APPEAL FROM the UNITED STATES DISTRICT COURT for the EASTERN DISTRICT of PENNSYLVANIA No. 74-1248.
Adams, Weis, Circuit Judges, and James A. Coolahan, District Judge.*fn*
We are presented here with a clash between two basic norms in our legal system. One concerns the valued right of a person to be protected against inaccurate statements harming his reputation. The other deals with one of the most indispensable freedoms in a democratic state, namely, that of untrammeled expression regarding the conduct of a public official. Although the reconciliation of these principles in the context of a particular factual configuration seldom will be easy, it is essential to the healthy survival of each. That is the task which this Court is now called upon to perform.
The plaintiff's objection to the publication he challenges - a television broadcast - is that it gave rise to innuendoes which are defamatory of him. Specifically, Alfred R. Pierce claims that a broadcast by Capital Cities Communications, Inc., owner and operator of a Philadelphia television station, WPVI-TV, and Richard Kellman, a reporter for the station, defamed him by creating the false impression that he had misused his public position in seeking private pecuniary gain. In response, the defendants urge that the First Amendment analysis in the landmark case of New York Times Co. v. Sullivan, 376 U.S. 254, 11 L. Ed. 2d 686, 84 S. Ct. 710 (1964), and in succeeding decisions, which protect speech about public officials absent a showing of "actual malice," bars recovery in the present situation.*fn1
Pierce was the Mayor of Camden, New Jersey, for a ten-year period ending in 1969, and a Commissioner of the Delaware River Port Authority from June 4, 1962, until May 11, 1970. From January 1, 1969, until May 11, 1970, he was Chairman of the Authority.*fn2
On November 30, 1973, more than three years after Pierce was last a member of the Port Authority, WPVI-TV televised a program, entitled "Public Bridges and Private Riches," which explored the activities of the Port Authority and, in particular, the performance of Ralph Cornell, then its Chairman.*fn3 During the broadcast, Pierce was named approximately five times in his capacity as former Camden Mayor and Port Authority Chairman.
Since Pierce's position is that the television program as a whole was defamatory with respect to him, even if no single remark in it was such, it is necessary to set forth in some detail its major aspects. The introduction included a statement that, while preparing for the broadcast, "Action News reporter, Richard Kellman" travelled "the bridges of the Delaware River Port Authority and the high speed road to profit " for ninety days.*fn4 The structure of the Port Authority, the cost of its projects and the use of tolls to pay its debts were then described.
Following the introduction, a segment of the telecast dealt with a cost increase for steel lattice work essential to building the superstructure of the Commodore Barry Bridge. A controversy in 1969 among the members of the Port Authority, relating to the desirability of seeking new bids on the contract for steel, was elaborated, and statements by two participants in the dispute, including Ralph Cornell, were juxtaposed. Then Kellman displayed the minutes of a Port Authority meeting held on September 17, 1969, which recorded the votes on a motion for new bids on the steel contract, and he stated that "New Jersey commissioners voting 'no' included Chairman Alfred R. Pierce and the present Chairman Ralph Cornell." At the conclusion of this portion of the program, Kellman narrated:
And so . . . as the toll-payers shelled out nickels, dimes and quarters to pay for the project - some Port Authority commissioners saw an opportunity for enormous profits, profits on land deals made possible by the very bridge motorists would be paying for well into the year 2000.
After a pause for a commercial announcement, Kellman noted that there was a close relationship between the construction of the Commodore Barry Bridge, which runs from Chester, Pennsylvania to Bridgeport, New Jersey, and the increase in land values in the Bridgeport area. The mayor of Bridgeport was quoted as saying that the values of land in the town had risen directly as a result of the construction of the bridge. As to Pierce's own interest in land in the vicinity of the Commodore Barry Bridge, Kellman remarked:
Among the properties with identifiable owners . . . is this 90-acre plot of Route 322 . . . where the expressway linking Routes 130 and 295 will be built. The deed is recorded at the Gloucester County Courthouse in Woodbury. It shows the property is owned by Alfred R. Pierce . . . former Mayor of Camden and Port Authority Chairman at the time the Barry bridge was approved. On the day Pierce bought his 90 acres . . . he also bought 22 acres more . . . just across the road . . . and on the same day . . . in April of last year . . . he sold the 22 acres to a corporation that also has the deed to 67 acres farther up the road where Route 322 crossed Route 295.
The broadcast proceeded to focus on the development of the Lindenwold Hi-Speed Line, a mass transit facility that was built and is operated under the auspices of the Port Authority and runs from Philadelphia to Lindenwold, New Jersey. Kellman indicated that " there's talk of extending the Hi-Speed Line past Lindenwold to the Jersey Shore" in the event of the continued expansion of the area, residentially and commercially. Certain land near the Ferry Avenue station of the Lindenwold Hi-Speed Line, described as "prime commercial property," was said to be owned by "a combine called ABJ, Inc.," whose shareholders "include former Camden Mayor and Port Authority Chairman Alfred R. Pierce."
Kellman mentioned a third parcel of real estate in which Pierce was portrayed as having an interest, which was said to be located in Woodbury, New Jersey, near a proposed extension of the Hi-Speed Line. As Kellman said:
A Port Authority study recommended the Gloucester route to Woodbury where there are five acres of land owned by a corporation that includes as shareholders former Camden Mayor and Port Authority Chairman Alfred Pierce and former Port Authority Commissioner John Crisconi of Philadelphia.
In mid-October, Port Authority engineers confirmed their recommendation that the Woodbury station would be built here, adjacent to the propoerty [sic] owned in part by Pierce, Crisconi and Cornell.
In the aftermath of those remarks, Kellman questioned Cornell about the "guidelines" he followed in his work in order to avoid a conflict of interest, and Cornell replied that he adhered to "the ten commandments." A prominent Philadelphia banker, John Bunting, who has since been appointed to the Port Authority, was quoted as saying that, in his view, "certainly buying land raises doubts."
Kellman then explained that the director of bridges for the Port Authority, Andrew Ferenz, had been fined and given a suspended jail sentence for "using Port Authority building materials on his own home." Ferenz was described as the brother-in-law of ...