9th Cir. Revives Preacher's Libel Suit Against Stossel, 20/20

Image by Getty Images via @daylifeIn its 21-page opinion in Frederick K.C. Price v. John Stossel et al. (Case No. 09-55087), the U.S. Circuit Court of Appeals for the Ninth Circuit has revived a defamation suit brought by a preacher against the ABC newsmagazine 20/20 and then correspondent John Stossel.

U.S. District Court for the Central District of California Judge R. Gary Klausner had tossed the case brought by the founder of the Crenshaw Christian Center based on a 2007 20/20 broadcast, finding the allegedly libelous statements by the defendants "substantially true." The offending clip of a sermon  by television evangelist Price quoted him as saying: "I live in a 25-room mansion. I have my own $6 million yacht. I have my own private jet, and I have my own helicopter."

ABC subsequently issued an apology and retraction when it came to light that Price was sermonizing on the topic of greed about a hypothetical individual, who though financially healthy, was spiritually unfulfilled.  As a matter of  fact, Price certainly hasn't taken a personal vow of poverty, as he wears an $8,500 watch, drives a Rolls Royce, resides in an 8,000-square-foot home valued at $4.6 million, and travels in a jet owned by the Church, according to court records.

Nevertheless, writing for the appellate court, Judge Mary Schroeder reinstated the defamation claim, framing the underlying issue thusly: "Journalists and publishers risk a defamation action when they put words in a public figure's mouth...The issue in this case is whether there are similar risks when a network television program broadcasts a statement actually made by a public figure, but presents the statement in a misleading context, thereby changing the viewer's understanding of the speaker's words."

Judge Schroeder noted:  "Where the published quotation contains a material alteration of the meaning conveyed by the speaker, the published quotation is false."  She added: "Here, the context in which Price's words were presented materially changed the words' meaning."

Although Price refers to himself as a "prophet of prosperity," creating a wrong impression about an individual could harm his reputation and is actionable as defamation.  It's possible that ABC's profile of the prophet could turn into a total loss for the network.