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(Reuters) - A federal judge has ruled that a Montana blogger was not acting as a journalist when she posted inflammatory statements about an Oregon attorney and that she is not protected from a $2.5 million defamation judgment.
The ruling last week by U.S. District Judge Marco Hernandez is seen by outside observers as potentially having chilling effects on other bloggers.
The case stems from a lawsuit filed on January 14 against Eureka, Montana-based blogger Crystal Cox that accused her of defaming Oregon attorney Kevin Padrick with writings on her website that called him "very corrupt" and falsely suggested he may have hired a hitman to kill her, court papers state.
Padrick was working as a trustee in the bankruptcy case of an Oregon-based real estate firm, Summit Accommodators Inc.
After Summit unraveled, executives with the firm were charged with wire fraud and money laundering over an alleged scheme that saw customers lose millions, according to the FBI.
Cox, 41, who represented herself in the defamation trial, said in court papers that she began blogging about the Summit bankruptcy in 2009 as an investigative journalist.
She presented arguments seeking legal protections often given to the media on the grounds that, in her view, Padrick and his company Obsidian Finance Group were public figures.
But Judge Hernandez disagreed.
"Based on the evidence presented at the time of trial, I conclude that plaintiffs are not public figures, defendant is not 'media' and the statements at issue were not made on an issue of public concern," the judge wrote in his ruling. "Thus, there are not First Amendment implications."
Attorneys for Padrick presented as evidence a January 19 email from Cox, sent days after she was sued for defamation by Padrick and Obsidian, in which she offered the firm her services "to protect online reputations and promote businesses" for $2,500 a month. Cox denied she was trying to extort money.
Hernandez, a federal judge for the District of Oregon, found Cox failed to present evidence that she had any media credentials or affiliation with a "recognized news entity," or that she had checked her facts or tried to contact the other side to "get both sides of the story."
David Ardia, co-director of the University of North Carolina center for media law and policy, said the judge exhibited a "cramped and myopic" view of journalism in his ruling against Cox.
"There is no accepted definition of journalism or who is a journalist," he said. "Judges have wisely shied away from wading into that debate unless they absolutely have to."
John Barrows, executive director of the Montana Newspaper Association, told Reuters he found the ruling "troubling" but that his group would review it further.
"Certainly the concern from a narrow point of view on our point would be on our newspapers' blog pages," Barrows said of the ruling. "Does that apply to comments that are placed on the blogs, on the comment sections of our newspaper websites?"
Most newspapers and media companies do not subject reader comments posted online to the same journalistic standards they apply to their own reporters.
Media organizations are also often protected by the "actual malice" legal standard established in a 1964 U.S. Supreme Court decision, which holds that, under the First Amendment, to be liable for defamation journalists must know or have warning signs that their inflammatory statements against a public figure are false.
Hernandez's ruling denying Cox protection under that malice standard came a day after a federal court jury found Cox had defamed Obsidian and Padrick, and ordered her to pay $1 million to the company and $1.5 million to Padrick.
Cox told Reuters she plans to appeal, and that attorneys have offered to defend her.
"I am a journalist, I have over 400 blogs and I have been doing this for years," Cox said. "You may say I'm not mainstream, but what could be more mainstream than the Internet, really?"
Padrick, 56, said in a telephone interview that, because of Cox's writings, a Google search of his name revealed pages of false information and that problem will continue for years, because posts can be "cached" online and not erased.
"She ruined my life, she's decimated my advisory business and I have to live with this every day," Padrick said.
Reporting by Alex Dobuzinskis: Editing by Peter Bohan