Appeals court clears way for retrial of suit in which jury awarded $5.7 million

NEW MEXICO — The New Mexico Court of Appeals in Santa Fe refused in mid-April to consider appeals by both parties to a libel suit. The decision cleared the way for a retrial of the case, in which a state district court jury in Alamogordo had awarded the plaintiff $5.7 million, the Associated Press reported.

In 1987 the Alamogordo Daily News incorrectly reported that a “prominent local bar owner,” James M. Furgason, had been arrested on gun and drug charges. The paper based its story on a police report that a “James M. Furgason” had been arrested. The police report did not state explicitly that this “Furgason” was the local bar owner.

The culprit turned out to be a man who had burglarized Furgason’s home and then impersonated Furgason with a forged driver’s license.

Although the district court initially threw out Furgason’s libel suit, the appellate court reinstated the suit in 1988, in part on the grounds that New Mexico’s fair and accurate report privilege applies only to information obtained directly from police, and not to related information obtained from other sources.

In 1991 a jury awarded Furgason $700,000 in compensatory damages and $5 million in punitive damages. The district judge threw out the punitive award because of insufficient evidence, and ordered a new trial to determine whether Furgason was libeled and should receive compensatory damages, the AP reported.

Explaining its refusal to hear the parties’ challenges, the appeals court said it would “assist the parties more by getting this case promptly back to the district court,” the AP reported.

(Furgason v. Clausen; Media Counsel: Frank Wilson, Alamogordo)

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