On April 29, 1976, Cox Enterprises, Inc., d/b/a Atlanta Newspapers (hereinafter the “Newspaper”)', published an article in The Atlanta Journal entitled “Tanner Hospital In Trouble, Critics Say.” The article contained charges that mismanagement of Tanner Memorial Hospital had resulted in economic difficulties and in serious deficiencies in the provision of health care for patients; e.g., insufficient number of nurses, inoperative equipment, wasteful expenditures, financial deficits and needs for tax increases. In addition, the article contained phrases such as “fear for the [patients’] safety,” “doctors are losing faith” and “earmarks of [financial] disaster.”
Tanner Memorial Hospital is operated by the Carroll City/County Hospital Authority (the “Authority”). In March, 1977, the Authority filed a complaint alleging libel against the Newspaper in which- the Authority charged that the article was “false and malicious defamation” and that it was published “willfully and maliciously and without regard.to the true facts” and “in careless disregard of the true facts,” and that the Newspaper has refused to retract the article. The Authority sought general damages of $250,000 and punitive damages of $250,000. No individual plaintiffs joined in the complaint. The Newspaper answered, denying the material allegations of the complaint (other than the publication of the article) including those relating to jurisdiction and venue. The Court of Appeals affirmed the grant of summary judgment to the Newspaper on the ground of improper venue; on certiorari this court reversed.
Carroll City/County Hospital Auth. v. Cox Enterprises, Inc.,
On remand, the trial court considered the remaining portions of the Newspaper’s motion for summary judgment, denied the motion and certified its order. The Newspaper then filed an application for interlocutory appeal which was granted by this court. Our
The Newspaper asserts a number of reasons why its motion for summary judgment should have been granted. First among them is that to allow the Authority, allegedly a governmental entity, to sue for libel would contravene the First Amendment to the United States Constitution.
We note at the outset that we do not deal here with the so-called “clear and present danger doctrine,” that is, with the power of government to punish speech that incites violent or illegal conduct. See Brandenburg v. Ohio,
We start from the seldom used but well founded rule: Governments and governmental entities cannot maintain an action for libel. “Criticism of government is at the very center of the constitutionally protected area of free discussion.” Rosenblatt v. Baer,
Although the Authority does not directly dispute this rule, it does dispute its application to this case. In short, the Authority asserts that it is a “quasi-private” hospital and a “quasi-governmental entity”, not purely a governmental entity, and that as such it may sue for libel. It argues that its ability to provide health care services to the needy is dependent upon the confidence of its paying patients in its ability to provide quality medical care and that vindication by damages for libel is necessary to maintain the confidence of its clientele.
It is true that the United States Supreme Court has not addressed this precise is.sue. In the two cases in which that Court found that the government could not maintain an action for libel, the nature of the governmental entities involved was different in several particulars from that of the Authority. In effect, one issue in the New York Times case, supra, was whether a suit for libel by a police department would lie — and the Court ruled that it would not. The plaintiff in the New York Times case was not the police department but the Commissioner of Public Affairs whose duty it was to supervise the police department. The Commissioner, however, was not named in the allegedly defamatory advertisement which referred to police armed with shotguns and tear gas, arrests for petty offenses, and charges of perjury. In determining that the Commissioner could not maintain a personal action for libel, the Court ruled that to allow him to do so given the particular advertisement complained of would be to sidestep the rule prohibiting a governmental entity from suing for libel by transmuting criticism of government into personal criticism. 376 U. S., supra, at 292.
Subsequently, in Rosenblatt v. Baer, supra, the Court reached a
Reviewing the few cases on this point in lower federal courts and other jurisdictions, we find none precisely on point. Most involve typical municipal corporations, i.e., cities. City of Philadelphia v. The Washington Post Co., 482 FSupp 897 (E. D. Pa. 1979); Johnson City v. Cowles Communication, Inc.,
A park district with the power to issue bonds was found to be a municipal corporation unable to sue for libel in Progress Development Corp. v. Mitchell, 219 FSupp 156 (D. Ill. 1963). See also Board of Education v. Marting,
A New York court has held that an off-track betting corporation is precluded from bringing an action for defamation. Capital District Regional Off-Track Betting Corp. v. Northeastern Harness Horsemen’s Asso.,
Factors tending to establish the Authority’s governmental nature include that it is a creature of statute; that it is defined as a “public body corporate and politic”(emphasis supplied); that its Board is appointed by the governing body of the relevant political subdivision or subdivisions; that it is tax exempt; that it is deemed to exercise public and essential governmental functions; that it may exercise the power of eminent domain; that is receives tax revenues; and that the governing bodies of the relevant political subdivisions have a role in determining the disposition of its property upon dissolution.
Yet marriage and private corporations are creatures of statutes but no one would call them governmental entities. Tax exemptions may be extended to private corporations,
Great Northern Nekoosa
Yet a substantial body of case law in effect treats hospital authorities as governmental in nature. In
Hospital Auth. of Albany v. Stewart,
Although we have found no decision precisely on point (i.e., where the plaintiff was an entity identical in structure to this plaintiff), we nevertheless are compelled to conclude that the Authority is merely the way the government has chosen to do its business in this instance. Certainly the government is authorized to
We have reviewed the nature of the Authority and determined that it is a “governmental entity.” Ga. L. 1964, p. 598 et seq., Code Ann. § 88-18. We have found that a governmental entity is absolutely barred from prosecuting a cause of action for libel — regardless of whether the libel was against the governmental entity in its governmental or its proprietary function. E.g., Rosenblatt v. Baer, supra. We conclude that although a hospital authority’s purpose may be impaired or defeated by unjust criticism and although the two U. S. Supreme Court decisions in this area involved entities that were more clearly part and parcel of a county or a city, their teaching and that of their progeny is that to allow the Authority to pursue this litigation would contravene the first amendment to the Constitution of the United States. Rosenblatt v. Baer, supra; New York Times Co. v. Sullivan, supra. Thus the Newspaper is entitled to have its motion for summary judgment granted. In view of this determination, it is not necessary for us to consider the other issues and contentions raised: “actual malice,” privilege of neutral reporting, and privilege of public interest reporting.
We are not unaware that critics of the press may be concerned lest the media abuse its privilege to criticize government. For while
Judgment reversed.
Notes
The cases are collected at Anno., Right of Governmental Entity to Maintain Action for Defamation, 45 ALR3d 1315 (1972). The annotator found (45 ALR3d 1315): “The few cases which have considered this point have unanimously concluded that a governmental entity, by reason of its nature as a governmental entity, cannot maintain an action for defamation in its own right, even if the defendant maliciously publishes the defamatory statements, knowing them to be false, and with intent to injure. It has further been held that no distinction as to the right to maintain such a suit will be made between the proprietary and the governmental functions of the entity.”
Of course an individual, albeit a government official, libeled for action taken in his official capacity may sue for libel. The government, on the other hand, would use its critics’ own money (public funds) to silence their criticism.
Regional Off-Track Betting Corporations use public funds, have the power of eminent domain, are deemed “municipalities,” and their directors are appointed
Tanner Memorial Hospital reportedly was the first hospital in the nation built under the Hill-Burton Act, Pub. L. No. 79-725, 60 Stat. 1041 (1946), a federal-state program which authorizes federal financial assistance for the construction and modernization of hospitals and other medical facilities. Nat. Assn. of Neighborhood Health Ctrs. v. Mathews, 551 F2d 321, 324 (D. C. Cir. 1976).
The Authority’s power to sue is not dispositive of the first amendment issues involved here.
The exemption from “all taxes” by Georgia’s General Assembly does not, of course, encompass federal taxes. Interest earned on obligations of the Authority may, however, be free from federal income tax because the Authority may well qualify as a “political subdivision” under 26 USC § 103 (a) (1). See Commissioner v. Shamberg’s Estate, 144 F2d 998 (2d Cir. 1944); cert. denied,
For a discussion of the nature of authorities see Bonapfel, “The Legal Nature of Public Purpose Authorities: Governmental, Private, or Neither?” 8 Ga. L. Rev. 680 (1974).
We note, however, that despite the U. S. Supreme Court’s apparent approval of City of Chicago, supra, the American Law Institute has declined to express an opinion on “whether there may be liability for defamation of a municipal corporation and if so under what circumstances.” Restatement, second, Torts § 561, Caveats (2). Messrs. Harper and James, The Law of Torts, Vol. 1, § 5.3, p. 361 (1974), would allow a municipal corporation to recover for defamation of its proprietary functions.