In Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974), we held that the First Amendment restricted the damages that a private individual could obtain from a publisher for a libel that involved a matter of public concern. More specifically, we held that in these circumstances the First Amendment prohibited awards of presumed and punitive damages for false and defamatory statements unless the plaintiff shows "actual malice," that is, knowledge of falsity or reckless disregard for the truth. The question presented in this case is whether this rule of Gertz applies when the false and defamatory statements do not involve matters of public concern.
Petitioner Dun & Bradstreet, a credit reporting agency, provides subscribers with financial and related information about businesses. All the information is confidential; under the terms of the subscription agreement the subscribers may not reveal it to anyone else. On July 26, 1976, petitioner sent a report to five subscribers indicating that respondent, a construction contractor, had filed a voluntary petition for bankruptcy. This report was false and grossly misrepresented respondent's assets and liabilities. That same day, while discussing the possibility of future financing with its bank, respondent's president was told that the bank had received the defamatory report. He immediately called petitioner's regional office, explained the error, and asked for a correction. In addition, he requested the names of the firms that had received the false report in order to assure them that the company was solvent. Petitioner promised to look into the matter but refused to divulge the names of those who had received the report.
After determining that its report was indeed false, petitioner issued a corrective notice on or about August 3, 1976,
Respondent then brought this defamation action in Vermont state court. It alleged that the false report had injured its reputation and sought both compensatory and punitive damages. The trial established that the error in petitioner's report had been caused when one of its employees, a 17-year-old high school student paid to review Vermont bankruptcy pleadings, had inadvertently attributed to respondent a bankruptcy petition filed by one of respondent's former employees. Although petitioner's representative testified that it was routine practice to check the accuracy of such reports with the businesses themselves, it did not try to verify the information about respondent before reporting it.
After trial, the jury returned a verdict in favor of respondent and awarded $50,000 in compensatory or presumed damages and $300,000 in punitive damages. Petitioner moved for a new trial. It argued that in Gertz v. Robert Welch, Inc., supra, at 349, this Court had ruled broadly that "the States may not permit recovery of presumed or punitive damages, at least when liability is not based on a showing of knowledge of falsity or reckless disregard for the truth," and it argued that the judge's instructions in this case permitted the jury to award such damages on a lesser showing. The trial court indicated some doubt as to whether Gertz applied to "non-media cases," but granted a new trial "[b]ecause of. . . dissatisfaction with its charge and . . . conviction that the interests of justice require[d]" it. App. 26.
The Vermont Supreme Court reversed. 143 Vt. 66, 461 A.2d 414 (1983). Although recognizing that "in certain instances the distinction between media and nonmedia defendants
Recognizing disagreement among the lower courts about when the protections of Gertz apply,
As an initial matter, respondent contends that we need not determine whether Gertz applies in this case because the instructions, taken as a whole, required the jury to find "actual
We reject this claim because the trial court failed to define any of these terms adequately. It did not, for example, provide the jury with any definition of the term "actual malice." In fact, the only relevant term it defined was simple "malice."
In New York Times Co. v. Sullivan, supra, the Court for the first time held that the First Amendment limits the reach of state defamation laws. That case concerned a public official's recovery of damages for the publication of an advertisement criticizing police conduct in a civil rights demonstration. As the Court noted, the advertisement concerned "one of the major public issues of our time." Id., at 271. Noting that "freedom of expression upon public questions is secured by the First Amendment," id., at 269 (emphasis added), and that "debate on public issues should be uninhibited, robust, and wide-open," id., at 270 (emphasis added), the Court held that a public official cannot recover damages for defamatory falsehood unless he proves that the false 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 280. In later cases, all involving public issues, the Court extended this same constitutional protection to libels of public figures, e. g., Curtis Publishing Co. v. Butts, 388 U.S. 130 (1967), and in one case suggested in a plurality opinion that this constitutional rule should extend to libels of any individual so long as the defamatory statements involved a "matter of public or general interest," Rosenbloom v. Metromedia, Inc., 403 U.S. 29, 44 (1971) (opinion of BRENNAN, J.).
In Gertz, we held that the fact that expression concerned a public issue did not by itself entitle the libel defendant to the constitutional protections of New York Times. These protections, we found, were not "justified solely by reference to the interest of the press and broadcast media in immunity from liability." 418 U. S., at 343. Rather, they represented "an accommodation between [First Amendment] concern[s] and the limited state interest present in the context of libel actions brought by public persons." Ibid. In libel actions brought by private persons we found the competing interests different. Largely because private persons have not voluntarily exposed themselves to increased risk of injury from defamatory statements and because they generally lack effective opportunities for rebutting such statements, id., at 345, we found that the State possessed a "strong and legitimate . . . interest in compensating private individuals for injury to reputation." Id., at 348-349. Balancing this stronger state interest against the same First Amendment interest at stake in New York Times, we held that a State could not allow recovery of presumed and punitive damages absent a showing of "actual malice." Nothing in our opinion,
We have never considered whether the Gertz balance obtains when the defamatory statements involve no issue of public concern. To make this determination, we must employ the approach approved in Gertz and balance the State's interest in compensating private individuals for injury to their reputation against the First Amendment interest in protecting this type of expression. This state interest is identical to the one weighed in Gertz. There we found that it was "strong and legitimate." 418 U. S., at 348. A State should not lightly be required to abandon it,
The First Amendment interest, on the other hand, is less important than the one weighed in Gertz. We have long recognized that not all speech is of equal First Amendment importance.
In contrast, speech on matters of purely private concern is of less First Amendment concern. Id., at 146-147. As a number of state courts, including the court below, have recognized, the role of the Constitution in regulating state libel law is far more limited when the concerns that activated New York Times and Gertz are absent.
While such speech is not totally unprotected by the First Amendment, see Connick v. Myers, supra, at 147, its protections are less stringent. In Gertz, we found that the state interest in awarding presumed and punitive damages was not "substantial" in view of their effect on speech at the core of First Amendment concern. 418 U. S., at 349. This interest, however, is "substantial" relative to the incidental effect these remedies may have on speech of significantly less constitutional interest. The rationale of the common-law rules has been the experience and judgment of history that "proof of actual damage will be impossible in a great many cases where, from the character of the defamatory words and the circumstances of publication, it is all but certain that serious harm has resulted in fact." W. Prosser, Law of Torts § 112, p. 765 (4th ed. 1971); accord, Rowe v. Metz, supra, at 425-426, 579 P. 2d, at 84; Note, Developments in the Law — Defamation, 69 Harv. L. Rev. 875, 891-892 (1956). As a result, courts for centuries have allowed juries to presume that some damage occurred from many defamatory utterances
The only remaining issue is whether petitioner's credit report involved a matter of public concern. In a related context, we have held that "[w]hether . . . speech addresses a matter of public concern must be determined by [the expression's] content, form, and context . . . as revealed by the whole record." Connick v. Myers, supra, at 147-148.
In addition, the speech here, like advertising, is hardy and unlikely to be deterred by incidental state regulation. See Virginia Pharmacy Bd. v. Virginia Citizens Consumer Council, Inc., 425 U. S., at 771-772. It is solely motivated by the desire for profit, which, we have noted, is a force less likely to be deterred than others. Ibid. Arguably, the reporting here was also more objectively verifiable than speech deserving of greater protection. See ibid. In any case, the market provides a powerful incentive to a credit reporting
We conclude that permitting recovery of presumed and punitive damages in defamation cases absent a showing of "actual malice" does not violate the First Amendment when the defamatory statements do not involve matters of public concern. Accordingly, we affirm the judgment of the Vermont Supreme Court.
It is so ordered.
CHIEF JUSTICE BURGER, concurring in the judgment.
In Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974), contrary to well-established common law prevailing in the states, a divided Court held that a private plaintiff in a defamation action cannot recover for a published falsehood unless he proves that the defendant was at least negligent in publishing the falsehood. The Court further held that there can be no "presumed" damages in such an action and that the private plaintiff cannot receive "punitive" damages unless it is established that the publication was made with "actual malice," as defined in New York Times Co. v. Sullivan, 376 U.S. 254 (1964).
I dissented in Gertz because I believed that, insofar as the "ordinary private citizen" was concerned, 418 U. S., at 355, the Court's opinion "abandon[ed] the traditional thread," id., at 354-355, that had been the theme of the law in this country
The single question before the Court today is whether Gertz applies to this case. The plurality opinion holds that Gertz does not apply because, unlike the challenged expression in Gertz, the alleged defamatory expression in this case does not relate to a matter of public concern. I agree that Gertz is limited to circumstances in which the alleged defamatory expression concerns a matter of general public importance, and that the expression in question here relates to a matter of essentially private concern. I therefore agree with the plurality opinion to the extent that it holds that Gertz is inapplicable in this case for the two reasons indicated. No more is needed to dispose of the present case.
I continue to believe, however, that Gertz was ill-conceived, and therefore agree with JUSTICE WHITE that Gertz should be overruled. I also agree generally with JUSTICE WHITE'S observations concerning New York Times Co. v. Sullivan. New York Times, however, equates "reckless disregard of the truth" with malice; this should permit a jury instruction that malice may be found if the defendant is shown to have published defamatory material which, in the exercise of reasonable care, would have been revealed as untrue. But since the Court has not applied the literal language of New York Times in this way, I agree with JUSTICE WHITE that it should be reexamined. The great rights guaranteed by the First Amendment carry with them certain responsibilities as well.
Consideration of these issues inevitably recalls an aphorism of journalism that "too much checking on the facts has ruined many a good news story."
Until New York Times Co. v. Sullivan, 376 U.S. 254 (1964), the law of defamation was almost exclusively the business of state courts and legislatures. Under the then prevailing state libel law, the defamed individual had only to prove a false written publication that subjected him to hatred, contempt, or ridicule. Truth was a defense; but given a defamatory false circulation, general injury to reputation was presumed; special damages, such as pecuniary loss and emotional distress, could be recovered; and punitive damages were available if common-law malice were shown. General damages for injury to reputation were presumed and awarded because the judgment of history was that "in many cases the effect of defamatory statements is so subtle and indirect that it is impossible directly to trace the effects thereof in loss to the person defamed." Restatement of Torts § 621, Comment a, p. 314 (1938). The defendant was permitted to show that there was no reputational injury; but at the very least, the prevailing rule was that at least nominal damages were to be awarded for any defamatory publication actionable per se. This rule performed
Similar rules applied to slanderous statements that were actionable per se.
In 1971, four Justices took the view that the New York Times rules should apply wherever a publication concerned any manner of general or public interest, even though the plaintiff was a private person. Rosenbloom v. Metromedia, Inc., 403 U.S. 29. That view did not command a majority. But in Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974), the Court again dealt with defamation actions by private individuals, for the first time holding that such plaintiffs could no longer recover by proving a false statement, no matter how damaging it might be to reputation. They must, in addition, prove some "fault," at least negligence. Id., at 347, 350. Even with that proof, damages were not presumed but had to be proved. Id., at 349. Furthermore, no punitive damages were available without proof of New York Times malice.
I joined the judgment and opinion in New York Times. I also joined later decisions extending the New York Times standard to other situations. But I came to have increasing doubts about the soundness of the Court's approach and about some of the assumptions underlying it. I could not join the plurality opinion in Rosenbloom, and I dissented in Gertz, asserting that the common-law remedies should be retained for private plaintiffs. I remain convinced that Gertz was erroneously decided. I have also become convinced that the Court struck an improvident balance in the New York Times case between the public's interest in being fully informed about public officials and public affairs and the competing interest of those who have been defamed in vindicating their reputation.
In a country like ours, where the people purport to be able to govern themselves through their elected representatives, adequate information about their government is of transcendent importance. That flow of intelligence deserves full First Amendment protection. Criticism and assessment of the performance of public officials and of government in general are not subject to penalties imposed by law. But these First Amendment values are not at all served by circulating false statements of fact about public officials. On the contrary, erroneous information frustrates these values. They are even more disserved when the statements falsely impugn the honesty of those men and women and hence lessen the confidence in government. As the Court said in Gertz: "[T]here is no constitutional value in false statements of fact. Neither the intentional lie nor the careless error materially advances society's interest in `uninhibited, robust, and wide-open' debate on public issues." 418 U. S., at 340. Yet in New York Times cases, the public official's complaint will be dismissed unless he alleges and makes out a jury case of a knowing or reckless falsehood. Absent such proof, there will be no
Also, by leaving the lie uncorrected, the New York Times rule plainly leaves the public official without a remedy for the damage to his reputation. Yet the Court has observed that the individual's right to the protection of his own good name is a basic consideration of our constitutional system, reflecting " `our basic concept of the essential dignity and worth of every human being — a concept at the root of any decent system of ordered liberty.' " Gertz, supra, at 341, quoting Rosenblatt v. Baer, 383 U.S. 75, 92 (1966) (Stewart, J., concurring). The upshot is that the public official must suffer the injury, often cannot get a judgment identifying the lie for what it is, and has very little, if any, chance of countering that lie in the public press.
The New York Times rule thus countenances two evils: first, the stream of information about public officials and public affairs is polluted and often remains polluted by false information; and second, the reputation and professional life of the defeated plaintiff may be destroyed by falsehoods that might have been avoided with a reasonable effort to investigate the facts. In terms of the First Amendment and reputational interests at stake, these seem grossly perverse results.
Of course, the Court in New York Times could not have been unaware of these realities. Despite our ringing endorsement of "wide-open" and "uninhibited" debate, which taken literally would protect falsehoods of all kinds, we cannot fairly be accused of giving constitutional protection to false information as such, for we went on to find competing and overriding constitutional justification for our decision. The constitutional interest in the flow of information about
Gertz is subject to similar observations. Although rejecting the New York Times malice standard where the plaintiff is neither a public official nor a public figure, there the Court nevertheless deprived the private plaintiff of his common-law remedies, making recovery more difficult in order to provide a margin for error. In doing so, the Court ruled that without proof of at least negligence, a plaintiff damaged by the most outrageous falsehoods would be remedies, and the lie very likely would go uncorrected. And even if fault were proved, actual damage to reputation would have to be shown, a burden traditional libel law considered difficult, if not impossible, to discharge. For this reason JUSTICE POWELL would not impose on the plaintiff the burden of proving damages in the case now before us.
Although there was much talk in Gertz about liability without fault and the unfairness of presuming damages, all of this, as was the case in New York Times, was done in the name of the First Amendment, purportedly to shield the press and others writing about public affairs from possibly intimidating
In New York Times, instead of escalating the plaintiff's burden of proof to an almost impossible level, we could have achieved our stated goal by limiting the recoverable damages to a level that would not unduly threaten the press. Punitive damages might have been scrutinized as Justice Harlan suggested in Rosenbloom, supra, at 77, or perhaps even entirely forbidden. Presumed damages to reputation might have been prohibited, or limited, as in Gertz. Had that course been taken and the common-law standard of liability been retained, the defamed public official, upon proving falsity, could at least have had a judgment to that effect. His reputation would then be vindicated; and to the extent possible, the misinformation circulated would have been countered. He might have also recovered a modest amount, enough perhaps to pay his litigation expenses. At the very least, the public official should not have been required to satisfy the actual malice standard where he sought no damages but only to clear his name. In this way, both First Amendment and reputational interests would have been far better served.
We are not talking in these cases about mere criticism or opinion, but about misstatements of fact that seriously harm the reputation of another, by lowering him in the estimation of the community or to deter third persons from associating or dealing with him. Restatement of Torts § 559 (1938). The necessary breathing room for speakers can be ensured by limitations on recoverable damages; it does not also require depriving many public figures of any room to vindicate their reputations sullied by false statements of fact. It could be suggested that even without the threat of large presumed and punitive damages awards, press defendants' communication
I still believe the common-law rules should have been retained where the plaintiff is not a public official or public figure. As I see it, the Court undervalued the reputational interest at stake in such cases. I have also come to doubt the easy assumption that the common-law rules would muzzle the press. But even accepting the Gertz premise that the press also needed protection in suits by private parties, there was no need to modify the common-law requirements for establishing liability and to increase the burden of proof that must be satisfied to secure a judgment authorizing at least nominal damages and the recovery of additional sums within the limitations that the Court might have set.
It is interesting that JUSTICE POWELL declines to follow the Gertz approach in this case. I had thought that the decision in Gertz was intended to reach cases that involve any false statements of fact injurious to reputation, whether the statement is made privately or publicly and whether or not it implicates a matter of public importance. JUSTICE POWELL, however, distinguishes Gertz as a case that involved a matter
As I have said, I dissented in Gertz, and I doubt that the decision in that case has made any measurable contribution to First Amendment or reputational values since its announcement. Nor am I sure that it has saved the press a great deal of money. Like the New York Times decision, the burden that plaintiffs must meet invites long and complicated discovery involving detailed investigation of the workings of the press, how a news story is developed, and the state of mind of the reporter and publisher. See Herbert v. Lando, 441 U.S. 153 (1979). That kind of litigation is very expensive. I suspect that the press would be no worse off financially if the common-law rules were to apply and if the judiciary was careful to insist that damages awards be kept within bounds. A legislative solution to the damages problem would also be appropriate. Moreover, since libel plaintiffs are very likely more interested in clearing their names than in damages, I doubt that limiting recoveries would deter or be unfair to them. In any event, I cannot assume that the press, as successful and powerful as it is, will be intimidated into withholding news that by decent journalistic standards it believes to be true.
The question before us is whether Gertz is to be applied in this case. For either of two reasons, I believe that it should not. First, I am unreconciled to the Gertz holding and believe that it should be overruled. Second, as JUSTICE POWELL indicates, the defamatory publication in this case does not deal with a matter of public importance. Consequently, I concur in the Court's judgment.
JUSTICE BRENNAN, with whom JUSTICE MARSHALL, JUSTICE BLACKMUN, and JUSTICE STEVENS join, dissenting.
This case involves a difficult question of the proper application of Gertz v. Robert Welch, Inc., 418 U.S. 323 (1974), to credit reporting — a type of speech at some remove from that
In New York Times Co. v. Sullivan the Court held that the First Amendment shields all who speak in good faith from the threat of unrestrained libel judgments for unintentionally false criticism of a public official. Recognizing that libel law, like all other governmental regulation of the content of speech, "can claim no talismanic immunity from constitutional limitations [and] must be measured by standards that satisfy the First Amendment," 376 U. S., at 269, the Court drew from salutary common-law developments, id., at 280, and n. 20,
Our First Amendment libel decisions in the last two decades have in large measure been an effort to explore the full ramifications of the New York Times Co. v. Sullivan principles. Building on the extension of actual malice to "public figure" plaintiffs in Curtis Publishing Co. v. Butts, 388 U.S. 130 (1967), the Court in Rosenbloom v. Metromedia, Inc., 403 U.S. 29 (1971), and Gertz v. Robert Welch, Inc., supra, focused largely on defining the circumstances under which protection of the central First Amendment value of robust debate of public issues should mandate plaintiffs to show actual malice to obtain a judgment and actual damages; the Court settled on a rule requiring actual malice as a prerequisite to recovery only in suits brought by public officials or public figures. 418 U. S., at 344-346.
In libel law, no less than any other governmental effort to regulate speech, States must therefore use finer instruments to ensure adequate space for protected expression. Cf. Central Hudson Gas & Electric Corp. v. Public Service Comm'n of New York, 447 U.S. 557, 565 (1980) (restriction "may extend only so far as the interest it serves"); Lowe v. SEC, ante, at 234 (WHITE, J., concurring in judgment) ("[T]he First Amendment permits restraints on speech only when they are narrowly tailored to advance a legitimate governmental interest"). The ready availability and unconstrained application of presumed and punitive damages in libel actions is too blunt a regulatory instrument to satisfy this First Amendment principle, even when the alleged libel does not implicate directly the type of speech at issue in New York Times Co. v.
See also id., at 65; New York Times Co. v. Sullivan, 376 U. S., at 269.
Justice Harlan's perception formed the cornerstone of the Court's analysis in Gertz. Requiring "that state remedies for defamatory falsehood reach no farther than is necessary to protect the legitimate interest involved," the Court found it "necessary to restrict defamation plaintiffs who do not prove knowledge of falsity or reckless disregard for the truth to compensation for actual injury." 418 U. S., at 349. The Court explained that state rules authorizing presumed and punitive damages conferred on juries "largely uncontrolled discretion" to assess damages "in wholly unpredictable amounts bearing no necessary relation to the actual harm caused." Id., at 349-350. Punitive damages in particular were found to be "wholly irrelevant to the state interest" because "[t]hey are not compensation for injury." Id., at 350 (emphasis added). For these reasons, the Court in Gertz specifically held that the award of presumed and punitive damages on less than a showing of actual malice is not a narrowly tailored means to achieve the legitimate state purpose of protecting the reputation of private persons: the common-law approach, said the Court, "unnecessarily compounds the
Thus, when an alleged libel involves criticism of a public official or a public figure, the need to nurture robust debate of public issues and the requirement that all state regulation of speech be narrowly tailored coalesce to require actual malice as a prerequisite to any recovery. When the alleged libel involves speech that falls outside these especially important categories, we have held that the Constitution permits States significant leeway to compensate for actual damage to reputation.
The question presented here is narrow. Neither the parties nor the courts below have suggested that respondent Greenmoss Builders should be required to show actual malice to obtain a judgment and actual compensatory damages. Nor do the parties question the requirement of Gertz that respondent must show fault to obtain a judgment and actual damages. The only question presented is whether a jury award of presumed and punitive damages based on less than a showing of actual malice is constitutionally permissible. Gertz provides a forthright negative answer. To preserve the jury verdict in this case, therefore, the opinions of JUSTICE POWELL and JUSTICE WHITE have cut away the protective mantle of Gertz.
Relying on the analysis of the Vermont Supreme Court, respondent urged that this pruning be accomplished by restricting the applicability of Gertz to cases in which the defendant is a "media" entity. Such a distinction is irreconcilable with the fundamental First Amendment principle that "[t]he inherent worth of . . . speech in terms of its capacity for informing the public does not depend upon the identity of its source, whether corporation, association, union, or individual." First National Bank of Boston v. Bellotti, 435 U.S. 765,
The free speech guarantee gives each citizen an equal right to self-expression and to participation in self-government. See, e. g., Carey v. Brown, 447 U.S. 455, 459-463 (1980); Police Department of Chicago v. Mosley, 408 U.S. 92 (1972); Cohen v. California, 403 U.S. 15, 24 (1971); Whitney v. California, 274 U.S. 357, 375-377 (1927) (Brandeis, J., concurring). This guarantee also protects the rights of listeners to "the widest possible dissemination of information from diverse and antagonistic sources." Associated Press v. United States, 326 U.S. 1, 20 (1945).
Eschewing the media/nonmedia distinction, the opinions of both JUSTICE WHITE and JUSTICE POWELL focus primarily on the content of the credit report as a reason for restricting the applicability of Gertz. Arguing that at most Gertz should protect speech that "deals with a matter of public or general importance," ante, at 773, JUSTICE WHITE, without analysis or explanation, decides that the credit report at issue here falls outside this protected category. The plurality opinion of JUSTICE POWELL offers virtually the same conclusion with at least a garnish of substantive analysis.
Purporting to "employ the approach approved in Gertz," ante, at 757, JUSTICE POWELL balances the state interest in protecting private reputation against the First Amendment interest in protecting expression on matters not of public concern. The state interest is found to be identical to that at stake in Gertz. The First Amendment interest is, however, found to be significantly weaker because speech on public issues, such as that involved in Gertz, receives greater constitutional protection than speech that is not a matter of public concern. See ante, at 759-760, citing Connick v. Myers,
In professing allegiance to Gertz, the plurality opinion protests too much. As JUSTICE WHITE correctly observes, JUSTICE POWELL departs completely from the analytic framework and result of that case: "Gertz was intended to reach cases that involve any false statements . . . whether or not [they] implicat[e] a matter of public importance." Ante, at 772 (concurring in judgment).
The five Members of the Court voting to affirm the damages award in this case have provided almost no guidance as to what constitutes a protected "matter of public concern." JUSTICE WHITE offers nothing at all, but his opinion does indicate that the distinction turns on solely the subject matter of the expression and not on the extent or conditions of dissemination of that expression. Ante, at 773. JUSTICE POWELL adumbrates a rationale that would appear to focus primarily on subject matter.
In evaluating the subject matter of expression, this Court has consistently rejected the argument that speech is entitled to diminished First Amendment protection simply because it concerns economic matters or is in the economic interest of the speaker or the audience. See, e. g., Joseph Burstyn, Inc. v. Wilson, 343 U.S. 495, 501-502 (1952); American Federation of Labor v. Swing, 312 U.S. 321, 325-326 (1941); Thornhill v. Alabama, 310 U.S. 88, 101-103 (1940); see also Abood v. Detroit Board of Education, 431 U. S., at 231-232, and n. 28. "[O]ur cases have never suggested that expression about philosophical, social, artistic, economic, literary, or ethical matters — to take a nonexhaustive list of labels — is not entitled to full First Amendment protection." Id., at 231. The breadth of this protection evinces recognition that freedom of expression is not only essential to check tyranny and foster self-government but also intrinsic to individual liberty and dignity and instrumental in society's search for truth. See Bose Corp. v. Consumers Union of United States, Inc., 466 U. S., at 503-504; Whitney v. California, 274 U. S., at 375 (Brandeis, J., concurring).
Speech about commercial or economic matters, even if not directly implicating "the central meaning of the First Amendment," 376 U. S., at 273, is an important part of our public discourse. The Court made clear in the context of discussing labor relations speech in Thornhill v. Alabama, supra:
As Thornhill suggests, the choices we make when we step into the voting booth may well be the products of what we have learned from the myriad of daily economic and social phenomenon that surround us. See id., at 102 ("Freedom of discussion, if it would fulfill its historic function in this nation, must embrace all issues about which information is needed or appropriate to enable the members of society to cope with the exigencies of their period").
Given that the subject matter of credit reporting directly implicates matters of public concern, the balancing analysis the Court today employs should properly lead to the conclusion that the type of expression here at issue should receive First Amendment protection from the chilling potential of unrestrained presumed and punitive damages in defamation actions.
Even if the subject matter of credit reporting were properly considered — in the terms of JUSTICE WHITE and JUSTICE POWELL — as purely a matter of private discourse, this speech would fall well within the range of valuable expression for which the First Amendment demands protection. Much expression that does not directly involve public issues receives significant protection. Our cases do permit some diminution in the degree of protection afforded one category of speech about economic or commercial matters. "Commercial speech" — defined as advertisements that "[do] no more than propose a commercial transaction," Pittsburgh Press Co. v. Pittsburgh Comm'n on Human Relations, 413 U.S. 376, 385 (1973) — may be more closely regulated than other types of speech. Even commercial speech, however, receives substantial First Amendment protection. Zauderer v. Office of Disciplinary Counsel of Supreme Court of Ohio, 471 U.S. 626 (1985); Virginia Pharmacy Bd. v. Virginia Citizens Consumer Council, Inc., supra, at 765 ("So long as we preserve a predominantly free enterprise economy, the allocation of our resources in large measure will be made through numerous private economic decisions. . . . To this end, the free flow of commercial information is indispensable"). Credit reporting is not "commercial speech" as this Court has defined the term. Even if credit reporting were so considered, it would still be entitled to the substantial protections the First Amendment affords that category. See Zauderer, 471 U. S., at 637; id., at 657-658 (BRENNAN, J., concurring in part and dissenting in part). Under either view, the expression at issue in this case should receive protection from the chilling potential of unrestrained presumed and punitive damages awards in defamation actions.
Justice Douglas further noted that "[p]resumably the credit reports published by the petitioner facilitate through the price system the improvement of human welfare at least as much as did the underlying disagreement in our most recent libel opinion, Rosenbloom v. Metromedia, Inc., 403 U.S. 29 (1971), arising out of a squabble over whether a vendor had sold obscene magazines." Id., at 905, n. 9.
The credit reports of Dun & Bradstreet bear few of the earmarks of commercial speech that might be entitled to somewhat less rigorous protection. In every case in which we have permitted more extensive state regulation on the basis of a commercial speech rationale the speech being regulated
It is worth noting in this regard that the common law of most States, although apparently not of Vermont, 143 Vt. 66, 76, 461 A.2d 414, 419 (1983), recognizes a qualified privilege for reports like that at issue here. See Maurer, Common Law Defamation and the Fair Credit Reporting Act, 72 Geo. L. J. 95, 99-105 (1983). The privilege typically precludes recovery for false and defamatory credit information without a showing of bad faith or malice, a standard of proof which is often defined according to the New York Times formulation. See, e. g., Datacon, Inc. v. Dun & Bradstreet, Inc., 465 F.Supp. 706, 708 (ND Tex. 1979). The common law thus recognizes that credit reporting is quite susceptible to libel's chill; this accumulated learning is worthy of respect.
The Court in Gertz specifically held that unrestrained presumed and punitive damages were "unnecessarily" broad,
Even if not at "the essence of self-government," Garrison v. Louisiana, 379 U.S. 64, 74-75 (1964), the expression at issue in this case is important to both our public discourse and our private welfare. That its motivation might be the economic interest of the speaker or listeners does not diminish its First Amendment value. See Consolidated Edison Co.
Of course, the commercial context of Dun & Bradstreet's reports is relevant to the constitutional analysis insofar as it implicates the strong state interest "in protecting consumers and regulating commercial transactions," Ohralik v. Ohio State Bar Assn., 436 U.S. 447, 460 (1978). Cf. Bolger v. Young Drug Products Corp., 463 U.S. 60, 81 (1983) (STEVENS, J., concurring in judgment). The special harms caused by inaccurate credit reports, the lack of public sophistication about or access to such reports, and the fact that such reports by and large contain statements that are fairly readily susceptible of verification, all may justify appropriate
William E. Murane filed briefs for Sunward Corp. as amicus curiae urging affirmance.
"If you find that the Defendant acted in a bad faith towards the Plaintiff in publishing the Erroneous Report, or that Defendant intended to injure the Plaintiff in its business, or that it acted in a willful, wanton or reckless disregard of the rights and interests of the Plaintiff, the Defendant has acted maliciously and the privilege is destroyed. Further, if the Report was made with reckless disregard of the possible consequences, or if it was made with the knowledge that it was false or with reckless disregard of its truth or falsity, it was made with malice." App. 18-19 (emphasis added).
The dissent also incorrectly states that Gertz "specifically held," post, at 779, 793, both "that the award of presumed and punitive damages on less than a showing of actual malice is not a narrowly tailored means to achieve the legitimate state purpose of protecting the reputation of private persons. . . ," post, at 779, and that "unrestrained presumed and punitive damages were `unnecessarily' broad . . . in relation to the legitimate state interests," post, at 793-794. Although the Court made both statements, it did so only within the context of public speech. Neither statement controls here. What was "not . . . narrowly tailored" or was " `unnecessarily' broad" with respect to public speech is not necessarily so with respect to the speech now at issue. Properly understood, Gertz is consistent with the result we reach today.
Other areas of the law provide further examples. In Ohralik we noted that there are "[n]umerous examples . . . of communications that are regulated without offending the First Amendment, such as the exchange of information about securities, corporate proxy statements, the exchange of price and production information among competitors, and employers' threats of retaliation for the labor activities of employees." 436 U. S., at 456 (citations omitted). Yet similar regulation of political speech is subject to the most rigorous scrutiny. See Brown v. Hartlage, 456 U.S. 45, 52-53 (1982); New York Times Co. v. Sullivan, 376 U.S. 254, 279, n. 19 (1964); Buckley v. Valeo, 424 U.S. 1, 14 (1976). Likewise, while the power of the State to license lawyers, psychiatrists, and public school teachers — all of whom speak for a living — is unquestioned, this Court has held that a law requiring licensing of union organizers is unconstitutional under the First Amendment. Thomas v. Collins, 323 U.S. 516 (1945); see also Rosenbloom v. Metromedia, Inc., 403 U.S. 29, 44 (1971) (opinion of BRENNAN, J.) ("the determinant whether the First Amendment applies to state libel actions is whether the utterance involved concerns an issue of public or general concern").
The dissent's "balance," moreover, would lead to the protection of all libels — no matter how attenuated their constitutional interest. If the dissent were the law, a woman of impeccable character who was branded a "whore" by a jealous neighbor would have no effective recourse unless she could prove "actual malice" by clear and convincing evidence. This is not malice in the ordinary sense, but in the more demanding sense of New York Times. The dissent would, in effect, constitutionalize the entire common law of libel.
It might be suggested that courts, as organs of the government, cannot be trusted to discern what the truth is. But the logical consequence of that view is that the First Amendment forbids all libel and slander suits, for in each such suit, there will be no recovery unless the court finds the publication at issue to be factually false. Of course, no forum is perfect, but that is not a justification for leaving whole classes of defamed individuals without redress or a realistic opportunity to clear their names. We entrust to juries and the courts the responsibility of decisions affecting the life and liberty of persons. It is perverse indeed to say that these bodies are incompetent to inquire into the truth of a statement of fact in a defamation case. I can therefore discern nothing in the Constitution which forbids a plaintiff to obtain a judicial decree that a statement is false — a decree he can then use in the community to clear his name and to prevent further damage from a defamation already published.
"What then is the meaning of the bill of rights, and Constitution of Pennsylvania, when they declare, `That the freedom of the press shall not be restrained,' and `that the printing presses shall be free to every person who undertakes to examine the proceedings of the legislature or any part of the government?' . . . [T]hey give to every citizen a right of investigating the conduct of those who are entrusted with the public business . . . . The true liberty of the press is amply secured by permitting every man to publish his opinions; but it is due to the peace and dignity of society to enquire into the motives of such publications, and to distinguish between those which are meant for use and reformation, and with an eye solely to the public good, and those which are intended merely to delude and defame. To the latter description, it is impossible that any good government should afford protection and impunity." Respublica v. Oswald, 1 Dall. 319, 325 (footnotes omitted).
No clear line consistent with First Amendment principles can be drawn on the basis of these criteria. That petitioner's information is "specialized" or that its subscribers pay "substantial fees" hardly distinguishes these reports from articles in many publications that would surely fall on the "media" side of the line the Vermont Supreme Court seeks to draw. Few published statements are of universal interest, and few publications are distributed without charge. Much fare of any metropolitan daily is specialized information for which a selective, finite audience pays a fee. Nor is there any reason to treat petitioner differently than a more widely circulated publication because it has "a limited number of subscribers." Indeed, it would be paradoxical to increase protection to statements injurious to reputation as the size of their audience, and hence their potential to injure, grows. Cf. Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 781 (1984).
Indeed, JUSTICE POWELL'S opinion today is fairly read as embracing the approach of the Rosenbloom plurality to deciding when the Constitution should limit state defamation law. The limits imposed, however, are less stringent than those suggest by the Rosenbloom plurality. Under the approach of today's plurality, speech about matters of public or general interest receives only the Gertz protections against unrestrained presumed and punitive damages, not the full New York Times Co. v. Sullivan protections against any recovery absent a showing of actual malice.
This argument does not save the analysis. The assertion that the limited and confidential circulation might make the expression less a matter of public concern is dubious on its own terms and flatly inconsistent with our decision in Givhan v. Western Line Consolidated School Dist., 439 U.S. 410 (1979). Perhaps more importantly, Dun & Bradstreet doubtless provides thousands of credit reports to thousands of subscribers who receive the information pursuant to the same strictures imposed on the recipients in this case. As a systemic matter, therefore, today's decision diminishes the free flow of information because Dun & Bradstreet will generally be made more reticent in providing information to all its subscribers.
"Under Gertz, plaintiffs may be compensated for actual damages upon establishing the fault of the defendant; to obtain punitive damages, a plaintiff must demonstrate malice. Sections 1681o and 1681n [of the Fair Credit Reporting Act] are consistent with these constitutional principles. Section 1681o provides for recovery of actual damages upon a showing of negligence, which presumably satisfies the Gertz requirement of fault. Section 1681n authorizes punitive damages for willful violation of the Act. Whether section 1681n is equivalent to Gertz's malice standard depends on whether a court would consider it to be possible to fail willfully to follow reasonable procedures and yet not manifest reckless disregard for the truth. Such a fine distinction appears unworkable as a categorical test, so that section 1681n would likely be regarded as harmonious with the principles of Gertz. Thus, the Act appears to provide the degree of protection for commercial speech currently required under first amendment doctrine" (footnotes omitted).