Opinion ID: 690481
Heading Depth: 3
Heading Rank: 1

Heading: Defamation counterclaim

Text: 10 Cyanamid first claims that the district court erred in granting summary judgment for Mylan on Cyanamid's defamation counterclaim. Cyanamid based its counterclaim on the following statements by Patricia Sunseri (Mylan's vice president) and Steven McKnight (Mylan's president): (1) Sunseri's statement that Maxzide languished while Lederle's sales force pushed other products, (2) McKnight's statement that Lederle literally is not living up to their contract, (3) McKnight's statements that orders from Lederle were nonexistent and that Lederle was digging its hole deeper and deeper, and (4) Sunseri's statement that Cyanamid responded to Mylan's lawsuit by cutting off all orders of Maxzide. The district court held that Cyanamid was a limited purpose public figure for the purposes of the above statements and that Cyanamid failed to show the requisite actual malice to hold Mylan liable for defamation. 11 The First Amendment provides less protection to a defamation plaintiff when that plaintiff is a public official or public figure rather than a private individual. In New York Times Co. v. Sullivan, 376 U.S. 254, 279-80 (1964), the Supreme Court held that a public official may recover for a defamatory falsehood only if he can show that the statement was made with actual malice, that is, with knowledge that it was false or with reckless disregard for its truth or falsity. The Court later extended this standard to public figures as well as public officials. See Curtis Publishing Co. v. Butts, 388 U.S. 130, 162-65 (1967). 12 In Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974), the Court held that a person could be considered a public figure for a limited range of issues by voluntarily injecting himself into a particular public controversy. Such a limited purpose public figure must show actual malice to recover for a defamatory statement relating to that controversy. 13 Here, the district court determined that Cyanamid became a limited purpose public figure by virtue of its launch and promotion of Maxzide, which were of virtually unprecedented intensity. By voluntarily putting itself into the public eye, the court concluded, Cyanamid became a limited purpose public figure with regard to the controversy about its marketing of Maxzide. 14 We recently set out a two-part test for determining whether a defamation plaintiff is a limited purpose public figure. See Foretich v. Capital Cities/ABC, Inc., 37 F.3d 1541 (4th Cir.1994). First, a public controversy must exist giving rise to the alleged defamation. Second, the nature and extent of the plaintiff's participation in that controversy must be sufficient to justify public figure status. Id. at 1553. We find that no public controversy exists here and that the district court erred in determining that Cyanamid is a limited purpose public figure. 15 In Foretich we adopted the District of Columbia Circuit's definition of public controversy as a real dispute, the outcome of which affects the general public or some segment or it in an appreciable way. Id. at 1554 (quoting Waldbaum v. Fairchild Publications, Inc., 627 F.2d 1287, 1296 (D.C.Cir.), cert. denied, 449 U.S. 898 (1980)). We noted that [e]ssentially private concerns or disagreements do not become public controversies simply because they attract attention. Id. 16 We considered the same issue in two cases prior to Foretich. In National Found. for Cancer Research (NFCR) v. Council of Better Business Bureaus, 705 F.2d 98 (4th Cir.), cert. denied, 464 U.S. 830 (1983), the Council for Better Business Bureaus published a statement regarding the percentage of the NFCR's total income that was spent on program services. We decided that the NFCR was a limited purpose public figure for the purpose of this statement by virtue of its massive solicitation efforts, through which it extolled its judicious use of donated funds in finding a cure for cancer. Id. at 101. In Blue Ridge Bank v. Veribanc, Inc., 866 F.2d 681 (4th Cir.1989), we held that a bank was not a limited purpose public figure for the purpose of a statement regarding its corporate financial health. While the bank had engaged in an extensive promotional campaign, it had never raised its financial health as part of its promotional message. Id. at 687. 17 No public controversy exists in the present case. The conflict between Mylan and Cyanamid is a purely private contractual dispute about whether Cyanamid used its best efforts to market Maxzide. The allegedly defamatory statements dealt only with the adequacy of Cyanamid's marketing efforts; they did not deal with any issues that could potentially affect the public, such as Maxzide's effectiveness or whether Maxzide would continue to be distributed. The general public will not be affected by the outcome of this dispute. 18 This case is distinguishable from NFCR. In that case, NFCR's claim of judicious use of donated funds was part of the message of its solicitation campaign. Here, as in Blue Ridge Bank, the subject of dispute (the adequacy of Cyanamid's marketing efforts) was not a part of Cyanamid's promotional message. Therefore, we conclude that the district court erred in finding that Cyanamid was a limited purpose public figure, and it thus erred in requiring Cyanamid to establish actual malice to maintain its claim of defamation. We vacate this finding and reinstate this counterclaim for additional proceedings under the standard applicable to a private individual.