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ATLANTA — Faced with a federal appeals court decision that would have forced the disclosure of confidential sources, Sports Illustrated and parent company Time Inc. decided to settle the defamation suit brought by former University of Alabama football coach Mike Price. Neither side would discuss the terms of the confidential settlement reached on Oct. 7. Price, who left the university without ever coaching a game, continued to assert in a news release that details of an alleged tryst with two women in a Florida hotel room were falsely reported in a 2003 Sports Illustrated story published shortly after he was hired. In his $20 million defamation suit, Price claimed that the publicity surrounding the article’s publication cost him his coaching job. In a separate news release, SI stood by writer Don Yaeger’s story “Bad Behavior: How He Met His Destiny at a Strip Club.” Price, now the head coach at the University of Texas at El Paso, claimed “a great victory.” For media lawyers and their clients, the case leaves a potentially troublesome legacy at the Eleventh Circuit U.S. Court of Appeals. Before Time settled, a three-judge panel affirmed the coach’s need to know the identity of the anonymous source who made the allegations to the magazine. But where the district court had ordered the SI writer to name his sources, Eleventh Circuit Judge Edward Carnes said that the plaintiff’s lawyers should depose four women who could attest to the story’s accuracy. One of them likely was the anonymous source for the story, the judge suggested, and lawyers could learn her identity by simply asking her. Carnes secured a promise from Time Inc. lawyers to tell the court if the source lied about her identity. The court stripped from media lawyers any obligation to protect their media clients’ anonymous sources, says Gary Huckaby, a partner at Alabama’s Bradley, Arant, Rose & White who defended Time Inc. It was Huckaby who had to promise Carnes that he would tell the court if the anonymous source were to lie. “In my opinion, at no time should a lawyer be required to do anything but observe his ethical obligations to make sure that no false statement is offered by his client in the case,” Huckaby says. “That’s all the ethical rules require.” PENDULUM SWINGS King & Spalding partner Joseph Bankoff, an expert on media law, says that the Eleventh Circuit’s confidential-source rulings signal “a pendulum swing on reporter’s privilege” that in the past has favored protecting confidential sources. The lesson of the Price case for the news media may well be that reporters “may not be able to protect your source, and you certainly cannot promise to protect your source in all instances,” Bankoff says. “If it becomes important from a business proposition to protect the source, you may wind up having to resolve a case out of court.” That may be what prompted Time Inc. to settle after Price’s Birmingham, Ala., attorney, Stephen Heninger, began aggressively seeking anonymous sources for the May 12, 2003, Sports Illustrated article. Heninger did not return calls. In a news release he stated, “We have won every legal battle at every corner. We think we have vindicated [Price's] name.” Time Inc. General Counsel John Redpath Jr. also declined to comment, referring to a Sports Illustrated news release announcing that Price and the magazine “amicably resolved the lawsuit.” Price has denied under oath that the hotel encounters as detailed in Sports Illustrated took place. Price’s position as a public figure and his consequent need to prove actual malice in order to secure a libel judgment prompted U.S. District Judge C. Lynwood Smith Jr. of the Northern District of Alabama in 2003 to order the media defendants to identify the anonymous sources whose comments formed the basis of the article. Price needed those sources, Smith reasoned, to determine their reliability and whether the magazine was reckless in relying on them. Smith also determined that while Alabama’s media shield law protects newspapers, television and radio, it specifically excludes magazines. HELP TO PRICE In July, Carnes, Judge William Pryor Jr. and Senior U.S. District Judge J. Owen Forrester let stand Smith’s ruling on Alabama’s shield law but stopped short of ordering the SI writer to identify his sources. The decision by Carnes noted that Yaeger, the writer, in a deposition, had identified four women with either direct or indirect knowledge of the identity of the writer’s primary confidential source who could confirm the allegations. Accordingly, the appellate panel directed Price’s lawyers to take their depositions. One of those four women was likely Yaeger’s source, although Carnes pointed out that all four had denied it previously. During oral arguments, Carnes offered additional help to Price’s lawyers in identifying the magazine’s confidential sources. He asked Huckaby what he would do if he heard the person who the lawyer knew to be the confidential source deny it under oath. “It would be fair to say that counsel was somewhat uncomfortable with this question, but he did assure us that he would do his duty as an officer of the court and inform the district court that the witness’s sworn denial was false,” Carnes wrote. “It is important because it assures us the identity of the confidential source (or perhaps the absence of one) is virtually certain to be discovered either from the deposition testimony of the women or through the ethically compelled disclosures of counsel for the defendants, correcting any material testimony that he knows to be false.” On Sept. 16 the panel denied Time’s petition for a rehearing and an amended ruling that would have removed the burden on its attorneys to reveal if a source had committed perjury in order to hide her identity. Media lawyers say the second decision backed away from a definitive ruling that would have forced them — in confidential-source cases — to choose between honoring attorney-client privilege and their duties as officers of the court. In the denial for a rehearing, Carnes expressed “problems” with arguments that a media lawyer had “no duty” to report a lie if it involved a confidential source’s identity. But he added, “We need not resolve those problems in this case. We asked counsel during oral argument if he would inform the district court should the confidential source falsely deny under oath that she is the source. He assured us he would. We took that assurance into account in our decision. That is enough to hold counsel to his word. Even if lawyers cannot be counted upon to inform the court on all occasions when a witness is perjuring herself, we think courts still have a right to hold lawyers to their word.” Arnall Golden Gregory attorney Robert Rothman, who counts the Atlanta Press Club among his clients, suggests that: “Based on the decision on rehearing, it’s still an open issue in the Eleventh Circuit whether a media attorney would be obliged to reveal the identity of a confidential source in the event of third-party perjury during litigation. Media counsel need to carefully consider that risk before asking their clients to reveal a confidential source.” Eric Schroeder, a partner at Powell Goldstein, which represents USA Today, CNN and Clear Channel Communications Inc., says that Carnes “brought to light a potential ethical challenge for a media defense lawyer.” The appellate rulings likely will encourage media defendant attorneys “not to inquire about who the confidential source is” for fear that they will become witnesses in the case,” he says. “I think I become much more careful about what I need to know to represent my client effectively. And the client is now going to be thinking, What could I tell my lawyer?” Schroeder adds. That makes it “a tougher job” for a media defense lawyer to assess the validity of a source, he says. “It’s going to make it much harder for me to judge what is the best strategy for defending that case. How far can I go to rely on that source if I don’t know who that source is? “It’s all part of a larger trend against what had developed into a very strong reporter’s privilege across the land that is gradually being weakened,” Schroeder continues. “I can’t say one decision caused a sea change. It’s every little decision that comes along. In the last four years we’ve seen a backlash against what was seen as a traditionally strong reporter’s privilege, a backlash by judges who are re-examining the whole doctrine.” Bankoff says that appellate rulings in the Price case re-emphasize that a reporter’s traditional privilege to protect a confidential source “is not an absolute protection. It is subject to balance. And one of the factors that is going to get weighed in the balance, whether it is talked about or not, is how important was the information that was published.” Bankoff suggests that judges may tend to look far more harshly on a salacious article about the alleged sexual activities of a college football coach than a document as historically and politically significant as the Pentagon Papers. “The concept of trying to protect the integrity of the news-gathering source is affected by the subject matter of what is being published,” he says. “At the end of the day, the courts are looking to see whether what the fuss is about is worth protecting.” R. Robin McDonald is a reporter with a Recorder affiliate based in Atlanta.

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