Wells v. Liddy

Reversed and remanded by published opinion. Judge Williams wrote

the opinion, in which Judge Wilkins and Judge Lee joined.

_________________________________________________________________

COUNSEL

ARGUED: David M. Dorsen, WALLACE, KING, MARRARO &

BRANSON, P.L.L.C., Washington, D.C., for Appellant. Kerrie L.

Hook, COLLIER, SHANNON, RILL & SCOTT, P.L.L.C., Washing-

ton, D.C., for Appellee. ON BRIEF: John B. Williams, COLLIER,

SHANNON, RILL & SCOTT, P.L.L.C., Washington, D.C.; Ty Cobb,

HOGAN & HARTSON, Baltimore, Maryland, for Appellee.

_________________________________________________________________

OPINION

WILLIAMS, Circuit Judge:

Ida Maxwell "Maxie" Wells, who was a secretary at the Demo-

cratic National Committee (DNC) for a short time in 1972, filed a

defamation action against G. Gordon Liddy stemming from his advo-

cation of an alternative theory explaining the purpose of the June 17,

1972, Watergate break-in. During several public appearances and on

a world wide web site Liddy stated that the burglars' objective during

the Watergate break-in was to determine whether the Democrats pos-

sessed information embarrassing to John Dean. 1 More specifically,

Liddy asserted that the burglars were seeking a compromising photo-

graph of Dean's fiance that was located in Wells's desk among sev-

eral photographs that were used to offer prostitution services to out-

of-town guests.

Upon Liddy's motion for summary judgment, the district court

determined that Wells was an involuntary public figure who could not

prove actual malice by clear and convincing evidence. Additionally,

the district court determined that Louisiana law applied to all of

Wells's defamation counts and that Louisiana law would require even

a private figure to prove actual malice. On the basis of these rulings,

the district court entered judgment in Liddy's favor. Because we

determine that Wells is not a public figure for purposes of the ongoing

public debate regarding Watergate and we also conclude that Louisi-

ana law does not apply to two of Wells's defamation counts, we

reverse the district court's grant of summary judgment and remand for

further proceedings consistent with this opinion.

1 John Dean was legal counsel to President Richard M. Nixon in 1972.

I.

In February of 1972, the then-twenty-three-year-old Wells moved

from her hometown of Jackson, Mississippi to Washington, D.C. and

began work at the DNC as the secretary to Spencer Oliver, Executive

Director of the Association of State Democratic Chairmen. Wells con-

tinued in the employ of the DNC and Oliver until late July 1972.

Throughout her employment, the DNC offices were located in the

Watergate complex.

A few months after Wells started her job at the DNC, Frank Wills,

a security guard, noticed a piece of tape propping open the door to the

DNC offices while making his routine rounds during the early morn-

ing hours of June 17, 1972. See David Behrens, Day by Day, News-

day, June 17, 1992, at 63. Wills removed the tape. See id. When he

made his next scheduled rounds, however, the tape had been returned

to the doorway. See id. Suspecting that something was afoot, Wills

called the police. See id. Shortly thereafter, the police arrived and

apprehended five men: James W. McCord, Frank Sturgis, Eugenio R.

Martinez, Virgilio R. Gonzalez, and Bernard L. Barker. See Alfred E.

Lewis, Five Held in Plot to Bug Democrats' Office Here, Wash. Post,

June 18, 1972, at A1. Of these five, one was a recent CIA retiree,

three were Cuban emigres, and the fifth had trained Cuban exiles for

possible guerrilla activity after the failed Bay of Pigs invasion. See id.

The men were wearing business attire and surgical gloves. They were

carrying $2,300 in sequentially numbered one hundred dollar bills,

sophisticated electronic surveillance equipment, lock picks, door jim-

mies, one walkie-talkie, a short wave receiver, forty rolls of thirty-

five millimeter film, three pen-sized tear gas guns, see id., and the

White House phone number of E. Howard Hunt. 2 When initially

asked about the events at the Watergate, White House spokesman

Ronald Ziegler dismissed the incident as "A third-rate burglary

attempt." Gaylord Shaw, Watergate Third Rate Burglary, Newsday,

June 17, 1992, at 62.

_________________________________________________________________

2 These well-chronicled facts regarding the June 17, 1972, Watergate

break-in are not in dispute in the present appeal and are recited to pro-

vide information regarding Wells's alleged public participation at the

time of the break-in and the historical context surrounding Wells's

claims.

In the wake of the burglary, the FBI determined that Spencer Oli-

ver's telephone conversations were being electronically monitored

from a listening post located in room 723 of the Howard Johnson's

Motor Inn across the street from the Watergate. Because Wells often

used Oliver's phone to make personal calls, some of her conversa-

tions were intercepted. 3 Additionally, a drawer of Wells's desk was

opened during the break-in. As a result, she was questioned by the

FBI. Although there is some factual dispute between the parties over

whether the FBI informed Wells of the discovery, the FBI also deter-

mined that a key found in a burglar's possession fit the lock on

Wells's desk.

In September of 1972, Wells was subpoenaed to appear as a wit-

ness before the federal grand jury investigating the break-in. On Sep-

tember 15, 1972, the grand jury indicted the five burglars as well as

the two men who allegedly had coordinated the break-in, E. Howard

Hunt, a White House aide, and G. Gordon Liddy, counsel for the

Committee to Reelect the President. Watergate Chronology, News &

Observer (Raleigh, N.C.), June 17, 1992, at A4. Appearing before

Judge John Sirica in United States District Court for the District of

Columbia in early January of 1973, the five Watergate burglars

pleaded guilty to a variety of burglary, conspiracy, and wiretapping

charges. See John Berlau & Jennifer G. Hickey, List of Jailbirds is

Long, but Sentences are Short, Insight Mag., June 23, 1997, at 10.

Each of the five burglars was sentenced to a prison term. 4 See A

Watergate Scorecard, Wall St. J., Jan. 26, 1998, at A19. E. Howard

Hunt also pleaded guilty to six counts of burglary, conspiracy, and

wiretapping. See Berlau & Hickey, supra . As a result, he was impris-

oned for thirty-three months. See A Watergate Scorecard, supra.

Liddy neither pleaded guilty nor cooperated with the prosecution. He

_________________________________________________________________

was tried on multiple counts of burglary, conspiracy, and interception

of wire and oral communications, was found guilty, and received a

sentence of six to twenty years imprisonment. See Berlau & Hickey,

supra. Liddy served fifty-two months in jail as a result of his convic-

tions. See Watergate Scorecard, supra .

Shortly after pleading guilty, James McCord wrote a letter from

prison stating that he had been pressured to plead guilty and to lie

during the district court proceedings relating to the Watergate inci-

dent. See Watergate Timeline, Cin. Enquirer, June 17, 1997, at A6. In

his letter, McCord implicated John Dean, the president's counsel,

and John Mitchell, the Attorney General, as the individuals who

had been pressuring the Watergate burglars to withhold

information. See Watergate TimeLine (visited April 29, 1999),

http://vcepolitics.com/wgate/timeline.htm > .

As a result of McCord's revelations implicating high level adminis-

tration officials, in February of 1973 the United States Senate voted

(77-0) to establish a Select Committee on Presidential Campaign

Activities to be chaired by Senator Sam Ervin of North Carolina. See

id. Wells, who had by this time relocated to Atlanta, Georgia,

returned to Washington on June 20, 1974 to testify before the Com-

mittee. Wells's testimony was not part of the televised Watergate

hearings. During its investigation, the Senate Committee discovered

a campaign of political "dirty tricks" of which the Watergate break-in

was a part. The White House's effort to cover up its involvement led

to the imprisonment of several high ranking White House officials

and ultimately to the resignation of President Nixon in August of

1974.

Wells returned to Washington in 1976 and served as a secretary to

President Carter. After she left that post, she entered a Ph.D. program

in English at Louisiana State University and at the time of this lawsuit

planned to pursue a career as a college professor. Liddy was released

from prison in 1977, and since that time he has become a successful

radio talk show personality. He has also published his autobiography,

Will, and is a frequent speaker on the lecture circuit.

In 1991, Len Colodny and Robert Gettlin authored a book entitled

Silent Coup: The Removal of a President. Len Colodny & Robert Get-

tlin, Silent Coup: The Removal of a President (1991). In Silent Coup,

Colodny and Gettlin discussed new evidence regarding the Watergate

break-in and concluded that the purpose of the break-in was not sim-

ply to replace a malfunctioning listening device that had been

installed in an earlier break-in at the DNC in May 1972. 5 Rather,

Colodny and Gettlin concluded that John Dean had personally autho-

rized the Watergate break-in to protect his own reputation and the

reputation of his now-wife, Maureen Biner. 6

In Silent Coup, Colodny and Gettlin assert that an attorney, Phillip

Mackin Bailley, assisted a woman named Erica L."Heidi" Rikan

expand her preexisting call-girl operation located at the Columbia

Plaza apartments, near the Watergate, by promoting Rikan's services

to Bailley's DNC connections. The book also notes that Maureen

Biner was a close friend of Rikan. According to Silent Coup, when

Bailley came to visit the DNC, he asked for Spencer Oliver, but

because Oliver was out of the office at the time, his secretary, Wells,

gave him a tour of the DNC facilities. As a result of Bailley's contact

with the DNC, Silent Coup reports that one client per day was

referred to Rikan from DNC headquarters. Colodny and Gettlin state

that meetings with call girls were arranged on Oliver's phone while

he was out of the office, and that Oliver's telephone was the target

of the first, May 1972, Watergate break-in during which the wiretaps

were initially installed. According to Silent Coup Bailley was eventu-

ally arrested and indicted for violations of the Mann Act (transporting

under-age females across state lines for immoral purposes), extortion,

blackmail, pandering, and procuring. As a result, Bailley's address

books were seized. Silent Coup also notes that Maureen Biner's name

appeared in Bailley's address books.

_________________________________________________________________

5 This is the majority or conventional view of the purpose for the June

17, 1972, Watergate break-in. See, e.g., Karlyn Barker & Walter Pincus,

Watergate Revisited, Wash. Post, June 14, 1992, at A1.

6 The Deans filed a libel suit against Colodny, Gettlin, Liddy and Silent

Coup's publisher, St. Martin's Press, in the United States District Court

for the District of Columbia. The Deans have settled with St. Martin's

Press. See George Lardner Jr., Watergate Libel Suit Settled, Wash. Post,

July 23, 1997, at C1. The suit against Colodny, Gettlin, and Liddy is still

pending. Wells is not a party to the Deans' suit.

After news of Bailley's arrest appeared in the newspaper, together

with information regarding a Capitol Hill call-girl ring staffed by sec-

retaries, office workers, and a White House secretary, Silent Coup

reports that John Dean called the Assistant United States Attorney

investigating the Bailley case and summoned him to the White House.

During the meeting, Dean reportedly told the Assistant United States

Attorney that he thought the Democrats had leaked the prostitution

ring story. Thereafter, Dean made a photocopy of Bailley's address

books and proceeded to compare the names from the book to a list of

White House staff. Colodny and Gettlin state that Dean immediately

would have recognized Maureen Biner's name as well as the alias of

her good friend Rikan during this examination.

The implication of Colodny and Gettlin's narrative is that the June

17, 1972, Watergate break-in was ordered by Dean so that he could

determine whether the Democrats had information linking Maureen

Biner to the Bailley/Rikan call-girl ring and whether they planned to

use such information to embarrass him. After the break-in was

ordered, Alfred Baldwin, the man who was operating the listening

post at the Howard Johnson's motel, visited DNC headquarters in

order to "case" the layout of the offices. Because he posed as a friend

of Oliver to gain admittance to the office, he was referred by the

receptionist to Wells, who gave him a tour of the facility. During the

visit, Silent Coup concludes "Baldwin either somehow obtained a key

from Wells, or stole one." Colodny & Gettlin, supra at 149. Colodny

and Gettlin contend that the purloined key was found on Watergate

burglar Martinez. Although Silent Coup posits the question, "Why

would a Watergate burglar have a key to Wells's desk in his posses-

sion and what items of possible interest to a Watergate burglar were

maintained in Wells's locked desk drawer?" id. at 159, the book never

proffers a specific answer. 7

_________________________________________________________________

Liddy had extensive conversations with Colodny regarding the the-

ory of the break-in promulgated in Silent Coup beginning in 1988. By

1991, Liddy had reached the conclusion that Colodny and Gettlin's

theory was correct. As a result, in 1991 Liddy published a special

paperback edition of his autobiography Will that included a discussion

and endorsement of the Silent Coup theory. On June 3, 1991, Liddy

had a meeting with Phillip Mackin Bailley, during which Bailley dis-

cussed his involvement with the Rikan prostitution ring. During the

meeting, Bailley told Liddy that tasteful photographs of the Rikan

call-girls wearing see-through negligees were kept in a desk at the

DNC in the Oliver/Wells/Governors area. According to Bailley, vari-

ous personnel at the DNC would show the photos to DNC visitors and

would arrange rendezvous. Bailley also stated that several DNC

employees were compensated for making referrals.

After he reissued his autobiography, Liddy began routinely incor-

porating Colodny and Gettlin's Silent Coup theory, including the

_________________________________________________________________

1984, a second book was published in which the call-girl ring theory sur-

faced. In Secret Agenda: Watergate, Deep Throat and the FBI, author

Jim Hougan specifically mentioned the Columbia Plaza prostitution ring

and Phillip Bailley. See Jim Hougan, Secret Agenda: Watergate, Deep

Throat and the FBI 178 (1984). In his book, however, Hougan asserts

that the CIA, through its ex-officer E. Howard Hunt, was secretly manip-

ulating the activities leading to the Watergate break-in. See id. at 126.

Additionally, Secret Agenda also concluded that the timing of the Water-

gate break-in was influenced by Bailley's arrest. See id. at 173-74.

Finally, Secret Agenda first revealed that Wells's key was in the posses-

sion of Martinez during the burglary. See id. at 173. Lukas wrote a

review of Secret Agenda for the New York Times in November of 1984

in which he noted, "Hougan . . . suggests that the tap . . . was indeed

intercepting conversations on Mr. Oliver's phone because a D.N.C. sec-

retary was using the phone to introduce visiting Democrats [to a prosti-

tute]. Mr. Hougan does not identify the secretary at this point, but later

strongly suggests that it was Ida "Maxie" Wells, Mr. Oliver's personal

secretary." (J.A. at 405.) Wells requested that the Times retract or correct

the book review to remove references to her connection to the call-girl

ring. The request was refused. Thereafter, Wells wrote a letter to the edi-

tor stating "[a]t no time did I know anything about any link to any call

girl operation and at no time did I have any involvement in or to any call

girl operation." (J.A. at 490.)

additional information garnered from Bailley, into his public

speeches. He would do so either by informing the listeners of the

recent developments in the Watergate case as part of his prepared

remarks or in response to questions raised by audience members dur-

ing a question-and-answer period at the end of the program. Several

of Liddy's public appearances during which he presented this theory

are the subject of Wells's defamation suit. He delivered one such

speech at James Madison University in Harrisonburg, Virginia on

April 2, 1996 (JMU speech).

During the JMU speech, an audience member asked Liddy:

Mr. Liddy, I have a question . . . I want your in put [sic] on one of the theories surrounding the mystery of Watergate. [I]t specifically related to James McCord. There are some who believe that maybe he wasn't working along with you, he had ulterior motives. And what gives . . . credit to this theory is that an ex-CIA agent . . . made two critical mis- takes that really . . . caused you all to be caught. What do you think about that?

(J.A. at 996.) In response to the question, Liddy began to explain the Silent Coup theory of Watergate to the audience. During the explana- tion, he noted that the Howard Johnson's listening post "looked directly down at a desk of a secretary named Maxine Wells, and her telephone. And they had a telescopic lens camera pointed at that. And that is where the wiretap was subsequently found by the democrats on that phone." (J.A. at 998.) After explaining the Bailley/Rikan prostitu- tion ring and Maureen Biner's connection to the ring, Liddy stated:

[S]ome members of the DNC were using the call girl ring as an asset to entertain visiting firemen. And to that end they had a manila envelope that you could open or close by wrapping a string around a wafer. And in that envelope were twelve photographs of an assortment of these girls and then one group photograph of them. And what you see is what you get. It was kept he said in that desk of Ida Maxine Wells. Thus, the camera [and] all the rest of it. And what they were doing is as these people would be looking at the brochure, if you want to call it that, and making the tele- phone call to arrange the assignation that was being wiretap- ped, recorded and photographed.

(J.A. at 998-99.) Liddy gave a similar speech while on a Mediterra- nean cruise (cruise ship speech) in August 1997. 8

Liddy also discussed Watergate during an appearance on the Don

and Mike Radio show on April 25, 1997. During the Don and Mike

broadcast, Don's son Bart, who was doing research for a school proj-

ect, asked Liddy questions about Watergate:

Bart: I was wondering what was your role in the Water- gate breakup [sic] scandal? Liddy: Okay. I was the political intelligence chieftain, as well as the general counsel of the Committee to Reelect the President. . . . Now what I did not know is that John Dean did not trust me any more than I trusted him. And so my men were told, although I was not, that they were to go in there and, what, the telephone that was wired was not Mr. O'Brien's but was the telephone that was on the desk of a woman named . . . Ida Maxwell Wells . . . and she was the secretary to a man named R. Spencer Oliver. . . . . Liddy: Well next door to the Watergate was a place called the Columbia Plaza Apartments and operating in there was what is known as a call girl ring and the lawyer who repre- sented those girls was arrested by the FBI and they found his address book that had the names of his clients and also that included the call girl and there was a woman in there whose code name was "clout." . . . . Liddy: Now to make a long story short. That was kind of what it was all about and if you want a secondary source on Watergate, you know to read about what was going on and everything. There is a book called Silent Coup .

(J.A. at 1021, 1022, 1023.)

The fact of Liddy's belief in the Colodny and Gettlin Watergate

theory also appeared on the Accuracy in Media site on the world wide

web 9 in a review of the Oliver Stone directed film Nixon. Nixon

(Cinergi, Hollywood Pictures, Illusion Entertainment 1995). The

Accuracy in Media review criticized Stone for failing to seize an

opportunity to adopt the Silent Coup theory of the Watergate break-in

and for speculating that the Watergate burglars were looking for

information linking Nixon to the Bay of Pigs invasion and the assassi-

nation of President Kennedy. In support of its argument that Stone

should have pursued the Silent Coup theory, the web site character-

ized the theory as plausible and provided Liddy's explanation of the

value of the Silent Coup theory:

Not until Colodny and Gettlin wrote Silent Coup did Liddy realize that the true objective of this second raid was to get into the desk of Maxie Wells, Spencer Oliver's secretary, said to be the key figure in arranging dates with the call girls. Unknown to Liddy at the time, one of the burglars car- ried a key to Wells'[s] desk.

(J.A. at 1016.)

II.

Based upon the foregoing statements, Wells filed a defamation suit

in the United States District Court for the District of Maryland on

April 1, 1997. 10 Wells asserted that Liddy defamed her by stating to

_________________________________________________________________

9 The parties did not provide a URL for this site.

10 The face of Wells's complaint indicates some confusion over the

basis for federal court jurisdiction over this suit. Although the complaint

cites 28 U.S.C.A. § 1331 (West 1993), the statute governing federal

question jurisdiction, the complaint recites the grounds for diversity

jurisdiction under 28 U.S.C.A. § 1332 (West 1993 & Supp. 1999).

Because complete diversity is present and defamation is a state law mat-

ter, we construe this as a diversity suit.

public audiences on several occasions that she acted as a procurer of

prostitutes for men who visited the DNC. Particularly, Wells asserted

that Liddy defamed her during the JMU speech, during the cruise ship

speech, on the Don and Mike Show, and in the Accuracy in Media

web site. 11 The complaint sought one million dollars in damages for

injury to reputation, one million dollars in damages for mental suffer-

ing and three million dollars in punitive damages. Liddy filed his

Answer on April 28, 1997, and the case proceeded to discovery.

Discovery did not progress smoothly, and Wells filed several

motions to compel interrogatory answers and document production.

The motions to compel asserted that Liddy had given inadequate

answers to the interrogatories, failed to sign the interrogatory

answers, and failed to provide a privilege log for the requested docu-

ments. Wells voluntarily dismissed the motions to compel based upon

Liddy's interrogatory answers, and the district court held a hearing on

Wells's remaining motion to compel document production by confer-

ence call on October 16, 1997. At the close of the hearing, the district

court denied Wells's motion because the initial document request was

overly broad and not narrowly tailored. 12

Liddy filed a summary judgment motion on October 10, 1997.

After various responses, replies and surreplies were filed, the sum-

mary judgment motion was ripe for disposition. After a hearing, the

district court issued an opinion granting summary judgment to Liddy

on April 13, 1998. See Wells v. Liddy, 1 F. Supp.2d 532 (D. Md.

1998). In its opinion the district court first applied Maryland's lex loci

_________________________________________________________________

11 Wells also initially claimed that Liddy had defamed her on his radio

show and during a broadcast of the television show Hardball. See

Hardball (CNBC television broadcast, June 16, 1997). Wells voluntarily

dismissed these claims, however, prior to the district court's summary

judgment ruling.

12 Wells appeals the district court's denial of her motion to compel. We

review the district court's management of the discovery process under

the narrow abuse of discretion standard. See Anderson v. Foundation for

Advancement, Educ. & Empl't of Am. Indians, 155 F.3d 500, 504 (4th

Cir. 1998). We have conducted a thorough review of the briefs and the

record on this issue and cannot conclude that the district court abused its

discretion when it denied Wells's motion.

delicti tort choice-of-law rule and concluded that the law of Louisi-

ana, Wells's domicile, should apply to all of Wells's defamation

claims. See id. at 536-37. The district court then reviewed each of the

alleged defamatory statements to determine whether each one was

capable of defamatory meaning under Louisiana law. See id. at 537-

39. After considering each of the statements as a whole, the context

in which each was made, and the effect each would have upon the lis-

tener, see id. at 537 (citing Kosmitis v. Bailey, 685 So.2d 1177, 1180

(La. Ct. App. 1996)), the district court held that only the JMU speech

was capable of defamatory meaning, see id. at 537-38.

Next, the district court considered whether Wells was required to

prove that Liddy acted with actual malice. See id. at 539. In evaluat-

ing that question, the district court examined Wells's situation under

the standard established in Gertz v. Robert Welch, Inc., 418 U.S. 323

(1974), that, inter alia, established a First Amendment-driven public

figure doctrine for determining which level of a defendant's culpabil-

ity a defamation plaintiff must prove. After rejecting Liddy's conten-

tion that Wells had voluntarily injected herself into a public

controversy, the district court concluded that Wells's participation in

Watergate was such that she was one of the rare involuntary public

figures envisioned by Justice Powell in Gertz . See Wells, 1 F. Supp.2d

at 540-41. Applying this reasoning, the district court held that Wells

was required to prove actual malice. In the alternative, the district

court examined Louisiana law and determined that Louisiana required

all plaintiffs, whether public or private figures, to prove actual malice

in defamation cases against a media defendant when the publication

was on a matter of public concern. See id. at 541-42.

Turning to the application of the actual malice standard, the district

court determined that Wells was unable to prove by clear and con-

vincing evidence that Liddy knew that the information regarding her

connection to a prostitution ring was false or that he recklessly disre-

garded the truth or falsity of the information. See id. at 542, 545. Spe-

cifically, the district court ruled that although Bailley, the sole source

of Liddy's information that Wells had prostitution-related pictures in

her desk, was extremely unreliable, there was sufficient factual verifi-

cation of his information to preclude Wells, as a matter of law, from

establishing that Liddy acted with actual malice. See id. at 543-45.

As a result of these rulings, the district court granted Liddy's sum-

mary judgment motion and entered judgment on his behalf. See id. at

545. Wells immediately filed a motion for reconsideration of the rul-

ing under Rule 59 of the Federal Rules of Civil Procedure. (J.A. at

2076.) In the motion, Wells contended that she had projected suffi-

cient evidence to raise a genuine issue of material fact on the actual

malice issue, and that the district court had erred in granting summary

judgment to Liddy. The district court considered the motion, and

issued a memorandum opinion and order in which it confirmed the

grant of summary judgment to Liddy. The district court noted that

Wells had not pointed to error in its previous ruling, but rather merely

raised the argument that the district court drew the wrong legal con-

clusion on the actual malice question. As a result, the district court

denied Wells's motion to reconsider. Wells appealed.

On appeal Wells makes several assignments of error: (1) that the

district court erred in applying Louisiana libel law to all counts of the

complaint; (2) that the district court erred in denying her motion to

compel document production; (3) that the district court erred in ruling

that Wells was an involuntary public figure; (4) that the district court

erred in ruling that Liddy's cruise ship speech, Don and Mike show

statements, and Accuracy in Media web site statements were not

capable of defamatory meaning; and (5) that the district court erred

when it ruled that Wells failed to forecast sufficient evidence from

which a reasonable jury could conclude that Liddy acted with actual

malice when publicizing Wells's connection with the DNC prostitu-

tion ring during the JMU speech.

Summary judgment is appropriate when a party, who would bear

the burden on the issue at trial, does not forecast evidence sufficient

to establish an essential element of the case, see Laughlin v. Metro-

politan Washington Airports Auth., 149 F.3d 253, 258 (4th Cir. 1998),

such that "there is no genuine issue as to any material fact and the

moving party is entitled to a judgment as a matter of law," Fed. R.

Civ. P. 56(c). Viewing the facts in the light most favorable to the non-

moving party, we review a grant of summary judgment de novo. See

Laughlin, 149 F.3d at 258. When, as here, the non-moving party must

produce clear and convincing evidence to support its claim, that

higher evidentiary burden is considered as part of the summary judg-

ment calculus. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 244

(1986) (noting that the New York Times Co. v. Sullivan requirement

of clear and convincing evidence of malice must be considered on a

motion for summary judgment). Additionally, because defamation

claims raise First Amendment issues, we have "an obligation to make

an independent examination of the whole record in order to make sure

that the judgment does not constitute a forbidden intrusion on the

field of free expression." Milkovich v. Lorain Journal Co., 497 U.S.

1, 17 (1990) (internal quotation marks omitted). These principles

guide our evaluation of Wells's claims.

III.

An individual's interest in protecting his good reputation from

being falsely impugned, the interest at the core of modern defamation

law, has been carefully guarded from time immemorial. See Rodney

A. Smolla, Law of Defamation § 1.01 (1998) (citing Exodus 20:16,

"Thou shalt not bear false witness against thy neighbour"). The com-

mon law "has afforded a cause of action for damage to a person's rep-

utation by the publication of false and defamatory statements" since

the second half of the sixteenth century. Milkovich v. Lorain Journal

Co., 497 U.S. 1, 11 (1990). Since the founding of the United States,

state governments primarily have been responsible for developing

defamation law adequate to protect citizens' reputational interests;

"[t]he protection of private personality, like the protection of life

itself, is left primarily to the individual States under the Ninth and

Tenth Amendments." Rosenblatt v. Baer, 383 U.S. 75, 92 (1966)

(Stewart, J., concurring) (cited with approval in Gertz v. Robert

Welch, Inc., 418 U.S. 323, 341 (1974)). "Prior to 1964, the common

law of defamation strongly favored the State's interest in preventing

and redressing injuries to individuals' reputations, and the prevailing

view gave little or no weight to First Amendment considerations."

Foretich v. Capital Cities/ABC, Inc., 37 F.3d 1541, 1551 (4th Cir.

1994).

In 1964, however, the landmark decision New York Times Co. v.

Sullivan, 376 U.S. 254 (1964), changed the course of defamation law.

In New York Times Co., the Court first determined that the First

Amendment limits state law remedies available to a defamation plain-

tiff. See id. at 269. The Court announced that the First Amendment,

as incorporated and applied to the states through the Fourteenth

Amendment, prohibited "a public official from recovering damages

for a defamatory falsehood relating to his official conduct unless he

proves that the statement was made with `actual malice' -- that is,

with knowledge that it was false or with reckless disregard of whether

it was false or not." Id. at 279-80. The limits of the New York Times

Co. standard have been further explored and defined in a series of

High Court defamation cases: Curtis Publ'g Co. v. Butts, 388 U.S.

130 (1967); Rosenbloom v. Metromedia, Inc., 403 U.S. 29 (1971),

overruled by Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974); Time,

Inc. v. Firestone, 424 U.S. 448 (1976); Wolston v. Reader's Digest

Ass'n, Inc., 443 U.S. 157 (1979); Hutchinson v. Proxmire, 443 U.S.

111 (1979); and Philadelphia Newspapers, Inc. v. Hepps, 475 U.S.

767 (1986).

Because a Constitutional defamation jurisprudence has developed,

the state law of defamation has been displaced to the extent that the

state law conflicts with Constitutional law. The primary framework of

a defamation claim, however, continues to be a state law tort claim.

This commingling of state law and Constitutional law has created a

complex jurisprudence of interlocking and overlapping Constitutional

and state law inquiries. On appeal, Wells has raised questions of both

state and Constitutional defamation law. We first address the state law

issues.

Wells's state law questions are two-fold. First, Wells appeals the

district court's ruling on choice of law. Second, Wells asserts that the

district court erred when it concluded that Liddy's statements made

during the cruise ship speech, the Accuracy in Media web site, and

the Don and Mike show appearance were not capable of defamatory

meaning. After a brief review of choice-of-law principles, we will

address each of Wells's four defamation claims in turn to review the

district court's conclusion regarding the applicable law and each

statement's possible defamatory meaning.

A.

Wells asserts that the district court misapplied Maryland's lex loci

delicti choice-of-law rule for tort claims when it determined that the

JMU speech claim, the cruise ship speech claim, and the Don and

Mike show claim were subject to the law of Wells's domicile, Louisi-

ana, rather than to the law of Virginia. 13 During the proceedings

below, the district court applied, as a default rule, the law of Louisi-

ana, the place of Wells's domicile, to all four of her claims of defama-

tion. The district court noted that "[i]dentifying the place of injury is

somewhat problematic in a case such as this where the plaintiff does

not allege concrete harm." Wells, 1 F. Supp.2d at 536. Therefore, it

determined that under Maryland's choice-of-law rules the presump-

tive place of the harm in a defamation action should be the plaintiff's

domicile. Wells asserts that the district court erred in applying Louisi-

ana law to the JMU speech claim, the cruise ship speech claim, and

the Don and Mike show claim. Instead, Wells asserts that Virginia

law, for varying reasons, should have been applied to each of these

claims.

A federal court sitting in diversity must apply the choice-of-law

rules from the forum state. See Klaxon Co. v. Stentor Elec. Mfg. Co.,

313 U.S. 487, 496-97 (1941). For tort claims, Maryland adheres to the

First Restatement of Conflict of Laws rule, lex loci delicti commissi,

or the law of the place of the harm, to determine the applicable sub-

stantive law. See Naughton v. Bankier, 691 A.2d 712, 716 (Md. Ct.

Spec. App. 1997). Under the First Restatement, the place of the harm

is defined as "the state where the last event necessary to make an

actor liable for an alleged tort takes place." Restatement (First) of

Conflict of Laws § 377 (1934); see generally Eugene F. Scoles &

Peter Hay, Conflict of Laws 571 (2d ed. 1992) (discussing lex loci

delicti); Robert L. Felix, Leflar in the Courts: Judicial Adoptions of

Choice-Influencing Considerations, 52 Ark. L. Rev. 35 (1999) (sur-

veying states' decisions to move away from lex loci delicti regime).

In defamation actions, the place of the harm has traditionally been

considered to be the place where the defamatory statement was pub-

lished, i.e., seen or heard by non-parties. See Restatement (First) of

Conflicts § 377 n.5 ("[W]here harm is done to the reputation of a per-

son, the place of wrong is where the defamatory statement is commu-

nicated."); Lapkoff v. Wilks, 969 F.2d 78, 81 (4th Cir. 1992) (applying

lex loci delicti rule and concluding that when defamatory statements

occurred in Virginia, Virginia law applied); Clair v. Righter, 250 F.

Supp. 148, 150 (W.D. Va. 1966) (stating that the place of publication

_________________________________________________________________

13 Wells does not challenge the district court's conclusion that the law

of Louisiana applies to the Accuracy in Media web site claim.

is the last event necessary to render the tort-feasor liable in a defama-

tion action); see also James R. Pielemeier, Constitutional Limitations

on Choice of Law: The Special Case of Multistate Defamation, 133

U. Pa. L. Rev. 381, 393-94 (1985) (noting that as a general rule the

place of publication is the place of the harm).

With this framework in mind, we address each of Wells's four def-

amation claims and apply the correct law to the legal question of

whether the statement is capable of a defamatory meaning.

1.

Applying Maryland's choice-of-law analysis to the JMU speech is

quite straightforward. Liddy delivered the JMU speech on April 2,

1996, in Harrisonburg, Virginia. The record indicates that the speech

was never broadcast by any means and was heard only by the audi-

ence at JMU. Therefore, publication of the speech occurred solely in

Virginia. Applying Maryland's traditional lex loci delicti rule as dis-

cussed above, it is clear that the law of Virginia should have been

applied to this claim. The district court erred when it applied the law

of Louisiana.

The district court ruled that under Louisiana law the JMU speech

was capable of defamatory meaning. Applying Virginia law to the

same question, we also conclude that the JMU speech is capable of

conveying a defamatory meaning. Under Virginia law, the question

of whether a statement is capable of having a defamatory meaning is

a legal question. See Yeagle v. Collegiate Times , 497 S.E.2d 136, 138

(Va. 1998) (noting that trial court had responsibility to determine as

a matter of law whether an allegedly defamatory phrase was capable

of defamatory meaning).

The Virginia standard for determining whether words are capable

of defamatory meaning derives from the common law:

At common law defamatory words which are actionable per se are: (1) Those which impute to a person the commission of some criminal offense involving moral turpitude, for which the party, if the charge is true, may be indicted and punished. (2) Those which impute that a person is infected with some contagious disease, where if the charge is true, it would exclude the party from society. (3) Those which impute to a person unfitness to perform the duties of an office or employment of profit, or want of integrity in the discharge of the duties of such an office or employment. (4) Those which prejudice such person in his or her profession or trade.

Carwile v. Richmond Newspapers, Inc., 82 S.E.2d 588, 591 (Va. 1954). 14 Additionally, Virginia recognizes that "[a]ll other defamatory words which, though not in themselves actionable, occasion a person special damage are actionable." Id., accord Fleming v. Moore, 275 S.E.2d 632, 635 (Va. 1981).

Virginia law requires that the potential defamatory meaning of

statements be considered in light of the plain and ordinary meaning

of the words used in context as the community would naturally under-

stand them. See Old Dominion Branch No. 496 v. Austin, 192 S.E.2d

737, 742 (Va. 1972), rev'd on other grounds, 418 U.S. 264 (1974).

We look not only to the actual words spoken, but also to "inferences

fairly attributable to [them]," Yeagle , 497 S.E.2d at 138, and consider

whether the words have the potential to hurt the plaintiff's reputation

among the "important and respectable" parts of the community.

Weaver v. Beneficial Finance Co., 106 S.E.2d 620, 622 (Va. 1959).

During the JMU speech, Liddy made the following statements per-

taining to Wells:

[The surveillance camera at the listening post in the Howard _________________________________________________________________ 14 To the extent that Virginia's law of defamation per se once allowed the jury to award actual damages without a showing of fault or allowed for the recovery of presumed or punitive damages without a showing of actual malice, those aspects of Virginia law have been superseded by the Supreme Court. See Philadelphia Newspapers, Inc. v. Hepps, 475 U.S. 767, 774 (1986) (noting that the First Amendment required all plaintiffs to make a showing of at least negligence to allow recovery for actual damages and all plaintiffs are required to show actual malice in order to recover presumed or punitive damages).

Johnson's] looked directly down at a desk of a secretary named Maxine Wells, and her telephone. And they had a telescopic lens camera pointed at that. And that is where the wiretap was subsequently found by the democrats on that phone.

(J.A. at 998.)

[S]ome members of the DNC were using the call girl ring as an asset to entertain visiting firemen. And to that end they had a manila envelope that you could open or close by wrapping a string around a wafer. And in that envelope were twelve photographs of an assortment of these girls and then one group photograph of them. And what you see is what you get. It was kept . . . in that desk of Ida Maxine Wells. Thus, the camera [and] all the rest of it. And what they were doing is as these people would be looking at the brochure, if you want to call it that, and making the telephone call to arrange the assignation that was being wiretapped, recorded and photographed.

(J.A. at 998-99.)

Ascribing to these words their plain meaning and understanding

them as the community would naturally understand them in their con-

text, we conclude that the actual words spoken by Liddy are capable

of defamatory meaning, namely, that Wells was a participant in a

scheme to procure prostitutes. Liddy mentioned Wells during the

JMU speech as the focus of illicit surveillance activities linked to the

effort to get information on a prostitution ring operating out of the

DNC. He mentioned her specifically because the prostitution "bro-

chure" was kept in her desk and her phone was used to arrange meet-

ings with prostitutes. Additionally, a fair inference from Liddy's

statements is that Wells was not only involved in prostitution activi-

ties but was the primary DNC contact for the prostitution ring. Based

upon Liddy's statements, a reasonable listener could readily conclude

that Wells's desk was the center of prostitution activity at the DNC.

It follows that if Wells's desk was the primary location of illicit activ-

ity at the DNC, then Wells herself may have been deeply involved.

Liddy's words, and a fair implication thereof, "impute to [Wells]

the commission of some criminal offense involving moral turpitude,"

Carwile, 82 S.E.2d at 591 -- procuring prostitution services. There-

fore, under Virginia law, Liddy's statements made during the JMU

speech are capable of conveying a defamatory meaning. See id.

2.

Wells also challenges both the district court's choice-of-law ruling

and its defamatory meaning ruling pertaining to the cruise ship speech

claim. Liddy allegedly defamed Wells while giving a speech on a

seven-day Mediterranean cruise. 15 Wells asserts that it was error for

the district court to apply Louisiana law, the law of her domicile, to

this claim. Instead, for reasons that are not entirely clear from her

argument, she suggests that Virginia law should have been applied.

Wells also avers that the district court erred when it ruled that Liddy's

cruise ship statements were not capable of defamatory meaning

because "testimony d[id] not establish the exact nature of the state-

ments sufficiently to demonstrate that the statements were capable of

defaming Wells." Wells, 1 F. Supp.2d at 538. We address the choice-

of-law issue and the defamatory meaning issue in turn and conclude

that the district court erred in both respects.

The district court's application of Louisiana law to a case of defa-

mation at sea was incorrect. "All cases involving a tort committed on

navigable water, whether brought under federal admiralty jurisdiction,

in state court under the saving-to-suitors clause, or in federal court

under diversity jurisdiction, are governed by admiralty law." Byrd v.

Byrd, 657 F.2d 615, 617 (4th Cir. 1981); accord Kermarec v. Com-

pagnie Generale Transatlantique, 358 U.S. 625, 628 (1959); see

Pryor v. American President Lines, 520 F.2d 974, 977 (4th Cir. 1975)

(noting that under either federal diversity or admiralty jurisdiction tort

claim would be rooted in maritime law); Scott v. Eastern Air Lines,

Inc., 399 F.2d 14, 25 (3d Cir. 1968) (opinion on rehearing)

("[M]aritime principles will govern the tort aspects of the case, since

admiralty standards define liability for a maritime tort, whether the

_________________________________________________________________

15 The record does not clarify whether at the time of the speech Liddy

was in international or territorial waters. The country of the ship's flag

also is unestablished.

proceeding is instituted in admiralty or on the law side of the court.");

see also Theodore F. Stevens, Erie R.R. v. Tompkins and the Uniform

General Maritime Law, 64 Harv. L. Rev. 246, 269 (1950) (noting that

federal courts should apply general maritime law to maritime cases

brought under diversity jurisdiction). In this case, the alleged defama-

tion of Wells occurred when Liddy delivered a speech on a ship sail-

ing on the high seas. 16 Hence, the governing law is not the common

law of any single state, but rather is the general maritime law as inter-

preted and applied by the courts of the United States. See

Knickerbocker Ice Co. v. Stewart, 253 U.S. 149, 159 (1920); cf.

Guidry v. Durkin, 834 F.2d 1465, 1470 (9th Cir. 1987) (noting that

tort of defamation is cognizable under general maritime law when

prima facie elements occur on the high seas). Were Maryland choice-

of-law rules applicable here, they too would point us to the general

maritime law. Maryland's lex loci delicti principles as outlined above

counsel that the law of the place of publication governs defamation

claims. Here, the place of publication was the high seas.

"Drawn from state and federal sources, the general maritime law

is an amalgam of traditional common-law rules, modifications of

those rules, and newly created rules." East River Steamship Corp. v.

Transamerica Delaval, Inc., 476 U.S. 858, 864-65 (1986). The role

of state law in maritime cases is significant and complex. 17 "State law

_________________________________________________________________

16 We leave open the question of whether this defamation claim could

have been brought in the first instance under the federal court's admiralty

jurisdiction, see 28 U.S.C.A. § 1333 (West 1993), and address admiralty

matters only insofar as is relevant to the choice-of-law question before

us. We express no opinion on whether the defamation in this case or def-

amation generally affects maritime commerce or bears a substantial rela-

tionship to traditional maritime activity. See Sisson v. Ruby, 497 U.S.

358, 362 (1990); see also id. at 374 (Scalia, J., concurring) (implying that

the holding of Sisson removes defamation actions from admiralty juris-

diction).

17 In a recent decision the Supreme Court noted that it has never pre-

cisely delineated the scope of admiralty's preemption of state law. See

Yamaha Motor Corp., U.S.A. v. Calhoun, 116 S. Ct. 619, 626 n.8 (1996)

("Our precedent does not precisely delineate that scope [of remaining

state regulation of maritime law]. . . . [i]t would be idle to pretend that

the line separating permissible from impermissible state regulation is

readily discernible in our admiralty jurisprudence." (internal quotation

marks omitted, second alteration in original)).

may . . . supplement federal maritime law, as in the exercise of its

police powers or in the additional maritime tort remedy; state law

may not, however, conflict with federal maritime law, as it would be

redefining the requirements or limits of a remedy available at admi-

ralty." Powell v. Offshore Navigation, Inc. , 644 F.2d 1063, 1065 n.5

(5th Cir. 1981). State law is said to conflict with general maritime law

when it negatively impacts upon admiralty's foremost goal -- unifor-

mity. See Maryland Dep't of Natural Resources v. Kellum, 51 F.3d

1220, 1227 (4th Cir. 1995); Lewis v. Timco, Inc. , 716 F.2d 1425, 1428

(5th Cir. 1983) ("[M]aritime law traditionally resists doctrinal change

that might balkanize its uniformity and generality."); Byrd, 657 F.2d

at 617. Thus, "courts applying maritime law have repeatedly rejected

choice of law notions that would reference state tort doctrines."

Lewis, 716 F.2d at 1428.

After a thorough review, it appears that there is no well-developed

body of general maritime law of defamation. In such a situation, it is

clear that the general maritime law may be supplemented by either

state law, see Bell v. Tug Shrike, 332 F.2d 330, 334 (4th Cir. 1964),

or more general common law principles, see Marastro Compania

Naviera, S.A. v. Canadian Maritime Carriers, Ltd. , 959 F.2d 49, 53

(5th Cir. 1992) (applying the Restatement (Second) of Torts in the

absence of general maritime law of trespass); Vickers v. Chiles Drill-

ing Co., 822 F.2d 535, 538 (5th Cir. 1987) (applying Restatement

(Second) of Torts for principles of product liability law); Nissan

Motor Corp. in U.S.A. v. Maryland Shipbuilding & Drydock Co., 544

F. Supp. 1104, 1110-111 (D. Md. 1982) (applying Restatement (Sec-

ond) of Torts for law of trespass and nuisance). Because great diver-

sity exists among the states' defamation laws, we conclude that it

would be more appropriate to apply general common law tort princi-

ples rather than the specific law of a single state. Application of a sin-

gle state's defamation law would "impair the uniformity and

simplicity which is a basic principle of the federal admiralty law."

Nissan Motor Corp., 544 F. Supp. at 1111 (internal quotation marks

omitted). Accordingly, we determine that the common law as com-

piled in the Restatement (Second) of Torts should control our evalua-

tion of Wells's claim of shipboard defamation. See Marastro

Compania Naviera, 959 F.2d at 53 (applying Restatement in absence

of clear general maritime law on point); Vickers , 822 F.2d at 538

(same); Nissan Motor Corp., 544 F. Supp. at 1111 (same).

Thus, we will apply the standards of the Restatement (Second) of

Torts to determine whether Liddy's cruise ship speech is capable of

defamatory meaning. 18 Under the Restatement, the questions of

"whether a communication is capable of bearing a particular mean-

ing" and "whether that meaning is defamatory" are questions of law.

Restatement (Second) of Torts § 614 (1977). Further, the Restatement

states that "[a] communication is defamatory if it tends so to harm the

reputation of another as to lower him in the estimation of the commu-

nity or to deter third persons from associating or dealing with him."

Id. § 559. In determining whether words are capable of conveying a

defamatory meaning the court must "take into account all of the cir-

cumstances surrounding the communication of the matter complained

of as defamatory." Id. § 614 cmt. d. "A communication to be defama-

tory need not tend to prejudice the other in the eyes of everyone in

the community or of all of his associates, nor even in the eyes of a

majority of them. It is enough that the communication would tend to

prejudice him in the eyes of a substantial and respectable minority of

them." Id. § 559 cmt. e. "On the other hand it is not enough that the

communication would be derogatory in the view of a single individual

or a very small group of persons." Id. We turn now to the task of

determining whether Liddy's cruise ship speech is capable of defama-

tory meaning.

As evidence of what statements were made on the Mediterranean

cruise, we have Liddy's own deposition testimony regarding the

events that transpired aboard the ship:

Q: I was told that in August you were scheduled to do some boat trip around the Mediterranean or something. Did that take place?

_________________________________________________________________ 18 We emphasize that the question of whether a statement is capable of a defamatory meaning is not the end of the matter. It is but one of the required elements of the defamation claim. Before any liability attaches to the defendant, the jury must determine whether the plaintiff was actu- ally defamed (including whether the statements were true or false), whether the defendant acted with the requisite level of fault, and whether the plaintiff was damaged. See Rodney A. Smolla, Law of Defamation § 1.08 (1998). The statements we have made in support of our legal determination are in no way intended to forecast the jury's ultimate con- clusion on these questions.

Liddy: Yes. Q: Now, when you are on a trip like that would you tell the Watergate story as you now believe it to be, that you tell in your book? Liddy: Yes. Sometimes, there are sometimes when I have given a speech that was a bring up to date, what we have learned through the Dean case of Watergate. Other times the speech has absolutely nothing to do with Watergate .. . a motivational speech. Typically, at the end of a motivational speech I will have a question and answer period and some- times the subject of Watergate comes up, sometimes it does not. Q: But on the boat trip, did you discuss the Watergate the- ory as you now believe it? . . . . Q: Did you mention the name of Ida Maxwell Wells on the boat? Liddy: I think I did. Q: Did you say to the people on the boat that she kept pic- tures of prostitutes in her desk? . . . . Liddy: My best recollection is that I said that the target of the second break-in was the desk in the Oliver/Wells area that was assigned to one Ida Maxie Wells. Q: And did you say there were pictures of prostitutes in that desk, and that's why Martinez had the key and went after it? Liddy: I said that the evidence indicates that there were photographs of women in the desk who were available for prostitution activities. Q: But did you say that to the people on the boat in August 1997, that you believe there were pictures of prostitutes in Maxie Wells'[s] desk? Liddy: In the desk of Maxie Wells. I would also mention that in addition to Miss Wells having a key, Mr. Martinez had a key . . . . Q: Did you say that in the speech in August 1997 that visi- tors to the DNC would be shown these pictures of prosti- tutes? Liddy: I said the photographs would act as a brochure.

(J.A. at 1131-34.)

The district court determined that Liddy's testimony"d[id] not

establish the exact nature of the statements sufficiently to demonstrate

that the statements were capable of defaming Wells" because "Liddy

was not even certain that he had mentioned Wells's name on the

cruise ship." Wells, 1 F. Supp.2d at 538.

We disagree. Reviewing Liddy's deposition testimony in context,

that testimony indicates that he gave a speech on the cruise ship dur-

ing which he discussed the Watergate break-in and can be viewed as

capable of defamatory meaning, specifically, that Wells's desk con-

tained pictures of prostitutes whose services would be offered to men

visiting the DNC. Liddy's deposition was taken in November of 1997,

only three months after the cruise ship speech, so the fact that some

of his answers are based upon his "best recollection" is not particu-

larly alarming. Nor do we share the district court's concern that

Liddy's testimony "did not expressly differentiate between what he

said on the boat and what he generally advances as his theory." Wells,

1 F. Supp.2d at 538. The majority of Liddy's answers directly address

his memory of the speech he gave during the cruise. The district court

based its conclusion that Liddy was not discussing a specific recollec-

tion of the cruise ship speech upon one statement that used the phrase

"I would also mention." Id. Given that we are obligated to review the

evidence in its full context and view it in the light most favorable to

Wells, the nonmoving party, to determine whether a statement is

capable of defamatory meaning, we believe the district court took too

narrow a view, discounting several more definite statements of what

transpired on the basis of one slightly unclear statement. Further,

Liddy's statement that he "would also mention" does not necessarily

indicate that he was speaking of his general Watergate presentation

to the exclusion of what he said on the cruise ship. Rather, it is just

as likely that Liddy was communicating to the questioner the fact that

he always said the same thing during his speeches, including the

speech delivered on the cruise ship.

Liddy's own testimony supports the conclusion that he told the

cruise ship audience that Wells's locked desk held pictures of prosti-

tutes that were shown to visiting men. Such a statement can be

viewed as implying that Wells was involved procuring prostitution

services, and as a result that Wells was involved in immoral criminal

acts. A statement implicating Wells in prostitution activities "tends so

to harm [her] reputation . . . as to lower h[er] in the estimation of the

community or to deter third persons from associating or dealing with

h[er]." Restatement (Second) of Torts § 559. Although a jury, upon

further factual development, may not conclude that Wells was actu-

ally defamed during the cruise ship speech, Liddy's testimony sup-

ports the conclusion that he made statements during the cruise ship

speech that meet the legal test for defamatory meaning.

3.

Next, Wells asserts that the district court improperly applied Loui-

siana law to the Don and Mike show broadcast and erred when it

determined that the statements on the radio show were not capable of

defamatory meaning. Finding no error in the district court's rulings,

we affirm.

The Don and Mike radio show is a nationally syndicated daily

show that can be heard throughout the United States. As such, any

defamatory content is published simultaneously in multiple state juris-

dictions. Because of the widespread simultaneous publication of the

allegedly defamatory statement in many different jurisdictions, appli-

cation of the traditional lex loci delicti rule becomes cumbersome, if

not completely impractical. See James R. Pielemeier, Constitutional

Limitations on Choice of Law: The Special Case of Multistate

Defamation, 133 U. Pa. L. Rev. 381, 393-94 (1985) (noting choice of

law difficulties in First Restatement jurisdictions). Maryland has not

yet promulgated a unique choice of law rule made applicable to multi-

state defamation cases to correct the obvious deficiency of the lex loci

delicti rule in this context. See Fornshill v. Ruddy, 891 F. Supp. 1062,

1069 (D. Md. 1995).

As a court sitting in diversity, we have an obligation to interpret the

law in accordance with the Court of Appeals of Maryland, or where

the law is unclear, as it appears that the Court of Appeals would rule.

See Liberty Mut. Ins. Co. v. Triangle Indus., 957 F.2d 1153, 1156 (4th

Cir. 1992) (holding that if state law is unclear federal courts must pre-

dict the decision of the state's highest court); Brendle v. General Tire

& Rubber Co., 505 F.2d 243, 245 (4th Cir. 1974). To forecast a deci-

sion of the state's highest court we can consider, inter alia: canons of

construction, restatements of the law, treatises, recent pronounce-

ments of general rules or policies by the state's highest court, well

considered dicta, and the state's trial court decisions. See Liberty

Mut., 957 F.2d at 1156.

In recent years, the Court of Appeals of Maryland has indicated its

willingness to apply more flexible choice-of-law rules from the Sec-

ond Restatement in situations when the First Restatement rules have

become unworkable. Specifically, in Hauch v. Connor, 453 A.2d

1207 (Md. 1983), the Court of Appeals of Maryland moved away

from a strict lex loci delicti approach in the field of workers' compen-

sation law, and instead adopted an approach considering the Second

Restatement's most significant relationship test. See id. at 1214. Simi-

larly, in American Motorists Ins. Co. v. ARTRA Group, Inc., 659 A.2d

1295 (Md. 1995), the Court of Appeals adopted a limited version of

the concept of renvoi from the Second Restatement and in so doing

displaced the strict lex loci contractus rule of the First Restatement.

See id. at 1301. Because multistate defamation is a tort for which the

lex loci delicti rule fails to reach a satisfactory result on the choice of

applicable substantive law, we believe, based upon the cases cited

above, that the Court of Appeals of Maryland would consider the rule

outlined in the Restatement (Second) of Conflict of Laws to select the

applicable substantive law. See Fornshill, 891 F. Supp. at 1069

(applying Second Restatement to choice of laws issue in Maryland

venue multistate defamation claim); Crowley v. Fox Broadcasting

Co., 851 F. Supp. 700, 702 (D. Md. 1994) (same).

The Second Restatement contains a specific section addressing

multistate defamation that provides:

(1) The rights and liabilities that arise from defamatory matter in any . . . broadcast over radio or television . . . or similar aggregate communication are determined by the local law of the state which, with respect to the particular issue, has the most significant relationship to the occurrence and the parties under the principles stated in § 6. (2) When a natural person claims that he has been defamed by an aggregate communication, the state of most significant relationship will usually be the state where the person was domiciled at the time, if the matter complained of was published in that state.

Restatement (Second) of Conflict of Laws § 150 (1971). Wells notes that the Don and Mike show was broadcast in Louisiana, the state of her domicile. Therefore, following the Second Restatement, Louisiana law applies to the Don and Mike show claim.

Under Louisiana law, whether a statement is capable of having a

defamatory meaning is a question of law. See Ryan v. Shreveport

Times Publ'g Co., 344 So.2d 114, 117 (La. Ct. App. 1977) ("Whether

the words used are capable of a defamatory meaning is a question of

law for a determination by the court, and not a question of fact to be

decided by a jury. If the court concludes, as a matter of law, the words

are capable of having a defamatory meaning, it then becomes a jury

question whether the words, as applied to plaintiff, in fact defamed

him.") To determine whether words are capable of defamatory mean-

ing, Louisiana applies the following standard:

29

Defamatory words are those that would expose a person to contempt or ridicule, or cause a person to be shunned or avoided. Defamatory words include almost any language which on its face has a tendency to injure a person's reputa- tion. Consideration must be given to the entire statement that was made and the circumstances of its publication. Words which impute criminal action to another are defama- tory per se.

Tonubbee v. River Parishes Guide, 702 So.2d 971, 974 (La. Ct. App. 1997), cert. denied, 119 S. Ct. 142 (1998).

In deciding whether the words are capable of a defamatory meaning, the publication must be read as a whole. The words must be construed according to the meaning that will be given them by reasonable individuals of ordinary intelli- gence and sensitivity. Their significance must not be dis- torted to give an unusual meaning, and they are to be understood only in the context in which they were used and in the manner shown by the circumstances under which they were used.

Brown v. News-World Publ'g Corp., 245 So.2d 430, 433 n.1 (La. Ct. App. 1971) (internal quotation marks and citations omitted). We turn now to applying the Louisiana law to Liddy's statements on the Don and Mike show. Wells asserts that the following state- ments are capable of defamatory meaning:

Liddy: Okay, I was the political intelligence chieftain, as well as the general counsel of the Committee to Reelect the President. . . . Now what I did not know is that John Dean did not trust me any more than I trusted him. And so my men were told, although I was not, that they were to go in there and, what, the telephone that was wired was not Mr. O'Brien's but was the telephone that was on the desk of a woman named . . . Ida Maxwell Wells . . . and she was the secretary to a man named R. Spencer Oliver. Liddy: Well next door to the Watergate was a place called the Columbia Plaza Apartments and operating in there was what is known as a call girl ring and the lawyer who repre- sented those girls was arrested by the FBI and they found his address book that had the names of his clients and also that included the call girl and there was a woman in there whose code name was "clout." . . . . Liddy: Now, to make a long story short. That was kind of what it was all about and if you want a secondary source on Watergate, you know, to read about what was going on and everything. There is a book called Silent Coup .

(J.A. at 1021, 1022, 1023.)

We cannot conclude that these statements when read in context and

given their ordinary and common meaning would be understood "by

reasonable individuals of ordinary intelligence and sensitivity," as

impugning Wells's reputation. Brown, 245 So.2d at 433 n.1. Although

the statements indicate that the telephone on Wells's desk was bugged

during Watergate, the statements do not indicate her participation in

that activity or any other criminal acts, including prostitution activi-

ties. Establishing only a connection between Wells and Watergate is

not sufficient to create defamatory meaning. Liddy's comments on the

Don and Mike show do not take the extra step of establishing a direct

connection between Wells, or even her desk, and the prostitution ring

to which the DNC was allegedly referring visitors.

Here, Liddy merely referred listeners to Silent Coup for the details

of the Watergate break-in. Wells argues that the Silent Coup reference

is sufficient to alert listeners to the alleged connection between her

and the DNC call-girl ring. We cannot agree. Silent Coup itself does

not explicitly state that Wells was personally involved in prostitution

activities. Under Louisiana law, we must assess the defamatory mean-

ing of a claim in terms of the reasonable listener of ordinary sensitiv-

ity. See Brown, 245 So.2d at 433 n.1. A reasonable Don and Mike

listener familiar with Silent Coup would not necessarily reach the

conclusion that Wells was linked to prostitution activities. Thus, fair

inferences from the Don and Mike show broadcast do not negatively

impact Wells's reputation. Accordingly, we conclude that the state-

ments are not capable of defamatory meaning, and we affirm the dis-

trict court's grant of summary judgment on this claim.

4.

Finally, we assess the final allegedly defamatory statement, the

comments that appeared on the Accuracy in Media web site. Wells

does not challenge the district court's application of Louisiana law to

this claim. Louisiana law is applicable because publication from a

world wide web site is another example of multistate defamation, and,

therefore, following our analysis in the previous part, we apply the

law of Wells's domicile.

For an unknown period of time, the Accuracy in Media web site

contained the following statement:

Not until Colodny and Gettlin wrote Silent Coup did Liddy realize that the true objective of this second raid was to get into the desk of Maxie Wells, Spencer Oliver's secretary, said to be the key figure in arranging dates with the call girls. Unknown to Liddy at the time, one of the burglars car- ried a key to Wells'[s] desk.

(J.A. at 1016.) Of the four statements that Wells has claimed to be defamatory, this statement most clearly associates Wells with crimi- nal activity. As a result, the statement is capable of defamatory mean- ing. There are evidentiary problems, however, that preclude attributing the statement to Liddy, and, therefore, the district court's grant of summary judgment was appropriate.

The record is devoid of any proof that Liddy ever spoke to Accu-

racy in Media regarding the Watergate break-in 19 or authorized them

_________________________________________________________________

19 There is evidence in the record that Liddy had a dinner meeting with

representatives of Accuracy in Media during which they discussed the

death of Vincent Foster. We cannot conclude, however, that because

Liddy met with Accuracy in Media on one occasion, he necessarily pub-

lished his theory of Watergate.

to use his theory. Thus, we cannot conclude that Wells has met an

essential element of a defamation cause of action under Louisiana law

-- publication. See Wiggins v. Creary, 475 So.2d 780, 782 (La. Ct.

App. 1985) ("The elements of [a] cause of action in defamation are

(1) defamatory words, (2) publication to a third party, (3) falsity of

the statement, and (4) injury."). Further, assuming the Accuracy in

Media web site is a republication of Liddy's views on Watergate,

Louisiana law holds as a general rule that the original author/speaker

is not liable for the voluntary republication of his statements by oth-

ers. See id. An exception to this rule exists when the republication is

the "natural and probable consequence of the defendant's act."

Giordano v. Tullier, 139 So.2d 15, 19 (La. Ct. App. 1962). Here,

however, Wells has not pleaded or put forth any proof on this point

of Louisiana law. Because Wells has not raised a genuine issue of

material fact on this matter, we hold that the district court's grant of

summary judgment on this claim was correct and must be affirmed.

B.

In sum, we hold that the district court's grant of summary judgment

was proper on the Don and Mike show and Accuracy in Media web

site claims. We conclude, however, that the district court erred when

it determined that Louisiana law applied to Wells's JMU speech and

cruise ship speech claims. Applying Maryland's lex loci delicti rule,

the substantive defamation law controlling the JMU speech must be

the law of Virginia. The cruise ship speech claim, asserting that defa-

mation occurred shipboard during a Mediterranean cruise, points us

to general maritime law of defamation and consequently to the

Restatement (Second) of Torts. Applying the correct substantive law,

we determine that both the JMU speech claim and the cruise ship

claim are capable of defamatory meaning. Having resolved these state

law matters, we turn next to Wells's public figure status.

IV.

Wells next appeals the district court's conclusion that for purposes

of the public debate on Watergate she is an involuntary public figure,

and therefore required to prove that Liddy acted with actual malice

before she can recover compensatory damages for actual injury.

Liddy argues that the district court's conclusion that Wells is an

involuntary public figure is correct and asserts in the alternative that

Wells's participation in Watergate-related dialogue is sufficient to

qualify her as a voluntary limited-purpose public figure. Because the

level of culpability the plaintiff must prove to recover compensatory

damages under state law is dependent upon the plaintiff's public or

private figure status, we must address this issue, which is a matter of

law. See Fitzgerald v. Penthouse Int'l, Ltd., 691 F.2d 666, 669-70 (4th

Cir. 1982).

A.

The public figure inquiry is a First Amendment-influenced area of

defamation jurisprudence. As we noted briefly above, prior to New

York Times Co. v. Sullivan, 376 U.S. 254 (1964), defamation law was

entirely an area of state concern and was immune from First Amend-

ment restraints. In New York Times Co., however, the Supreme Court

announced that the First and Fourteenth Amendments prohibit "a pub-

lic official from recovering damages for a defamatory falsehood relat-

ing to his official conduct unless he proves that the statement was

made with `actual malice' -- that is, with knowledge that it was false

or with reckless disregard of whether it was false or not." Id. at 279-

80. Additionally, New York Times Co. indicated that actual malice

must be demonstrated by clear and convincing evidence. Id. at 285-

86; see Gertz v. Robert Welch, Inc., 418 U.S. 323, 342 (1974). In

Curtis Publishing Co., v. Butts, 388 U.S. 130 (1967), the New York

Times Co. actual malice standard was extended beyond public offi-

cials to encompass "public figures." See id. at 162-65 (Warren, C.J.,

concurring in the result). The parameters of public figure status were

not fully defined in the Curtis decision.

After Curtis, the Court took a short-lived step away from classify-

ing plaintiffs by their public or private figure status as a means to

determine what level of defendant's fault was required for recovery.

In Rosenbloom v. Metromedia, Inc., 403 U.S. 29 (1971), a plurality

of the Court determined that plaintiffs must prove actual malice when

their claim rested upon any "discussion and communication involving

matters of public or general concern, without regard to whether the

persons involved are famous or anonymous." Id. at 44.

The Rosenbloom plurality's standard, however, was overruled in

Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974). In reversing course

and holding that to recover compensatory damages private individuals

need not prove that the defendant acted with actual malice even when

the defamation occurred during discussion of matters of public con-

cern, the Court enunciated classifications of defamation plaintiffs and

the corresponding levels of defendant's culpability that must be

proven. See id. at 342-48. Justice Powell, writing for the majority, dis-

tinguished between public figures and private figures and justified

their different requirements for proof of defendant's fault on two

grounds: first, the greater ability of public figures to resort to self-help

on account of their better access to the media and channels of commu-

nication, and second, the voluntary assumption of the risk of publicity

undertaken by public figures. See id. at 344. Among the class of pub-

lic figures, the Court made further distinctions:

Hypothetically, it may be possible for someone to become a public figure through no purposeful action of his own, but the instances of truly involuntary public figures must be exceedingly rare. For the most part those who attain this sta- tus have assumed roles of especial prominence in the affairs of society. Some occupy positions of such persuasive power and influence that they are deemed public figures for all pur- poses. More commonly, those classed as public figures have thrust themselves to the forefront of particular public contro- versies in order to influence the resolution of the issues involved. In either event, they invite attention and comment.

Id. at 345. Thus, we have interpreted Gertz as creating three distinct types of public figures:

(1) "involuntary public figures," who become public figures through no purposeful action of their own; (2) "all-purpose public figures," who achieve such pervasive fame or notori- ety that they become public figures for all purposes and in all contexts; and (3) "limited-purpose public figures," who voluntarily inject themselves into a particular public contro- versy and thereby become public figures for a limited range of issues.

Foretich v. Capital Cities/ABC, Inc., 37 F.3d 1541, 1551-52 (4th Cir. 1994). 20

Since Gertz, it has been clear that the First Amendment sets limits

on a public figure's ability to recover for defamation. A public figure

"may recover for injury to reputation only on clear and convincing

proof that the defamatory falsehood was made with knowledge of its

falsity or with reckless disregard for the truth." Gertz, 418 U.S. at

342. After Gertz, however, the level of defendant's fault that must be

proved by private figures to recover compensatory damages 21 in defa-

mation actions is left to the states 22 even when the defamatory com-

munication touches on matters of public concern, with the caveat that

strict liability schemes run afoul of the First Amendment. See id. at

347-50.

B.

The Court has revisited public figure status three times since it

handed down its decision in Gertz. In Time, Inc. v. Firestone, 424

U.S. 448 (1976), Time magazine had printed an unflattering report

_________________________________________________________________

20 During the course of this litigation there has been no assertion that

Wells is an all-purpose public figure.

21 The standards are somewhat different as applied to punitive damages

and require analysis not only of the plaintiff's status, but also of the

nature of the speech. For a private plaintiff claiming defamation in a

communication on a matter of public concern, actual malice must be

proven before the plaintiff can recover punitive damages. See Gertz v.

Robert Welch, Inc., 418 U.S. 323, 348-50 (1974). When the private

plaintiff has alleged defamation in a communication regarding a private

matter, however, the plaintiff need not show actual malice. See Dun &

Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. 749, 761 (1985)

(plurality opinion). Additionally, all plaintiffs (i.e., both public and pri-

vate figures) bear the burden of proving falsity when the allegedly

defamatory statement touches upon a matter of public concern. See

Philadelphia Newspapers, Inc. v. Hepps, 475 U.S. 767, 775-77 (1986).

22 In Virginia, the relevant standard for statements that are defamatory

on their face is a negligence standard. See Gazette, Inc. v. Harris, 325

S.E.2d 713, 724-25 (Va. 1985). The Restatement (Second) of Torts also

follows a negligence standard. See Restatement (Second) of Torts

§ 580B (1977).

regarding the divorce of Russell and Mary Alice Firestone. See id. at

452. Mary Alice Firestone filed a defamation action in Florida state

court and won a $100,000 judgment. See id. Time appealed to the

Supreme Court and argued that Mary Alice Firestone should have

been required to prove actual malice because she was a public figure.

See id. The Court disagreed with Time's contention. See id. at 453.

The Court noted that Mary Alice Firestone was not a public figure

because she "did not assume any role of especial prominence in the

affairs of society, . . . and she did not thrust herself to the forefront

of any particular public controversy in order to influence the resolu-

tion of the issues involved in it." Id. The Court noted that although

the divorce proceedings were a matter of public record and public

interest, they were not a public controversy. See id. at 454. Further,

the Court held that Mary Alice Firestone's participation in the divorce

proceedings was required by state law, so she had not freely chosen

to publicize the issues. See id. The Court also stated that Mary Alice

Firestone's appearance in a few press conferences to satisfy the press

did not convert her into a public figure. See id. n.3.

The Court next addressed the public figure issue in a pair of 1979

cases -- Hutchinson v. Proxmire, 443 U.S. 111 (1979) and Wolston

v. Reader's Digest Ass'n, Inc., 443 U.S. 157 (1979). Hutchinson, a

research behavioral scientist, filed a defamation suit as the result of

having the topic of his research, why monkeys clench their jaws,

listed as a "Golden Fleece Award"²³ winner. See Hutchinson, 443 U.S.

at 117-18. The Court held that it was error to classify Hutchinson as

a limited-purpose public figure based upon his receipt of federal

research funds and his access to the media to respond to the Golden

Fleece controversy, because neither factor demonstrated that Hutchin-

son was a public figure prior to his mention in connection with the

Golden Fleece Award. See id. at 134-35. In Wolston, the Court held

that the nephew of convicted spies was not a public figure on the

basis of his receipt of grand jury subpoenas, failure to appear before

the grand jury, and contempt conviction resulting therefrom. See

Wolston, 443 U.S. at 161-63. Although fifteen newspaper stories had

_________________________________________________________________

23 The "Golden Fleece of the Month Awards" were initiated by Wiscon-

sin Senator William Proxmire in March 1975 to publicize examples of

wasteful government spending. See Hutchinson v. Proxmire, 443 U.S.

111, 114 (1979).

been written covering his contempt conviction and Wolston's name

appeared in two books published at the time of the events, the

Supreme Court held that Wolston's action of failing to appear at the

grand jury was not sufficient to create limited-purpose public figure

status when his voluntary discussion of the matter was minimal. See

id. at 166. The Court reasoned that "[a] private individual is not auto-

matically transformed into a public figure just by becoming involved

in or associated with a matter that attracts public attention," id. at 167,

and emphasized that Wolston had not "engaged the attention of the

public in an attempt to influence the resolution of the issues involved,

id. at 168, and "in no way calculated to draw attention to himself . . .

to invite public comment or influence the public with respect to any

issue," id. Because the Court concluded that Wolston was a private

figure it was error to apply the actual malice standard to Wolston's

claim for compensatory damages.

C.

Applying the foregoing Supreme Court precedents, this Circuit has

developed a five-factor test to determine whether a plaintiff is a

limited-purpose public figure. Liddy has asserted that Wells meets the

test for limited-purpose public figure status. Because the jurispru-

dence regarding limited-purpose public figures is well-established in

this Circuit, we address Liddy's contentions regarding the voluntary

nature of Wells's participation in the Watergate controversy first,

before weighing-in on the district court's ultimate conclusion that

Wells qualifies as an involuntary public figure.

Before a plaintiff can be classified, as a matter of law, as a limited-

purpose public figure, the defendant must prove that:

(1) the plaintiff has access to channels of effective commu- nication; (2) the plaintiff voluntarily assumed a role of special promi- nence in the public controversy; (3) the plaintiff sought to influence the resolution or out- come of the controversy; (4) the controversy existed prior to the publication of the defamatory statement; and (5) the plaintiff retained public-figure status at the time of the alleged defamation.

See Reuber v. Food Chemical News, Inc., 925 F.2d 703, 708-10 (4th Cir. 1991) (en banc). In Foretich, we added an additional consider- ation to the limited-purpose public figure inquiry when we held that if the content of a defamatory statement touches upon an area that state law has traditionally considered to be defamatory per se, then the plaintiff cannot be categorized as a limited-purpose public figure solely because he makes reasonable public replies to the statement. See 37 F.3d at 1558. In evaluating an individual's limited-purpose public figure status we look at "the nature and extent of an individu- al's participation in the particular controversy giving rise to the defa- mation." Gertz, 418 U.S. at 351.

In order to prevail on his assertion that Wells's participation in the

Watergate controversy merits her classification as a limited-purpose

public figure Liddy must establish each of the five elements recited

above. See Foretich, 37 F.3d at 1556 (noting that the defendant bears

the burden on all five elements). According to Liddy, Wells's volun-

tary injection into the Watergate controversy, an event of unprece-

dented historical interest and importance, is sufficient to satisfy the

five-part test because she was interviewed by the FBI, mentioned in

the newspaper, subpoenaed to testify before the grand jury, and called

before the Senate in the early 1970s. Additionally, Liddy points to

several media exposures Wells has had since the prostitution-oriented

theory of the Watergate break-in emerged in 1984. Specifically,

Liddy points out that Wells published a letter to the editor in the New

York Times in 1985, spoke to a reporter on the twentieth anniversary

of the Watergate break-in for an article that appeared in the

Washington Post in 1992, spoke to the BBC in 1993, was named in

an Arts & Entertainment Network broadcast entitled"The Key to

Watergate" and a Geraldo Rivera documentary "Now it Can be Told,"

and spoke to historian James Rosen. Although Liddy has amply dem-

onstrated that Wells has "access to channels of effective communica-

tion," we conclude that Liddy has failed to show that Wells has

"voluntarily assumed [a role] of special prominence in the . . . public

controversy." 24 Id. Therefore, we cannot conclude that Wells is a

limited-purpose public figure.

Gertz, Firestone, and Wolston each have touched upon the charac-

teristics that must be proven to demonstrate that a plaintiff has "vol-

untarily assumed a role of special prominence in a public

controversy." Reuber, 925 F.2d at 709. The Supreme Court stated in

Gertz that the class of limited-purpose public figures included those

individuals who "thrust[ed] themselves to the forefront of particular

public controversies in order to influence the resolution of the issues

involved," 418 U.S. at 345, or who "voluntarily inject[ed] [them-

selves] . . . into a particular public controversy . . . [and] assume[d]

special prominence in the resolution of public questions," id. at 351.

Although Gertz, an attorney, had taken on a case that was related to

a public controversy and likely to generate media exposure, the Court

held that Gertz's actions were insufficient to characterize him as a

public figure:

_________________________________________________________________

24 We need not dwell on what is usually a preliminary question,

whether the statements in question were made in connection with a pub-

lic controversy. See Foretich v. Capital Cities/ABC, Inc., 37 F.3d 1541,

1554-55 (4th Cir. 1994) (indicating that the public controversy require-

ment is a preliminary inquiry). Watergate is perhaps the quintessential

public controversy, an event that has evoked extensive political and his-

torical interest and debate and has had effects felt well beyond the direct

participants. See, e.g., Helen Dewar, GOP Senator Proposes Alternative

to Independent Counsel Law, Wash. Post, June 22, 1999, at A5 (stating

that the independent counsel statute was passed in 1978 as a result of

Watergate); Doug Struck, The FDR Memorial's Deeper Meaning; For

Many Older Americans, Roosevelt Symbolizes Their Triumph Over

Adversity, Wash. Post., May 1, 1997, at A1 (noting that two or three gen-

erations of Americans have become cynical as a result of the Watergate

scandal). More than twenty-seven years after the break-in, Watergate still

attracts intense public interest and media attention. See, e.g., George

Lardner Jr., Nixon Aide Testifies Against Boss in Estate Case, Wash.

Post, Mar. 29, 1999, at A17 (reporting that John Dean testified about

Nixon's presidential library plans during efforts of Nixon estate to

recover just compensation for seized documents); George Lardner Jr. &

Walter Pincus, Watergate Burglars Broke Into Chilean Embassy as

Cover, Tapes Show, Wash. Post, Feb. 26, 1999, at A9.

[Gertz's] participation related solely to his representation of a private client. He took no part in the criminal prosecution . . . . Moreover, he never discussed either the criminal or civil litigation with the press and was never quoted as hav- ing done so. He plainly did not thrust himself into the vortex of this public issue, nor did he engage the public's attention in an attempt to influence its outcome.

Id. at 352.

In Firestone, the Court stated that the Firestones' divorce was a pri-

vate matter, not a public controversy, but even if it had been a public

controversy, Mary Alice Firestone "did not thrust herself to the fore-

front of [that] controversy in order to influence the resolution of the

issues involved in it." 424 U.S. at 453. Thus, the Court held that Mary

Alice Firestone was not a limited-purpose public figure. Then-Justice

Rehnquist amplified the Court's holding, noting that Mary Alice Fire-

stone:

[had not] freely cho[sen] to publicize issues as to the propri- ety of her married life. She was compelled to go to court by the State in order to obtain legal release from the bonds of matrimony. . . . [I]n such an instance resort to the judicial process . . . is no more voluntary in a realistic sense than that of the defendant called upon to defend his interests in court.

Id. at 454 (internal quotation marks omitted).

The Court went on to observe that litigants in general have not vol-

untarily stepped before the public eye, but rather are "drawn into a

public forum largely against their will in order to attempt to obtain the

only redress available to them or to defend themselves against actions

brought by the State or by others." Id. at 457.

In Wolston, the Court built upon its holding in Firestone regarding

the public figure status of those involved in litigation. Its holding

extended the view that persons involved in litigation have not volun-

tarily sought prominence in a public controversy merely by being the

subject of a subpoena to appear as a witness in a government investi-

gation. In addressing whether Wolston had voluntarily injected him-

self into the controversy surrounding Soviet espionage in the 1950s,

the Court stated:

It would be more accurate to say that [Wolston] was dragged unwillingly into the controversy. The Government pursued him in its investigation. [He] did fail to respond to a grand jury subpoena, and this failure, as well as his subse- quent citation for contempt, did attract media attention. But the mere fact that [he] voluntarily chose not to appear before the grand jury, knowing that his action might be attended by publicity, is not decisive on the question of public figure sta- tus. . . . [Wolston] never discussed this matter with the press and limited his involvement to that necessary to defend him- self against the contempt charge. It is clear that[he] played only a minor role in whatever public controversy there may have been concerning the investigation of Soviet espionage.

443 U.S. at 166-67.

Further, the Court observed that Wolston "assumed no `special

prominence in the resolution of public questions,'" id. at 168 (quoting

Gertz, 418 U.S. at 351), because "[h]is failure to respond to the grand

jury's subpoena was in no way calculated to draw attention to himself

in order to invite public comment or influence the public with respect

to any issue. He did not in any way seek to arouse public sentiment

in his favor and against the investigation." Id.

In light of the foregoing, viewing Wells's public exposures during

and after the Watergate break-in collectively, we conclude that Wells

has not "voluntarily assumed [a role] of special prominence in the . . .

public controversy." Foretich, 37 F.3d at 1556. Gertz, Firestone, and

Wolston establish conclusively that Wells was not a public figure dur-

ing the immediate aftermath of the Watergate break-in in the 1970s.

Like Wolston, Wells's involvement in the Watergate investigation

was wholly involuntarily; she was "dragged unwillingly into the con-

troversy," Wolston, 443 U.S. at 166, initially by the commission of a

crime at her workplace and later by the governmental investigation

that ensued. Wells's discussions with the FBI, response to the grand

jury subpoena, and appearance before the Senate committee simply

were not voluntary actions but rather were compelled by the force of

law. See id. Even if we assume arguendo that Wells was involved in

criminal activity during her employment at the DNC, 25 precedent

counsels that activity likely to engender publicity, even criminal

activity, does not equate to taking on a role of special prominence in

a public controversy. See Wolston, 443 U.S. at 168 ("reject[ing] the

further contention . . . that any person who engages in criminal con-

duct automatically becomes a public figure for purposes of comment

on a limited range of issues relating to his conviction."); Gertz, 418

U.S. at 352 (holding that an attorney who took on a case linked to a

public controversy but who did not speak to the press was not a public

figure).

The question then arises whether Wells voluntarily has attained

special prominence in the Watergate controversy as a result of the

revelation of the prostitution-related theory of the break-in. For the

most part, Wells's reported role in Watergate has remained

unchanged after Secret Agenda and Silent Coup -- Wells is named as

Spencer Oliver's secretary and a woman whose phone calls were

overheard on illegal wire taps. To the extent that Wells's role has

expanded, it has done so because Secret Agenda and Silent Coup

revealed that Watergate burglar Martinez possessed a key to her desk,

exposed prostitution activities that purportedly were occurring at the

DNC, and implied that Wells may have had some connection to those

illicit activities. There is no proof that any of these disclosures were

the result of Wells's voluntary interaction with the authors. Instead,

it is clear, as the district court concluded, that the story was divulged

by a sole source, Bailley. See Wells, 1 F. Supp.2d at 543. Because the

disclosures of Secret Agenda and Silent Coup cannot be fairly attri-

buted to Wells's voluntary participation, we cannot conclude that she

sought a prominent role in the Watergate controversy as a result of

being named therein.

Therefore, the question of whether Wells has "voluntarily assumed

[a role] of special prominence in the . . . public controversy,"

Foretich, 37 F.3d at 1556, ultimately, on this record, revolves around

_________________________________________________________________

25 Because Watergate is a matter of public concern, Wells bears the

burden on remand of proving the falsity of Liddy's statements. See

Philadelphia Newspapers, Inc. v. Hepps, 475 U.S. 767, 777 (1986).

four media contacts: (1) her letter-to-the-editor of the New York

Times, published in 1985; (2) her 1992 interview with a Washington

Post reporter on the twentieth anniversary of the Watergate break-in;

(3) her interview with the BBC in 1993; and (4) her discussions with

historian James Rosen. The letter-to-the-editor, made in response to

a book review of Secret Agenda that named her as a figure involved

in arranging dates with prostitutes, clearly falls within the category of

self-help and reasonable response to reputation-injuring statements of

the type that we approved in Foretich. See 37 F.3d at 1558. Therefore,

Wells's letter-to-the-editor should not contribute to the public figure

analysis.

Regarding Wells's three other media contacts, Firestone makes

clear that voluntary discussion of events with the press does not per

se indicate that a defamation plaintiff has "thrust herself to the fore-

front of [a public] controversy." 424 U.S. at 454 n.3. Rather, when an

individual has had contact with the press, the proper questions are

whether he has attempted to influence the merits of a controversy, see

id., or has "draw[n] attention to himself in order to invite public com-

ment," Wolston, 443 U.S. at 168, or "invited that degree of public

attention and comment . . . essential to meet the public figure level,"

Hutchinson v. Proxmire, 443 U.S. 111, 135 (1979). In this case, there

is no proof that Wells spoke to the press in any role other than as a

witness to history in response to their repeated requests. Wells, as a

DNC worker at the time of Watergate, has a story to tell about the

facts of the break-in and the circumstances surrounding the investiga-

tion that has independent value. Telling that story, however, is simply

giving an eye-witness account of events that are no longer controver-

sial. For example, whether the Watergate break-in occurred on June

17, 1972 is not generally regarded as an open question. How Wells

felt as an individual caught up in the investigation is a strictly per-

sonal observation. Responding to requests from inquiring reporters

about these matters does not convert Wells into a public figure when

her statements cannot be interpreted to have an impact upon the mer-

its of the ongoing Watergate controversy. See Firestone, 424 U.S. at

454 n.3 (stating that holding press conferences does not create public

figure status when held in response to reporter inquiries and in a situa-

tion when it is not possible to influence the merits).

Twenty-seven years after the event, the still-controversial aspects

of Watergate revolve around bigger issues such as why the break-in

occurred, who was responsible, whether our Constitutional checks

and balances are adequate, whether the American populace lost confi-

dence in politicians as a result of the scandal, etc. Liddy has failed to

point to evidence demonstrating that Wells has made any attempt to

become a spokesperson on any of these types of matters. Therefore,

we cannot conclude that Wells has voluntarily undertaken a position

at the forefront of the Watergate controversy. The record establishes

that Wells has conducted only a handful of interviews over the course

of twenty-seven years and each one has been in response to inquiries

from reporters requesting her eye-witness account. As a result, we

conclude that Liddy has not met his burden of proving each of the

five elements of this circuit's limited-purpose public figure test, and

we must determine that Wells is not a limited-purpose public figure

under our jurisprudence.

D.

The district court also concluded that Wells did not meet the five-

part test governing limited-purpose public figure status. Rather, the

district court concluded that Wells was an involuntary public figure.

See Wells, 1 F. Supp.2d at 540. Wells appeals this ruling. We con-

clude that Wells was not an involuntary public figure and reverse.

The concept of an involuntary public figure has its origins in one

sentence from Gertz: "Hypothetically, it may be possible for someone

to become a public figure through no purposeful action of his own,

but the instances of truly involuntary public figures must be exceed-

ingly rare." 418 U.S. at 345. So rarely have courts determined that an

individual was an involuntary public figure that commentators have

questioned the continuing existence of that category. See, e.g., Rod-

ney A. Smolla, Law of Defamation § 2.14 (1998) (questioning contin-

uing vitality of involuntary public figure). Although we have

acknowledged that involuntary public figures constitute one of the

three classes of public figures categorized in Gertz, we have never

explored the parameters of the involuntary branch of the public figure

typography. See Foretich, 37 F.3d at 1551-52 (stating that Gertz cre-

ated three categories of public figures, one of which was involuntary).

Thus, Wells's challenge to the district court's conclusion that she is

an involuntary public figure presents a novel question of law.

The district court ruled, applying Dameron v. Washington Maga-

zine, Inc., 779 F.2d 736 (D.C. Cir. 1985), that Wells was an involun-

tary public figure because she had the "misfortune" of being "drawn

by a series of events into the Watergate controversy." Wells, 1 F.

Supp.2d at 540-41. Because we conclude that "misfortune" is but one

aspect of the considerations that should be weighed before concluding

that an individual is an involuntary public figure, we are not per-

suaded by the district court's analysis.

The Dameron case, the leading case on involuntary public figure

status, involved an air-traffic controller who had been the sole con-

troller on duty during a 1974 airline crash near Dulles Airport in

Northern Virginia. See 779 F.2d at 738. In 1982, following the crash

of Air Florida Flight 90 into the Potomac River on takeoff from

National Airport in Washington, D.C., Washingtonian magazine pub-

lished a story that listed, inter alia, plane crashes that had occurred

in the Washington, D.C. metropolitan area and were attributable to

controller error. See id. The magazine article stated that controller

error was partially to blame for the 1974 Dulles crash. See id. As a

result, the air traffic controller filed a defamation action. See id.

The D.C. Circuit, recognizing that the air traffic controller had not

voluntarily injected himself into a public controversy, and therefore

could not satisfy the court's definition of a limited-purpose public fig-

ure, concluded that the air traffic controller could nevertheless be con-

sidered a public figure. See id. at 741. The court applied two of the

three parts of its Waldbaum test for limited-purpose public figures and

evaluated whether there was a public controversy and whether the

allegedly defamatory statements concerned the public controversy.

See id. at 741 (citing Waldbaum v. Fairchild Publications, Inc., 627

F.2d 1287, 1296-98 (D.C. Cir. 1980)). Instead of inquiring whether

the air traffic controller had voluntarily entered the fray, however, the

D.C. Circuit concluded that "[b]y sheer bad luck" the air traffic con-

troller had become a prominent figure, central to the resolution of a

public question. Id. at 742. On that basis, the D.C. Circuit held that

the air traffic controller was an involuntary public figure. See id. at

743.

We are hesitant to rest involuntary public figure status upon "sheer

bad luck." Gertz tells us that involuntary public figures "must be

exceedingly rare," 418 U.S. at 345, and, unfortunately, bad luck is rel-

atively common. The Dameron definition of an involuntary public

figure, someone who by bad luck is an important figure in a public

controversy, runs the risk of returning us to the Rosenbloom plurali-

ty's conception of defamation law. Under Rosenbloom, all defamation

plaintiffs were required to prove actual malice when the allegedly

defamatory statements occurred during "discussion and communica-

tion involving matters of public or general concern, without regard to

whether the persons involved are famous or anonymous." 403 U.S. at

44. The Supreme Court expressly repudiated the "public interest" test

in Gertz, see 418 U.S. at 346, and further disavowed it in Wolston,

see 443 U.S. at 168 ("To accept such reasoning would in effect re-

establish the doctrine advanced by the plurality opinion in

Rosenbloom . . . which concluded that the New York Times standard

should extend to defamatory falsehoods relating to private persons if

the statements involved matters of public or general concern. We

repudiated this approach in Gertz and in Firestone, however, and we

reject it again today."). Because Dameron has not narrowly tailored

the class of possible involuntary public figures, it has created a class

of individuals who must prove actual malice that is equivalent to the

class in Rosenbloom. Under either Dameron or Rosenbloom all indi-

viduals defamed during discourse on a matter of public concern must

prove actual malice. In light of the Supreme Court's repeated rejec-

tion of Rosenbloom, we are unwilling to adopt an approach that

returns us to an analysis that is indistinguishable. See David L. Wallis,

Note, The Revival of Involuntary Limited-Purpose Public Figures--

Dameron v. Washington Magazine, Inc., 1987 B.Y.U. L. Rev. 313,

323 (criticizing the Dameron approach as overinclusive and as a

return to Rosenbloom).

In order to flesh out the boundaries of who may constitute an invol-

untary public figure, a return to Gertz, the only Supreme Court case

to mention the concept, is in order. In Gertz , Justice Powell iterated

two rationales for concluding that public figure status must be the

determinative inquiry in the balance of interests between the plaintiff

and the First Amendment in a defamation case. First, the public figure

can take better advantage of the free press and has an easier time

resorting to self-help because notoriety guarantees better access to the

media and channels of communication. See 418 U.S. at 344. Second,

the public figure has taken actions through which he has voluntarily

assumed the risk of publicity. See id. We conclude that in order to

ensure that the balance between states' and individuals' interests in

protection of reputation and First Amendment freedoms at the heart

of Constitutional defamation law is maintained, any standard for

determining who is an involuntary public figure must be mindful of

both of these underpinnings. See Khawar v. Globe Int'l, Inc., 965

P.2d 696, 702 (Cal. 1998) (holding that the characterization of invol-

untary public figure must be reserved for those individuals who sat-

isfy both of Gertz's supporting grounds), cert. denied, 119 S. Ct. 1760

(1999). Yet, because the usual and natural conception of a public fig-

ure encompasses a sense of voluntary participation in public debate,

and because to do otherwise would threaten a return to Rosenbloom,

the class of involuntary public figures must be a narrow one, so as to

encompass only "exceedingly rare" cases. Gertz, 418 U.S. at 345.

With Gertz's two supporting rationales and the need for a narrow

class of involuntary public figures in mind, we believe that the fol-

lowing considerations are warranted. First, to prove that a plaintiff is

an involuntary public figure the defendant must demonstrate to the

court that the plaintiff has become a central figure in a significant

public controversy and that the allegedly defamatory statement has

arisen in the course of discourse regarding the public matter. To prove

that the plaintiff is a central figure in the controversy, the defendant

must put forth evidence that the plaintiff has been the regular focus

of media reports 26 on the controversy. A significant public contro-

versy is one that touches upon serious issues relating to, for example,

community values, historical events, governmental or political activ-

ity, arts, education, or public safety. Second, although an involuntary

public figure need not have sought to publicize her views on the rele-

vant controversy, she must have nonetheless assumed the risk of pub-

licity. Therefore, the defendant must demonstrate that the plaintiff has

taken some action, or failed to act when action was required, in cir-

_________________________________________________________________

26 The extent of media coverage required to prove that the plaintiff is

a central figure will vary greatly depending upon the scope of the public

controversy. For a controversy that is localized in a specific community,

the defendant may rely on local media outlets such as the local newspa-

per and the local television news. In contrast, when the defendant seeks

to show that the plaintiff is a central figure in a national or international

controversy, the scope of media coverage must be significantly broader.

cumstances in which a reasonable person would understand that pub-

licity would likely inhere.²⁷ See Reuber v. Food Chemical News, Inc.,

925 F.2d 703, 709 (4th Cir. 1991) (en banc) ("[E]ven involuntary par-

ticipants can be public figures when they choose a course of conduct

which invites public attention."). Unlike the limited-purpose public

figure, an involuntary public figure need not have specifically taken

action through which he has voluntarily sought a primary role in the

controversy to influence the outcome of debate on the matter.

To summarize, an involuntary public figure has pursued a course

of conduct from which it was reasonably foreseeable, at the time of

the conduct, that public interest would arise. A public controversy

must have actually arisen that is related to, although not necessarily

causally linked, to the action. The involuntary public figure must be

recognized as a central figure during debate over that matter. Further,

we retain two elements of the five-part Reuber test, specifically: (1)

the controversy existed prior to the publication of the defamatory

statement; and (2) the plaintiff retained public-figure status at the time

of the alleged defamation. See id. at 710. Additionally, to the extent

that an involuntary public figure attempts self-help, the Foretich rule

must apply with equal strength. See 37 F.3d at 1558.

We believe that the foregoing test captures that"exceedingly rare"

individual who, although remaining mute during public discussion of

the results of her action, nevertheless has become a principal in an

important public matter. Further, this test excludes from the category

of involuntary public figures those individuals who by happenstance

have been mentioned peripherally in a matter of public interest or

have merely been named in a press account. Also, the foregoing anal-

ysis avoids resurrecting Rosenbloom because this conception of the

involuntary public figure does not cast too broad a net and encompass

all individuals who become linked in the media to a matter of public

concern. Every plaintiff who is allegedly defamed during discussion

of a public controversy will not necessarily be required to prove

actual malice to recover compensatory damages under this test.

_________________________________________________________________

27 In evaluating whether a plaintiff has conducted herself in such a

manner, it is important to avoid bootstrapping, i.e., letting the defamatory

statements themselves be the linchpin that makes the plaintiff an involun-

tary public figure.

Applying this formulation to Wells, we determine that she is not

an involuntary public figure. Wells simply has not been a central fig-

ure in media reports on Watergate. Liddy has been able to point to

very few published reports on Watergate even mentioning Wells by

name. Prior to the revelation of the call-girl ring theory, Liddy has

shown that Wells was mentioned by name only in an International

Herald Tribune article noting that her conversations, and those of her

boss Spencer Oliver, had been overheard on a listening device. Since

the emergence of the call-girl ring theory, in those instances where the

media has mentioned Wells, she has been a very minor figure in the

discussion of the primary actors in the Watergate affair -- the bur-

glars, Dean, Hunt, Liddy, and, of course, President Nixon. We cannot

say that in any of the reports contained in the record Wells is por-

trayed as a central figure in the Watergate controversy. The focus has

always been on the roles of other people.

This is true even of Secret Agenda and Silent Coup, the two books

that are the primary proponents of the call-girl theory. From the

excerpts that are contained in the record, it appears that Wells is men-

tioned very briefly in Secret Agenda. In the midst of several hundred

pages explaining a complex theory regarding CIA manipulation,

Wells's name appears on three pages that recount her testimony

before the Senate Select Committee and note in passing that Martinez

had a key to her desk. See Jim Hougan, Secret Agenda: Watergate,

Deep Throat and the CIA 176-79 (1984). Similarly, in Silent Coup,

Wells is mentioned on six pages of an approximately five hundred

page book that focuses on John Dean. On those pages the contents of

Wells's Senate Committee testimony are reiterated, her position as

Oliver's secretary is mentioned, and questions about Martinez's pos-

session of her key are posed. See Len Colodny & Robert Gettlin,

Silent Coup: The Removal of A President 134, 138, 148, 149, 157,

159 (1991).

Liddy argues that Wells is an important figure in the Watergate

controversy because a Watergate burglar possessed a key to her desk.

We agree that Martinez's possession of that key is an interesting mys-

tery, and it immediately raises the questions posed in Silent Coup:

"Why would a Watergate burglar have a key to Wells's desk in his

possession and what items of possible interest to a Watergate burglar

were maintained in Wells's locked desk drawer?" Colodny & Gettlin,

supra at 159 (emphasis omitted). But, however intriguing the factual

revelation regarding Martinez's possession of Wells's key may be, it

doesn't establish involuntary public figure status for Wells. The

touchstone of involuntary public figure status cannot be mere poten-

tial public interest. Designating someone as a public figure in a sense

makes her name and her reputation public property. Defamation juris-

prudence has managed to strike a delicate, but fair, balance. In order

to prevent a chilling effect upon the media's investigation of public

events, the media need not even be reasonable in reporting on a public

figure. All we require is that the media not be reckless or state know-

ing falsehoods. The typical public figure has championed her views

on a matter of public interest and thereby has assumed the risk of pub-

licity. The public's potential interest in an unknown cannot serve as

surrogate to that voluntary engagement in public affairs. Were we to

reach such a holding, an individual's interest in privacy and protect-

ing her reputation would be erased from the balance of defamation

law.

There is a great temptation when evaluating a controversy as long-

standing and significant as Watergate to allow the controversy itself

to take precedence in the analysis and let it convert all individuals in

its path into public figures. The Supreme Court has admonished us

strongly against allowing the public event with which the individual

is connected to be the determinative factor governing an individual's

public figure designation. In the great wealth of materials on Water-

gate, Wells is, at most, a footnote. Even within materials promulgat-

ing the call-girl theory of the June 17, 1972, break-in, Wells is a

minor figure. As a result, we must conclude that she is not an involun-

tary public figure. 28

E.

Based upon the preceding analysis, we must conclude that Wells

is a private figure. She need not prove actual malice to recover com-

pensatory damages under the applicable law. Therefore, this case

_________________________________________________________________

must be remanded for the district court to reconsider Wells's claims

under the lesser standard. Because, however, punitive and presumed

damages hinge on a finding of actual malice, we proceed below to

consider Wells's final assignment of error.

V.

Wells lodges her final challenge against the district court's conclu-

sion that she would be unable to prove that Liddy made the allegedly

defamatory statements with knowledge of their falsity or reckless dis-

regard for their falsity, i.e., with actual malice, see New York Times

Co. v. Sullivan, 376 U.S. 254, 279-80 (1964), by clear and convincing

evidence as a matter of law. Wells claims that the district court erred

when it relied on seven pieces of corroborating factual evidence to

determine that she could not prove actual malice because there was

no proof that Liddy had relied upon those items. Additionally, Wells

argues that the unreliability of the primary source for the information

coupled with Liddy's personal knowledge of the Watergate affair

should be sufficient to create a genuine issue of material fact.

Our review of the evidence adduced below indicates that one can

fairly infer that there was only one source for the specific content of

Liddy's allegedly defamatory statements. The record amply supports

the district court's conclusion that the single source was unreliable.

Further, it is apparent that Liddy understood that the source may not

be trustworthy. On those bases, we agree with Wells that when the

evidence is viewed in the light most favorable to her, she has raised

a genuine issue of material fact on the actual malice question. Accord-

ingly, we reverse.

In evaluating whether Wells raised a genuine issue of material fact

on the question of whether Liddy had acted with actual malice, the

district court thoroughly reviewed the great quantity of evidence sub-

mitted to it throughout the course of the proceedings below. As a

result of that review, the district court first determined that Bailley

was the sole source for all of the variations of the prostitution ring

theories of the June 17, 1972, Watergate break-in including both

Silent Coup and Secret Agenda. See Wells, 1 F. Supp.2d at 543. The

district court also stated that Bailley, who is a disbarred attorney and

convicted felon with a long history of substance abuse and mental ill-

ness, had changed his story about the prostitution ring several times

and was not a reliable source. See id. Nevertheless, the district court

concluded that there were seven pieces of evidence corroborating

Bailley's story, and the existence of that evidence prevented Wells

from establishing that Liddy acted with actual malice. See id. at 543-

44.

The district court concluded that the following evidence suffi-

ciently corroborated Bailley's story: (1) although Bailley changed his

story several times, he consistently stated that a DNC secretary was

involved in the call-girl ring; (2) in 1976 public reports circulated that

intimate phone calls were occurring on DNC phones that led to

unconfirmed rumors that the phones were being used in a call-girl

ring; (3) the FBI found a tap on Oliver's phone; (4) Martinez pos-

sessed a key to Wells's desk; (5) it is entirely unclear why anyone

would want to break into Wells's desk; (6) Bailley's sister said that

Wells had a relationship with Bailley; and (7) there were rumors cir-

culating among DNC staffers after the Watergate break-in regarding

a call-girl ring. See id. at 543-45. Because this evidence has a ten-

dency to verify the call-girl theory generally, rather than Wells's par-

ticipation in the call-girl ring specifically, and because Liddy has

confirmed that he does not find believable the sole source connecting

Wells specifically to prostitution activities, we cannot conclude that

these seven pieces of evidence prevent Wells from proving that Liddy

acted with actual malice.

The district court, in summarizing the seven points of corroborating

evidence overlooked a very significant fact. Bailley is the only indi-

vidual who has ever made the claim that there were pictures of prosti-

tutes in a desk at the DNC. Bailley told Liddy during a meeting in

June 1991 that "[t]he photographs were kept in a manila envelope that

was opened and closed with a string wound around a disc on the flap.

The envelope, [which] Bailley stated he saw physically, was kept in

a locked desk drawer in the DNC in the Oliver/Wells/Governors

area." (J.A. at 1074.) The transcript of the JMU speech shows that

Liddy recited this information practically verbatim. The only differ-

ence between the report of Liddy's 1991 meeting with Bailley and

Liddy's recitation at JMU was that, rather than noting that the photo-

graphs of prostitutes were in any desk in the Oliver/Wells/Governors

area, Liddy stated during the JMU speech that those photos were in

Wells's personal desk.

The seven points of corroborating evidence relied upon by the dis-

trict court, although they may tend to corroborate the overall Silent

Coup theory of the break-in, do not sufficiently corroborate the cen-

tral issue in this case -- whether Wells was personally involved in

prostitution activities. Liddy's statements from the JMU speech and

the cruise ship speech are capable of defamatory meaning as a matter

of law only because they can be fairly understood to connect Wells

directly to prostitution activity. If Wells's defamation claims were

premised solely upon the fact that Liddy told the Silent Coup story,

summary judgment for Liddy would have been appropriate. Liddy,

using material that came from Bailley, however, expanded upon the

Silent Coup theory in his speeches and said enough so that the ordi-

nary listener could conclude that he explicitly connected Wells per-

sonally to prostitution activities.

During his deposition testimony Liddy verified that he was aware

that Bailley was not a credible individual. Liddy was aware of Bail-

ley's history of mental illness prior to the publication of Silent Coup

in 1991. Liddy had been advised by counsel that he should not rely

on Bailley as a sole source for any information because Bailley had

"difficulty differentiating between reality and nonreality." (J.A. at

1161.) Liddy also knew that in 1992 Bailley had gotten into an alter-

cation with a security guard at the Library of Congress during which

Bailley told the guard that he was Star Caesar and that Bailley

believed that the Green River murderers from Washington State were

chasing him. In as much as the actual malice standard inquires about

the defendant's mental state at the time of publication -- whether the

defendant knew the statement was false or recklessly disregarded the

truth or falsity of the statement -- Liddy's knowledge of Bailley's

condition is very significant. See Church of Scientology Int'l v.

Daniels, 992 F.2d 1329, 1332 (4th Cir. 1993) (defining actual mal-

ice). The district court underemphasized Liddy's knowledge of Bail-

ley's unreliability.

Wells's alleged direct involvement in DNC prostitution activities

is not sufficiently corroborated by reliable sources to the extent neces-

sary to warrant summary judgment against her. While a defamation

plaintiff must meet a clear and convincing standard of proof of actual

malice, during summary judgment proceedings initiated by the defen-

dant the court must draw all possible inferences in the plaintiff's

favor. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255-56

(1986). Based upon the evidence in the record viewed in the light

most favorable to Wells, the inference that Bailley is the only person

who has ever linked Wells to prostitution activities is a fair one.

Although Secret Agenda and Silent Coup imply that Wells may have

been involved in the call-girl operation allegedly catering to DNC vis-

itors, those books do not explicitly state that Wells was directly

involved in prostitution-related activities. Further, as the district court

noted, for both Secret Agenda and Silent Coup, the source of informa-

tion on the call-girl ring is Bailley. There is no question that Liddy

was aware that Bailley was the primary source for those books. Addi-

tionally, during the JMU speech, Liddy quoted virtually verbatim

from his report of his 1991 meeting with Bailley, to the extent that

he specifically told the audience that the envelope in Wells's desk

was one that opened and closed by winding a string around a disc on

the flap. The inference that Bailley was Liddy's only source directly

connecting Wells to prostitution activity combined with Liddy's

acknowledgment that he knew Bailley was not reliable is sufficient to

create a genuine issue of material fact regarding whether Liddy acted

with actual malice. See Hudnall v. Sellner, 800 F.2d 377, 382 (4th

Cir. 1986).

When the evidence is properly viewed in the light most favorable

to Wells, the nonmoving party, she is able to raise a genuine issue of

material fact regarding whether Liddy acted with actual malice when

he published statements that can be fairly understood as linking her

to prostitution activities at the DNC. As a result, the district court

erred in granting summary judgment to Liddy.

VI.

In sum, two statements identified by Wells as potentially defama-

tory are capable of defamatory meaning: the JMU speech, governed

by the substantive law of Virginia, and the cruise ship speech, gov-

erned by the maritime common law. Because Wells is a private fig-

ure, these two claims must be remanded for trial under the applicable

negligence standards for Liddy's culpability. Finally, Wells has suc-

ceeded in raising a genuine issue of material fact on the issue of

Liddy's actual malice. For these reasons we remand this case for fur-

ther proceedings consistent with this opinion.

REVERSED AND REMANDED