## Facts

- John J. Stone sued Essex County Newspapers, Inc., publisher of the *Newburyport Daily News*, for libel.
- The newspaper covered a District Court hearing involving Stone’s son, Jeffrey C. Stone, who faced narcotics-related charges.
- An inexperienced reporter, seated far from the testimony and unable to hear well, misunderstood the marshal’s testimony and wrote that testimony indicated the narcotics were owned by John Stone (the father), who was not a defendant.
- The editor, who knew John Stone and was surprised by the implication, published the story after a day’s delay without further verification.
- The article inaccurately connected John Stone to ownership of a narcotic drug and to the criminal proceeding.

## Issues

1. Whether falsely stating that testimony indicated the plaintiff owned a narcotic drug was capable of a defamatory meaning even without expressly accusing him of a crime.
2. Whether the newspaper was protected by the common-law privilege for reports of judicial proceedings despite the inaccurate attribution.
3. Whether the First Amendment permits liability for libel without proof of fault, and what fault standard applies to private persons versus public officials/figures.
4. Whether Massachusetts law permits punitive damages in defamation actions after modern First Amendment limits.
5. What standard of proof applies when “actual malice” must be shown.

## Decision

- The court held the publication was capable of a defamatory meaning because attributing ownership of a narcotic drug could harm reputation even absent a direct criminal accusation.
- The court held the judicial-proceeding report privilege did not apply if the report was not fair and accurate; the misstatement could defeat the privilege.
- The court ruled it was error to instruct the jury that the plaintiff could recover without proof of fault, regardless of whether he was a public or private person.
- The court adopted negligence as the minimum fault standard for private plaintiffs under Massachusetts law, including when the subject matter is of public or general interest.
- The court reaffirmed that public officials/figures must prove actual malice (wilful or reckless disregard of truth).
- The court declined to allow punitive damages in defamation cases, limiting recovery to compensatory damages for actual injury subject to close judicial review.
- The court required clear and convincing evidence where actual malice must be proven.
- The court affirmed denial of a directed verdict but remanded for a new trial due to erroneous jury instructions on fault.

## Legal Principles

- A statement may be defamatory if it would tend to harm reputation; imputing ownership of narcotics can be defamatory even without an explicit criminal charge.
- The common-law privilege for reporting judicial proceedings applies only to fair and accurate reports; material inaccuracies may forfeit the privilege.
- Liability for defamation may not be imposed without fault; strict liability instructions are erroneous.
- Private-person plaintiffs may recover upon proof of negligence by the publisher.
- Public officials and public figures may recover only upon proof of actual malice (knowledge of falsity or reckless disregard for truth).
- When actual malice is required, it must be proven by clear and convincing evidence.
- Defamation damages in Massachusetts are limited to compensatory damages for actual injury; punitive damages are not available.

## Conclusion

The court aligned Massachusetts defamation law with constitutional limits by requiring fault (negligence for private plaintiffs and actual malice for public officials/figures), rejecting punitive damages, and ordering a new trial because the jury had been instructed that liability could be imposed without proof of fault.


Stone v. Essex Cnty. Newspapers, Inc., 367 Mass. 849, 330 N.E.2d 161 (1975)