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From the Winter 2001 issue of The News Media & The Law, page 34.
A libel lawsuit brought by an eye clinic against ABC's "PrimeTime Live" and reporter Sam Donaldson was dismissed by the U.S. Court of Appeals in Chicago (7th Cir.) in October. The court ruled the Desnick Eye Centers did not prove the network acted with actual malice in reporting that the clinic tampered with a vision machine giving patients false diagnoses of cataracts.
PrimeTime broadcast a segment in June 1993 that reported the Desnick eye clinics in the Midwest performed unnecessary cataract surgeries. The clinic, which agreed to an interview, claimed that ABC producer John Entine promised before the interview that the segment would focus on ophthalmological practices that market their services to senior citizens and would not involve "ambush" journalism or undercover techniques.
ABC used undercover patients to undergo testing at Desnick clinics and used hidden cameras to record the examination. The aired episode included testimony from a former Desnick employee, Paddy Kalish, who showed how a cataract-detecting machine could be modified to give false positives. The employee alleged that the Desnick machine was tampered with in the same way.
ABC broadcast Kalish's allegation and demonstrated, using Donaldson's vision, how the machine could be tampered with to produce a false positive. The network supported the former employee's allegation with evidence of unnecessary surgeries, alterations of patient records and statements from other former employees that nearly all patients failed the test.
The plaintiffs first sued in 1993 for claims of trespass, invasion of privacy, wiretapping violation, fraud, breach of contract and defamation. A federal district court dismissed the lawsuit for failure to state a claim. In 1995, the Seventh Circuit resurrected only the defamation claim.
On Oct. 27, 2000, the federal appeals court held that the eye clinic had to prove that the news program acted with actual knowledge that the content was false or aired the program with a reckless disregard for the truth because the Desnick Eye Centers qualified as a public figure. The appeals court held there was insufficient evidence for a jury to believe the show and its reporters had serious doubts that the content was false.
The plaintiffs argued that ABC knew other facts that would have cast doubt on Kalish's accusation. For example, the plaintiffs told the appeals court that the clinic received a favorable judgment for defamation against Kalish in state court. However, the court pointed out that summary judgment was entered against Kalish in the state lawsuit only after Kalish's attorney failed to make a timely filing. The appeals court said that the state lawsuit "should have set off warning bells at ABC," but that ABC would not have learned that Kalish's allegations were false from the state court record.
The plaintiffs also argued that the test of Donaldson's vision, which required several attempts by Kalish to produce the false positive, should have provided notice to ABC of Kalish's untruthfulness. The appeals court discounted this claim because, it said, Kalish and another technician were unfamiliar with the machine.
The appeals court supported its decision to dismiss the case because the allegations in the broadcast were corroborated by other evidence of unnecessary surgery, alterations of patient records, the undercover patients who were given false positive cataract results, and statements by former Desnick employees.
The Seventh Circuit denied the plaintiff's petition for a rehearing on Nov. 13. --DB