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Friday, November 30, 2007
Alabama Jury Gets Revenge Against NCAA

Yesterday, a jury in Alabama awarded $5 million to a former University of Alabama football booster, Ray Keller, who claimed the NCAA defamed him when it imposed penalties on the Crimson Tide in 2002. Keller maintained that the NCAA wrongly lumped him in with other boosters who were accused of making improper contacts and payments to recruits in the 1990s. A timber dealer and Crimson Tide fan, Keller argued that the NCAA slandered and libeled him during the announcement of penalties by referring to him and others as "rogue boosters," "parasites" and "pariahs." According to the press report, the NCAA didn't use the name of Keller or other boosters in announcing penalties against Alabama, but their names appeared in news accounts and the university sent Keller a letter barring him from its athletics program. The jury awarded him $3 million in punitive damages, $1 million for mental anguish, $500,000 for economic loss and $500,000 for damage to reputation.

This trial wasn't about defamation. It essentially amounted to a rehearing of the penalties imposed on the Alabama football program five years ago by the NCAA, but this time the case was heard by 12 Crimson Tide fans! As a torts professor, I've read plenty of defamation cases and I will be really surprised if this judgment ends up sticking on appeal (but I've been surprised before so I guess that's not saying much).

First, a statement must be defamatory by definition, which means that the statement must tend to adversely affect the plaintiff's reputation, for example, by impeaching the plaintiff's honesty or integrity. Referring to the former boosters collectively as "parasites" and "pariahs" is not any more defamatory than it is to simply say that the boosters made improper contacts and payments to recruits in violation of NCAA rules. In other words, what is potentially damaging to the former boosters' reputations in the community is the fact that the NCAA implicated them in wrongdoing which led to sanctions imposed on Alabama's football program, not that the NCAA called them parasites and pariahs.

Second, even if the NCAA's statement is deemed defamatory, the damages award seems excessive. Keller would most likely be classified as a private person, not a public figure. However, when the defamatory statement relates to a private person involving a matter of public concern or controversy -- such as penalties imposed on Alabama's football program as a result of improper activity by boosters -- the U.S. Supreme Court in Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974) held that the plaintiff has the burden to prove that the defendant was negligent in ascertaining the truth of what it published. The NCAA performed a full investigation and determined that the boosters made improper payments and contacts. To my knowledge, there is no evidence of bad faith or even a negligent investigation on the part of the NCAA.

Finally, even if the NCAA was negligent in ascertaining the truth of what it published, Gertz held that damages are limited to the "actual injury" sustained by the plaintiff, which includes out-of-pocket loss, impairment of reputation, humiliation and mental anguish. However, there must be competent evidence of actual injury. Damages are not presumed, which is typically the case in libel actions relating to private persons involving matters of purely private concern. Thus, any award of punitive damages in this case can hardly be justified absent a showing that the NCAA made the statement knowing it was false or with reckless disregard for the truth. Also, $1 million for mental anguish on these facts seems fairly excessive.


Very interesting... while I'm not familiar with Alabama law, I think the case really depends on whether Keller is determined a limited purpose public figure. Two key points:

1) Under Gertz and its subsequent cases, generally figures have to voluntarily enter an issue of public concern to become limited purpose public figures for the interests of a libel case. Arguably, Keller didn't enter this controversy - he was absorbed by it due to media coverage. This is generally not seen to be a "voluntary insertion".

2) If Keller has an elected position as part of the boosters, he may be a limited purpose public figure because the criticism involved his actions as a booster. In this case, the award should not stand.

If the judgment stands, I agree that the award seems high, but given the high publicity that this issue received in 2002 and the results (banning him from a program in which he has invested so highly, financially and emotionally), there is definitely grounds for a substantial award.

Blogger Slims -- 11/30/2007 9:01 AM  

New York Times v. Sullivan rewrote defamation law in a First Amendment light in 1964 because an Alabama jury ran wild with a massive damages award against an "out-of-town speaker." 43 years later, not much has changed . . .

Blogger Howard Wasserman -- 11/30/2007 9:02 AM  


I disagree with some of what you said about Gertz. One who voluntarily assumes a central role in a particular public controversy, becomes a "public figure" for that limited range of issues, in which case the plaintiff would have to prove actual malice (knowledge of its falsity or reckless disregard for its truth). Gertz imposes, not an actual malice standard but a negligence standard, when it relates to a private person involving a matter of public concern.

Also, I disagree with you that the "high publicity that this issue received in 2002 and the results" provides grounds for a substantial award. I would argue that supports the point that it's a matter of public concern, which means that the defamation action is subject to some constitutional limitations even though Keller is a private person (i.e. negligence standard not actual malice).

Blogger Rick Karcher -- 11/30/2007 9:31 AM  

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Blogger Slims -- 11/30/2007 10:08 AM  


I'm not disputing the malice/negligence point or that this is a matter of public concern. I'm simply saying that I do not believe that Keller's actions, on their face, consist of a "voluntary assumption" of a role in the controversy unless Keller holds an official role in some capacity with the Alabama boosters.

From the limited facts I have seen on the case (obviously could be wrong), Keller acted as a private party and invested in the potential of the Alabama football team. He was considered a booster, or program supporter, based on his efforts, but this is not an official title of any kind. He remained a private party up until and through the media coverage put Keller and his actions in what he considered an inaccurate and improper light. Where in this instance does Keller voluntarily insert himself into a pre-existing issue of public concern?

Blogger Slims -- 11/30/2007 10:10 AM  

But can that be the standard? Slims's rule means that a private person who engages in (alleged or potential) wrongdoing with respect to something of a public concern remains a private person when his public-concern wrongdoing is made public.

Blogger Howard Wasserman -- 11/30/2007 10:40 AM  


I'm not saying that he voluntarily inserted himself into a public controversy. If he had done so, then an actual malice standard would apply. But since he didn't, then a negligence standard applies (some fault must be shown) because this is clearly a public controversy that deserves constitutional protection (although not as much protection as if he were a public figure or even a limited public figure). As I said in my post, I don't see any evidence of negligence on the part of the NCAA. Hope this clears things up.

Blogger Rick Karcher -- 11/30/2007 10:56 AM  

A complicated case.

From what I understand this case centered around the NCAA's failure to follow their own bylaws when investigating their case against the University of Alabama. By doing this they violated an important bylaw that disallows evidence from a confidential source.

In addition, the NCAA violated their own statute of limitations by alleging Mr. Keller's involvement in a violation outside the four year window.

The NCAA used very defamatory language during their announcement of penalties against Alabama by calling Mr. Keller "a pariah, poronah, and parasite."

All this caused Mr. Keller to lose several real estate developments he was involved in.

Most interesting was the fact that Professor David Swank (Oklahoma Law School) testified in this case against the NCAA and their investigation techniques used in this case. Professor Swank served 9 years at the NCAA and authored their investigative procedures manual.

Anonymous josh kingston -- 12/01/2007 10:58 PM  

$5 million dollar damages award? That seems a bit excessive to me. Hopefully, the NCAA will appeal the damages amount and it will be reduced on appeal. $5 million award for alleged damage to reputation and "mental suffering" seems a bit excessive. If this were a negligence action and he had actual, provable damages then I could understand this more. Excessive jury verdicts are nothing but trouble for the legal system.

Blogger John Biggs -- 12/02/2007 4:35 PM  


Thanks for the comment. You raise a good point about allegations that the NCAA violated its own bylaws. The problem I have is that this defamation case turned into a case about the legality of the NCAA's investigation process and authority to issue sanctions. I'm not convinced that the "pariah" and "parasite" references materially change the simple fact that the NCAA found that he violated its rules. If the NCAA had stated something like, "these results tend to put the integrity of Keller's timber business in question as well" then I think it's a different case entirely. From a policy standpoint, the question is whether somebody should be able to "go around" a determination made by a private organization by simply filing a defamation claim in court (which essentially creates a second hearing in front of a jury). I think the more appropriate analysis would be to address the NCAA's enforcement process from the standpoints of due process, arbitrary enforcement, ultra vires conduct in violation of its bylaws, etc.

Blogger Rick Karcher -- 12/03/2007 8:28 AM  

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