N&O lawyers ask NC appeals court to throw out $6 million libel verdict

Two years after a Wake County jury said The News & Observer must pay $6 million to a state employee who said she was libeled by the newspaper, lawyers for The N&O have asked the N.C. Court of Appeals to throw out the verdict.

In oral arguments heard Wednesday, The N&O’s lawyers said the judge overseeing the 2016 libel trial at the Wake County Superior Court committed a number of errors during the 3 1/2 week trial. The jury decided that The N&O defamed State Bureau of Investigation agent Beth Desmond in a 2010 article about improper law enforcement methods.

Key among the alleged errors was the judge’s instruction to the jury to decide whether former N&O investigative reporter Mandy Locke committed libel by incorrectly attributing statements to ballistics experts she interviewed for the article. The N&O’s lawyers contend that the nation’s libel laws establish truth as an absolute defense against libel, above any other consideration, and the jury’s focus should have been on the truth of the statements themselves, not how they were attributed.

“Without proper jury instructions, newspapers are exposed to almost limitless liability,” N&O attorney John Bussian told the three-judge appellate panel. “This sort of reporting on the criminal justice system is going to be threatened going forward.”

The experts testified during the libel trial that they did not tell Locke what she wrote in the paper. Desmond’s lawyer James Johnson said the jurors ruled against The N&O because they believed the statements were not only misquoted but also untrue. Johnson also argued that Locke knew the statements were false but wrote them anyway.

“This was what the story was going to be no matter what anyone said,” Johnson told the judges. “There is sufficient evidence to show that what she was reporting was not true.”

If the state appellate judges rule with a dissent, in a 2-1 decision, the libel case will automatically advance to the N.C. Supreme Court. But if the judges rule unanimously, then the losing side would have to ask The N.C. Supreme Court to review the case because it erodes First Amendment protections for the press, or because it curtails libel protections for public officials, or for another compelling reason.

Desmond, 53, initially sued The N&O for defamation in 2011. At trial, she cited five instances of libel in an August 2010 article by Locke and one instance of libel in a December 2010 article by then-investigative reporter Joseph Neff.

The jury awarded Desmond $1.5 million in compensatory damages against The N&O and $7.5 million in punitive damages against the paper. The $7.5 million was reduced to $4.5 million by the court to comply with a state law that limits punitive damages to three times the amount of compensatory damages. The jury also awarded Desmond $75,000 in punitive damages against Locke.

Locke and Neff, as well as investigative editor Steve Riley who oversaw their work, have since left The N&O.

Locke’s article was the final installment in a 2010 investigative series titled “Agents’ Secrets” alleging longstanding corruption in criminal investigations at the State Bureau of Investigation. The final story focused on Desmond’s lab analysis of bullet fragments in a 2006 Pitt County murder case that resulted in a conviction for the 2005 shooting of a 10-year-old boy.

Locke’s story said that Desmond exaggerated the odds that the bullet fragments located at the crime scene came from the suspect’s gun. In her lawsuit, Desmond said Locke’s characterizations were false and inflammatory.

In her lab report, Desmond said the fragments were “consistent” with bullets that would have been fired by the Hi-Point 9 mm Model C handgun allegedly used by the murder suspect but noted that other types of guns should not be ruled out, according to court filings. But during jury selection for the 2006 murder trial, Desmond went further, telling the judge she had “absolute certainty” the fragments came from that same type of gun, the filings say.

According to The N&O’s 2010 article: “Independent firearms experts who have studied the photographs [of the bullet fragments] question whether Desmond knows anything about the discipline. Worse, some suspect she falsified the evidence to offer prosecutors the answer they wanted.”

One expert is quoted as saying: “This is as bad as it can be. It raises the question of whether she did an analysis at all.”

Desmond says in her legal filings that The N&O article not only accused her of gross incompetence but of committing a crime. She said the story triggered post-traumatic stress disorder and she had to request reassignment to another job within the agency, where she still works.

“When you’re a forensic examiner, the one thing you have is your reputation,” Johnson said. “The worst thing that can happen to you is to be accused of falsifying evidence.”

During the libel trial in Raleigh two years ago, the experts whom Locke had interviewed told the jury that they were not criticizing Desmond’s forensics work in the Pitt County murder trial, but rather making hypothetical comments about the limitations of firearms investigations. They also said Locke took their comments out of context, but they also praised her reporting on the story.

At the trial in 2016, Locke testified that the direct quotes came from her reporter’s notes. She also said that she summarized and paraphrased statements that weren’t attributed to any specific expert. In The N&O’s appellate briefs, the company says that libel law permits reporters to rationally interpret and rephrase interviews.

In Desmond’s appellate legal briefs, Johnson accuses Locke and The N&O of “sly misrepresentations” and of attempting “to make the SBI appear loathsome and incompetent.” Publishing blatant falsehoods on the front page of a statewide newspaper is a textbook definition of libel, their legal brief says.

“Locke’s misstatements and misquotes were not honest mistakes,” Desmond’s legal brief says. “Locke did, in fact, have serious doubts about the truth of what she was publishing.”

The N&O’s lawyers argue that Wake County Superior Court Judge A. Graham Shirley II made a number of legal errors, and the alleged inaccuracies in Locke’s story don’t rise to the legal definition of libel.

Among The N&O’s contentions: Judge Shirley didn’t allow the N&O’s lawyers to show the jury a report by the American Society of Crime Laboratory Directors/Laboratory Accreditation Board. The N&O says the 2010 report raised questions about the reliability of Desmond’s ballistics work on the Pitt County murder case and corroborated the truth of its reporting.

The N&O argues that in order for a jury to award punitive damages, Shirley should have required Desmond to prove to the jury that Locke either committed fraud or was motivated by ill will against Desmond. Also, The N&O contends that Desmond failed to prove, as state law requires, that Locke and The N&O had serious doubts as to the truth of the story when they published it.

The N&O argues in its legal briefs that libel law allows for some margin of journalistic error to protect the “freedom to investigate, report on, and raise questions about the operations of our government and the activities of our public officials without constant fear that the publication of slight inaccuracies will result in massive libel verdicts.”

Related stories from Raleigh News & Observer