This morning, the Supreme Court of New Hampshire handed down an important decision holding that a mortgage industry website, The Mortgage Lender Implode-O-Meter, is entitled to protection under the state's reporter's privilege.
The case is Mortgage Specialists, Inc. v. Implode-Explode Heavy Industries, Inc., which was argued before the New Hampshire Supreme Court last fall. The dispute centers on an article that Impode-O-Meter published in August 2008, which detailed administrative actions taken by the New Hampshire Banking Department against The Mortgage Specialists, a mortgage lender. The article included a link to a financial document that The Mortgage Specialists allegedly submitted to the state banking authorities, which Implode-O-Meter had obtained from an anonymous source. After the mortgage company discovered the disclosure, it sued the website, demanding that the document be removed from the Internet and that the anonymous source be identified. A Rockingham County Superior Court judge granted these requests.
In the part of the decision dealing with the reporter's privilege, the state high court ruled that New Hampshire's qualified reporter's privilege applied to Implode-O-Meter and could protect the identity of the source who provided the loan document. The court flatly rejected The Mortgage Specialists' argument that "the newsgathering privilege is inapplicable here because Implode is neither an established media entity nor engaged in investigative reporting." Slip op. at 4. It explained that "[t]he fact that Implode operates a website makes it no less a member of the press," and that "Implode's website serves an informative function and contributes to the flow of information to the public." Id. Therefore, the court concluded, "Implode is a reporter for purposes of the newsgathering privilege." Id.
Because New Hampshire's privilege is a qualified one, Implode-O-Meter may ultimately have to disclose its source. The court remanded the case for the lower court to determine whether The Mortgage Specialists' need for the identity of the source is sufficient to overcome the qualified newsgathering privilege. That will depend on a balancing of interests: "The court . . . must place those factors that relate to the movant's need for the information on one pan of the scales and those that reflect the objector's interest in confidentiality and the potential injury to the free flow of information that disclosure portends on the opposite pan." Id. at 6 (quoting In re Cusumano, 162 F.3d 708, 716 (1st Cir. 1998).
The New Hampshire decision is timely given recent interest in the question of whether online news organizations count as journalists for shield law purposes, an issue raised by the police raid on Gizmodo editor Jason Chen's home two weeks ago. The New Hampshire Supreme Court's approach to the question is similar to that adopted by the California appellate court in O'Grady v. Superior Court, 139 Cal. App.4th 1423 (Cal. Ct. App. 2006). Both cases don't extend coverage to anyone who posts something online, but they make clear that online publishers can qualify when they engage in a journalistic function. (Incidentally, this is not all that different from the approach taken by a New Jersey appellate court a few weeks ago in Too Much Media v. Hale, No. A-0964-09T3 (N.J. App. Ct. Apr. 22, 2010), which relied on O'Grady extensively, but ultimately concluded that the poster there was not engaging in a journalistic function.)
Beyond the reporter's privilege issue, the New Hampshire decision covers a number of additional topics of interest, including prior restraints and First Amendment protection for pseudonymous speech. The court reversed the trial court's order prohibiting Implode-O-Meter from publishing the loan document, holding that it constituted an unconstitutional prior restraint. It also adopted the Dendrite standard for determining whether to unmask a commenter to the Implode-O-Meter website. Time permitting, I'll post separately on these issues.
I'm happy to see the New Hampshire Supreme Court rectify the many errors in the trial court's order, which were the subject of our amicus brief with the Reporters Committee for Freedom of the Press. The reasoning of today’s ruling mirrors arguments in the amicus brief in many respects. Thanks to the Berkman Cyberlaw Clinic and once-and-future summer clinical student Andy Sellers (@guitarzandy) for helping put the brief together.