Largest libel award reduced after judge finds lack of actual malice

TEXAS–A federal judge in Houston in late May overturned a $200 million punitive damages award in a libel case brought against the publisher of the Wall Street Journal. The award of $22.7 million in actual damages still stands.

In March, a now-defunct investment company, MMAR Group Inc., won the $222.7 award, the largest libel award ever given in the United States, after convincing a jury that inaccuracies in an October 1993 article led to the firm’s collapse.

In deciding to reverse the jury’s decision in part, the judge found that the evidence presented was insufficient to show that the Journal writer and editors acted with actual malice — knowledge of falsity or reckless disregard of the truth — which is required to receive punitive damages.

The Journal conceded during the litigation that some facts reported in the story were inaccurate, but argued that editors believed they were accurate at the time. The publisher also contended that the business failed for reasons unrelated to the news story, such as a lawsuit filed by its biggest client.

MMAR told the Associated Press that he would appeal the judge’s reversal. The Journal said in a statement that it still plans to appeal the award of actual damages. (MMAR v. Dow Jones; Media Counsel: David Donaldson, Houston)