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| The Mortgage Specialists, Inc. v. Implode-Explode Heavy Industries, Inc. | |
|---|---|
 | |
| Court | New Hampshire Supreme Court |
| Full case name | The Mortgage Specialists, Inc. v. Implode-Explode Heavy Industries, Inc. |
| Decided | May 6, 2010 |
| Holding | |
| Protections for traditional print media extend to online publishers | |
| Court membership | |
| Judge(s) sitting | Broderick, C.J.; Dalianis, Duggan; Hicks, JJ. |
| Keywords | |
| Shield Law, Newsgathering Privilege, Anonymous Speech, Defamation, Prior Restraint | |
The Mortgage Specialists, Inc. v. Implode-Explode Heavy Industries, Inc. is a court case where Mortgage Specialists sought to obtain the identity of an anonymous source who provided Implode, a website monitoring risky lenders, with confidential documents about Mortgage Specialists' loan practices. Furthermore, Mortgage Specialists sought to prohibit the republication of the loan documents as well as to learn the identity of anonymous individuals purportedly defaming Mortage Specialists on Implode's website via comments related to the documents. Mortgage Specialists disputed that Implode was not a news organization and should not be afforded any protections under shield laws. The resulting court decision found that Internet news outlets should be treated as traditional print media and receive the same legal privileges granted to journalists. Similarly, the court found that the publication of the confidential documents could not be restrained and that the identities of anonymous posters were protected so long as Mortgage Specialists could not prove harm. This case sets a precedent for protecting the legal rights of online media and reiterates the high legal hurdle required to restrict the free flow of information.
Background[edit]
Implode-Explode Heavy Industries, Inc. (Implode) was a website that reports on risky mortgage lenders and allows users to post comments on different lenders. Mortgage Specialists was a mortgage lender. From the court proceedings, it was determined that Implode "published an article that detailed administrative actions taken by the New Hampshire Banking Department against Mortgage Specialists"[1]. The story included a loan chart that documented Mortgage Specialists loan practices, which Mortgage Specialists contended was both unlawful and a breach of privacy[1]. In addition to the loan figures, an anonymous poster acting under the pseudonym Brianbattersby posted two comments about Mortgage Specialists, which Mortgage Specialists alleged were defamatory in nature[1]. As a result, Mortgage Specialists sought the New Hampshire Supreme Court to (1) compel Implode to reveal the source that provided the loan chart, (2) restrict Implode from any further publication of the loan chart, and (3) obtain all the information Implode had regarding the identity of Brianbattersby for the purposes of a defamation case.
Court Findings[edit]
Newsgathering Privileges for Online Publishers[edit]
At court, Implode argued that it qualified for "newsgathering privileges" under Part 1, Article 22 of the New Hampshire Constitution which protects publishers from revealing the identity of their source[1]. To the contrary, Mortgage Specialists argued Implode should not be afforded any shield law protections as Implode was not a news organization. In arriving at a decision, the court considered what constituted a media outlet. In the Opinion of the Justices, 117 NH[2], the court noted that it avoided defining a news outlet or the privileges they are afforded:
We need not decide the scope of the privilege, whether it is absolute, who is a reporter, what qualifies as "press," what the situation would be if criminal proceedings were at issue, or whether libel actions would require disclosure.
As such, the determination of whether Implode was a news organization came from facts elucidated in trial court. Ultimately, the New Hampshire Supreme Court found that Implode was "a legitimate publisher of information and a member of the press" and that "the fact that Implode operates a website makes it no less a member of the press"[1]. The court also weighed their decision based on Branzburg v. Hayes[3], which states:
Freedom of the press is a fundamental personal right which is not confined to newspapers and periodicals . . . Almost any author may quite accurately assert that he is contributing to the flow of information to the public, that he relies on confidential sources of information, and that these sources will be silenced if he is forced to make disclosures.
As a result, Implode was considered to be a reporter in the context of the shield law protections offered to publishers and could protect the identity of its source. While the court noted that reporters can be compelled to reveal their sources, the Supreme Court remanded this decision to trial court in order to determine whether Mortgage Specialists' interests outweighed disrupting the free flow of information[1].
Defamation and Anonymous Speech[edit]
Apart from the source of the confidential loan documents, Mortgage Specialists also sought to identify the entity behind the pseudonym Brianbattersby which Mortgage Specialists alleged was defaming their company. Where the trial court originally required that Implode comply with Mortgage Specialists' request, the Supreme Court held that "posters have a first amendment right to retain their anonymity and not to be subject to frivolous suits for defamation brought solely to unmask their identity"[1]. In order for a party to be unmasked, the court held that the plaintiff must demonstrate actual harm from the comments. This determination was again left for a future trial court.
Enjoining Publication and Prior Restraint[edit]
The final component of the court case examined whether Implode could be restricted from further publishing the loan documents and Brianbattersby's comments. Mortgage Specialists contended the documents were confidential and their publishing represented a breach of privacy, while Brianbattersby's comments were unlawful and defamatory. The Supreme Court considered a long history of prior restraint, which requires publications "threaten an interest more fundamental than the First Amendment itself"[1]. The court relies on previous rulings by the Supreme Court of the United States which required parties seeking prior restraint prove damages "to a near sacred right" and that "no less extreme measures are available"[1]. The court denied Mortgage Specialists' request of prior restraint, stating:
While it may be true that Mortgage Specialists' loan information is confidential, such information is certainly not more sensitive than the documents at issue in the Pentagon Papers case ... Accordingly, we conclude that Mortgage Specialists' interests in protecting its privacy and reputation do not justify the extraordinary remedy of prior restraint.