Alfa Bank branch in Moscow. (Photo: Andrey Rudakov/Bloomberg)

New York’s long-settled and broad fair report privilege will remain an affirmative defense for BuzzFeed News in an ongoing defamation lawsuit launched against it by the owners of a Russian bank after BuzzFeed published the Steele dossier in 2017, a state appeals court has ruled.

The uncorroborated dossier—which contained a raft of allegations laid out by former British intelligence officer Christopher Steele that painted a picture of the Russian government scheming to aid Donald Trump in the 2016 U.S. presidential election—was published by BuzzFeed in January 2017 to much controversy.

(Photo: Andrew Harrer/Bloomberg)

BuzzFeed admitted that the allegations were unverified and “potentially unverifiable,” but defended publishing its report because it said Americans “can make up their own minds about allegations about the [then-]president-elect” Trump.

The owners of a Russian bank called Alfa Bank, who say the dossier wrongly linked them to the Russian government’s alleged scheming, brought multiple lawsuits after the dossier was read by millions, including against Steele, against Fusion GPS and against BuzzFeed in Manhattan Supreme Court.

While one defamation suit against Steele and his company leveled by the bank owners and investors—Mikhail Fridman, Petr Aven and German Khan—has been thrown out by a Washington, D.C., Superior Court judge, the BuzzFeed action in New York is moving forward.

Now, in a terse but notable ruling for BuzzFeed and other news organizations, an Appellate Division, First Department panel has affirmed Manhattan Supreme Court Justice Arlene Bluth’s 2018 decision denying the Russian bank owners’ motion to dismiss BuzzFeed’s affirmative defense based on New York’s true and fair report privilege.

In the affirmance, the unanimous panel zeroed in on the major issue and debate between BuzzFeed and the Russian businessmen over the privilege’s application: whether the Steele dossier could be understood to be part of an official government proceeding.

A necessary “element” for application of the privilege—which is codified in New York Civil Rights Law Section 74—is that the allegedly defamatory content or statements have been tied to “official proceedings” or official government activity.

As explained by Bluth in her lower court decision, the bank owner plaintiffs have claimed that the “privilege is inapplicable to the instant action because defendants”—BuzzFeed, one of its reporters who authored the report, and certain editors—”failed to allege that the dossier was obtained from a U.S. government source or that the dossier was part of a government proceeding.”

In taking up the issue, the First Department panel of Justices John Sweeny, Judith Gische, Troy Webber, Marcy Kahn and Peter Moulton explained, first, that New York state’s “fair and true report privilege … shields publishers from civil liability for claims of defamation when the alleged defamatory statements are published to report accurately about official government activity.”

Then—in a single, long sentence—they addressed the affirmative defense dismissal issue before them.

The justices wrote in their May 2 opinion that “an ordinary reader of the publications at issue here, a BuzzFeed article, which hyperlinked a CNN article and the embedded dossier compiled by Christopher Steele, which included a confidential report containing the alleged defamatory statements about plaintiffs, would have concluded that there were official proceedings, such as classified briefings and/or an FBI investigation concerning the dossier as a whole, including the confidential report relating to plaintiffs.” (The sentence also referenced a ruling in a separate but similar case lodged against BuzzFeed over publication of the dossier.)

In Bluth’s 2018 Supreme Court opinion, she addressed the arguments over the fair report privilege’s application in greater detail.

Bluth wrote, for instance, that “defendants have alleged facts in their amended answer that the dossier was part of an official proceeding. BuzzFeed alleges that the dossier was part of briefings to President Obama, Vice President Biden and President-Elect Trump on January 6, 2017 and that the dossier was given to the FBI director. … These allegations suggest that the article reported on an issue of national public interest and are therefore sufficient to defeat plaintiffs’ motion to dismiss.”

Continuing, she wrote that “as the [New York] Court of Appeals held in Holy Spirit Assn. for Unification of World Christianity v. New York Times Co. (49 NY2d 63, 68, 424 NYS2b 165 [1979]), ‘[N]ewspaper accounts of legislative or other official proceedings must be accorded some degree of liberality. When determining whether an article constitutes a “fair and true” report, the language used therein should not be dissected and analyzed with a lexicographer’s precision. This is so because a newspaper article is, by its very nature, a condensed report of events which must, of necessity, reflect to some degree the subjective viewpoint of its author.’”

Later, Bluth also pointed out that the “plaintiffs failed to cite any case law that explicitly holds that the government must be the source of the information.”

Then she added that “to the extent the plaintiffs claim that the specific allegations against plaintiffs made in the dossier were not part of a government investigation, that does not compel a different outcome,” before also writing that “under plaintiffs’ theory, BuzzFeed could only publish the dossier if it knew that every single statement in it was part of the alleged government investigation. That is not a logical reading of the fair report privilege.”

The fair report privilege has arisen as a legal issue in other litigation flowing from BuzzFeed’s publication of the Steele dossier.

In a separate defamation action against BuzzFeed over the dossier’s publication, lodged by Russian technology executive Aleksej Gubarev—who was named, along with companies he owns, in the dossier—an amicus brief was filed in late April in the U.S. Court of Appeals for the Eleventh Circuit on behalf of the Reporters Committee for Freedom of the Press and dozens of media companies and organizations.

In that case, the Eleventh Circuit is examining the plaintiffs’ appeal of a Florida federal court ruling that said BuzzFeed was protected when publishing the dossier under New York’s fair report privilege. The amicus brief, signed by notable First Amendment lawyer Floyd Abrams, a senior counsel at Cahill Gordon & Reindel, states that “the issue presented in this appeal concerns the scope of the privilege for fair and true reports of official proceedings under New York Civil Rights Law Section 74.”

Abrams and Cahill Gordon partner Joel Kurtzberg argue in their brief that “New York courts interpret the scope of ‘official proceedings’ far more broadly than plaintiffs [in the federal lawsuit] suggest, and the [New York] case law overwhelmingly supports its application to the type of governmental investigations at issue in this case.”

They also trace the history of the privilege in New York, noting that “before 1854, New York had no statute extending the fair report privilege to ‘official proceedings,’” but that after the state Legislature disagreed with a ruling in a case in 1850, it “moved to broaden the fair report privilege in New York to protect reporting on unverified allegations made during a police magistrate’s investigation.”

“The Legislature passed a statute—the first of its kind—to extend the fair report privilege, not only to reporting on judicial proceedings, but also to ‘legislative proceedings’ and ‘official proceedings,’” Abrams and Kurtzberg wrote.

In the Russian bank owners’ lawsuit against BuzzFeed, Nathan Siegel, a Davis Wright Tremaine partner, represented BuzzFeed and the related defendants. He said in an email: “The First Department’s decision upholds the key principle that the press has a right to inform the public about documents their government uses to make decisions. That right is critical to maintaining a free press, and we look forward to continuing to defend it in these cases.”

Carter Ledyard & Milburn partner Alan Lewis represented the bank owners in the First Department appeal.

Lewis said in an email that the First Department ruling is “flatly erroneous” and “says, without quoting any language from the two articles in question, that they reported something which neither of them did.”

“Neither article actually reported that there were either classified briefings or an FBI Investigation ‘concerning the dossier as a whole, including the confidential report relating to plaintiffs,’” Lewis wrote, adding that “BuzzFeed’s fair report privilege is ultimately doomed” because “BuzzFeed will now be required to prove that as of January 10, 2017, the statements that defame plaintiffs were actually [included] in classified briefings or investigated by [the] FBI. Because we do not believe that was actually true, we are confident that BuzzFeed will fail to sustain its burden.”

Lewis noted that dismissal of the claims against Steele is being appealed.