United States: Defamation Claim Against HBO Sports Documentary Proceeds; International Sporting Goods Supplier Not A Public Figure

Last Updated: June 9 2014
Article by David A. Kluft

On May 16, 2014, in Mitre Sports v. HBO, the Southern District of New York allowed a defamation claim brought by a UK company against HBO to proceed to trial.

In doing so, the Court ruled that Mitre Sports International, one of the world's top sporting goods suppliers, was not a public figure.

Capture

Battle of the Rotten Subcontractors

The case was sparked by an episode of HBO's Real Sports with Bryant Gumbel, aired in 2008.  The episode included a report on the use of child labor in India in the manufacture of soccer balls, and included footage of children sewing Mitre-branded balls. The reporter stated that he felt Mitre was operating in good faith: it had publicly acknowledged that child labor was a problem in the industry and had pledged to undertake efforts to stop the practice.  However, according to the report, Mitre was being let down by its subcontractors in India, who furtively continued to use children as part of their workforce.

HBO

But it turned out that Mitre wasn't the only one with subcontractor problems.  When Mitre sued HBO for defamation, it unearthed evidence – including witness statements and raw video footage – that HBO's independent stringers in India had fabricated some of the footage. According to this evidence, the Mitre soccer balls depicted in the report were actually pre-sewn and the children pretending to sew them (who, contrary to the report, attended school regularly) were paid by the stringers to falsely state they worked for Mitre. Thus, from Mitre's perspective, the important issues at trial would be what HBO knew and when did they know it.

Is the adequacy of the investigation relevant?

Mitre moved for summary judgment that it was not a public figure. This issue is of critical importance to Mitre's case due to the First Amendment principles set forth New York Times v. Sullivan and its progeny. If Mitre is a public figure, it must show that HBO published false information with "actual malice," i.e., knowledge of its falsity or reckless disregard as to its truth. Mitre would have to show at a minimum that HBO "in fact entertained serious doubts as to the truth of its publication," a very tough standard. Mere evidence that HBO failed to investigate properly would be insufficient and perhaps even irrelevant.

However, if Mitre is only a private figure, the standard is very different. HBO would be liable for defamation under New York law if, in connection with the publication of a defamatory statement, it "acted in a grossly irresponsible manner without due consideration for the standards of information gathering and dissemination ordinarily followed by responsible parties." In other words, the standard is negligence, and the adequacy and diligence of HBO's investigation would be a live issue in the case.

Mitre is not a "Public Figure"

In support of its contention that Mitre is a public figure, HBO presented evidence that Mitre is internationally-known as the number one global manufacturer of soccer balls, and that it sells sporting equipment worldwide. While Mitre does not have a U.S. subsidiary, it does sell equipment in the U.S. through major retail chains. It engages in advertising and marketing, and at one time had been a sponsor of both the English Premier League and Major League Soccer.

But none of this was enough for the Court.

The Court first addressed whether Mitre was a general purpose public figure, that is, whether it had achieved a "general fame and notoriety."  The Court found that Mitre was a privately held company which no longer sponsored any U.S. teams or leagues, and that it was not a "household name or celebrity." Simply being a leading company in a particular industry was not sufficient, because "even well-known corporations that sell and advertise common products are not [thereby] general purpose public figures."

The Court then turned to the question of whether Mitre was a limited purpose public figure, that is, whether it had voluntarily "injected" or "thrust" itself into the public eye on a particular issue. Here, HBO presented evidence that Mitre had made public statements denouncing child labor in soccer ball production on its website and in press releases, that it had sponsored a conference on the issue in Pakistan, and that had participated in public industry-wide efforts to eliminate the problem. Without much explanation, the Court dismissed this evidence as "lack[ing] the level of involvement required by" the relevant case law.

Thus, the Court granted Mitre's motion for summary judgment that it was not a public figure, and Mitre will be able to prevail at trial by convincing a jury that HBO was negligent in gathering information for or dissemination of the report. The Court also denied another summary judgment motion filed by HBO, which argued that the report was substantially true, on the grounds that there were several genuine disputes of material fact as to whether the report was susceptible of defamatory meaning. Mitre's counsel has asked the Court to set a trial date.

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