Bose Corporation v. Consumers Union of United State Brief for Respondents

    No, 82-1246

IN THE

Bnpnm dmxt tit %  Imtrli BUUb
O ctober Term , 1983

BOSE CORPORATION, 

against
Petitioner,

CONSUMERS UNION OP UNITED STATES, INC.,

Respondent,

On a  W rit of C ertio rari to  the  U nited States 
Court of A ppeals fo r the  F irst Circuit

B R I E F  F O R  R E S P O N D E N T

M ichael N. P ollet
C owns el of Record 

Marshall B eil  
Carol A, S chrager

K arfatkin P ollet P erlmutter & B eil 
Attorneys for Respondent 

708 Third Avenue 
New York, New York 10017 

(212) 557-4700



Question Presented
Was the Court of Appeals in this 

product disparagement suit brought by a 

conceded public figure precluded by 
Fed. R. Civ. P. 52(a) from exercising 

independent judicial judgment to deter­

mine for itself whether the district 
judge sitting without a jury had proper­

ly applied the actual malice standard, 
when:

(i) this Court has held since

New York Times Co. v. Sullivan, 376 U.S. 

254, 285-86 (1964), that appellate 
courts in public figure defamation 
actions are required to make an inde­

pendent examination of the entire record 
to determine if "the proof presented to 

show actual malice lacks the convincing 
clarity which the constitutional stand­
ard demands;" and

(ii) the Court of Appeals accepted



-li­

the trial judge's findings on underlying 
events and did not redetermine any 
disputed facts; and

(iii) the District Court based its

findings upon an erroneous view of the 

law: it applied a reasonable belief
criterion, inferred actual malice from 
the purported falsity alone and 
effectively held Consumers Union to 
strict liability because it is a 

responsible publisher having an intelli­
gent staff which ergo is not capable of 

committing honest error; and

(iv) actual malice is an ultimate 
fact which has long been held not to be 
subject to the "clearly erroneous" rule; 

and
(v) the record permits only one 

rational conclusion: the firm and 

definite conviction that the district 
judge committed error?



-iii-

Table of Contents

Page
Question Presented .....    i

Table of Contents .......... H i
Table of Authorities ............... ,iv

Statement of the Case ................ 1

Summary of the Argument ....... .....37
Argument

Point I: ....................... 42

The Independent Appellate 
Review Carried Out by the 
Court of Appeals to Determine 
Whether the Constitutional 
Actual Malice Standard was 
Properly Applied is a 
Substantive Right Unaffected 
by a Rule of Civil Procedure
Point II: ........ .62
As the District Court's 
Determination on Actual 
Malice was Based on an 
Error of Law, It is Not 
Subject to Rule 52(a) and 
was Properly Reversed by 
the Court of Appeals



- 1 V “

Point III:  .... 77

The Court of Appeals 
Properly Exercised 
Independent Review 
Because the Determination 
of Actual Malice is an 
Ultimate Fact Involving 
Both Law and Fact Issues
Point IV: ................... ..88
The District Court's 
Finding of Actual Malice 
is Clearly Erroneous

Conclusion ........................ 106

Table of Authorities

Cases
Addington v. Texas, 441 U.S.
418 ( 1 979 )..... ................. 82-83,

101, 104

Baldine v. Sharon Herald Co.,
391 F. 2d 703 (3d Cir. 1968)...... ...54
Baumgartner v. United States,
322 U.S. 665 ( 1 9 4 4 4 0 ,  79-

82, 87

Beckley Newspapers Corp. v.
Hanks, 389 U.S. 81 (1967 )........... 48



—v~

Berry v. National Broadcasting 
Co., 480 F .2d 428 (8th Cir.
1973), cert, dismissed, 418
U.S. 91 1 ( 1 974) ....................... 55
Bogardus v , Commissioner, 302
U.S. 34 (1937)..................--- .85

Bon Air Hotel, Inc, v. Time,
Inc., 426 F.2d 858 (5th Cir.
1970)___ ...........................100

Brewer v. Memphis Publishing 
Co., 626 F.2d 1238 (5th Cir.
1980) , cert. denied, 452 U.S.
962 (1981) ................ ........... 54
Briarcliff Lodge Hotels, Inc, 
v. Citizens-Sentinental 
Publishers, Inc., 260 N.Y.
106, 183 N.E. 193 (1932).... ........ 72
Bruno & Stillman, Inc, v.
Globe Newspaper Co., 633 F.2d
583 ( 1st Cir. 1 980) ...................29
Buckley v. Littell, 539 F.2d
882 (2d Cir. 1976), cert.
denied, 429 U.S. 1062 (1977)..... ...52

Commissioner v . Duberstein,
363 U.S. 278 ( 1 960) ........ .....85, 106
Connick v. Myers, _____ U.S.
51 U.S.L.W. 4436 (Apr. 20,
1983) ............... ...... 52



-vi-

In re Consumers Union of 
UnTtecT States, Inc.~7~7 Media 
L. Rep. (BNA) 2038 (S.D.N.Y.
1981).... . ............ .............. . . 3
Consumers Union of United
States, Inc, v. Theodore Hamm
Brewing Co., 314 F. Supp. 697
(D. Conn. 1 970 ).................... . 3

Curtis Publishing Co. v .
Butts, 388 U.S. 130 (1967)...43, 48, 74

Davis Co. v. United Furn.
Workers, 674 F.2d 557 (6th 
Cir .) , cert. denied, 103 S .
Ct. 296 ( 1982)... .............. . .53-54

Dyer v . MacDougall, 201 F.2d
265 (2d Cxr. 1952)................ .103

Fadell v . Minneapolis Star and 
Tribune Co., 557 F.2d 107 (7th 
Cir.), cert. denied, 434 U.S.
966 (1977)...... ................ ....55
Garrison v. Louisiana, 379
U.S. 64 (1964)................ .39, 65,

68, 72-74

Gertz v. Robert Welch, Inc.,
418 U.S. 323 ( 1974)............ 29, 39,

43, 63-64

Glasson v. Louisville, 518 
F .2d 899 (6th Cir.), cert. 
denied, 423 U.S. 930 (1975) 54



-VI 1-

Greenbelt Cooperative 
Publishing Ass'n v. Bresler,
398 U.S. 6 (1970)................. 48, 65

71, 74

Guzick v. Drebus, 431 F.2d 
594 (6th Cir. 1970), cert. 
denied, 401 U.S. 948 ( 1971 ).......... 53
Haynes v. Washington, 373 U.S.
503 (1963)...... ................. 58-59
Helverinq v. Rankin, 295 U.S.
1 23 ( 1 935)............................ 85
Helvering v. Tex-Penn Oil Co.,
300 U.S. 481 (1937)................ 84-85
Herbert v. Lando, 441 U.S.
153 . (1979) ........... ................. 63
Hotchner v. Castillo-Puche,
551 F.2d 910 (2d Cir), cert. 
denied sub nom, Hotchner v.
Doubleday & Co., 434 U.S. 834
(1977) ................................   .54
Inwood Laboratories, Inc, v.
Ives Laboratories, Inc., 456
U.S. 884 ( 1982)... ....... . 62-6 3
Janigan v. Taylor, 344 F.2d 
781 (1st Cir.), cert. denied,
382 U.S. 879 ( 1965) ........  .103
Lisenba v. California, 314
U.S. 219 (1941)....................... 56



-Vlll-

Loeb v. Globe Newspaper Co.,
489 F. Supp. 481 (D. Mass,
1980)....        .71
Loeb v. New Times 
Communications Corp., 497 F.
Supp. 85 (S.D.N.Y. 1980)............. .76
Long v. Arcell, 618 F.2d 1145 
(5th Cir. 1980), cert, denied,
449 U.S. 1083 ( 1981 .54
Miller v . California, 413 U.S. 15 
( 1973)......................  53
Moore v. Chesapeake & Ohio Ry.
Co. , 340 U.S. 573 (1951).... ........ 103
National Ass1n of Letter 
Carriers v . Austin, 418 U.S.
264 (1974) ........................... . .71

New York Times Co. v.
Sullivan, 376 U.S 254 ( 1964)..... passim

Nishikawa v . Dulles, 356 U.S.
1 29 ( 1 958)........ . . . .......... . ... .103
NLRB v. Gotham Industries,
Inc., 406 F.2d 1306 (1st Cir.
(1969)..... ..........................103
Penthouse Int11, Ltd. v.
McAuliffe, 610 F.2d 1353 
(5th Cir . ), cert. dismissed,
447 U.S. 931 ( 1 980)......... 52-53



-ix~

Pierce v. Capital Cities 
Communications, Inc., 576 F.2d 
495 (3rd Cir.), cert. denied,
439 U.S. 861 ( 1978)..,......___ ......54

Pullman-Standard v. Swint, 456
U.S. 273 (1982) .......... ........ 38, 62,

85-86, 106
Reliance Ins. Co. v.
Barron's, 442 F. Supp.
1341 (S.D.N.Y. 1 977)..................76

Rosenblatt v. Baer, 383 U.S
75 (1966)... ........... . .48, 65

Rosenbloom v. Metromedia,
Inc. , 403 U.S. 29 (1971 )......... 47, 65
Ryan v. Brooks, 634 F.2d
726 (4th Cir, 1980)...... ............ 54
St. Amant v. Thompson, 390
U.S. 727 (1968).............  39, 48, 64,

65, 66, 68

Sambo's Restaurants, Inc, v.
Ann Arbor, 663 F.2d 686 (6th
Cir. 1981).... .......... ....... ......54
Schneiderman v. United States,
320 U.S. 1 1 8 ( 1943) . . ..................79
Steaks Uniimited, Inc, v,
Deaner, 623 F.2d 264 (3d Cir.
1980)... ......... ..................... . 3
Stone v. Essex County 
Newspapers, Inc., 367 Mass.
849, 330 N . E . 2d 161 ( 1975)...... ....101



~ X ”

Sumner v. Mata, 449 U.S. 539 
( 1981 ).... ................. .......... 82
■Tilton v. Cowles Publications 
Co., 76 Wash. 2d 707, 459 P.2d 
8 (1969), cert. denied, 399 
U .S. 927 (1970).......................76
Time, Inc. v. Pape, 401 U.S.
279 ( 1971 .35, 46, 51,

65, 75, 84
Towne v. Eisner, 245 U.S.
413 (1913).... ....................... 100
United States v. Appalachian
Power Co., 311 U.S. 377 (1940 ).....86-87
United States v. General
Motors Corp., 384 U.S. 127
(1966) ..35
United States v. United States 
Gypsum Co., 333 U.S. 364
(1948) ...............................35,

89-91
Vandenburg v. Newsweek, Inc.,
507 F . 2d 1024 (5th Cir. 1975 )........ 55
Va. Bd. of Pharmacy v. Va.
Citizens Consumer Council, 425
U.S. 748 (1976) ........................ .3
Watts v. Indiana, 338 U.S. 49
(1949) .. ...........................60“61
Wood v. Georgia, 370 U.S.
375 (1962) 59



-xi-

Yiamouyiannis v. Consumers 
Union of United States, Inc.,
619 F .2d 932 (2d Cir„) cert.,
denied, 449 U.S. 839 ( 1 980)...--- 3, 101

Constitutional Provisions
U.S. Const., Amend. 1 .............passim

U.S. Const., Amend. 7 ................ 49,
50, 90

Statutes
15 U.S.C. § 1125(a) (1976 ).............8

Federal Rules
Fed. R. Civ. P. 52(a).--- ........passim

Other Authorities
Anderson, Libel and Press 
Self-Censorship, 53 Tex. L.
Rev. 422 (1975)..................43, 49

Blume, Review of Facts in Non-
Jury Cases, 20 Am. Jud. Soc’y
68 (1936).........................57-58
T. Emerson, The System of
Freedom of Expression (1970)........ 49



-xxi-

Kalven, The New York Times 
Case: A Note on "The Central 
Meaning-of the "First- '
Amendment," 1964 Sup. Ct.
Rev. 191.... ............ ........43, 46
Note, Federal Rule of Civil 
Procedure 52(a) and the Scope 
olT Appellate ~Faot~~ReviewT Has
Application of the Clearly 
Erroneous Rule Been Clearly 
Erroneous?, 52 St. John's L.
Rev. 68 ( 1 977) ............ ....... .90
Oakes, Proof of Actual Malice 
In Defamation Actions: An 
Unsolved Dilemma, 7 Hofstra L .
Rev . 6 55 (1979 )...................... 49

Restatement (Second) of Torts 
§ 580A comment g (1977)..............49
Robertson, Defamation and the 
First Amendment: In Praise of 
Gertz v. Robert Welch, Inc.,
54 Tex. L. Rev. 199 (1976 )......... .49
R. Sack, Libel, Slander, and
Related Problems (1980)......... 49, 76



No. 82-1246

IN THE
SUPREME COURT OF THE UNITED STATES 

OCTOBER TERM, 1983

BOSE CORPORATION,

Petitioner,
- against -

CONSUMERS UNION OF UNITED STATES, INC.,

Respondent.

BRIEF FOR RESPONDENT

Statement of the Case

The respondent in this twelve-year 
old product disparagement suit is 
Consumers Union of United States, Inc. 

(hereinafter "respondent.," "Consumers 
Union," or "CU"), the highly-respected



- 2 -

nonprofit, independent consumer testing 
organization, which for forty-seven 

years has published the monthly maga­

zine, CONSUMER REPORTS. As both the 
District Court and the Court of Appeals 

found (App. X4, 45) ,1 CU and CONSUMER 

REPORTS had at the time of publication 
of the disputed review "a very favorable 

reputation for independence, integrity,

1. Reference to the separate Appendix 
filed with the Petition for a Writ of 
Certiorari containing the opinions of 
the lower courts is to "App." followed 
by "X" and page numbers. Reference to 
the Joint Appendix filed in this Court 
is to "J.A." and page numbers. Refer­
ence to the Appendix in the Court of 
Appeals is to "A." and page numbers. 
Reference to the transcript of the trial 
of liability issues is to "LTr." and 
page numbers. Reference to petitioner's 
and respondent's exhibits is to "PX" 
numbers and "DX" letters, respec­
tively.



-3-
accuracy, and freedom from bias."2

2. This well-deserved reputation con­
tinues to the present. CU has approxi­
mately one hundred thousand individual 
members, and the magazine CONSUMER 
REPORTS enjoys a circulation of approxi­
mately 2.7 million. CU's consistent 
efforts to provide consumers with truth­
ful and independent judgments on goods 
and services in the consumer marketplace 
have been recognized by the courts. See 
Consumers Union of United States, Inc. 
v. Theodore Hamm Brewing Co., 314 F. 
Supp. 697, 698, 700 (D. Conn. 1970); In 
re Consumers Union of United States,
Inc., 7 Media L. Rep. (BNA) 2038, 2039 
(S.D.N.Y. 1981) (CONSUMER REPORTS is a 
"public service publication which 
advances a primary First Amendment 
objective by providing a public forum 
for impartial discussion of the safety, 
fitness for use and reliability of pro­
ducts offered to the consuming public"); 
Yiamouyiannis v. Consumers Union of 
United States, Inc., 619 F.2d 932, 940 
{2d Cir.) , cert. denied, 449 U.S. 839 
(1980). Because consumer reporting 
helps citizens to make intelligent and 
well-informed marketplace decisions it 
commands full First Amendment protec­
tion. Va. Bd. of Pharmacy v . Va. 
Citizens Consumer Council, 425 U.S. 748
(1976) ; Steaks Unlimited, Inc. v .
Deaner , 6 23 F.2d 26 4, 280 ( 3d Cir.
1980) .



-4-
This action stems from the peti­

tioner's dissatisfaction with a review 

of the Bose 901 loudspeaker system con­
tained in an article entitled "Loud­

speakers" appearing in the May 1970 

issue of CONSUMER REPORTS.
The eight-page article evaluated 

the quality and performance of twenty- 

four brands of loudspeakers;  ̂only seven 
paragraphs in a boxed-off section cap­

tioned "Some loudspeakers of special 

interest" discussed the Bose product. 
After describing the unique and uncon­

ventional design of the 901 system, the 

review described the opinions of a panel

The full article (PX7; A. 475-81) 
appears at pages 272-78 of the May 1970 
issue of CONSUMER REPORTS (PX2). Ten 
copies of the May 1970 issue have been 
lodged with the Clerk for the 
convenience of the Court. (J.A. 338)



-5-
who were asked to compare the Bose 901 

with a conventional speaker system and 

to judge for each "the direction from 
which the sound appeared to come (App. 

X48)f" when a tape recording of the 

sound of a moving cricket-like 
noisemaker was played through each 

system. No differences were reported.

Next, the article compared music 
heard through the 901 and a conventional 

speaker and described the Bose in terms 

which were conceded (App. X158 n.19) to 
be highly complimentary:

When it came to music, the 
panelists immediately noted a 
remarkable difference between the 
systems. The Bose 901 seemed 
considerably more spacious and 
reverberant, actually to the 
point of giving the impression 
that the wall of the listening 
room had dropped away. The 
effect was rather dramatic and 
was felt from any listening 
position.



- 6 -

This praise was tempered somewhat 

by judgments contained in the next para­
graph where CU expressed its impressions 

of size and movement effects subjec­
tively perceived through the 901 (App.

X158 n.20):
But after listening to a 

number of recordings, it became 
apparent that the panelists could 
pinpoint the location of various 
instruments much more easily with 
a standard speaker system than 
with the Bose system. Worse, 
individual instruments heard 
through the Bose system seemed to 
grow to gigantic proportions and 
tended to wander about the room. 
For instance, a violin appeared 
to be 10 feet wide and a piano 
stretched from wall to wall.

These critical judgments were
immediately limited and minimized by the

next two sentences (id . ) :
With orchestral music, such 
effects seemed inconsequential. 
But we think they might become 
annoying when listening to 
soloists.



-7-
After reporting that the "same 

spacial openness and size distortions" 
occurred with monophonic records played 

through the Bose, the review next 
offered CD's assessment of the 901!s 

sound quality (App. X49):
As for sound quality, if the 

Bose 901 had been rated with 
the main group of tested 
speakers, it would have fallen 
between the high- and medium- 
accuracy groups. The overall 
sound was of good quality with 
impressive bass, considering the 
small speakers. But the combina 
tion of the equalizer and the 
speakers tended to overemphasize 
the middle bass, giving it a 
somewhat overly full, heavy 
sound.

After discussing the Bose speaker* 
power requirements, the review con­
cluded, not by recommending against pur 

chase of the 901, but by inviting 
CONSUMER REPORTS readers to form their 

own opinions (id.):



- 8 -

We think the Bose system is so 
unusual that a prospective buyer 
must listen to it and judge it 
for himself.

From the moment of publication Bose 
asserted there were numerous errors in 

the CU review. In February 1971, it 
commenced a civil action in the United 
States District Court for the District 

of Massachusetts charging CU with pro­
duct disparagement, unfair competition 

and violation of Section 43(a) of the 

Lanham Act, 15 U.S.C. § 1125(a)

(1976).4

4. Issue was not joined until 1974 
because Bose's original and amended com­
plaints were each dismissed (with leave 
to replead) by the District Court.



-9-
At the liability trial?5 the 

petitioner offered the testimony of only 
one witness: the founder, majority 
shareholder, chief executive officer and 

the namesake of the plaintiff corpora­

tion —  Amar G. Bose, Ph.D. Dr. Bose 
postulated at length on why Consumers 

Union's findings were either wrong or 

"scientifically impossible." (See, 

e.g., J.A. 27-58)
Although nearly ten years passed 

between the publication of the CONSUMER 

REPORTS article and the trial, Bose 

presented no evidence of any objective 
tests or measurements of the Bose 901 

speaker system, and no evidence of any

57 The District Court severed the 
issues of liability and damages and held 
two non-jury trials.



- 10 -

listening tests in which the Bose or 

conventional loudspeakers were played 
before a group of observers (independent 

or otherwise) and their reactions 
recorded.

And Bose offered no proof whatever 

that CU published any statement with 

knowing or reckless falsity. Constitu­

tional actual malice, the petitioner 
urged, could be inferred merely by 

accepting Bose's contention that when 
read literally the description of 

widened and wandering instruments was 
scientifically impossible and "could not 
have [been] heard." (LTr. 6-22) More­
over, Bose contended that CU's senior 

project engineer, Arnold L. Seligson, 
the person primarily responsible for 

conducting and supervising the research 

on the 901, deliberately downgraded the



"11-

petitioner1s product in order to 
commercialize a potentially competing 

product supposedly embodied in a patent 

held by Seligson.
In contrast to the conclusory and 

unsupported trial testimony offered by 

the petitioner, Consumers Union intro­
duced all of its relevant original 

research data; all of the documents 

involved in the editorial process, 
including original notes, drafts and 
revisions of the disputed review; the 

live testimony of Seligson and Alan 
Lefkow, the employees who conducted the 
research on the 901 and whose judgments 

are reflected in the published review; 
the live testimony of CU's technical 

director; and the expert testimony of 

Dr. David M. Green, the Chairman of 
Harvard1s Department of Psychology and



-12-
Social Relations, a member of the 
National Academy of Sciences and a 

Fellow and the then president-elect of 

the Acoustical Society of America -- all 

of which demonstrated beyond cavil that 
CU labored long and hard with a con­
sistent concern for truthful and respon­

sible reporting in a successful effort 
to make the article accurately reflect 
the outcome of CU's research and the 
performance of the Bose system.

The evidence of CU's efforts and 
results, summarized in the following 
paragraphs, is uncontradicted. No 

contrary evidence was introduced to or 
credited by the District Court.

It was shown that Consumers Union 

had extensive experience in testing and 
reporting on loudspeakers and other 
consumer audio products. Prior to its



1969-70 tests of loudspeakers, Consumers 
Union had tested and reported on 100 or 

more different makes and models of loud­
speakers over a ten year period. (J.A.

91-92) Since 1970, Consumers Union has 

tested at least 100 additional speaker 
systems . (_ld . )

Consumers Union tested the Bose 901 

in 1969 and 1970 as part of a much 
larger project involving twenty-four 

loudspeakers grouped into three cate­

gories . The research and editing pro­
cess that led to publication was a 

lengthy one and involved many Consumers 
Union personnel and numerous internal 
checks and reviews. (J.A. 134-37, 145- 

47, 197-200)
Each speaker was subjected to an 

extensive battery of tests and measure-



-14-

ments which took several months to com­
plete . These tests, which are described 

in detail by the District Court (App, 

X54-60), the Court of Appeals (App. X5- 
6) and in the CONSUMER REPORTS article 

(A. 475-76; PX7, pp. 272-73), were 
designed to measure both the objective 
electrical and acoustical output of the 

loudspeakers and the more subjective, 

psychoacoustical and aesthetic aspects 
of their performance. The tests were 

conducted and supervised by Seligson, 
then the Senior Project Engineer in 
charge of testing loudspeakers and other 
audio products, assisted by Lefkow, then 

a project engineer, two assistant pro­
ject engineers and a statistician.

(App. X50; J .A . 93-95)
Seligson and Lefkow were found to



- 15 -

be extremely capable, highly skilled and 

experienced in the testing and evalua­

tion of loudspeakers. {App. X50-52, 30) 
Seligson has worked in the field of 

acoustics and testing of audio products 

since 1953. He received a bachelor's 
degree in electronic engineering from 

CCNY in 1952 and studied acoustics at 
Brooklyn Polytechnical Institute in 
1953. From 1953 to 1956, while studying 
at night for a Master's degree, which he 

did not complete for personal reasons, 
Seligson worked for the United States 
Navy Laboratories testing acoustical 
equipment, such as microphones and loud­
speakers. He joined Consumers Union in 
1956 and has worked there ever since, 
except for a two-year period (1961-63) 
when he worked for a private corporation



- 16 -

on audio products. (J.A. 83-89; App. 

X51-52)
At Consumers Union, first as a 

Project Engineer, then as Senior Project 
Engineer and now as Chief of the Elec­
tronics Division, Seligson has worked on 

all aspects of the testing and evalua­
tion of loudspeakers and other audio 

products. Prior to the 1969-70 tests, 
Seligson had participated in at least 

four or five Consumers Union loudspeaker 

projects involving the testing of at 
least 100 different brands and models of 

loudspeakers. (J.A. 91) As the Dis­
trict Court noted, Seligson has been 
testing and evaluating loudspeakers "for 

more than 25 years." (App. X52)
Because of the competence and 

expertise which Seligson demonstrated in



-17-
his work at CU —  testing and reporting 

on literally hundreds of audio products 
— ■ he was highly regarded and relied 
upon by his superiors. His work 

generated virtually no reader complaint 

mail and received an extraordinarily 
positive response from persons in the 

audio community, including the 
manufacturers whose products had been 

evaluated. (J.A. 201-03)
In addition to his work at Con­

sumers Union, Seligson has written a 
scientific paper on microphone calibra­
tion, has been a monthly columnist for 

the Sunday New York Times on audio 
equipment, wrote an article for the 
February 1969 issue of Stereo Review on 
how Consumers Union tests loudspeakers 

(PX6) and has lectured publicly on the



- 18 -

testing and evaluation of audio pro­
ducts. (J.A. 89-90; LTr. 6-134-135) He 
also holds two patents, one granted in 

1960 for a device similar to a condenser 
microphone, and the other granted in 

1969 for an "Ionic Electro-Acoustic 
Transucer." (PX5) Neither patent has 
been used commercially.

Upon completion of the testing in 

January 1970, Seligson and Lefkow pre­
pared the draft of the "Report to 

Editorial" -- a lengthy document which 
summarized the research and its results 
for Consumers Union's editorial depart­
ment. The sections of the draft refer­

ring to the Bose 901 were drafted by 
Seligson and reviewed by Lefkow. (App. 

X65; J.A. 126-30) The draft was 

reviewed and revised by their superiors.



-19-
The revisions were widely circulated 

within Consumers Union. (J.A. 129-37, 
145-47; App. X32-34)

Using the revised "Report to 

Editorial," a professional writer in 
Consumers Union's editorial department 

prepared a draft manuscript. (J.A. 134- 

35; App. X65-66) Prior to final 
approval for publication, the draft, 
subsequent revisions and galley proofs 

were circulated to and reviewed by 
Seligson, Lefkow, their superiors and 

others in several departments of Con­

sumers Union for accuracy. (J.A. 129- 
37, 145-47, 200-03; App. X32-34)

At trial, both Seligson and Lefkow 

consistently testified that the pub­
lished article accurately reflected the 
results of their research and the sub-



- 20-

jactive judgments they had 

result of testing the Bose 
They testified that at all 
had (and continue to have) 

belief in the truth of the

reached as a 

product. 

times they 
a good faith 

entire

review.
With respect to the comments on 

"instruments seem[ing] to grow to gigan­
tic proportions and tend[ing] to wander 

about the room," Seligson described what 

he had heard during a listening test of 

the Bose in the following testimony 
which was credited and quoted by the 

trial judge (App. X95-97):
As best as I could describe it, 
it would be that —  if you can 
imagine peering at an array of 
lights from a distance so when 
you view them they seem like a 
blur of lights somewhere in front 
of you; and in this array of 
lights there may be individual 
lights which twinkle more 
strongly and focus one's atten-



- 21 -

tion upon them, but the twinkling 
shifts from point to point so 
that one's attention is drawn 
first to one spot, then to 
another, but it would be diffi­
cult to see whether at those 
times when one's attention shifts 
to a bright spot, whether one has 
suppressed the fact that there is 
a broad light source behind.

This is something that occurs 
with time and it is a perception. 
It is difficult to recall 
precisely the manner in which I 
heard it, but that is about the 
best analogy that I could give 
you.

With the violin wide, the 
impression is one predominantly 
of sound coming at you from 
roughly the entire area in front 
of you.

In other words, roughly from 
in front of the entire area. But 
individual notes, however, may 
occasionally seem to focus a 
little better in one location 
than in another and give the 
impression that that is where the 
violin is for that moment.

And it is a shifting 
impression.

He concluded with this description of



- 2 2 -

his impressions (J .A. 180):

It is something which is part of 
that vagueness which we mentioned 
in the story. We said simply it 
became apparent that the 
panelists could pinpoint the 
instruments much more precisely 
with a standard speaker system 
than with the Bose system. It is 
that difficulty in pinpointing 
the location that leads to some 
of the problems. It also makes 
it difficult to describe.

The other researcher whose observa­
tions formed part of the review, Alan 

Lefkow, described the subjective 
phenomena he had heard in these words 
also quoted by the District Court (App. 

X97) :
Yes, the piano seemed very wide 
in the sense that you could hear 
the various tones from the piano 
come in at many points right 
across the front of the room.
And the violin, as the violin is



-23-
played, the violin -- the source 
of the notes seemed to change as 
he played different notes. As he 
went up and down the scale, I 
heard the notes coming from 
different points, spread out 
between the two speakers.6

~6~. "The District Court conceded that 
others, independent of Consumers Union, 
observed similar effects. The Court 
quoted the trial testimony of Dr. David 
M. Green, one of the nation's leading 
psychoacousticians (App. X98):

I have heard things [through the 
Bose 901] that I would describe 
as, first of all, as very broad 
image. There is no question 
about that. Secondly, the source 
is hard to localize. It's vague, 
and from moment to moment changes 
its location. So you might 
[say], especially on solo 
instruments, the apparent source 
moves from time to time. It 
could be located in any number of 
places in front of you. (See
also J.A. 306-07)

Dr. Green also testified at length 
concerning the scientific principles 
involved which substantiate the validity 
of CU's judgments (J.A. 276-85) and 
described the results of an independent 
listening study he conducted with 16

(Footnote continued on next page)



-24-

When asked by the District Court to 

define the word "about" as used in the 
fragmentary phrase "tended to wander 

about the room," Seligson stated that

(Footnote Continued from Previous Page)

persons unaffiliated with the parties 
who were unaware of the loudspeaker 
models being played and who compared 
movement of a flute heard through the 
901 and a conventional speaker. (J.A.
285-311) The results of that experiment 
confirmed the truth of the CU assess­
ment. Dr. Green thus concluded that 
solo passages played through the 901 
"may be localized [by listeners] in 
different places in the listening room 
at different times" (J.A. 307), and that 
there was significantly more movement 
with the Bose 901 than with conventional 
speakers. (J.A. 299, 301, 303-04)
Although the District Court made passing 
reference to Dr. Green's testimony, the 
Court erroneously ruled that his per­
sonal observations of moving instruments 
and the results of his experiment with 
independent subjects were "irrelevant" 
because Seligson and Lefkow testified 
that the wandering sounds they heard 
were confined to an area within a few 
feet of the wall. (App. X162-63 n .33)



-25-
that word "was meant to mean about the 
rear wall between the speakers." He 
believed he had accurately conveyed this 

judgment to the reader by including in 
the text the example given in the next 

sentence: "For instance, a violin
appeared to be 10 feet wide and a piano 

stretched from wall to wall." (J.A. 

123-24, 169-70)
Seligson and Lefkow each prepared a 

drawing at the trial in an attempt to 

depict on paper the size and movement 
phenomena they perceived. (PX 29, 35; 
J.A. 342-43) Both drawings indicated 

some movement towards and away from the 

wall, as well as laterally.
Seligson further testifed how 

difficult it was to describe precisely 
what he observed. (J.A. 180-82) He



-26-

called his trial drawings a "crude" or 
"broad" depiction of what he observed 
(J.A. 156), and because of the abstract 

and subjective nature of the experience, 

he had to resort to the array of 
shifting lights analogy quoted above.

Dr. Green (J.A. 331-32) and Dr. Bose 
both agreed that it is quite difficult 
to translate an aural perception, an 

auditory image, into words. As Dr. Bose 

said, "there are no words to describe 
all the aesthetic aspects of sound." 

(J.A. 337)
The District Court rendered its 

decision on the liability issues in 
January of 1981, finding for Consumers 

Union on all claims save one. The un­
fair competition and Lanham Act counts 

were dismissed because after a "careful 
review of the testimony at trial," the



-27-
Court concluded that Bose failed to 

prove that CU was biased in its ratings 
of loudspeakers. (App. X145) Four of 
the review's statements alleged to 

constitute actionable product 
disparagement were held by the Court 
either not proven false or not shown to 

be defamatory.
The District Court held only one 

portion of one phrase of the article to 

be factually false7 —  and that only by 
a preponderance of the evidence. The 
isolated fragment, "individual instru­

ments heard through the Bose system ... 
tended to wander about the room," the 

Court found to be untrue because

77 In holding the fragment to be 
factual and not opinion, the District 
(Footnote Continued on Next Page)



- 2 8 -

although the article reported accurately 

that "instruments ... tended to wander," 
Consumer Union’s engineers testified that

(Footnote Continued from Previous Page)

Court wrongly wrenched the statement 
from its proper context as part of a 
judgmental, evaluative and figurative 
statement of aesthetic criticism. The 
statement was based on perceptions and 
judgments recognized by the District 
Court as being "subjective" and was 
replete with cautionary phrases of 
apparency that made its status as opinion 
crystal clear. The petitioner itself 
recognized that the phrase in issue was 
opinion and said so explicitly in a 
publication instructing its dealers on 
how to respond to the CONSUMER REPORTS 
article. (DX CU)



-29
they heard the "wandering sounds" only 

"within a few feet of the wall near which 

the Bose 901 loudspeakers were placed." 

(App. X100) The difference between 
"tended to wander about the room" and 
"tended to wander about [or along] the 
wall" was what the Court found to be both 

false and disparaging.
The Court then determined that Bose 

met the tests enunciated by this Court in 

Gertz v. Robert Welch, Inc., 418 U.S. 323 
(1974), and by the First Circuit in Bruno 
& Stillman, Inc, v. Globe Newspaper Co., 

633 F.2d 583 (1st Cir. 1980), and was a 
"public figure, at least with respect to 
the limited issues of the characteristics



30-

and quality of the Bose 901." (App.
X132-33)8 Accordingly, the 
constitutional rules of New York Times 

Co. v. Sullivan, 376 U.S 254 (1964), 
were held to apply.

Turning next to the issue of CU's 

asserted motivation to disparage the 
Bose product (an issue upon which plain­

tiff subjected Seligson to lengthy 
cross-examination and which constituted 
a "significant portion of the testimony 

at trial") (App. X133), the District 
Court rejected the petitioner's claims 
in their entirety (App. X136):

Having reviewed the record 
and considered the demeanor of 
the witnesses involved, 
especially that of Seligson the 
Court finds that the possible

8. Bose conceded its public figure 
status on appeal and the Court of 
Appeals accepted the finding for pur­
poses of the appeal. (App. X21)



-  3 1 -
commercialization of his own 
patent did not influence 
Seligson's evaluation of 
loudspeakers for the Article. 
Specifically, the Court finds 
that Seligson did not downgrade 
the Bose 901 in order to smooth 
the way for his own invention.
(emphasis supplied)

Bose's other claims that CU was 
motivated to disparage the 901 because 
of a bias against higher priced prod­

ucts, or to inject "sarcasm" and "spice 

into its magazine, were rejected by the 
District Court because of "insufficient 
evidence" and because the testimony 

presented left the allegation "entirely 
within the realm of speculation." (App 

X145)
Nonetheless, the District Court 

found that the disputed fragmentary 

phrase was published with "actual 

malice." (App. X142-43) As the fore-



-32-

going review of the undisputed trial 
testimony demonstrates, it did so with­
out the benefit of any evidence, 

objective or subjective, upon which 
constitutional malice could be based. 

Instead, falsity plus the author1s 

intelligence were erroneously held to 
create actual malice. In the Court's 

words (App. X142), Consumers Union's 

principal researcher was not to be 
believed solely because he

is an intelligent person whose 
knowledge of the English language 
cannot be questioned. It is 
simply impossible for the Court 
to believe that he interprets a 
commonplace word such as "about" 
to mean anything other than its



-33-
plain, ordinary meaning.^

A separate trial on the issue of 

damages followed. Basing his decision 

only upon hearsay assertions of a 
general decline in growth of sales 

(sales continued to increase after the 

article's publication) and awarding 
compensation for critical but non- 

actionable portions of the article, 

Chief Judge Caffrey assessed damages in 
the amount of $115,296.00 plus interest 

and costs of $95,609.24, a total of 

$210,905.24. This finding was also

9. Although resting on an improper 
application of the standard of constitu­
tional malice, the District Court 
facilely labeled its finding as one of 
credibility. As shown in greater detail 
at pp. 65-71, infra, this ipse dixit has 
no validity and was induced by an 
erroneous view of the law.



-34-

plain error of constitutional 

dimension.10
Consumers Union's appeal to the 

First Circuit raised numerous questions 

of error in both the liability and 
damages holdings. Because it could find 

no evidence of actual malice, the Court 
of Appeals did.not consider CU's prin­
cipal claims of truth and nonactionable 

opinion. Assuming arguendo a false

10. Because it reversed on issues of 
liability, the Court of Appeals did not 
review the damages findings. In fact, 
sales of the 901 increased dramatically 
after the CU article was published.
1970 sales increased incrementally over 
1969 sales by some 48% and sales 
increased at an average annual rate of 
35% until 1974. (A. 454, 567) Sales in
late 1970 exceeded Bose's internal fore­
casts and were characterized by Bose 
itself as a remarkable performance.
(A. 543-44) Starting with zero percent 
of the loudspeaker market in 1968, Bose 
grew to a position of first or second in 
dollar volume by 1971. (A. 94-96, 473-
74, 540-41)



-35-
statement of fact (even though the Court 

noted, "we are not sure that the state­
ment that instruments tended to wander 

about the room is false") (App. X19), 
the Court of Appeals reviewed the entire 

evidence "to ensure that the district 
court has applied properly the governing 

constitutional law and that the 
plaintiff has indeed satisfied its 

burden of proof." (App. X23-24)
In carrying out its review, the 

appellate court held that this Court's 
decisions in New York Times Co. v. 
Sullivan, 376 U.S. 254, 285 & n .26 

(1964), and Time, Inc, v. Pape, 401 U.S. 
279, 284 (1971), required it to examine 
the record independently to determine if 
the evidence could constitutionally 
support the lower court's conclusion of



-36-

actual malice.
Exercising independent judicial 

judgment without re-resolving any dis­
puted factual findings or redetermining 
credibility,11 the Court of Appeals 

faulted the District Court for its legal 

error in misapplying the constitutional 

standard of actual malice and held that 
"[t]o find actual malice in this case 

would be to interpret that concept to 

require little more than proof of 
falsity." (App. X36) Having found that 

the District Court*s findings rested on 
an erroneous view of the law, the Court 

of Appeals reversed.

11. The Court of Appeals explicitly 
"recognize[d] that [it was] in no posi­
tion to consider the credibility of 
witnesses and must leave questions of 
demeanor to the trier of fact." (App. 
X23)



-37-
Given the proper application of the 

constitutional actual malice standard, 

and since only one rational result was 
possible on the undisputed facts that 

reversal was eminently correct.

Summary of the Argument

Since New York Times Co. v. 
Sullivan, 376 U.S. 254 (1964), this 

Court has consistently held that inde­
pendent appellate review of the record 
to determine whether actual malice had 

been proved with convincing clarity was 

an integral part of the protection the 
First Amendment affords publishers in 

defamation actions brought by public 
figures. Since the Seventh Amendment 
does not preclude independent appellate



-38-
review, a fortiori, neither can Fed. R. 

Civ. P. 52(a). To abandon the indepen­
dent review requirement would eviscerate 

this constitutional protection as it 
would place in the factfinder's hands 

unreviewable final authority over funda­
mental First Amendment freedoms. In any 

event, the Court of Appeals here exer­

cised only limited independent judicial 
judgment and did not redetermine dis­
puted facts or review credibility find­
ings .

The District Court's finding of 
actual malice was based on an erroneous 
view of the law and was thus properly 
reversed under any standard of appellate 

review. Pullman-Standard v. Swint, 456

U.S. 273, 287, 292 (1982). The trial 
court erred in imposing a negligence or



-39-
"reasonable person" standard rather than 

requiring petitioner to prove by clear 
and convincing evidence "subjective 
awareness of probable falsity." Gertz 

v. Robert Welch, Inc., 418 U.S. 323, 334 

n .6 ( 1 974). See St. Amant v. Thompson, 
390 U.S. 727 (1968); Garrison v. 
Louisiana, 379 U.S. 64 (1964). Applying 
the wrong legal standard, the District 
Court found actual malice because it 
held that the author was too intelligent 

to have made an honest mistake. This 
finding, contrary to governing law, 

rewards ignorance and sloppy journalis­
tic practices at the expense of the 
honest, intelligent publisher a 
result that turns New York Times on its 

head.
Under New York Times, the determi-



-40-
nation of actual malice is a mixed ques­
tion of law and fact. In cases implica­

ting fundamental constitutional rights, 

such determinations, sometimes called 
"ultimate facts," are subject to 

unhindered appellate review to ensure 

that the Constitution has not been 
abridged and that the evidence 

satisfies the high "clear and 

convincing" standard. Baumgartner v. 
United States, 322 U.S. 665 (1944 ) .

The District Court's finding of 
actual malice was clearly erroneous.
The evidence, virtually all of which was 

undisputed, shows beyond doubt that Con­

sumers Union followed its normally care­
ful editorial procedures, evidenced 

great concern for the truth and pub­
lished a balanced and fair report of the



results of its own research on the Bose 

901. Seligson, Consumers Union's chief 
test engineer and the principal author 

of the disputed passage, is an expert 

who is highly regarded in the field of 

audio testing. Despite petitioner's 

massive and sometimes vicious attack on 
Seligson's honesty and integrity, the 
District Court repeatedly upheld 

Seligson's credibility and freedom from 
conflict of interest or motive to dis­

parage. The trial court's finding of 
actual malice is inconsistent with the 

trial court's findings on all other 
credibility and motive issues and vio­
lates the principle that disbelief alone 
does not supply affirmative proof, much 

less clear and convincing proof. The 
only rational conclusion from the



-42-
evidence is that, if Consumers Union 

chose the wrong word to use in its 

subjective, aesthetic criticism, it was 
a mistake honestly made.

Argument 
POINT I

The Independent Appellate 
Review Carried Out by the 
Court of Appeals to Determine 
Whether the Constitutional 
Actual Malice Standard was 
Properly Applied is a 
Substantive Right Unaffected 
by a Rule of Civil Procedure

The petitioner's contention that

Fed. R. Civ. P. 52(a) compelled the. # ' . C ... .» c  ■
Court of Appeals to uphold the district 

judge's conclusion of actual malice 

ignores the long line of cases in this 
Court which make actual malice a 
constitutional standard, the determina­
tion of which must be reviewed independ-



-43-
ently against requirements drawn from the 
First Amendment.

In the landmark decision of New 

York Times Co. v. Sullivan, 376 U.S. 254 

(1964) , the Supreme Court for the first 

time placed constitutional limitations 
upon public officials bringing libel 

suits.^2 n o w , the First Amendment 
requires the public official or public 
figure^ libel plaintiff to prove that 

the defamatory statement is false and to 
establish with convincing clarity that

12. Kalven, The New York Times Case: A 
Note on "The Central Meaning of the First 
Amendment," 1964 Sup. Ct. Rev. 191, 194
("the [New York Times] opinion makes a 
notable shift in constitutional 
idiom...."). See also Anderson, Libel 
and Press Self-Censorship, 53 Tex. L.
Rev. 422 (1975) .
13, The constitutional rules adopted in 
New York Times were extended to public 
figures in Curtis Publishing Co. v.
Butts, 388 U.S. 130 (1967). See Gertz v. 
Robert Welch, Inc., 418 U.S. 323, 336 n.7 
(1974).



-4 4-
the statement was made with actual malice 
-- that is, with knowledge that it was 

false or with reckless disregard of 

whether it was false or not.
Because the First Amendment free­

doms involved are fundamental, the New 
York Times Court included, as an 

integral and inseparable part of the 
constitutional protection afforded to 
publishers, the right to have appellate 

courts independently examine the entire 

record to determine for themselves 
whether "the proof presented to shew 

actual malice lacks the convincing 

clarity which the constitutional 
standard demands." 376 U.S. at 285-86. 

These principles were stated as 

follows:
Since respondent may seek a 

new trial, we deem that consider­
ations of effective judicial



-45-
administration require us to 
review the evidence in the pre­
sent record to determine whether 
it could constitutionally support 
a judgment for respondent. This 
Court’s duty is not limited to 
the elaboration of constitutional 
principles; we must also in prop­
er cases review the evidence to 
make certain that those princi­
ples have been constitutionally 
applied. [T]he rule is that we 
"examine for ourselves the 
statements in issue and the cir­
cumstances under which they were 
made to see...whether they are of 
a character which the principles 
of the First Amendment, as 
adopted by the Due Process Clause 
of the Fourteenth Amendment, 
protect." Pennekamp v. Florida 
.... We must "make an 
independent examination of the 
whole record," Edwards v. South 
Carolina... so as to assure 
ourselves that the judgment does 
not constitute a forbidden 
intrusion on the field of free 
expression.

Applying these standards, we 
consider that the proof presented 
to show actual malice lacks the 
convincing clarity which the 
constitutional standard demands, 
and hence that it would not con­
stitutionally sustain the judg­
ment for respondent under the 
proper rule of law.



-46-
376 U.S. at 284-286 (emphasis supplied) 
(citations and footnote omitted).^ 

These constitutional guideposts 

have been followed in every public offi 
cial and public figure defamation suit 

to reach this Court. For example, in 

Time, Inc. v. Pape, 401 U.S. 279, 284 
(1971), in reversing a decision by the 

Seventh Circuit which had overturned a 

district judge’s grant of a directed 
verdict for the publisher, the Court 

referred to the "settled principle" 

that
[i]n cases in which there is a 
claim of denial of rights under 
this Federal Constitution, this 
Court is not bound by the conclu 
sions of lower courts, but will 
re-examine the evidentiary basis

14. Professor Kalven summarized the 
Times Court's holding as "mak[ing] 
actual malice a 'constitutional fact' 
that it will review de novo and indeed 
did review de novo in the case itself." 
Kalven, supra note 12, at 220.



-47-
on which those conclusions are 
founded." [W]e have frequently 
had occasion to review "the 
evidence in the...record to 
determine whether it could con­
stitutionally support a judgment" 
for the plaintiff. (citations 
omitted).

And, in Rosenbloom v. Metromedia, Inc., 

403 U.S. 29 (1971), the plurality 
concluded that independent appellate 
review of constitutional facts is not 

merely permissive but is a constitution­

al mandate:
Clearly, then, this Court has an 
"obligation to test challenged 
judgments against the guarantees 
of the First and Fourteenth 
Amendments," and in doing so 
"this Court cannot avoid making 
an independent constitutional 
judgment on the facts of the 
case." The simple fact is that 
First Amendment questions of 
"constitutional fact" compel this 
Court's de novo review.



-48-
403 U.S. at 54 (citations omitted).^ 

Indeed, the teachings of New York 

Times and its progeny in this regard 
have received the virtually unanimous 

praise of First Amendment scholars and 

have been adopted by the American Law

15. As noted, the Court has been un­
swervingly faithful to these principles 
See , e.g., Greenbelt Cooperative 
Publishing Ass'n v. Bresler, 398 U.S. 6 
11 (1970); St. Amant v. Thompson, 390 
U.S. 727, 732-33 (1968); Beckley 
Newspapers Corp. v. Hanks, 389 U.S. 81, 
83 (1967); Curtis Publishing Co. v. 
Butts, 388 U.S. 130, 158 (1967); 
Rosenblatt v. Baer, 383 U.S 75, 86 
(1966).



-49-
Institute . 6

To urge, as petitioner does, that 

Rule 52(a) strips away the independent 
review required by the First Amendment 
would produce the anomalous result of 

apotheosizing a rule of civil procedure 
to a more weighty and dispositive cate­

gory than the Seventh Amendment to the 

Constitution of the United States. In 
New York Times, the Court explicitly

TgT ~See tT EmersorTT- The System of 
Freedom of Expression 535-37 (1970) ; 
Restatement (Second) of Torts § 580A 
comment g (1977); R, Sack, Libel,
Slander, and Related Problems 538, 560 
(1980); Anderson, Libel and Press Self- 
Censorship, 53 Tex. L. Rev. 422, 467-468 
(1975); Oakes, Proof of Actual Malice In 
Defamation Actions: An Unsolved 
Dilemma, 7 Hofstra L. Rev. 655, 707-09 
(1979); Robertson, Defamation and the 
First Amendment; In Praise of Gertz v . 
Robert Welch, Inc.,
199 , 249-250 (1976 ) .

54 Tex. L. Rev.



-50-
re jected the argument that the Seventh 

Amendment (!,no fact tried by a jury, 

shall be otherwise reexamined in any 
Court of the United States, than accord­
ing to the rules of the common law") 

forebade independent appellate review.
In language that could not be more to 

the point it was stated:
But its ban on re-examination of 
facts does not preclude us from 
determining whether governing 
rules of federal law have been 
properly applied to the facts. 
"[T]his Court will review the 
finding of facts by a State court 
. ..where a conclusion of law as 
to a Federal right and a finding 
of fact are so intermingled as 
to make it necessary, in order 
to pass upon the Federal ques­
tion, to analyze the facts."
Fiske v. Kansas, 274 U.S. 380, 
385-386. See also Haynes v. 
Washington, 373 U.S. 503, 515- 
516 .

376 U.S. at 285 n.26.
If even the Seventh Amendment is



- 5 1 -

deeined not to diminish the requirement 
of independent review of facts decisive 
of constitutionality, it follows inexor­

ably as an a fortiori proposition that 

Rule 52(a) cannot do so.
Although this Court has never had 

the opportunity to rule on the issue 

presented here in a defamation case,17 
just last Term the Court held, in a case 
involving the First Amendment claim of a 
government employee tried before a 

district judge without a jury, that it 
has a constitutional "obligation ...

[to] mak[e] an independent constitu-

17. But see Time, Inc. v. Pape, 401 
U.S. 279, 284 (1971), where the Court 
exercised the rule of independent appel­
late review where the question before it 
was the propriety of the grant of a 
directed verdict for the publisher by a 
federal district court judge.



-52-

tional judgment on the facts of the

case." Connick v. Myers, ___ U.S. __,
51 U.S.L.W. 4436, 4439 n.10 (Apr. 20, 

1983).
Numerous federal appeals courts 

have held that Rule 52(a) cannot limit 
independent judicial judgment where 

First Amendment rights, including the 
determination of actual malice in libel 
suits, are involved. In Buckley v. 

Littell, 539 F.2d 882, 888 (2d Cir. 
1976), cert. denied, 429 U.S. 1062

(1977), the Second Circuit specifically 
held the clearly erroneous standard to 
be overridden by the "duty to ’re­
examine the evidentiary basis' of the 
lower Court decision," even when the 
fact-finder is a federal judge. And in 

Penthouse Int'l, Ltd. v. McAuliffe, 610
F.2d 1353, 1363 (5th Cir.), cert.



-53-
dismissed, 447 U.S. 931 (1980), when the 
constitutional fact before it was 

obscenity, the Fifth Circuit held that 

this Court's decision in Miller v. 
California, 413 U.S. 15, 25 (1973), 

required it to exercise independent 

review, although the fact-finder was a 
judge. The Sixth Circuit held in Guzick 

v. Prebus, 431 F.2d 594, 599 (6th Cir. 

1970) , cert. denied, 401 U.S. 948 
(1971), that "when dealing with ques­

tions of constitutional magnitude, we 
are not at liberty to accept the fact 
trier's findings merely because we con­

sider them not 'clearly erroneous' as 
that term is employed in Rule 52(a) F.R. 
Civ.P. We must make our own examination 
of the material from which decision is

made." See also Davis Co. v. United



-54-
Furn. Workers, 674 F. 2d 557, 563 (6th 
Cir. ) , cert. denied, 103 S. Ct. 296 

(1982); Sambo's Restaurants, Inc, v. 
Ann Arbor, 663 F.2d 686, 690 (6th Cir. 

19 81); Glasson v. Louisville, 518 F. 2d 
899 , 903 (6th Cir.), cert. denied, 423 

O.S. 930 ( 1 975). 18

18. The following decisions, represent 
ing appeals from cases tried before 
juries as well as those in which the 
district judge ruled upon a motion for 
summary judgment, all stand for the 
proposition that independent appellate 
scrutiny of an actual malice conclusion 
is mandated: Hotchner v. Castilio- 
Puche, 551 F.2d 910, 913 (2d Cir.) 
(jury), cert. denied sub nom. Hotchner 
v. Doubleday & Co., 434 U.S. 834 (1977) 
Pierce v. Capital Cities Communications 
Inc., 576 F.2d 495, 510 n.70 (3rd Cir.) 
(judge), cert. denied, 439 U.S. 861
(1978); Baldine v. Sharon Herald Co., 
391 F.2d 703, 706 (3d Cir. 1968) (jury) 
Ryan v. Brooks, 634 F.2d 726, 728 (4th 
Cir. 1980) (jury); Long v. Arcell, 618 
F . 2d 1145, 1147 (5th Cir. 1980) (jury), 
cert. denied, 449 U.S. 1 083 ( 1981); 
Brewer v. Memphis Publishing Co., 626 
F.2d 1238, 1258 (5th Cir. 1980) (jury), 
cert. denied, 452 U.S. 962 (1981);



-55-
No valid reason has been or can be 

put forth as to why this Court should 
abnegate the role of independent appel­
late scrutiny of the proper application 
of the constitutional malice standard 

when the fact-finder is a single and 

fallible federal judge rather than a 
state court judge or a federal or state 
jury. Assuredly, the compulsion to 
defer to a state court or to any jury is 
greater than that to be accorded to an 

individual federal judge, Deference to 
juries enjoys constitutional dignity and 
is phrased absolutely 'while any defer-

(Footnote Continued from Previous Page)
Vandenburg v. Newsweek, Inc., 507 F.2d 
1024, 1026-27 (5th Cir. 1975) (jury); 
Fade11 v. Minneapolis Star and Tribune 
Co., 557 F.2d 107, 108 (7th Cir.) 
(judge), cert. denied, 434 U.S. 966 
(1977). See also Berry v. National 
Broadcasting Co., 480 F.2d 428, 432 (8th 
Cir. 1973) (jury), cert. dismissed, 418 
U.S. 911 (1974) (jury) (false light,
invasion of privacy).



-56-
ence to be accorded to a federal judge 

is based upon a mere procedural rule.

To elevate Rule 52(a) to a status 
compelling an appellate court to be 
bound by a district judge's application 

of the actual malice standard (espec­
ially in the circumstances of this case 

where the finding of actual malice is 

not only totally lacking in support in 
the record but is in conflict therewith 

and was plainly induced by an error of 

law) would be to give that procedural 
rule an effect that works a fundamental 

unfairness at war with the First Amend­

ment , cf. Lisenba v. California, 314 

U.S. 219, 237-38 (1941), and would 
engender public dismay at an arbitrary 
judicial administration.

Unless proper corrective authority



-57-

can be exercised by the Courts of 
Appeals, the constitutional standards 

for determining actual malice will 

differ from individual judge to 
individual judge. The First Amendment 

protections will lose their unity and 
certainty and freedom of expression will 
be dampened.

Moreover, unfair and unjust hold­

ings which become impervious to reversal 
could lead to public contempt for the 

judicial system. As stated by Professor 
Blume, a member of the Advisory Commit­
tee on Rules for Civil Procedure which 
drafted Rule 52(a) and one of the lead­
ing proponents of the Rule as drafted,
"[a] sure way to arouse distrust and 

suspicion in the public mind is to give 
the district judge final power over 
life, liberty or property." Blume,



58-

Review of Facts in Non-Jury Cases, 20 

Am. Jud. Soc'y 68, 71 (1936).

To preserve the "profound national 
commitment to the principle that debate 

on public issues should be uninhibited, 
robust, and wide open," to give "the 

freedoms of expression... the ’breathing 

space’ that they 'need...to survive,'" 
and to assure that "constitutional 

protection does not turn upon 'the truth, 
popularity, or social utility of the 
ideas and beliefs which are offered,'"

New York Times, 376 U.S. at 270-72, it is 

essential that blinders not be placed 

over the eyes of our appellate courts and 

that the constitutionally-based rule of 
independent judicial judgment not here be 
eviscerated.19

19. Justice Goldberg's statement in 
(Footnote Continued on Next Page)



59-
Further, a full reading of the 

Court of Appeals' opinion makes it plain 

that that court exercised its independ­

ent review in a limited fashion, only 
"to ensure that the district court had 

applied properly the governing constitu­

tional law and that the plaintiff had 
indeed satisfied its burden of proof." 
(App. X22-23) The appellate court did 

not re-review or redetermine any 
disputed underlying facts. There were 

none. Nor did it purport to go

(Footnote Continued from Previous Page)

Haynes v . Washington, 373 U.S. 503, 515- 
16 (1963), is particularly apposite: 
"[W]e cannot avoid our responsibilities 
by permitting ourselves to be 'com­
pletely bound by state court determina­
tion of any issue essential to decision 
of a claim of federal right, else 
federal law could.be frustrated by 
distorted fact finding.1" (emphasis 
supplied). See also Wood v. Georgia,
370 U.S. 375, 386 (1962) .



-60

beyond any legally valid credibility 

finding by the district judge. It did 

not reweigh or reevaluate conflicting 

testimony concerning the subsidiary 

events which led to the District Court's 

conclusion of actual malice. The Court 

of Appeals' review accepted the District 

Court's findings and independently re­

viewed only the definition and proper 

application of the constitutional stand­

ard by which those incontrovertible 

facts were to be tested. The meaning of 

undisputed facts in relation to the 

First Amendment standard of actual mal­

ice is precisely the constitutional 

issue which this Court has directed that 

federal appellate courts reserve for 

themselves.

As Justice Frankfurter stated in 

Watts v. Indiana, 338 U.S. 49, 51

( 1 949):



- 6 1 -

[An] "issue of fact" is a coat of 
many colors. It does not cover a 
conclusion drawn from uncontro­
verted happenings, when that 
conclusion incorporates standards 
of conduct or criteria for judg­
ment which in themselves are 
decisive of constitutional 
rights. Such standards and cri­
teria , measured against the 
requirements drawn from constitu­
tional provisions, and their 
proper applications, are issues 
for this Court's adj udication.

Unquestionably, the proper domain 

of any appellate court exercising 

independent review of facts having fund­

amental constitutional significance 

includes well within its ambit (without 

even approaching the outer limits of the 

proper scope of independent review) the 

right to determine for itself without 
any artificial constraint whether the 

conclusion of constitutional malice is



-62-

adequately supported in the record and 

whether the constitutional rules 

have been properly applied.

The standard of review, as employed 

by the Court of Appeals, was therefore 

eminently correct.

POINT II

As the District Court's Determi­
nation of Actual Malice was Based 
on an Error of Law, It is Not 
Subject to Rule 52(a) and was 
Properly Reversed by the Court 
of Appeals

Under any set of circumstances,

Rule 52(a) does not apply in this case 

because "if a district court's findings 

rest on an erroneous view of the law, 

they may be set aside on that basis," 

Pullman-Standard v. Swint, 456 U.S.

27 3, 287 ( 1982). See also Inwood Labor­

atories, Inc, v. Ives Laboratories,



-63-

Inc., 456 U.S. 844, 856 n.15 (1982).
Recognizing that the district judge 

had committed plain legal error ("[t]o 
find actual malice in this case would be 

to interpret that concept to require 

little more than proof of falsity")
(App. X36) the Court of Appeals properly 

reversed.
From New York Times Co. v. Sulli­

van, 376 U.S. 254, 279-80 (1964), to the 

present this Court has never wavered in 

rigorously defining and demanding proper 

application of the constitutionally- 

required actual malice standard. See, 

e.g ., Herbert v. Lando, 441 U.S. 153,
156 (1979). The plaintiff through clear 

and convincing proof must adduce suffi­

cient evidence to establish that the 
publisher acted with "subjective aware-



-64-

ness of probable falsity," Gertz v. 

Robert Welch, Inc., 418 U.S. at 332 

n .6, that he in fact knew what he pub­

lished was false or "in fact entertained 

serious doubts as to the truth of his 

publication," St. Amant v. Thompson,

390 U.S. 727 , 731 ( 1968 ) .
This Court has resisted all efforts 

by public official and public figure 

plaintiffs to diminish the definition or 

to allow actual malice to mean something 

less than what the First Amendment 

requires. Falsity, defamatory content, 

unreasonable belief in the truth, negli­
gence, strict liability, misinterpreta­

tion or misconception of the facts -- 

all of these have been rejected as suff­

icient bases by themselves, or in com­

bination, to establish actual malice. 

Gertz v. Robert Welch, Inc., supra;



-6 5-

Rosenbloom v. Metromedia, 403 U.S. 29 
(1971); Time, Inc, v. Pape, 401 U.S. 

279 (1971); St. Amant v. Thompson, 
supra; Greenbelt Cooperative Publishing 

Ass8n. v. Bresler, 398 U.S. 6 (1970); 

Rosenblatt v. Baer, 383 U.S. 75 (1966); 

Garrison v. Louisiana, 379 U.S. 64 
(1964); New York Times Co. v. Sullivan, 

supra.
The "honest utterance, even if 

inaccurate/' must be protected because 

it "further[s] the fruitful exercise of 

the right of free speech." Garrison v. 

Louisiana, 379 U.S. at 75.

The District Court, however, 

ignored these clear holdings. By sub­

stituting its own predilection of how a 

reasonable person would have acted, the



- 66-

trial court misapplied the applicable 

law and committed legal error of consti­

tutional magnitude.
The District Court did not find 

that "the publication was [not] made in 

good faith." St. Amant v. Thompson, 390 

U.S. at 732. Indeed, quite the opposite 

is the case. The District Court never 

doubted Consumers Union's good faith 

(App. X140) and it rejected out of hand 
all of petitioner's attacks upon the 

honesty or integrity of Consumers Union 

and its staff. (App. X133-38, 143-45)
Rather, the District Court, eleven 

years after publication, held solely 

that it was unreasonable for an intelli­

gent man to have confused "about the 

room" with "about (or along) the wall."



-67-

Such a finding, the Court of Appeals 

rightly held, is erroneous as a matter 

of law.

Ever since New York Times Co. v. 
Sullivan it has been clear that actual 

malice cannot be inferred from falsity 

a l o n e . A  "test of truth," this Court 

has repeatedly said, does not provide 

the "breathing space" that the "freedoms 

of expression...'need to survive.’" New 

York Times at 271-72.

A finding of actual malice that is 

based upon a notion of the unrea­

sonableness of a publisher’s belief in

20. " [N]either factual error nor defam­
atory content suffices to remove the 
constitutional shield ...." New York 
Times Co. v . Sullivan, 376 U.S. at 273. 
And see Justice Goldberg's concurring 
opinion, 376 U.S. at 298 n.2: "The 
requirement of proving actual malice or 
(Footnote Continued on Next Page)



- 68-

the truth suffers from such a defect;
"[t]he reasonable-belief standard ... is

not the same as the reckless-disregard-

of-truth standard." Garrison v.

Louisiana, 379 U.S. at 79. As the Court

held in St. Arnant v. Thompson;
But New York Times and succeeding 
cases have emphasized that the 
stake of the people in public 
business and the conduct of 
public officials is so great that 
neither the defense of truth nor 
the standard of ordinary care 
would protect against self­
censorship and thus adequately 
implement First Amendment 
policies.

390 U.S. at 731-32.
The District Court strayed far from 

these teachings. In determining actual

(Footnote Continued from Previous Page) 
disregard may, in the mind of the jury, 
add little to the requirement of proving 
falsity, a requirement which the Court 
recognizes not to be an adequate safe­
guard ."



-69-

malice by combining a highly irrational? 

unique and extra-contextual interpreta­
tion of the character and content of the 

publication with an objective, reason­

able person standard, it afforded Con­

sumers Union none of the "breathing 

space" for erroneous statement this 

Court has been so careful to preserve. 
The trial court effectively held Con­

sumers Union to strict liability: 

because CU is a highly professional 
publisher with an intelligent staff, CU 

is not capable of committing honest 

error.
That the District Court misapplied 

the constitutional standards despite its 

denials (App. X140) is plain from a 
reading of its opinion. After acknow-



-70-

ledging Consumers Union's consistent 

professions of good faith belief in 

the accuracy of the article as written 

(id,.)/ and in the absence of any con­
tradictory evidence, the District Court 

concluded (App. X141-42) that actual 

malice existed only because

according to Seligson, the words 
used in the Article -- "About the 
room"— mean something different to 
him than they do to the populace 
in general. If Seligson is to be 
believed, at the time of 
publication of the Article he 
interpreted, and he still 
interprets today, the words "about 
the room" to mean "along the 
wall." After careful 
consideration of Seligson's 
testimony and of his demeanor at 
trial, the Court finds that 
Seligson’s testimony on this point 
is not credible. Seligson is an 
intelligent person whose knowledge 
of the English language cannot be 
questioned. It is simply 
impossible for the Court to 
believe that he interprets a 
commonplace word such as "about" 
to mean anything other than its



- 7 1 -

plain, ordinary meaning.

Expressed simply, the District 

Court's conclusion was based only on the 

following equation: falsity + the 

author's intelligence = actual malice.

21. The District Court relies on its own 
view, not supportedly by any evidence in 
the record or by any citation, of the 
strict, literal meaning of the words used 
by Consumers Union. Regardless of 
whether the Court's definitions are cor­
rect, such "[a] fussy insistence upon 
literal accuracy 'would condemn the press 
to an arid, dessicated [sic] recital of 
bare facts.'" Loeb v. Globe Newspaper 
Co., 489 F. Supp. 481, 486 (D. Mass. 
1980). Particularly where, as here, the 
subjective perception being described is 
inherently ambiguous and admittedly dif­
ficult to describe precisely (see pp. 20- 
26, supra), the reader will not interpret 
the comment literally (as the District 
Court agreed, App. X92-93), but in a 
"loose, figurative sense," National Ass'n 
of Letter Carriers v. Austin, 418 U.S. 
264, 284 (1974). The description is thus 
analogous to protected "rhetorical hyper­
bole," Greenbelt Cooperative Publishing 
Ass'n v. Bresler, 398 U.S. 6, 14 (1970), 
(Footnote Continued on Next Page)



-72-

This Court, however, has already 

rejected a nearly identical finding of 

actual malice similarly improperly based 

on a reasonable person standard. In 

Garrison v. Louisiana, supra, the trial 

judge had made a determination virtually 

identical to that of the District Court 

here:

It is inconceivable to me that 
the Defendant could have had a 
reasonable belief, which could 
be defined as an honest belief, 
that not one but all eight of 
these Judges of the Criminal 
District Court were guilty of

(Footnote Continued from Previous Page) 
or "[m]ere exaggeration, slight irony or 
wit, or all of those delightful touches 
of style which go to make an article 
readable [but] do not push beyond the 
limitations of fair comment." Briarcliff 
Lodge Hotels, Inc. v. Citizens- 
Sentinental Publishers, Inc., 260 N.Y. 
106, 118-19, 183 N.E. 193 (1932).



-73-

what he charged them with in the 
defamatory statement.... It is 
inconceivable to me that all of 
them could have been guilty of all 
of the accusations made against 
them. Therefore, I do not believe 
that the qualified privilege...is 
applicable...."

379 U.S. at 78-79.
This Court rejected that analysis: 

"This is not a holding applying the New

York Times test. The reasonable-belief 

standard applied by the trial judge is 
not the same as the reckless-disregard- 

of-truth standard." Id. at 79.

As the Court stated in Garrison,

and reaffirmed repeatedly thereafter:

The test which we laid down in 
New York Times is not keyed to 
ordinary care; defeasance of the 
privilege is conditioned, not on 
mere negligence, but on disregard



-74-
for the truth.22

Even if by second guessing it could 
be said that Seligson should have known 

that his description was inaccurate? even 
if he and his superiors should have been 

more careful and more precise in their 

use of language, that they were not is 
not a constitutionally acceptable ground 

for finding actual malice. The case is 

even clearer here where the publisher was 
engaged in a subjective critique and

22. See, e ,g., Greenbelt Cooperative 
Publishing Ass'n v . Bresler, 398 U.S. at 
10 (It was error of constitutional 
magnitude "to find liability merely on 
the basis of a combination of falsehood 
and general hostility"); Curtis Publish­
ing Co. v. Butts, 388 U.S. 130, 152 
( 1967 ) (!![W]e have re j ected . . . the
argument that a finding of falsity alone 
should strip protections from the pub­
lisher. " ) .



-75-

aesthetic evaluation (App. X60)j where 

the language employed was suffused with 

metaphorical and figurative usage; and 

where, as the District Court found, the 

terminology used by those in the field is 

replete with "confusion." (App. X87, 162 

n. 29)
To find actual malice here would be 

as impermissible as the Court held it to 

be in Time, Inc, v. Pape, 401 U .S. 279, 

291 (1971): "[First Amendment] protec­
tion would not exist for errors of inter­

pretation ... for once a jury was satisfied 

that the interpretation was ’wrong,' the 

error itself would be sufficient to 

justify a verdict for the plaintiff."

Even if Seligson were wrong, that is, 
even if he chose the wrong language to 

describe the subjective, abstract, aural



-76-
phenomenon he heard in the mistaken 

belief that it was the correct phrase, he 

cannot be said to be guilty of actual 

malice because he believed it to be 

truth. Tilton v. Cowles Publications 

Co., 76 Wash. 2d 707, 459 P.2d 8, 15, 18

(1969) , cert. denied, 399 U.S. 927

(1970) . See also Loeb v. New Times

Communications Carp., 497 F. Supp. 85, 93 

(S.D.N.Y. 1980); Reliance Ins. Co. v. 

Barron1s, 442 F. Supp. 1341 , 1350 

(S.D.N.Y. 1977); R. Sack, Libel, Slander, 

and Related Problems 213 (1980) ("A

person who believes and intends to say 
one thing is not lying and not guilty of 

actual malice merely because he chooses 

the wrong language to say it.")

In the absence of any evidence at 

all that "impeaches the witness' good



-77-

faith " belief that his description was 

"substantially correct," New York Times 
Co. v. Sullivan, 376 U.S. at 286, (the 

District Court did not and could not 

point to any such evidence because none 
existed), the conclusion of actual malice 

was plainly based on an erroneous inter­

pretation of the law and was properly 
reversed by the Court of Appeals.

POINT III

The Court Of Appeals 
Properly Exercised 
Independent Review 
Because the Determination 
of Actual Malice is an 
Ultimate Fact Involving 
Both Law and Fact Issues

Even if actual malice were not 

required to be reviewed independently 

under New York Times and its progeny 
and even if the district judge had not 

reached his conclusion because of an



-78-
erroneous view of the law, Rule 52(a) 

would still not control under tradi­

tional standards of appellate review.

Actual malice is not simply a 

factual determination. It is an 

"ultimate fact" -- an issue in which 

law and fact are so intertwined and the 

standard of proof required so high that 

appellate courts have not been held bound 

by what the trial court may label "find­

ings of fact."

Since it is not possible to separ­

ate the legal component of a finding of 

actual malice from the factual one, and 

because the determination implicates 

fundamental constitutional rights, appel­

late courts, this Court held in New York 

Times Co. v. Sullivan, 376 U.S. 254, 285

n . 26 ( 1964), are required to exercise



-7 9-

independent review to ensure that the 
governing law is properly applied to the 

facts.

. in this regard New York Times echoes 

an earlier holding by this Court to the 

same effect. In Baumgartner v. United 

States, 322 U.S. 665 (1944), the issue 

was whether the Government could revoke 

petitioner1s citizenship. It had pre­
viously been decided, in Schneiderman v. 

United States, 320 U.S. 1 1 8, 1 25 ( 1 943) , 

that the Government had to prove by 

"clear, unequivocal and convincing" 

evidence that the petitioner had 

fraudulently misrepresented his true 

allegiance when becoming an American 

citizen. Despite concurrent findings of 

fact by two lower courts, this Court in 

Baumgartner conducted its own independent



- 80-

review of the record and reversed the 

lower courts' holding that Baumgartner 
had committed fraud.

In so doing,. Justice Frankfurter 

recognized that certain types of factual 

findings -- "ultimate facts" involving 
questions of both law and fact -- are 

freely reviewable by appellate courts 

even if credibility findings are in­
volved :

The phrase "finding of fact" 
may be a summmary characterization 
of complicated factors of varying 
significance for judgment. Such a 
"finding of fact" may be the ulti­
mate j udgment on a mass of details 
involving not merely an assessment 
of the trustworthiness of wit­
nesses but other appropriate 
inferences that may be drawn from 
living testimony which elude 
print.... Finding so-called ulti­
mate "facts" more clearly implies 
the application of standards of 
law.... Though labeled "finding of 
fact," it may involve the very 
basis on which judgment of fallible 
evidence is to be made. Thus, the



-81-
conclusion that may appropriately 
be drawn from the whole mass of 
evidence is not always the ascer­
tainment of the kind of "fact" that 
precludes consideration by this 
Court.

322 U.S. at 670-71.
In words that apply with equal 

force to the finding of actual malice 
here, Justice Frankfurter stated that 

since the "decision here for review 

cannot escape broadly social judgments" 
touching upon important fundamental 

rights, the "recognized scope of appel­

late review is usually differentiated 

from review of ordinary questions of 

fact," I d . at 671.
Unimpeded appellate review, the 

Court stressed, is particularly impor­

tant when the standard of proof is 

higher than usual -- when it is "clear 
and convincing" rather than a mere "pre­

ponderance." Otherwise, the policy 

considerations underlying such a high



-82-

standard will be left to the whim and

fancy of the finder of fact:
Suffice it to say that emphasis 
on the importance of "clear, 
unequivocal, and convincing" 
proof...would be lost if the 
ascertainment by the lower courts 
whether that exacting standard of 
proof had been satisfied on the 
whole record were to be deemed a 
"fact" of the same order as all 
other "facts," not open to review 
here.

Id. at 671 (citation omitted).

This Court has recently restated 

and reaffirmed the importance to society 
and to litigants of the setting of a high 

standard of proof:

The function of a standard of 
proof, as that concept is embodied 
in the Due Process Clause and in 
the realm of factfinding, is to 
"instruct the factfinder concern­
ing the degree of confidence our 
society thinks he should have in 
the correctness of factual conclu­
sions for a particular type of 
adjudication." In re Winship, 397 
U.S. 358, 370 (1970) (Harlan, J., 
concurring). The standard serves 
to allocate the risk of error 
between the litigants and to indi­
cate the relative importance 
attached to the ultimate deci- 
s ion.



-83-

Addington v. Texas, 44] U.S. 418, 423

(1979); see also Sumner v. Mata, 449 U.S. 

539, 551 (1981).
The higher standard has been 

required in public figure defamation 

cases in recognition of the fundamental 

First Amendment liberties involved:

"the interests at stake...are deemed to 

be more substantial than mere loss of 

money." Addington v. Texas, 441 U.S. at 

424.
If the protections afforded by the 

First Amendment are to be preserved and 

the standard of clear and convincing 

proof of actual malice is to have mean­
ing and continued vitality, appellate 

courts, as the Court of Appeals recog­
nized, must exercise independent review 

of the trial court's ultimate finding of

actual malice.



-84-

To hold otherwise would have the 

practical effect of making the trial 

judge the sole and final arbiter of both 

the legal and the factual questions 

involved and would leave the standard of 

proof to "the unguided discretion of a 

[trial judge]," Time, Inc, v. Pape,

401 U.S. at 291.
Even in cases not involving this

higher standard of proof, this Court has

recognized that some factual issues are

so intertwined with principles of law as

to require plenary appellate review.

This Court has often stated that the

determination of a "mixed question of

law and fact" can be freely reviewed by

an appellate court:

The ultimate finding is a conclu­
sion of law or at least a deter­
mination of a mixed question of 
law and fact. It is to be dis­
tinguished from the findings of 
primary, evidentiary or circum­
stantial facts. It is subject to 
judicial review and, on such



-85-

review, the court may substitute 
its judgment for that of the 
[fact-finder].

Helvering v. Tex-Penn Oil Co., 300 U.S. 

481, 491 (1937). Accord, Bogardus v. 
Commissioner, 302 U.S. 34, 39 (1937); 

Helvering v. Rankin, 295 U.S. 123, 131 

(1935). Cf. United States v. General 

Motors Corp., 384 U.S. 127, 141 n .16 

(1966); United States v. United States 

Gypsum Co., 333 U.S. 364, 396 (1948).
But see Commissioner v. Duberstein, 363 

U.S. 278, 289 n. 1 1 ( 1 960 ) .
Pullman-Standard v. Swint, 456 U.S. 

273 (1982), is in accord. In that case, 

the Court recognized that there is a 

"mixed question of law and fact of the 
kind that in some cases may allow an 

appellate court to review the facts to 

see if they satisfy some legal concept of 
discriminatory intent." 456 U.S. at



- 86-

289 (footnote omitted).23

Actual malice is such a "legal con­

cept." It is a constitutionally-based 

construct which denotes a complex or 

matrix of legal and factual determina­

tions -- the social judgment — that must 

be made with great confidence and cer­

tainty in the outcome before the pro­

tections of the First Amendment may be 

taken away from a publisher. It is 

completely infused with legal policy and 

constitutional considerations and is thus 

wholly unlike the traditional, purely 

factual findings of design, motive or

23. Cf. United States v . Appalachian 
Power Co., 311 U.S. 377, 404 (1940):

When we deal with issues such as these 
before us, facts and their constitu­
tional significance are too closely 

(Footnote Continued on Next Page)



-87-

intent that stand apart from legal 

standards and that cannot ordinarily be 

reversed unless clearly erroneous.

The Court need not rule in this 

case that all mixed questions of law and 

fact are independently reviewable. 

Baumgartner v. United States,. 322 U. S .

665 (1944), and New York Times Co. v. 

Sullivan, 376 U.S. 254 (1964), hold, at 

the very least, that when such a mixed 
question involves fundamental rights and 

must be proved with convincing clarity, 

appellate review cannot be narrowly 
circumscribed by a trial court's use of 

the label "finding of fact". In such

(Footnote Continued from Previous Page)

connected to make the two-court rule a 
serviceable guide. The legal concept 
of navigability embraces both public 
and private interests.... Both the 
standards and the ultimate conclusion 
involve questions of law inseparable 
from the particular facts to which 
they are applied.



- 88-

circumstances, the appellate court may -- 

indeed, must -- conduct an independent 

review to ensure that the governing legal 
principles have been properly applied and 

that the ultimate finding is consistent 

with the constitutional principles at 
stake.

The Court of Appeals properly 

conducted such a review. Its conclusion 
should be affirmed.

POINT IV

The District Court's 
Finding of Actual Malice 
is Clearly Erroneous.

Petitioner urges that because the 

district judge purported to base his 
conclusion of actual malice in part on 

demeanor, it is a credibility finding 

which binds an appellate court unless 
"clearly erroneous." (Pet. Br. at 49)



-89-

As previously shown, however, the trial 

court's actual malice determination was 
not a valid credibility finding which 

the Court of Appeals could not look 

behind but, rather was a conclusion based 

on an erroneous view of the law, or was a 

finding of a constitutional or an 

ultimate fact, each of which calls for 
independent appellate review.

Nonetheless, even if it is held 

that the finding of actual malice can be 

reversed only if it is "clearly erron­

eous" under Fed. R. Civ. P. 52(a), it 

must still fall.
Rule 52(a) "was intended, in all 

actions tried upon the facts without a 

jury, to make applicable the then pre­
vailing equity practice." United States



-90-

v. United States Gypsum Co., 333 U.S.
364, 394-95 (1948) (footnote omitted).

Its purpose is to permit appellate courts 

to "reverse findings of fact by a trial 
court where 'clearly erroneous,1" id. at 

395, free of the constitutional limita­

tions imposed by the Seventh Amendment on 
appellate review of fact-finding by 
j uries.24

The rule does not make the trial 
court's findings, even when involving 

"the candor and credibility of the wit­

nesses," binding or conclusive on 

appeal. United States v. United States 

Gypsum Co., 333 U.S. at 395,25 The test,

24. For a recent history of the adop­
tion of Rule 52(a), see Note, Federal 
Rule of Civil Procedure 52(a) and the 
S^pe~oF~AppeTIate'~Fact Review: Has 
AppITcatTon~~oT~the Clearly Erroneous 
Rule Been Clearly Erroneous?, 52 St. 
John's L. Rev. 68 , 69-75 ( 1977) .

25. Indeed, in Gypsum the Court reversed 
a finding based on credibility as being 
clearly erroneous. 333 U.S. at 396.



-91-

set forth in Gypsum and often repeated 

since, is:
A finding is "clearly erroneous" 
when although there is evidence 
to support it, the reviewing 
court on the entire evidence is 
left with the definite and firm 
conviction that a mistake has 
been committed.

There is no evidence below to sup­

port the trial court’s finding of actual 

malice. When scrutinized under any 

standard of appellate review, the record 

admits of but one rational conclusion: 

the definite and firm convict ion that a 

mistake was made.
Summarized here, {the evidence is 

described in greater detail in the

26. Whether the appellate court can 
exercise independent review or is bound 
by the clearly erroneous test, the 
appellate court must still review all 
the evidence in the record.



-92-

Statement of the Case, pp.12-19, 30-31, 
supra), the evidence, virtually all 

undisputed and uncontradicted, demon­

strates beyond cavil that not a scintilla 

of evidence existed upon which a rational 

finding of actual malice could be based:

a) Consumers Union and its maga­

zine have a "very favorable reputation 

for independence, integrity, accuracy 

and freedom from bias" (App. X4, 45);

b) the disputed article was the 
end result of a lengthy process of orig­

inal research (App. X5-6, 54-60; A. 475- 

76; PX7, pp. 272-73) and careful edi­

torial preparation (J.A. .129-37, 145-47, 
200-03; App. X32-34);

c) Seligson, the engineer in charge 

of the research and the person primarily 

responsible for the preliminary drafts of



-93-

the article, had many years of experience 

in the testing of loudspeakers and audio 

products. His work at Consumers Union 
had earned him the praise of his 

superiors, CU's readers and the audio 
industry (J.A. 201-03);

d) the draft Report to Editorial 

was edited and revised by Seligson's 

superiors and all drafts of the article 

plus all galleys and page proofs were 

circulated to numerous persons at Con­

sumers Union in various departments for 
revision and editing (J.A. 129-37, 145- 

47; App. X32-34), all in accordance with 

Consumers Union's normal editorial pro­
cedures (J.A. 198-200 ) ;

e) Consumers Union produced at 

trial all of its research data and 

editorial material. Bose produced



-94-

nothing ;

f) the published article fairly 

reflected the results of Consumers 

Union's own research, both favorable and 

unfavorable to the Bose product;27

g) the trial court made three 

findings in support of Seligson's cred-

21, Nothing in the research data or in 
the published article was so inherently 
improbable that only a reckless person 
would have put it in circulation and the 
District Court made no such finding. 
Indeed, that Court fully credited 
Seligson's and Lefkow's testimony on the 
localization effects they heard (App. 
X94-97) and flatly rejected Bose's con­
tention of scientific impossibility.
(App. X98-99) Seligson's testimony that 
in preparing the article he neither per­
ceived nor intended any defamatory or 
disparaging innuendo (J.A. 163-69) was 
uncontradicted. The Court's holding that 
the single phrase "about the room" 
carried with it an innuendo of "bizarre" 

(Footnote Continued on Next Page)



-95

ibility and lack of subjective motive 

to disparage. They are all unchallenged 

on appeal and are all inconsistent with 

the finding of actual malices

-- after considering the demeanor 

of the witnesses, "especially that of 

Seligson" (App. X136), the trial court 

rejected petitioner's efforts, which took 

up much time at trial, to establish 

Seligson1s (and CU's) dishonesty and bias 

because of a patent held by him (id.);

(Footnote Continued from Previous Page)
or "grotesque" effects was without any 
foundation in the record. Significantly, 
the article makes no such statement.
In fact, read fairly in context, as it 
should be, the article flatly contradicts 
any such innuendo or implication. The 
article states that the localization 
problems "seemed inconsequential" with 
orchestral music and that when listening 
to soloists only that "we think they 
might become annoying" (emphasis added). 
To find liability here based on the con­
tent of the article -- as in effect the 
District Court did in part -- constitutes 
"Malice in Wonderland."



-96-
-- the District Court similarly 

rejected Bose’s argument that Seligson 

and his assistant Lefkow "completely 

fabricated" the so-called cricket test 

(App. X152-53 n .12);

—  the trial judge found that when 

Seligson thought the Bose's performance 

on a particular test was too low because 

of the Bose's unconventional design, 
Seligson exercised his subjective judg­

ment to upgrade the rating of the Bose 

901, (App. X59)
Standing in contrast to this evid­

ence and these findings — • all of which 

unequivocally show that Consumers Union 
exhibited a constant concern to publish a 

truthful and accurate article and that 

Seligson spoke the truth at trial --



- 9 7 -

was nothing else,28

28. Petitioner contends for the first 
time in this Court that other evidence 
exists to buttress the trial court's 
finding of actual malice. (Pet. Br. at 
36-37, 55-60) The trial court, however, 
did not rely on any such evidence in 
making its finding and petitioner made no 
such arguments in the Court of Appeals. 
(Pet. Br. in Ct. of App., pp. 32-38) The 
District Court limited itself solely to 
the purported fact of falsity and 
Seligson's intelligence.

Moreover, petitioner's "other" evid­
ence is not supported by the record. 
Petitioner asserts that all Consumers 
Union heard was movement associated with 
"normal stereo sound" or produced by 
special recordings, and faults CU for 
failing to compare the Bose 901 with a 
conventional loudspeaker during the 
special listening test, for failing to 
conduct a test using twelve "young music 
students" and for refusing to conduct a 
demonstration of the loudspeaker or to 
identify what records had been played 
during the test at a post-publication 
meeting between CU and petitioner on June 
3, 1970. (Pet. Br. at 52-60)

The special listening test, however, 
was a comparative test. As described in 

(Footnote Continued on Next Page)



-98-

There was no evidence in the record 

found or relied upon by the District 

Court which showed that Consumers Union

(Footnote Continued from Previous Page)

the Report to Editorial quoted by the 
District Court (App. X 151 n . 11, 154-56) 
and by Seligson at trial (J .A. 102), the 
Bose 901 and, for a brief time, another 
unconventional loudspeaker, the Harman 
Kardon HK-50, were compared to a conven­
tional loudspeaker during "several hours 
[of listening] to a variety of records." 
(App. X60) Seligson and Lekfow played 
not special recordings, but a "large" 
number of records which were selected at 
"random" from the "closet full of 
recordings which [CU had] accumulated 
over the years" of classical and popular 
music. (J.A. 151, 227, 236-37)

Although urged to do so by peti­
tioner, the District Court did not find 
that CU heard only "normal stereo sound" 
or that the wandering was induced by 
special recordings. As noted, the Dis­
trict Court credited fully Seligson's and 
Lefkow's uncontroverted descriptions of 
what they had heard. (App. X94-97)
There was also no evidence to contradict 
Seligson's, Lefkow1s and Dr. Green's 
testimony that what they had heard on the 
Bose they did not hear with conventional 
loudspeakers. (J.A. 103-04, 162-63, 167- 
68, 182-86, 305-10, 327-28) Dr. Bose 
(Footnote Continued on Next Page)



published a knowing falsity or recklessly 

disregarded the truth.

(Footnote Continued from Previous Page)

himself testified that movement-inducing 
special recordings were "not a factor" in 
1970. (J.A. 56-57)

Finally, Consumers Union's purported 
post-publication refusal to provide in­
formation or demonstrate the 901 to Dr. 
Bose does not constitute evidence of 
actual malice. New York Times Co. v . 
Sullivan, 376 U .S. 254, 279-80 (1964). 
in fact, in response to Bose's com­
plaints, Consumers Union retested the 
Bose 901 three separate times -- once in 
June 1970 (J.A. 203-06), and then in
1979 (J.A. 177-78; LTr. 10-10-18; PX31; 
LTr 13-26-27, 13-145-146) and again in 
1980, The 1980 retest was a scientific 
experiment designed and conducted by Dr. 
Green and involved playing the Bose 901 
and a conventional loudspeaker to sixteen 
subjects who were not affiliated with 
Bose or with Consumers Union. (J.A. 286- 
302, 304, 311-15) The data from all 
three tests were introduced at trial and 
confirmed the accuracy of Consumers 
Union's article in all respects.

Despite the passage of ten years 
time between the publication date and 
trial, despite its claims in this Court 
and despite the fact that it had the 
burden of proof, Bose introduced no test 
data relating to the performance of the 
Bose 901 system or conventional loud­
speakers .



- 1 0 0 -

All that the District Court relied 

on was that Court's conclusion that since 
the "plain, ordinary meaning" of 

"about" was crystal clear,29 and that 

since Seligson was an "intelligent per­
son," it is simply impossible for the 

Court to believe that he knew the article 

to be truthful. (App. X142) Such a 
finding of lack of credibility is a 

facile ipse dixit which cannot withstand 

even limited appellate scrutiny.

Disbelief of a publisher's statement 

of good faith cannnot constitute clear

29. But, cf. "'A word is not a crystal, 
transparent and unchanged, it is the skin 
of a living thought and may vary greatly 
in color and content according to the 
circumstances and the time in which it is 
used.'" Bon Air Hotel, Inc. v. Time,
Inc., 426 F.2d 858, 867 n.17 (5th Cir. 
1970) (quoting Towne v. Eisner, 245 U.S. 
418, 425 (1918)) .



- 101 -

and convincing proof^O of actual 

malice where it stands alone, and is (a) 

in contradiction to the District Court's 

own findings that in all other vital 

respects the author's testimony was 

entirely credible, that the author and 

the publisher had no motive to disparage 

petitioner's product, that the author had 

in another part of the article upgraded 

the evaluation of the Bose 901 and that

30. This standard of proof has been 
characterized as being "'intermediate 
between the normal 'preponderance of the 
evidence' civil standard and the 'beyond 
the reasonable doubt' criminal stand­
ard,'" Yiamouyiannis v. Consumers Union 
of United States, Inc., 619 F.2d 932,
940 (2d Cir.), cert. denied, 449 U.S.
839 (1980)? Addington v. Texas, 441 U.S. 
418, 424 (1979); and as proof which must 
be "strong, positive and free from doubt 
...full, clear and decisive...." Stone v. 
Essex County Newspapers, Inc., 367 Mass. 
849, 330 N.E.2d 161, 175 (1975)
(citations omitted).



—  10 2 —

the author was an expert at what he 

did; and is (b) in conflict with 

uncontroverted evidence that the author 

was highly respected in his field, that 

what was being described was an abstract, 

subjective perception of an ambiguous 

aural phenomenon, published in the 

context of an aesthetic review, that the 
publisher followed its normally careful 

editorial processes designed to insure 

accuracy and freedom from bias, that the 

article was balanced in that it presented 

both praise and criticism and that it 

contained language explicitly limiting 

the negative impact of the comment in 
question.

Even in the ordinary civil action 

where plaintiff need prove his case only 

by a preponderance of the evidence, it 

has long been the rule that disbelief



-103-
alone does "not supply a want of proof," 

Moore v. Chesapeake & Ohio Ry. Co., 340 

U.S. 573, 576 (1951), sufficient even to 

create a jury question.

This Court and others have often 

cautioned against the impropriety of 
using disbelief alone to support a find­

ing that the opposite is the fact. 

Nishikawa v. Dulles, 356 U.S. 129, 137 
(1958); NLRB v. Gotham Industries, Inc., 

406 F.2d 1 306, 1310 (1st Cir. 1969) ; 

Janigan v. Taylor, 344 F.2d 781, 784 (1st 
Cir.), cert. denied, 382 U.S. 879 (1965); 

Dyer v. MacDougall, 201 F .2d 265, 269 (2d 

Cir. 1952) (L. Hand, J.).
If disbelief alone cannot provide 

sufficient proof in the ordinary civil 

case, it is even more inadequate in this 
case when the plaintiff's constitution-



-104-

ally mandated burden of proof is much 

higher and the societal interest "in the 
correctness of [the] factual conclusions" 

is more substantial, Addington v.

Texas, 441 U.S. 418, 423 (1979),

Internally inconsistent, inherently 

incredible, and without any affirmative 

proof to support it, the trial court's 

finding of actual malice is clearly 

erroneous.

Moreover, the trial court's finding 

makes no rational sense. Seligson and 

Lefkow, when asked at trial to translate 

their aural perceptions into pictoral 

form, produced drawings which puncti­

liously depicted what they heard: 

"wandering sounds [in the words of the



-105-
District Court] within a few feet of a 

wall near which the Bose 901 loudspeakers 

were placed." (App. X100, footnote 

omitted)

Had these men had any doubts that 

the article described something else, 
had these men been prevaricators engaged 

in a plan to besmirch petitioner1s 

product, would they not have attempted to 

cover up their lie and instead drawn 

charts showing the sound to have moved 

all over the listening room?
Only their own integrity and honesty 

—  as the District Court found in reject­

ing all other challenges to their cred­

ibility — - and their good faith belief in 

what they wrote prevented them from doing 

so. The trial court's finding to the 

contrary is simply not in accord with



-1 06-

one's "experience with the mainsprings of 

human conduct." Commissioner v, 

Duberstein, 363 U.S. 278, 289 (1960).

As the Court of Appeals realized, 

the evidence admits of only one 

conclusion: defendant may have chosen

the wrong phrase in its aesthetic 

critique, but it did so in the honest 

belief that it was uttering the 

truth.^1

Conclusion

Under any standard of appellate 

review, the trial court's finding of 

actual malice was constitutionally and

31. Since the "record permits only one 
resolution of the factual issue [s] ," 
there is no need to remand this case 
back to the Court of Appeals for further 
consideration. Pullman-Standard v . 
Swint, 456 U.S. 273, 292 (1982).



-107-

factually inadequate. It was properly 

reversed by the Court of Appeals and 

that reversal should be affirmed by this 

Court.*

Dated: New York, New York
July 13, 1983

Respectfully submitted,

MICHAEL N. POLLET, 
Counsel of Record 

MARSHALL BEIL 
CAROL A. SCHRAGER 
KARPATKIN POLLET

PERLMUTTER & BEIL 
708 Third Avenue 
New York, N.Y. 10017

Attorneys for Respondent

* Attorneys for Respondent gratefully 
acknowledge the research assistance in 
the preparation of this brief provided 
by Marya Yee, a graduate of Brooklyn Law 
School, and Robert Shuman, a student at 
Brooklyn Law School.



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