Appeals court upholds dismissal of defamation suit against Spitzer, Slate

In upholding the dismissal of a defamation claim against Eliot Spitzer and Slate on Wednesday, the U.S. Court of Appeals in New York City (2nd Cir.) ruled that a broad reference to an organization or “[a company] and its employees” does not give an individual in that company a right to sue for defamation.

The lawsuit stemmed from a column Spitzer wrote for Slate on August 22, 2010, in which Spitzer defends his investigation into the company Marsh & McLennan during his tenure as New York Attorney General.

A Wall Street Journal editorial was critical of the investigation, noting that two of the convictions were later overturned. Spitzer countered in Slate that the editorial “fail[ed] to note the many employees of Marsh who have been convicted and sentenced to jail terms” and that “Marsh and its employees pocketed the increased fees and kickbacks.”

William Gilman was one of the two Marsh employees whose convictions were later overturned. Gilman sued Spitzer and Slate for defamation, arguing that, while he was not specifically named in the article, readers would assume he was one of the employees Spitzer referred to as having been sentenced to jail terms and having pocketed kickbacks.

The federal district court in New York disagreed, and the Second Circuit affirmed on Wednesday. No reasonable person would think the statements in the article were about Gilman, the court said. First, the fact that Gilman’s conviction was overturned necessarily excludes him from the category of employees who were “convicted and sentenced to jail terms.” Second, Spitzer’s references to “Marsh’s behavior” and “Marsh and its employees” is too broad to suggest any one employee — Gilman included — was being defamed.