CHURCH OF SCIENTOLOGY OF CALIFORNIA, Plaintiff,
Michael J. FLYNN, Defendant.
Civ. A. No. 83-2386-MA.
United States District Court,
Jan. 16, 1984.
Not-for-profit religious corporation brought libel action against attorney.
The District Court, Mazzone, J., held that: (1) statement asserting that an
individual or small group of individuals belonging to not-for-profit
corporation infiltrated county court house and stole attorney's filing fee did
not libel corporation, and (2) corporation could not sue derivatively to
vindicate its members' rights.
 LIBEL AND SLANDER
Florida law applied to libel suit where publication of alleged libel occurred
in Florida and that state was place of injury, place of much of the relevant
conduct, and place where relationship between defendant and plaintiff was
 LIBEL AND SLANDER
A corporation and not-for-profit corporation can sue for libel.
 LIBEL AND SLANDER
A corporation cannot prevail in libel action unless allegedly defamatory
statement was published of and concerning the corporation.
 LIBEL AND SLANDER
Whether, for purposes of libel action brought by corporation, a corporation's
standing in community was actually diminished is not relevant if publication at
issue did not falsely charge corporation itself with some kind of impropriety.
 LIBEL AND SLANDER
Statements by attorney asserting that an individual or small group of
individuals belonging to not-for-profit religious corporation infiltrated
county court house and stole his filing fee did not libel not-for-profit
corporation, as the statement was directed at an individual or a few
individuals, not the corporation.
 LIBEL AND SLANDER
A not-for-profit corporation may sue to vindicate its members' rights; but in
order to do so in a libel action, those members must have rights which they
could assert in an individual action.
 LIBEL AND SLANDER
Not-for-profit religious corporation could not sue derivatively, on behalf of
members, for alleged libel by attorney, who asserted that an individual or
small group of individuals belonging to corporation infiltrated county court
house and stole his filing fee, as no individual members possessed rights they
could assert in an individual action.
*266 Roger Geller, Geller & Weinberg, Boston, Mass., Jonathan Lubell, Cohn,
Glickstein, Lurie, Ostrin, Lubell & Lubell, New York City, for plaintiff.
Elizabeth Butler Heath, Morrison, Mahoney & Miller, Boston, Mass., for
MEMORANDUM AND ORDER
MAZZONE, District Judge.
This is a libel action. The plaintiff, the Church of Scientology of
California ("CSC"), seeks damages from the defendant, Michael J. Flynn, for
allegedly defamatory statements made by Flynn and subsequently *267
published in a Florida newspaper. The matter is before the Court on the
defendant's motion to dismiss for failure to state a claim upon which relief
can be granted.
Flynn, a Boston attorney, made the statements in November, 1982, in a
telephone interview with a reporter from the Clearwater (Florida) Times. The
statements concern Flynn's attempt to appeal a contempt order issued by a
Florida court in litigation against the CSC. The complaint alleges that the
following portions of the story are defamatory:
Michael Flynn, Clearwater's consultant on the Church of Scientology,
contended Friday that Scientologists have infiltrated the Volusia County court
system and stolen two checks that he sent to appeal a court decision here.
* * *
Speaking from his Boston office, lawyer Flynn said he mailed two checks, one
for $50 and another for $10, to Volusia, and claimed that he even has the bank
records to prove it.
"Someone at that end infiltrated the courthouse and intercepted the mailed
check," he said. "Someone like a Scientologist."
The filing fee is very important, Flynn said, because it assures him the
right to appeal the contempt order.
"It's ridiculous to think I wouldn't pay a $60 filing fee," the Boston lawyer
continued, adding that he has several deposits at the First National Bank of
Boston and plenty of money in them.
"If you check into this in depth, you'll find that something's afoot in
Volusia County," Flynn went on. He has noted before the Durden and Scientology
attorneys are "longtime friends."
The complaint further alleges that the story conveys "the false and defamatory
meaning that plaintiff, through its members, had improperly and corruptly
become involved with the judicial system, had wrongfully interfered with the
U.S. mails and had stolen from the U.S. mails and the Courthouse."
Flynn urges that the action must be dismissed chiefly because the allegedly
libelous statements are, as a matter of law, incapable of being understood as
referring to the plaintiff. [FN1]
FN1. The defendant also argues that the statements are expressions of
opinion and hence not actionable and asserts, in addition, that he was
privileged to make the statements because they relate directly to a pending
judicial proceeding. My resolution of the defendant's first ground for
dismissal makes it unnecessary to consider these arguments.
 As a preliminary matter, it is necessary to make a choice-of-law. I
look to Massachusetts conflict rules to decide which state's law should govern
this action. Klaxon v. Stentor Electric Manufacturing Co., 313 U.S. 487, 61
S.Ct. 1020, 85 L.Ed. 1477 (1941). Whether I apply the doctrine of lex loci
delecti, see Brogie v. Vogel, 348 Mass. 619, 621, 205 N.E.2d 234 (1965), or the
interests analysis embodied in Restatement (Second) of Conflicts of Law s 1818
(1971), see Pevoski v. Pevoski, 371 Mass. 358, 360, 358 N.E.2d 416 (1976),
the result is the same: Florida law applies. The publication of the libel
occurred in Florida; thus, that state is the place where all the elements of
the tort alleged were first present. See Strogoff v. Motor Sales Co., 302
Mass. 345, 347, 18 N.E.2d 1016 (1939). Florida contacts also predominate, as
that state is the place of injury, the place of much of the relevant conduct,
and the place where the relationship between Flynn and the CSC, at least as far
as this action is concerned, is centered. See In Re Air Crash Disaster in
Boston, Massachusetts on July 31, 1973, 399 F.Supp. 1106, 1111-1112
(D.Mass.1975). In any event, however, Florida law provides no precedent
closely on point. Therefore, in deciding whether Flynn's statements are
reasonably capable of being understood as referring to the plaintiff, I look to
general principles of libel law on the assumption that Florida's law is in
accord. Cf. Arcand v. Evening Call Publishing Co., 567 F.2d 1163, 1164 (1st
Cir.1977) (Where Massachusetts law provided no clear answer to "group libel"
*268 question, Court of Appeals "proceed[ed] on the assumption that
Massachusetts law would be in accord with the current state of the authorities,
i.e., would not occupy an eccentric minority position."). The parties have
done the same.
 There is no doubt, under those general principles, that a corporation
can sue for libel. See, e.g., Diplomat Electric, Inc. v. Westinghouse
Electric Supply Co., 378 F.2d 377 (5th Cir.1967) (Florida law). That right
extends to not-for-profit corporations like the CSC. Finnish Temperance
Society Sovittaja v. Finnish Socialist Publishing Co., 238 Mass. 345, 355, 130
N.E. 845 (1921); Restatement (Second) of Torts s 561(b) (1977).
 But a corporation, like a private individual, cannot prevail in a
libel action unless the allegedly defamatory statement was published "of and
concerning" the corporation. Gilbert Shoe Co. v. Rumpf Publishing Co., 112
F.Supp. 228, 229 (D.Mass.1953); Restatement (Second) of Torts ss 561, 564
(1977). Whether a corporation's standing in the community was actually
diminished is not relevant if the publication at issue did not falsely charge
the corporation itself with some kind of impropriety: "One who is not himself
libelled cannot recover even though he has been injured by the libel published
concerning another." Gilbert Shoe Co. v. Rumpf Publishing Co., 112 F.Supp.
at 229 (officer or stockholder of a corporation who is not personally libelled
has no right to recover for a libel published of the corporation). Likewise,
an allegation that a defendant made a statement, intending to reduce public
respect for a person does not, in the absence of a libelous charge directed at
that person, present a triable issue. Corrigan v. Bobbs-Merril Co., 228
N.Y. 58, 126 N.E. 260, 262 (1920) ("The question is not so much who was aimed
at as who was hit.").
With these general principles in mind, I turn to the central question
presented by this motion: whether the defendant's statements are reasonably
capable of being understood as having been made "of and concerning" the
plaintiff. In particular, I must consider whether the defendant's accusation
that "Scientologists" or " 'someone like a Scientologist' " stole his filing
fee is capable of being viewed as a libel of the CSC.
For the purposes of this inquiry, I assume, as the plaintiff asserts, that the
plaintiff would be able to prove at trial that the CSC is the official branch
of the Scientology movement most active in Clearwater, Florida. Thus, I assume
that a reference that is capable of being viewed as concerning any of the
Scientology movement's not-for-profit religious organizations would, given the
facts and circumstances of this case, refer to the CSC.
 Nevertheless, I conclude that the statements here at issue cannot
support a libel action brought by the CSC. Flynn's statements assert that an
individual or, perhaps, a small group of individuals, infiltrated the Volusia
County courthouse and stole his filing fee. The statement was directed at an
individual or a few individuals, not a not-for-profit corporation. Had the
defendant said, for example, that it was the practice of the CSC to train its
members to infiltrate the courthouse, or reward them for doing so, a different
question would be presented. But he did not. His statement was directed at
the actions of one or a few individual Scientologists, not at the governing
body of the Church of Scientology most active in the Clearwater area. Accusing
members of any religious organization of criminal activity is hardly likely to
reflect well on the religion's official organs, but the fact that the CSC's
reputation in the community may have been diminished by virtue of Flynn's
charges against an anonymous individual or individuals does not vest in CSC a
right to sue for libel. That conclusion follows naturally from the established
principle, noted above, that one who is injured by the libel of another has no
right of action. Gilbert Shoe Co. v. Rumpf Publishing Co., 112 F.Supp. at
The case law supports the view that this action should be dismissed. In
Mullins v. *269 Brando, 13 Cal.App.3d 409, 423, 91 Cal.Rptr. 796, 805
(1970), cert. denied sub nom. Brando v. Coffman, 403 U.S. 923, 91 S.Ct.
2231, 29 L.Ed.2d 701 (1971), the actor Marlon Brando alleged that members of
the Oakland Police Department, motivated by racial animus, shot and killed an
unarmed member of the Black Panthers who was in the process of surrendering
peacefully. The president of the Oakland Police Officers Association sued
Brando for libel on behalf of his organization. The court treated the
president's suit as one brought directly by the association, but held that the
organization had no right of action. The court said:
We recognize, of course, that an unincorporated association, such as the
OPOA, can be defamed. The only trouble with OPOA's ability to state a cause of
action is simply that there is absolutely nothing in any innuendo or inducement
pleaded which by any stretch of the imagination can be construed as defamatory
of the organization.
In Michigan United Conservation Clubs v. CBS News, 485 F.Supp. 893
(W.D.Mich.1980), the named plaintiff and several individual hunters alleged
that a television broadcast about hunters, part of which had been filmed in
Michigan, defamed them. The court ruled that even if it were to assume that
the broadcast had defamed some individual hunters, "... the indirect injury
which [the organizational plaintiff] claim[s] to have suffered as a result of
this would not be compensable." Id. at 900.
In addition, in Mikilonski v. Burt Reynolds Production Co., 10 Mass.App.
895, 409 N.E.2d 1324 (1980) (rescript) the court held that the Polish-American
Guardian Society had no right to sue the defendant on account of allegedly
defamatory statements about Poles he made in a motion picture, because the
society was not "the object of the alleged defamations." Id. Like the
Oakland Police association, the Michigan hunters group, and the Polish-American
society, CSC fails to state a cause of action: Flynn's statements refer to
individual Scientologists, not to the organization they belong to. See also
Novick v. Hearst Corporation, 278 F.Supp. 277, 281 (D.Md.1968); Cohn v.
National Broadcasting Co., Inc., 414 N.Y.S.2d 906, 909, 67 A.D.2d 140 (1979),
aff'd, 430 N.Y.S.2d 265, 50 N.Y.2d 885, 408 N.E.2d 672 (1980), cert.
denied, 449 U.S. 1022, 101 S.Ct. 590, 66 L.Ed.2d 484.
The cases the plaintiff relies on do not alter this conclusion. In Neiman-
Marcus Co. v. Lait, 107 F.Supp. 96 (S.D.N.Y.1952), the court permitted the
corporate plaintiff to sue for defamatory statements published about its
employees. Id. at 101. The statements at issue there, however, suggested
that the corporation had intentionally recruited persons of alleged immoral
character, and the court noted that "... it cannot be said as a matter of law
that a corporation cannot be damaged in a business way by a publication that it
employs seriously undesirable personnel." Id.
In DiGiorgio Fruit Corp. v. American Federation of Labor, 30 Cal.Rptr. 350,
355, 215 Cal.App.2d 560 (Dist.Ct.App.1963), the court permitted a corporation
to sue, but the facts indicate clearly that the publication in question
referred to the plaintiff, as a corporation (if not by precise name), and
criticized it as such. Finally, in Sullivan v. Affiliated Publications, 8
Med.L.Rptr. 1654 (Mass.Super.Ct.1982), another case in which a corporate libel
plaintiff was allowed to proceed, the article referred frequently to the names
by which the corporate plaintiff is popularly known. [FN2]
FN2. I have also reviewed those cases which address the "of and
concerning" question in the context of suits brought by the CSC or another
official branch of the Scientology movement. In California Church of
Scientology v. Cazares, 638 F.2d 1272 (5th Cir.1981), the allegedly
defamatory remarks were clearly addressed at the CSC itself. In Church
of Scientology v. Adams, 584 F.2d 893 (9th Cir.1978), the court, despite
its suggestion "... there is serious doubt that the articles refer to the
[CSC]," did not reach the "of and concerning" question on the merits. And
in Church of Scientology v. Siegelman, 481 F.Supp. 866 (S.D.N.Y.1979),
the court did not quote the language which it concluded raised a factual
question regarding whether the plaintiff official branches of the
Scientology movement, including the CSC, has been defamed. Again, then,
these cases do not in my judgment alter the analysis above.
*270  Although the plaintiff appears not to raise the matter
specifically, I have also considered the question whether the CSC may bring a
libel action derivatively on behalf of its members. It is settled that a not-
for-profit organization may sometimes sue to vindicate its members' rights.
See, e.g., Church of Scientology of California v. Cazares, 638 F.2d 1272,
1279 (5th Cir.1981). But in order to do so in a libel action, those members
must have rights which they could assert in an individual action. Id.; see
also Michigan United Conservation Clubs v. CBS News, 485 F.Supp. at 900.
Here, no individual Scientologists possess such rights. Arcand v. Evening
Call Publishing Co., 567 F.2d at 1164-65. Therefore, the CSC may not sue
Accordingly, because the defendant's statements are not capable of being
understood as having been made "of and concerning" the plaintiff, the
defendant's motion to dismiss for failure to state a claim is granted.