United States District Court, Central District of California

Opinions and Orders of Previous Years

Subject: Case Number:Title:Date Posted:
Opinions and Orders of Previous Years SA CV 96-340 AHS (ANx) Suzuki Motor Corporation v. Consumers Union of United, Inc. - Order Granting Defendant's Motion for Summary Judgment (Appendices and Related Orders Omitted)05/25/2000

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

SUZUKI MOTOR CORPORATION,
Plaintiffs,

v.

CONSUMERS UNION OF UNITED STATES, INC.,
Defendants.
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Case No. SA CV 96-340 AHS (ANx)

ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT (APPENDICES AND RELATED ORDERS OMITTED)


I.
PROCEDURAL BACKGROUND

The Court heard oral argument on defendant’s motion for summary judgment on June 28, 1999. After complete review of all declarations and exhibits, as hereinafter described, review of the Reporter’s Transcript of counsels’ oral arguments, and additional independent research, the Court, by this Order, grants defendant’s motion.

Consumers Union of United States, Inc. (“CU”) filed a Motion for Summary Judgment on May 3, 1999. In support of its motion, CU filed a number of declarations,1 as well as a Request for Judicial Notice, an Appendix of Extrajudicial Authorities, the Statement of Uncontroverted Facts and Conclusions of Law, and a proposed Judgment. Plaintiff Suzuki Motor Corporation (“Suzuki”) filed its opposition on May 24, 1999. In addition to its Memorandum of Points and Authorities, Suzuki filed opposition to CU's Request for Judicial Notice, opposition to CU's documentary exhibits attached to the declarations of Baird and Williams, its Statement of Genuine Issues (“GI”), as required by Local Rule 7.14.2, objections to CU's declarations, and a number of declarations in support of its opposition.2 CU filed its reply on June 7, 1999. CU submitted exhibits 393-400 as attachments to the Supplemental Declaration of Williams. In addition, CU filed Objections to Suzuki's declarations, a Response to Suzuki's Statement of Genuine Issues, a Response to Suzuki's objections to CU's Request for Judicial Notice, a Response to Suzuki's objections to documentary exhibits attached to the declarations of Baird and Williams, and a Response to Suzuki's objections to declarations. With leave of Court, Suzuki filed responses to CU's evidentiary objections on June 23, 1999.

On July 1, 1999, the parties were requested, via minute order, to prepare, serve, and lodge proposed orders regarding their evidentiary objections. The parties then lodged proposed orders on July 19, 1999. Having read and considered the parties’ arguments in support of or against admissibility, the Court separately files today those orders which now contain the Court’s rulings on the evidentiary objections. Generally speaking, most of the plaintiff’s hearsay objections are overruled because many statements and documents are not offered for the truth of the matter stated but as circumstantial evidence bearing on the issue in controversy. On the other hand, many of the defendant’s objections to plaintiff’s declarations are sustained because the witnesses are not qualified to opine on defendant’s state of mind; to the extent that the declarants state factual matter, however, their testimony is accepted.

In addition, the Court this date separately files, as Appendix A to Order Granting Defendant’s Motion for Summary Judgment, a list of all exhibits submitted by defendant CU in support of its motion as well as its reply. The Court also separately files, as Appendix B to Order Granting Defendant’s Motion for Summary Judgment, a list of all exhibits submitted on behalf of plaintiff Suzuki, all of which, whether text, photo, or video, have been reviewed by the Court. The Court has also received, read, and considered plaintiff’s Notice of Recent Additional Authority Re Summary Judgment, filed September 23, 1999, and defendant’s response thereto filed September 24, 1999. Having considered the parties’ arguments in support of and against judicial notice, the Court denies Defendant’s Request for Judicial Notice. Certain court decisions contained in the Request for Judicial Notice are otherwise admitted in connection with declarations of witnesses for limited purposes, as ruled upon in the aforementioned orders on evidentiary objections. The Court sustains Suzuki’s objections to CU’s Objections to Evidence Set Forth in Suzuki’s Statement of Genuine Issues and grants Suzuki’s request that those objections be disregarded.

II.
FACTUAL OVERVIEW


This action stems from an article that originally appeared in the July 1988 issue of Consumer Reports ("CR"), a monthly magazine published by defendant CU. In the article (Ex. 105), CU opined that the Suzuki Samurai ("Samurai") was "Not Acceptable" because CU's tests showed a tendency for the car to roll over during an accident avoidance maneuver. Plaintiff Suzuki Motor Corp. Japan is the manufacturer of the Samurai, a sports-utility vehicle. American Suzuki Motor Corp., the American distributor of the Samurai, was originally a plaintiff but was dismissed in the order granting defendant's Motion to Dismiss on February 3, 1997.

In this action, Suzuki asserts that statements referring to the Samurai's rollover tendency, which initially appeared in the 1988 CR article and which have been repeated in various CU and other publications, are false, disparaged the Samurai, and caused Suzuki to suffer damages. While the original complaint and the supplemental complaint contained 22 claims, including defamation and libel claims, the First Amended Complaint contains only three claims, two product-disparagement claims and one claim under California Business & Professions Code 17200. The Court denied Suzuki's Motion for Leave to File a Second Amended Complaint on April 13, 1999.

In this motion, CU challenges the sufficiency of plaintiff’s evidence supporting one essential factual element of its case: whether CU acted with actual malice in reporting on the Samurai on the basis of its 1988 testing. Suzuki points to a number of facts, culled from a voluminous record compiled by both parties, that it contends support a finding of malice. Suzuki highlights the following:

1. After more than three dozen runs in the Samurai on CU's established avoidance maneuver, CU's professional drivers rated it highest of all the vehicles, and expressly stated “no tendency to tip up” and “no real problem” in the written evaluations. See Plaintiff’s Statement of Genuine Issues (“GI”), 440-41;

2. After the Samurai completed the standard testing without incident, CU's editor-in-chief, Irwin Landau, remarked
that “If you can't find someone to roll this car, I will.”
Motion at 23-25; GI 445;

3. CU's technical director, R. David Pittle, then asked to drive the Samurai. After nine more runs and after departing from the established track, the Samurai tipped up. Motion at 24-25; GI 452-54;

4. After the tip-up, Pittle directed the chief of
CU's auto test division, Robert Knoll, to prepare a new “modified emergency avoidance maneuver” and replicate Pittle's path. GI 465-67;

5. When driver Richard Small was able to tip up the Samurai on the new course after multiple successful runs by
another driver, the test course video and audio tape recorded CU employees cheering, and someone said “All right Ricky baby!”
Motion at 22; GI 478-83;

6. Landau drafted the article reviewing the Samurai as “Not Acceptable” before the auto test division prepared its
usual report on the testing and before the runs on the modified course had been completed by the other vehicles, including one vehicle whose performance was lauded by Landau in the draft. GI 521-26;

7. On the last day of testing, after Landau completed the draft and Pittle signed off on it, and CU had begun to prepare for a press conference to announce the findings, Pittle saw that the drivers were unable to tip the Samurai and exclaimed “Can't you just see it, we get no lift off the ground, Oh God!”
Motion at 22; GI 487;

8. CU refused to reconsider the validity of its testing despite the federal government's conclusion, in September 1988, that CU's “test procedures . . . do not have a scientific basis and cannot be linked to real-world crash avoidance needs, or actual crash data” and similar findings by other governments. GI 588;

9. By 1995, CU knew that one of its former test drivers, Lee Baldrick, purchased a Samurai for his own personal use. GI 636-44;

10. At the time of CU's testing in 1988, CU was financially overextended due to capital investments. Motion at 20-22; GI 732-35.

Suzuki maintains that the totality of evidence that it has presented, and especially the foregoing excerpts, satisfies the requirements of the malice standard and justifies trial proceedings.

III.
DISCUSSION

A. Standard of Review

To avoid an adverse grant of summary judgment, Suzuki must "set forth specific facts showing that there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 91 L. Ed. 2d 202, 212-213, 106 S. Ct. 2505, 2511 (1986) (quoting Fed. R. Civ. P. 56(e)). The plain language of Rule 56(c) mandates the entry of summary judgment against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case and on which that party will bear the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). The inquiry involved in a ruling on a motion for summary judgment necessarily implicates the substantive evidentiary standard of proof that would apply at the trial on the merits, i.e., the “actual quantum and quality of proof necessary to support liability” at trial. Liberty Lobby, 477 U.S. at 252, 254. The mere existence of a scintilla of evidence in support of the plaintiff’s position will be insufficient; there must be evidence on which the jury could reasonably find for the plaintiff. See id.

There is no disagreement that plaintiff must prove actual malice by “clear and convincing evidence.” See Plaintiff’s Opposition to Motion for Summary Judgment on Issue of Actual Malice at 6. In other words, the Court must determine whether a reasonable fact-finder could conclude that the plaintiff has shown actual malice with convincing clarity. Liberty Lobby, 477 U.S. at 252. Actual malice is a term of art denoting deliberate or reckless falsification. See Masson v. New Yorker, 501 U.S. 496, 499, 115 L. Ed. 2d 447, 111 S. Ct. 2419, 2424 (1991). Malice entails a showing that the defendant made a false statement “‘with knowledge that the statement was false or with reckless disregard as to whether or not it was true.’” Harte-Hanks Communications, Inc. v. Connaughton, 491 U.S. 657, 667, 105 L. Ed. 2d 562, 109 S. Ct. 2678, 2685 (1989) (quoting Hustler Magazine Inc. v. Falwell, 485 U.S. 46, 56 (1988)). Put another way, defendant must have made the decision to publish the relevant information with a “‘high degree of awareness of . . . probable falsity,’” or defendant must have entertained “‘serious doubts as to the truth of [the] publication.’” Harte-Hanks Communications, 491 U.S. at 667 (quoting Garrison v. Louisiana, 379 U.S. 64, 74 (1964) and St. Amant v. Thompson, 390 U.S. 727, 731 (1968)).

Whether a plaintiff has shown actual malice is determined on a case-by-case basis, and the courts have a constitutional duty to “exercise independent judgment and determine whether the record establishes actual malice with convincing clarity.” Bose Corp. v. Consumers Union of United States, Inc., 466 U.S. 485, 514, 80 L. Ed. 2d 502, 104 S. Ct. 1949, 1967 (1984).

B. Application

The merits of CU’s motion for summary judgment do not turn on the stability of the Samurai or even the soundness of CU’s testing methodology. Rather, the issue is whether plaintiff has satisfied its evidentiary burden of showing with convincing clarity that CU reported on the Samurai with actual malice. Having viewed all the evidence in the light most favorable to plaintiff, in making a “case-by-case” assessment by looking to all of plaintiff’s evidence, and, compressing cartloads of evidence into a legal conclusion, the Court holds that plaintiff has not shown malice by clear and convincing evidence.

First, the trier of fact must necessarily view thecontext of CU’s testing of the Samurai. The trier of fact could not be expected to disregard the nature of defendant’s business — testing and reporting on consumer products — nor would plaintiff so urge, and it would be error for a court to so instruct. Thus, it is clear that, based on the information CU had gathered, it was concerned about the safety of the Suzuki Samurai. Defendant was confident that its tests would disclose road-safety dangers, if there were any. This pre-testing concern is not an impermissible mindset for a publisher, particularly one which proclaims its mission as protecting the consumer, and particularly given the background information already known about the Samurai. When the tip-up problem with the vehicle’s stability appeared, defendant put the car through more rigorous tests. Plaintiff emphasizes the redesigned test (the “short course”) in particular, as if defendant had irreversibly committed itself to testing all products the same, irrespective of new design or technology. All these facts, while relevant, do not evince malice as a matter of law at the requisite legal standard.

Plaintiff’s reliance on CU’s overextended financial status, supposedly due to its building program, is one example of plaintiff’s attempt to impute a financial motive to defendant in causing distribution of its Samurai review. While a motive in publishing material may bear on malice, the Supreme Court has settled the issue by holding that a goal of increasing one’s profits through publishing material is not sufficient to prove actual malice. Harte-Hanks Communications, 491 U.S. at 667 (“If profit motive could somehow strip communications of the otherwise available constitutional protection, our cases from New York Times to Hustler Magazine would be little more than empty vessels.”).

Likewise, plaintiff does not explain why CU’s difference of opinion with the National Highway Transportation and Safety Administration (“NHTSA,” in the evidence)3 over the acceptability of the driving test should compel the trier of fact to conclude that defendant is for that reason intent upon deliberate or reckless falsification. To the contrary, part of the First Amendment’s protection has to do with disagreeing with the government. See New York Times v. Sullivan, 376 U.S. 254, 270-71, 11 L. Ed. 2d 686, 84 S. Ct. 710, 721 (1964) ([D]ebate on public issues . . . may well include vehement, caustic, and sometimes unpleasantly sharp attacks on government and public officials.” citing Terminiello v. Chicago, 337 U.S. 1, 4 (1949); De Jonge v. Oregon, 299 U.S. 353, 365 (1937)). While the NHTSA evidence is admissible in support of plaintiff’s theory of its case, it is not shown to be evidence entitled to greater weight than any other study or opinion regarding vehicle testing methods.

Viewing the evidence presented through the “prism of the substantive evidentiary burden,” as stated in Liberty Lobby, the Court concludes that a jury could not reasonably find that plaintiff proves its case by the quality and quantity of evidence required by governing law. Defendant is therefore entitled to judgment as a matter of law.

IV.
CONCLUSION

Accordingly and for the foregoing reasons, the defendant’s Motion for Summary Judgment is granted. The Court has modified, signed, and filed defendant’s proposed Statement of Uncontroverted Facts and Conclusions of Law as well as defendant’s proposed Judgment.

The Clerk is instructed to file the following documents:

1. Order Granting Defendant’s Motion for Summary Judgment;

2. Appendix A to Order Granting Defendant’s Motion for Summary Judgment (List of Defendant’s Exhibits);

3. Appendix B to Order Granting Defendant’s Motion for Summary Judgment (List of Plaintiff’s Exhibits);

4. Suzuki Motor Corporation’s Order on Evidentiary Objections, lodged July 19, 1999;

5. Order re Defendant Consumers Union’s Objections to Declarations, lodged July 19, 1999;

6. Defendant’s proposed Statement of Uncontroverted Facts and Conclusions of Law, as modified by the Court;

7. Judgment for defendant.

IT IS SO ORDERED.

IT IS FURTHER ORDERED that the Clerk shall serve a copy of this Order on counsel for all parties in this action and enter the Judgment.

Dated: May ___, 2000.

______________________________
ALICEMARIE H. STOTLER
UNITED STATES DISTRICT JUDGE


1The declarations of Karpatkin, Pittle, Knoll, Landau, Sheehan, Wood, Small, Conkling, Allen, Nappi, Baird (attached to which are Volumes I through VI containing exhibits 1-148), and Williams (attached to which are Exhibits 149-182).

2The declarations of Reichert, McCarthy, Cooperrider, Yarborough, Edwards, Guthman, Bottomley, Riley, Rudd, Rogers, Rasmussen, Murray, Schwartz, Goldie, Gomez, Heywood, Jacobs, Lundquist, McCloskey, Ouellette, Singley, Smith, Theis, Beasley, Garcia, O'Neal, Seidle, Strauss, Tagland, in addition to exhibits 183-392.

3See 49 U.S.C. 105(a) and 49 C.F.R. 501.1, et seq. See also, Motor Vehicle Mfrs. Assoc. v. State Farm Mutual Ins. Co., 463 U. S. 29, 33, 77 L. Ed. 2d 443, 103 S. Ct. 2856 (1983), discussing origin and purpose of NHTSA.


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