is subjectivethat is, concerned with the

defendant's state of mind when he actedthe inference of actual malice must necessarily be drawn

solely upon the basis of the information that was available to and considered by the defendant prior

to publication. See Bose Corp. v. Consumers Union, 466 U.S. 485, 498 (1984).

McFarlane concedesthat he is a public figure, so the only question before usis whether a jury

could reasonably conclude that the evidence clearly and convincingly shows Sheridan Square acted

with actualmalice. On appeal, McFarlane advances four bases upon which he says a jury could reach

that conclusion. First, McFarlane argues that Schaap's knowledge of Ben-Menashe's dubious

credibility created in him a duty to corroborate the allegations against McFarlane; Sheridan Square's

decision to publish without having corroborated those allegations betrays a reckless disregard for the

truth. Second, McFarlane contends that by deciding to go ahead with the publication after having

attempted but failed to corroborate the allegations, Schaap acted in reckless disregard of the truth.

Third, McFarlane arguesthat there is a genuine issue offact concerning Schaap's credibility; Schaap's

assertion that he had no serious doubt about the veracity of the McFarlane allegations depends upon

his own credibility, and a jury could infer, based upon inconsistencies and errors in the affidavit he

submitted, that he lied about what he knew and when he knew it. Finally, McFarlane contends that

Sheridan Square's failure to retract or correct the alleged falsehoods when it had reason to do so is

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another instance of its actual malice.

A. Duty to Corroborate

Sheridan Square concedes that it published Profits of War without having any independent

verification of the allegations about McFarlane; in other words, Schaap did not uncover any

affirmative evidence that McFarlane was indeed an Israeli spy or that he played a role in the alleged

arms-for-hostages scheme. According to McFarlane, this complete want of corroboration, when

viewed incombinationwiththe knowncontroversysurroundingBen-Menashe, is sufficient to support

a jury's conclusion that Sheridan Square published the book with actual malice. In essence,

McFarlane urges us to impose upon a publisher a "duty to corroborate" at least when the source of

potentially libelous material is a person of questionable credibility. That we cannot do, for the

following reason.

The rule McFarlane proposes would work a dramatic change in the nature ofthe actualmalice

standard asthe Supreme Court established it in Times v. Sullivan. See 376 U.S. at 279-80. The term

"actual malice," as we have said, describes a state of mind; in order to prevail, the plaintiff must

provide clear and convincing evidence that would "permit the conclusion that the defendant in fact

entertained serious doubts as to the truth of his publication." St. Amant, 390 U.S. at 731; see also

Tavoulareas, 817 F.2d at 789 ("the "serious doubt'standard requires a showing ofsubjective doubts

by the defendant. It does not turn on whether a reasonably prudent person would have published

under the circumstances"). Accordingly, a publisher's effort to investigate damaging allegations,

particularly when they are made by a questionable source, is evidence that the publisher neither

believed the allegations to be false nor wilfully blinded himself to the truth. To hold that a publisher

who relies upon a questionable source must not only investigate the allegations but actually

corroborate themthat is, establish through an independent source that the allegations are

truewould be to turn the inquiry away from the publisher's state of mind and to inquire instead

whetherthe publishersatisfied an objective standard of care. See Washington PostCo. v. Keogh, 365

F.2d 965, 972-73 (D.C. Cir. 1966) (discussing difficulties with proposed rule requiring newspapers

to verify controversial allegations).

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Indeed, the cases McFarlane cites in support of this supposed "duty to corroborate" only

confirm the subjective nature of the inquiry. In Curtis Publishing Co. v. Butts, 388 U.S. 130 (1967),

the Saturday Evening Post had published an article accusing a college athletic director of "fixing" a

football game. The publisher was aware that the source for this story, a local insurance salesman who

claimed to have overheard a conversation between the plaintiff and the coach of the opposing team,

was on probation for having passed bad checks. Id. at 136, 157. Despite the obvious reason to

question the veracity of the source, the magazine did not take even the most "elementary

precautions," id. at 157; the writer assigned to the story attempted neither to examine the notes the

source claimed to have taken during the conversation he overheard nor to view the tapes of the

football game in order to find out whether the opposing team had used the playsthat the plaintiff had

allegedly passed to its coach, id. at 157-58. The Supreme Court held that this evidence "amply

supported" the jury's verdict for the plaintiff. Id. at 161. Neither the plurality opinion by Justice

Harlan nor Chief Justice Warren's opinion concurring in the result suggests that the Post had any

obligation to prove the story true before publishing it; rather, the publisher was held liable because

itsfailure to take even the simplest and most obviousstepsto investigate the allegations demonstrated

a reckless disregard for the truth. See id. at 156-58 (Harlan, J.); id. at 169-70 (Warren, C.J.,

concurring).

In Harte-Hanks Communications, Inc. v. Connaughton, 491 U.S. 657 (1989), the defendant

newspaper, relying upon a single source, had accused a candidate for public office of using "dirty

tricks" to influence a grand jury investigation so as to cast doubt upon his opponent. Although the

newspaper did interview all but one witness to the events at issueeach of whom contradicted the

source's accountthe editors failed to interview the only witness who had no particular loyalty to

the plaintiff; this witness was the person most likely to confirm the source, but had she not done so

her denial of the story would have demonstrated convincingly that it was false. Id. at 682. The

newspaper also failed to review two audiotapes that could easily have verified or disproved the

allegations. Id. at 683. The Supreme Court held that the evidence supported the jury's finding of

actual malice; it was "likely that the newspaper's inaction was a product of a deliberate decision not

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to acquire knowledge of facts that might confirm the probable falsity of [the] charges. Although

failure to investigate will not alone support a finding of actual malice ... the purposeful avoidance of

the truth is in a different category." Id. at 692. Again, the Court's conclusion turned not upon the

newspaper's failure to prove the story true but upon its deliberate decision to avoid information that

might have proven the story false.

When the source of potentially libelous material is questionable, therefore, the investigatory

efforts of the publisher are important only to the extent that they serve as evidence that it did not

publish the material in reckless disregard of the truth. As in Butts and Connaughton, if a defendant

has reason to doubt the veracity of its source, then its utter failure to examine evidence within easy

reach or to make obvious contacts in an effort to confirm a story would be evidence of its reckless

disregard. That a publisher can by investigating a questionable allegation preclude the implication

that it acted in reckless disregard of the truth does not mean, however, that the publisher has a duty

to corroborate the allegation.

B. Reckless Disregard for the Truth

Evenwithout a "duty to corroborate," the question remains whether McFarlane has produced

evidence sufficient to support a jury's conclusion that Sheridan Square entertained "serious doubt"

about the truth of the allegations concerning McFarlane. Tavoulareas, 817 F.2d at 788-89.

McFarlane contends that a reasonable jury could find that Sheridan Square acted with actual malice

based upon (1) Schaap's decision to publish the book without first verifyingBen-Menashe'sstorywith

any of the major figures in it; (2) his inability to corroborate the allegations about McFarlane; (3)

the warnings ofAmerican and English counsel; (4) the alleged inconsistency between Ben-Menashe's

passports and his account of where he was at particular times; and (5) his awareness of BenMenashe's credibility problems. We take up each of these points in turn, but recognize that

McFarlane is "entitled to an aggregate consideration of all [his] evidence," construed most favorably

to him, when we determine whether he has met his burden. Tavoulareas, 817 F.2d at 794 n.43; see

McFarlane v. Esquire Magazine, 74 F.3d at 1304.

McFarlane first argues that Schaap's failure to contact any individual who would have had

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first-hand knowledge of McFarlane's alleged involvement in an October Surprise demonstrates that

Sheridan Square "wilfullyblind[ed]itselfto the falsityofits utterance," Tavoulareas, 817 F.2d at 776;

if Schaap had contacted these sources, McFarlane suggests, he would have reached the same

conclusion as did the Task Force. Although it is true that Schaap relied for the most part upon

secondary sources, there is no authority for the proposition that anything short of interviewing those

with first-hand knowledge amounts to "willful blindness." On the contrary, we have held that a

publisher's "good faith reliance on previously published reports in reputable sources ... precludes a

finding of actual malice as a matter of law." Liberty Lobby, Inc. v. DowJones &Co., 838 F.2d 1287,

1297 (D.C. Cir. 1988). Nor is it clear, as it was in Connaughton, that the individuals whom the

defendant failed to contact would have provided any credible information. Cf. Connaughton, 491

U.S. at 682. Schaap's failure to contact McFarlane himself about the allegations provides even less

support for a finding of actualmalice. Schaap knew from Ben-Menashe's manuscript that McFarlane

had sued Craig Unger for defamation based upon similar allegations, PW at 345; Schaap could

reasonably expect McFarlane to deny any involvement regardless of the facts. See Edwards v.

National Audubon Soc'y, Inc., 556 F.2d 113, 121 (2d Cir. 1977) ("[S]uch denials are so

commonplace in the world of polemical charge and countercharge that, in themselves, they hardly

alert the conscientious reporter to the likelihood of error").

Apart from his claim about Schaap's methods, McFarlane contendsthat Schaap's decision to

publish despite his inability to confirm the allegations about McFarlane is itself evidence of actual

malice. The cases McFarlane cites in support of this argument, however, show that actual malice may

be inferred from an author's or publisher's inability to corroborate a story only when, in attempting

to corroborate, he encounters persuasive evidence that contradicts the allegation. For example, in

Brown & Williamson Tobacco Corp. v. Jacobson, 827 F.2d 1119 (7th Cir. 1987), the defendants

reported without corroboration the accusation that a cigarette company had adopted a "pot, wine,

beer, and sex" advertising strategy; before this claim was published, however, the defendants

discovered that the company had never actually adopted the strategy. Moreover, prior to trial, the

defendants destroyed all their interview and research notes; the court found that to be "the most

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compelling evidence of actual malice." Id. at 1134. Similarly, in Schiavone Construction Co. v.

Time, Inc., 847 F.2d 1069 (3d Cir. 1988), after attempting without success to corroborate the story,

the defendant published a claim that the name Schiavone had appeared several times in an FBI file

concerning the disappearance of Jimmy Hoffa. The evidence showed, however, that four reliable

sources had each told the defendant that the name did not appear in the FBI file. Id. at 1091. In this

case, by contrast, although Schaap was unable to get independent verification of the charges against

McFarlane, he encountered no contradictoryevidence (aside fromMcFarlane's denial and the general

skepticism about Ben Menashe discussed below). As a result, the publisher's lack of corroboration

in this case provides little if any support for a finding of actual malice.

Nor are we persuaded by the appellant's novel contention that "if a publisher undertakes an

attempt to corroborate an informant's defamatory claims and failsto find anycorroborating evidence,

a jury may find actual malice if the statements are published anyway." According to McFarlane, this

proposition follows by analogy from the rule that even though a passerby has no duty to rescue or

assist a person in danger, one who undertakes to help must act with due care. The appellant offers

us no authority for imposing a duty of care upon a publisher who undertakes to investigate

controversial allegations before putting them into circulation, nor do we see how doing so could be

reconciled with the actual malice standard that the Supreme Court has prescribed for a public figure

who has been libeled.

McFarlane also argues that Schaap had in hand two pieces of information that should and

indeed must have alerted him to the falsity of the allegations: Ben-Menashe's passports for 1985 to

1989, which are not in all respects consistent with his account of where he was during that period;

and the specific warning from a firm of English solicitors that Ben-Menashe was not at the Paris

meeting in 1980 at which he claims to have seen George Bush and William Casey. According to

McFarlane, this evidence refutes Schaap's statement in his affidavit that despite "at least a hundred

hours" of fact-checking and performing research on the allegationsin Profits of War, he was not able

to establish that any allegation in the manuscript is false. Neither of these items, however, provides

much support for a finding of actual malice.

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First, at oralargument McFarlane's counseldirected our attention to a chronologydrawnfrom

Ben-Menashe's passports for 1985 to 1989; at least one of the allegations in the book, he argued,

is flatly inconsistent with the dates and places listed in this chronology. Assuming, arguendo, that

the dates on the passport for that particular period are not merely ambiguous but actually inconsistent

with Ben- Menashe's story, it is not an inconsistency upon which a reasonable jury could base a

finding of actual malice. In his affidavit, Schaap described his examination of these passports as

follows:

The examples described above about the results of my fact-checking are just

some of the several dozens of specific matters I tracked down in detail. There were

many dozens of names and dates and placesthat I checked through database searches

and, in the case of dates, also through a careful review of Mr. Ben- Menashe's

passports. Virtually all of the people named were who Mr. Ben-Menashe said they

were, and the events he described had happened at the times and places he said they

had.

This statement is insufficient as a basis for charging Schaap with knowledge of all the dates listed in

the passports; his claim to have checked "many dozens" of dates "through a careful review of Mr.

Ben-Menashe's passports" makes clear that he did not check more than a small portion of the many

dates and places mentioned in the book. With no reason to believe that Schaap had checked the

particular date upon which McFarlane's counsel pounced, the inconsistency between the book and

the passport is very weak evidence indeed.

Second, McFarlane contendsthat the memoranda from Wulf and Hooper to Sheridan Square

must have alerted Schaap to "problems with the accuracy" of Profits of War. McFarlane's argument,

however, mischaracterizes the nature of the memoranda. Although Hooper commented generally

upon Ben-Menashe's credibility problems and both lawyers listed specific passages for which they

believed "the risks of legal action are high," neither purported to comment upon whether there was

reason to doubt the truth of the passages or upon whether a legal action was likely to be successful.

The subject passages were singled out, it appears to us, because they made controversial and

damaging allegations. Moreover, Hooper's warning that the allegations must be corroborated is of

no consequence here; in the United States the defendant in a libel action does not bear the burden,

as he would in England, of proving with admissible evidence that his damaging factual allegations are

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true.

The Hooper memorandum does, however, present what at first glance appears to be the

strongest evidence against Sheridan Square: Ben-Menashe did not personally attend the 1980 Paris

meeting butrather received hisinformation second-hand, which, according to McFarlane, contradicts

Ben-Menashe's claim in the book. McFarlane makes much of this"Schaap disregarded this

important example of Ben-Menashe's dishonesty and of the truth"but there is less than meets the

eye in this claimed inconsistency between the book and Hooper's statement. In Profits of War BenMenashe never actually claims that he attended the alleged meeting at the Ritz with President Bush

and William Casey; instead, he clearly describes himself as essentially an advance-man for the

meeting, able to witness who attended but not to observe the meeting itself. PW at 73-76. BenMenashe admits that he learned of the details of the alleged deal several days later from an Israeli

named Yehoshua Sagi. Id. at 75. The Hooper memorandum, which was based upon both the

manuscript and conversations with Ben-Menashe, is entirely consistent withBen-Menashe's account

in the book. Hooper wrote:

The evidence relating to the Ritz and other meetings needs to be carefully evaluated,

particularly as ABM was not there. [Sayeed Mehdi] Kashani reported back to Sagi

as did [Rafi Eitan] and that is the source of ABM's knowledge. Kashani spoke

directly to ABM as well.

Although the Task Force later concluded that Ben-Menashe could not have been in Paris at all in

October 1980 because his civilian passport shows that he was in Israel at that time and there was no

evidence that he held a diplomatic passport, from Schaap's perspective before the book was

published, there was no extrinsic reason to suspect that Ben-Menashe's account of the Paris meeting

was false.

At this point it becomes clear that McFarlane's ability to prove actual malice rests almost

entirely upon circumstantial evidence. The Supreme Court in St. Amant identified three types of

circumstantial evidence that would likely support a finding of actual malice: They are evidence

establishing that the storywas(1) "fabricated," (2) "so inherently improbable that only a reckless man

would have put [it] in circulation," or (3) "based wholly on" a source that the defendant had "obvious

reasons to doubt," such as "an unverified anonymous telephone call." 390 U.S. at 732. The first of

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these is not relevant here; although the Task Force ultimately found that there is "no credible

evidence" to support Ben-Menashe's allegations of an October Surprise, see Task Force Report at

175, McFarlane points to no evidence that would have been available to Schaap before he published

Profits of War establishing that the story is a fabrication. Second, we cannot conclude that the

inherent improbability of the allegation itself supports a finding of actual malice; when Sheridan

Square published Ben-Menashe's book the Senate Foreign Relations Committee was taking his

allegation of an October Surprise seriously enough to hold hearings on the matter, and the House of

Representatives had commissioned the Task Force specificallyto investigate thisstory. Accordingly,

we are concerned here solely with the third possibility, viz., that the author of the allegation was

someone whom Schaap had "obvious reasons to doubt."

Schaap concedes that he was aware that Ben-Menashe "was a controversial figure" and that

"there were different opinions about his credibility." We need not dwell, therefore, upon whether

Schaap knew about specific press accounts ofBen-Menashe's dubious character; suffice it to say that

Schaap was on notice that Ben-Menashe was controversial and had often been discredited. Indeed,

the author himself notes this criticism in the book, though not in an unbiased tone. PW at 348-50;

see McFarlane v. Esquire Magazine, 74 F.3d at 1304 ("full(or pretty full) publication ofthe grounds

for doubting a source tends to rebut a claim of malice, not to establish one"). Even journalists who

had relied uponBen-Menashe expressed their general distrust of him: Craig Unger, for example, was

quite forthright in criticizing Ben-Menashe in an article that Schaap concedes he read. See The

Trouble with Ari,supra, at 39 ("Ben-Menashe may be suffering from an advanced form of Defector's

Syndrome. Having spun tales for two years, many of which were true, he is now all used up, but,

afraid of losing his audience, he brays like a dying elephant, making up whatever he thinks they want

to hear").

Schaap had reason to be wary of Ben-Menashe, but he also had some reason to believe the

story, based upon his own research and his conversations with journalists and experts on Middle East

affairs. Unger himself is quick to explain that Ben-Menashe's propensity to exaggerate and even to

lie about his relative importance in any given situation should not lead a reader to discount his

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established knowledgeability in these matters. Id. ("Just as it is indisputable that Ben-Menashe lies,

so is it indisputable that in some sense he is who he says he is, that the most closely guarded secrets

in the world have passed before his eyes"). Ben-Menashe's friend Rebecca Sims, who brought

Sheridan Square the manuscript for Profits of War, apparently shares this view: Unger quotes her

as saying, "Ari is a pathological liar.... But the thing is, there is so much evidence to support many

of his allegations." Id. Moreover, both Unger and Gary Sick, the former NSC staffer, claimed to

have verified some of Ben-Menashe's allegations; Sickwho, along with other experts, reviewed

the Profits of War manuscripttold Schaap that he found Ben-Menashe's story about the October

Surprise to be credible. Accordingly, although the press accounts must have given Schaap reason

to be skeptical about Ben-Menashe, his conversations with these journalists also gave him reason to

believe that the allegations were not fabricated.

Even more damaging to McFarlane's case for actualmalice are the factssurrounding Schaap's

participationalongsideBen-Menashe inthe congressionalinvestigationofthe October Surprise story.

As we noted in McFarlane v. Esquire Magazine, "we have in the past given weight to the fact that

a source told congressional investigators the same story that he told the defendant, under

circumstances where lying could have serious consequences." 74 F.3d at 1305; see Tavoulareas,

817 F.2d at 791 (defendant's most important reason to believe otherwise questionable source was

defendant's "uncontroverted knowledge that [the source] provided virtually the same information to

[the author] as he gave to investigators for the House Subcommittee"). In the Esquire case the

publisher claimed that its knowledge that Ben-Menashe had been "interviewed by congressional

staffers" gave it reason to believe the allegations; we rejected this argument because Esquire "d[id]

not even claim to have had information that Ben-Menashe's statements to the investigators were the

same as to Unger, and it offered no evidence that the circumstances of the interviews in any way

would have alerted Ben-Menashe to the penalties for lying." 74 F.3d at 1305. In the present case,

however, the publisher was presentindeed in his capacity as Ben-Menashe's lawyerduring the

author's testimony before both the Senate Foreign Relations Committee and the House Task Force;

Schaap's affidavit states that he heard Ben-Menashe repeat under oath "exactly what he had said in

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his manuscript," including the allegations about McFarlane. Schaap "was impressed with his

demeanor and believed that he was telling the truth." Also, the testimony Schaap heard was given

in a far more formalsetting thanwereBen-Menashe's earlier "interviews with congressionalstaffers";

the penalties for lying would have been quite clear.

In sum, there is persuasive evidence that Schaap had reason to believe Ben-Menashe's

allegations, and the cumulative force of the evidence to the contrary is very weak. Therefore, we

must conclude that a reasonable jury could not have found by clear and convincing evidence that

Sheridan Square published Profits of War with actual malice.

C. Schaap's Lack of Candor

McFarlane contends that a jury could find Schaap perjured himself in his original affidavit in

support of Sheridan Square's motion forsummary judgment. Such a lack of candor on Schaap's part,

argues McFarlane, would support a finding of actual malice; moreover, to the extent that this lack

of candor raises a question about Schaap's own credibility, McFarlane argues, that question is

properly an issue for the jury. McFarlane points to several statements in Schaap's affidavit that he

contends evince a lack of candor; only two of these merit discussion.

The first instance of Schaap's alleged lack of candor occursin his claim,set out above, to have

used Ben-Menashe's passports for fact-checking the allegations in Profits of War. According to

McFarlane, Schaap's statement that he confirmed, "through a careful review of Mr. Ben-Menashe's

passports ... [that] the events he described had happened at the times and places he said they had"

must be a falsehood because the only passports Schaap had in his possession were those for 1985 to

1989, long after the alleged events implicating McFarlane. In context, however, Schaap's statement

does not imply that he checked all the dates in the bookor any of the dates concerning

McFarlaneagainst the passports. This paragraph of Schaap's affidavit refers generally to his efforts

to verify "many dozens of names and dates and places," and it presents the passports merely as an

additionalsource of information, not as hissole basisfor confirming dates. Although the allegations

about McFarlane all concern events before 1985, the book goes on to describe events after 1985 as

well; Schaap can have used the passports in his possession to confirm only those later dates, but he

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could have used his "database searches" to check earlier ones. Moreover, the affidavit expressly

details Schaap's efforts to verify the entire October Surprise storyand, more generally, BenMenashe's credibilitynot the McFarlane allegationsin particular; indeed, shortly after the statement

quoted above, Schaap explains, "There were a number of thingsI was unable to verify, including the

material that is the subject matter of this lawsuit." In context, therefore, the passage to which

McFarlane points cannot reasonablybe read either as demonstrating that Schaap waslessthan candid

about the extent of his fact-checking or as an attempt to misrepresent the years covered by the

passports in his possession.

Second, McFarlane alleges that Schaap lied when he made the following statement about his

conversations with people who had relied upon Ben-Menashe in the past:

Prior to signing a contract with Mr. Ben-Menashe on February 25, 1992, and

in the period immediately thereafter, I had general discussions with several people

who were familiar with him and the assertions he had been making in the press in the

several months preceding our first contact. I spoke with Mr. Hersh and Mr. Sick, and

had extensive conversations with them later on. I spoke with Louis Wolf, a colleague

and well-known researcher on intelligence-related matters. I spoke with Jane Hunter,

the publisher of Israeli Foreign Affairs. I spoke with Joel Bleifuss, a reporter for In

These Times. All of these people had published material that relied upon information

from Mr. Ben-Menashe. While I did not, at this point, go into any of the details of

the manuscript, I did ask for general opinions as to Mr. Ben-Menashe's

knowledgeability and credibility. All of them confirmed that he appeared to be

extremely knowledgeable and credible regarding Israeli intelligence matters.

In particular, McFarlane points out that Hunter later filed an affidavit in a case pending in the

Southern District of New York in which she declared, under penalty of perjury: "I did use

information obtained from Ari Ben-Menashe in my work. Mr. Schaap asked me about specific

matters and I have no recollection of endorsing Mr. Ben-Menashe's general credibility. Indeed his

credibilitywas an issue even after we had satisfied ourselvesthat he was a former intelligence officer."

Although there does indeed appear to be a conflict between Hunter's and Schaap's recollections of

their conversation, the conflict is so narrow that it appears to reflect only sloppiness and a slight

over-generalization, not deceit, on the part of Schaap. Schaap's mentioning that he spoke with

Hunter adds almost nothing to the face of the statement, and there is no dispute, regardless of

whether she wants to characterize him as credible, that Hunter did "use information obtained from

Ari Ben-Menashe in [her] work." The true conflict is simply too insubstantial to support the

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conclusion that Schaap perjured himself in his affidavit, nor doesit cast enough doubt upon Schaap's

credibility to raise a genuine issue of material fact.

D. Duty to Retract

Finally, McFarlane arguesthat a jurycould find evidence of actualmalice in Sheridan Square's

failure to retract or correct Profits of War after the Task Force issued its report discrediting BenMenashe's allegations. McFarlane presents no authority, however, nor are we aware of any, for the

proposition that a publisher may be liable for defamation because it fails to retract a statement upon

which grave doubt is cast after publication. In any event, if such a rule existed it would not likely

apply in this case. The book notes that both Houses of Congress had begun to investigate the

October Surprise allegations, and it reports (albeit critically) the interim findings of the House Task

Force, which contradicted Ben-Menashe's allegation that President Bush attended the 1980 meeting

in Paris. PW at 343-44. This disclosure clearly put the reader on notice that a final report of the Task

Force would be forthcoming and that it might well take issue with Ben-Menashe's account.

Accordingly, a later retraction or correction was not necessary in order to give the reader a full view

of the controversy, and the publisher'sfailure to update the reader on the state ofthe controversy can

hardly be taken as evidence that it published the book with actual malice.

III. Conclusion

As we noted when McFarlane last came to this court looking for redress, "[t]he standard of

actual malice is a daunting one." 74 F.3d at 1308. Few public figures have been able clearly and

convincingly to prove that the scurrilous things said about them were published by someone with

"serious doubts as to the truth of his publication." St. Amant, 390 U.S. at 731. Unfortunately for

McFarlane, the best evidence to which he can point in support of his claim is the general controversy

surrounding Ben-Menashe's credibility. Even that evidence, however, must be viewed in light of the

reliance that other members of the press placed upon Ben-Menashe's story, the statements of

reputable journalists that they had verified some of Ben-Menashe's allegations (though none

concerning McFarlane), and most important, Schaap's having witnessed Ben-Menashe make the very

same allegations before the Congress under oathand under the realistic threat of a penalty for

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perjury. So viewed, the evidence simply is not enough to prove, clearly and convincingly, that

Sheridan Square published Profits of War with actual malice.

McFarlane's other argumentsthat Schaap failed to contact anyone with first-hand

knowledge of the alleged events, that he had been unable to corroborate the allegations about

McFarlane, that he should (and may) have been aware of an inconsistency between Ben-Menashe's

story and his passports, that he had been alerted that Ben-Menashe had not been present for a crucial

meeting as reported in the book, and that he perjured himself in an affidavit submitted to the district

courteach provideslittle or no additionalsupport for a finding of actual malice; cumulatively, they

do not amount to much, and surely not enough under the standard set by the Supreme Court.

Because no reasonable jury could find that this evidence demonstrates, clearly and convincingly, that

Sheridan Square published Profits of War with actual malice, the decision of the district court is

Affirmed.

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