OPERATION CLAMBAKE: SCIENTOLOGY COURT FILES

Part of a public library containing court papers related to lawsuits involving Scientology in some way. Collected to help lawyers and critics of Scientology in future lawsuits from or against this cult. Please report back if this has been of help, or send new contributions to the collection. Thanks. Andreas Heldal-Lund (heldal@online.no)




              CHURCH OF SCIENTOLOGY OF CALIFORNIA, INC., Plaintiff,
                                       v.
                  Bernard GREEN and Barbara Green, Defendants.
                                No. 69 Civ. 5745.
                          United States District Court,
                                 S. D. New York.
                                  Feb. 9, 1973.
  Proceeding on counterclaim for libel brought by members of church against
 church.  The District Court, Levet, J., held that where third party saw a copy
 of alleged libelous writ of expulsion issued by the church in normal course of
 his duties as executive secretary worldwide for the church and as a member of
 executive council, and the writ was properly brought to such third party by
 executive officers of the church, such communication to third party was subject
 to a qualified privilege and did not constitute a "publication."
  Counterclaim dismissed.

 [1] FEDERAL COURTS
 In cases founded upon diversity of citizenship, a federal district court
 applies substantive law of state wherein it sits, including rules of conflict
 of law prevailing in that state.

 [2] FEDERAL COURTS
 New York's rule of conflict of law furnished guide for resolution of choice of
 law issue arising in diversity action for libel brought in federal district
 court for Southern District of New York.

 [3] TORTS
 Under New York's rule of conflict of law, substantive law applicable to an
 alleged tort is the place which has the most significant relationship with the
 subject matter of the tort charged.

 [4] LIBEL AND SLANDER
 Substantive law of New York governed diversity action for libel brought in
 United States District Court for Southern District of New York, where receipt
 of alleged libelous statement took place in New York, and alleged publication,
 in all but one instance, took place in New York.

 [5] LIBEL AND SLANDER
 There can be no libel, regardless of nature of statement, unless there is
 publication.

 [6] LIBEL AND SLANDER
 Mere receipt of an alleged libelous statement by one claiming to be defamed
 does not establish libel.

 [7] LIBEL AND SLANDER
 There is no publication if defamatory statement is exposed to a third party by
 person claiming to be defamed.

 [8] LIBEL AND SLANDER
 A communication made between officers within organizational structure of a
 church, or a corporation, made in good faith, on any subject in which the one
 communicating has an interest or in which there is a duty, is privileged if
 made to a person having a corresponding interest or duty, even though it
 contains matter which, without this privilege, would be actionable;  such is
 case even though duty is not a legal one but only a moral or social duty or
 obligation.

 [9] LIBEL AND SLANDER
 Where third party saw a copy of alleged libelous writ of expulsion issued by
 church in normal course of his duties as executive secretary worldwide for the
 church and as a member of executive council, and the writ was properly brought
 to such third party by executive officers of the church, such communication to
 third party was subject to a qualified privilege and did not constitute a
 "publication," hence there was no libel.
 See publication Words and Phrases for other judicial constructions and
 definitions.

 [9] LIBEL AND SLANDER
 Where third party saw a copy of alleged libelous writ of expulsion issued by
 church in normal course of his duties as executive secretary worldwide for the
 church and as a member of executive council, and the writ was properly brought
 to such third party by executive officers of the church, such communication to
 third party was subject to a qualified privilege and did not constitute a
 "publication," hence there was no libel.
 See publication Words and Phrases for other judicial constructions and
 definitions.

 [10] LIBEL AND SLANDER
 Evidence failed to show publication on part of church of alleged libelous writ
 of expulsion.
  *801 Silk, Slonim & Young, New York City, for plaintiff; Howard Slonim, New
 York City, Joel Kreiner, Los Angeles, Cal., of counsel.
  John J. Seffern, New York City, for defendants.

  LEVET, District Judge.
  The present action, by way of a counterclaim, is for libel brought by
 defendants Bernard Green and Barbara Green against plaintiff The Church of
 Scientology of California, Inc. (sometimes referred to as "the Church").  One
 of the original claims of the Church sought to enjoin the Greens from holding
 themselves out as "bona fide" ministers of the Church.  All claims of the
 Church have been withdrawn.
  Although the case has been completely tried, the sole issue for determination
 presently before this court is whether there was publication of the alleged
 libelous statement.  Obviously, if there is no publication then there is no
 libel.  Other issues, although tried, have been deferred pending a decision on
 this limited issue.
  After hearing the testimony of the parties, examining the exhibits, the
 pleadings, the Proposed Findings of Fact and Conclusions of Law with respect to
 the issue of publication, this court makes the following Findings of Fact and
 Conclusions of Law:
                                FINDINGS OF FACT
  1.  This court has jurisdiction over the subject matter of the litigation and
 the parties hereto.
  2.  The Church of Scientology of California, Inc. is a non-profit corporation,
 incorporated under the laws of the State of California, with its principal
 place of business in Los Angeles, California. [FN1]  (288 [FN2]; Ex. 6.)

      FN1. For a thorough discussion of the structure, history and goals of the
     "unusual" Church of Scientology see the extraordinarily able opinion of
     Judge Skelly Wright in Founding Church of Scientology v. United States,
     133 U.S.App.D.C. 229, 409 F.2d 1146 (1969).  See also, Founding Church
     of Scientology v. United States, 188 Ct.Cl. 490, 412 F.2d 1197 (decided
     July 16, 1969); Church of Scientology v. United States, United States
     Court of Claims No. 226-61 (decided August 7, 1968).

      FN2. Numbers in parentheses, unless otherwise specified, refer to the
     stenographic minutes of the trial before this court on October 4, 5, and 6,
     1972.

  3.  Bernard Green and Barbara Green reside at 685 West End Avenue, New York,
 New York, and are presently operating from that address an unincorporated
 association known as the "International Awareness Center."
  Bernard Green became a member of Scientology in 1953 and received training for
 several years thereafter.  He held a "franchise" of the Church of Scientology
 and was operating said franchise in 1969. In such a capacity he conducted
 spiritual counseling.  (17-34, 38-43, 69.)
  *802 Barbara Ferraro married Bernard Green in 1968 and together they
 operated the Scientology franchise.  (170-171.)
  On or about November 20, 1969 the Scientology franchise held by the Greens was
 cancelled by a notice from the Church of Scientology of New York.  (123-124;
 Ex. 3.)
  4.  On December 10, 1969 a document from the Church bearing the heading, "Writ
 of Expulsion," was received by Bernard Green in the mail.  The document, dated
 December 3, 1969, contained the alleged libelous statement:
   "1.  Further evidence found indicts Bernard Green of attempted blackmail of
 parishioners he has counseled."  (50-52; Ex. B.) [FN3]

      FN3. Exhibit B is Appendix I hereto.  In this opinion I am proceeding on
     the presumption that this statement is libelous.

  Clarice Jackson, an Ethics Officer and member of the Church of Scientology of
 California, authored the writ which was sent to Bernard Green.  After the
 formulation of the writ Jackson personally carried it to Fred Hare and Hanna
 Eltringham, officers of the Church, for their approval.  The names of Jackson,
 Hare and Eltringham appear on the writ (Ex. B) as co-originators.  Jackson then
 typed the original handwritten draft onto a stencil.  Two copies of the stencil
 were then mimeographed, in Jackson's presence, by one James Isaacson.  Isaacson
 was a L. Ron Hubbard (LRH), [FN4] Communicator, whose duties were "to watch the
 organization, that it was running correctly, that it was following the
 prescribed policy ... and that the ethics decisions that came down were done
 correctly ..."  (374.)  In such a capacity Isaacson was responsible for
 mimeographing ethic orders such as the writ sent to Bernard Green.  (325-326,
 374-375; Ex. B.)

      FN4. L. Ron Hubbard is the founder of Scientology and resides somewhere at
     sea.  (260.)

  Clarice Jackson mailed one copy of the writ to Bernard Green and placed the
 other copy in the locked files of the Church.  (339-342.)
  The original writ prepared by Clarice Jackson differed from the letters or
 copies of the writ claimed by the Greens to have been received by other members
 of the Church (Ex. B) in three respects:
  (A) It did not have a border of approximately two inches from the top and
 bottom edges of the paper;
  (B) There were no initials on the original prepared by Jackson as found in the
 lower left corner of Exhibit B;
  (C) The writ, when mailed by Jackson, was placed in a white envelope and
 folded in thirds.  There is no indication on Exhibit B, the writ received by
 Bernard Green, that it had been folded.
  6.  Bernard Green's allegation of publication by the Church is not supported
 by the credible evidence.
  Green contends that there was publication of the writ when it was mailed in
 California and received in New York by Barbara Green, Michael Gerson, Michael
 Kates, Frank Catricola and Allan Ferguson.
  (A) Barbara Green testified that she first saw a copy of the writ when her
 husband showed it to her.  (159-160.)  This, obviously, is not a publication on
 which a libel action can be based since Bernard Green himself "published" it.
  (B) Michael Gerson, who had received counseling from Bernard Green in 1969,
 testified that he received a copy of the writ on October 4, 1969.  Gerson said
 the letter came in a business envelope and that it was folded in thirds.  (148-
 149.)  Furthermore, he had no definite recollection from whom or from which
 branch of the Church of Scientology, if any (California or New York), the
 letter came. (241-243.)
  (C) Michael Kates, who received counseling from Bernard Green, testified that
 he received a copy of the writ in the mail in December of 1969.  He also
 conceded that he did not know where the writ came from.  (233-242.)
  (D) Frank Catricola, who received counseling from Bernard Green, testified
 *803 that he received a copy of the writ on or about December 15 or 16,
 1969.  He did not testify as to where the writ came from.  (273-276.)
  (E)  Allan Ferguson, the Executive Secretary World Wide for Scientology and a
 member of the Executive Council, working in England in 1969, testified that he
 saw a copy of the writ in the course of his official duties in December 1969.
 Ferguson said that the writ was brought to him by executive officers either
 Roger Wright, a LRH Communicator, or by Jane Kember, who was the Deputy
 Guardian or Guardian World Wide of the Church of Scientology. Ferguson passed
 the copy of the writ on to Hubbard "wherever he might have been."  (259-261.)
 Ferguson had a duty to see the writ.  Accordingly, there was no publication.
  I find that publication of the alleged libelous writ has not been shown
 through any of the aforementioned witnesses.
  In summary, I find that there was no publication of the alleged libelous
 statement.
                                   DISCUSSION
  Bernard and Barbara [FN5] Green bring this action for libel against the Church
 of Scientology of California, Inc.

      FN5. In disposing of this case I have not considered the question of
     whether Barbara Green is a proper party, although it would seem that she
     has no right af action since her husband was the one allegedly defamed.

  [1][2][3][4]  The basic choice-of-law question requires no extended
 discussion.  What law applies, New York or California?  In such cases as this,
 founded upon diversity of citizenship, a federal district court applies the
 substantive law of the state wherein it sits, including the rules of conflict
 of law prevailing in that state.  Klaxon Co. v. Stentor Electric Mfg. Co.,
 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941); Jaftex Corp. v. Randolph
 Mills, Inc., 282 F.2d 508 (2d Cir. 1960).  New York's rule of conflict of law,
 therefore, furnishes the guide.  It plainly provides that the substantive law
 applicable to an alleged tort is "the place which has the most significant
 relationship with the subject matter of the tort charged."  Nader v. General
 Motors Corp., 25 N.Y.2d 560, 307 N.Y.S.2d 647, 255 N.E.2d 765 (1970).  See
 also Babcock v. Jackson, 12 N.Y.2d 473, 240 N.Y.S.2d 743, 191 N.E.2d 279
 (1963).  Accordingly, the substantive law of New York governs.  Bernard Green
 is a citizen of the State of New York.  Receipt of the alleged libelous
 statement by Bernard Green took place in New York.  Alleged publication, in all
 but one instance (i. e., Ferguson) took place in New York.  New York thus has
 the greatest interest in the outcome of the litigation.
  The only substantive issue presently before this court for determination is
 whether or not there was publication of the alleged libelous statement.
  On December 10, 1969 a "Writ of Expulsion" (Ex. B) was received in the mail by
 Bernard Green from the Church.  The writ or letter contained the alleged
 libelous statement:
   "Further evidence found indicts Bernard Green of attempted blackmail of
 parishioners he has counseled."  (Ex. B.)
  [5][6]  It is elementary that there can be no libel, regardless of the
 nature of the statement, unless there is publication.  Mere receipt of an
 alleged libelous statement by the one claiming to be defamed does not establish
 libel.
  Law in the field of defamation has changed considerably in a short span of
 time.  However, an enunciation of Judge Cardozo in Ostrowe v. Lee, 256 N.Y.
 36, 175 N.E. 505 (1931) is "as good as new":
   "In the law of defamation, 'publication' is a term of art.... A defamatory
 writing is not published if it is read by no one but the one defamed.
 Published, it is, however, as soon as read by any one else.  [Citations
 omitted.]"  (At p. 38, 175 N.E. at p. 505.)
  *804 [7]  Furthermore, there is no publication if the defamatory
 statement is exposed to a third party by the person claiming to be defamed.
 Horovitz v. Weidenmiller, 53 N.Y.S.2d 379 (S.Ct. N.Y.1945); Shepard v.
 Lamphier, 84 Misc. 498, 146 N.Y.S. 745 (1914); Galligan v. Kelly, 31 N.Y.S.
 561 (Sup. 1894).
  The evidence unequivocally establishes that the Church issued only two
 "original" Writs of Expulsion.  One writ was mailed to Bernard Green in New
 York, while the other was maintained in the locked files of the Church.
  Clarice Jackson, an Ethics Officer of the Church, charged with the
 responsibility of issuing such writs, drew up the writ in question. She had the
 writ cosigned, as required by the rules and regulations of the Church, and
 then personally drew up the stencil for the two "original" mimeographed
 documents.  Furthermore, the physical dimensions of the writ prepared by
 Jackson differ from that document allegedly received by Green and others-that
 is, it did not have a border of approximately two inches, there were no
 initials in the lower left hand corner and the writ, when mailed, was folded
 into thirds.
  Bernard Green attempts to establish publication by alleging that the writ was
 received by others.  However, his proof falls far short of the requisite and
 fails to rebut the well-documented steps taken by Clarice Jackson.
  Bernard and Barbara Green put on the stand several persons who claimed that
 they received a letter or a copy of the writ in the mail.  However, not one
 witness was certain that the writ came from the California church.  Even
 approaching the situation in the light most favorable to claimants and assuming
 that every witness testified that the writ came from the Church of Scientology
 of California, this does not counteract the testimony given by Clarice
 Jackson.  Indeed, a speculative argument could be made that it was not the
 Church of California from whom these persons received the writ but from the
 defendants, the Greens.  There is testimony that the copies received by other
 persons were Xeroxed copies.  (328.)
  In one instance the Greens' contention of publication is plausible but falters
 upon close examination.
  The proof clearly establishes that Allan Ferguson, the Executive Secretary
 Word Wide for Scientology, received, in England, a copy of the alleged libelous
 writ.  On its face this constitutes publication; exhibition of a libelous
 document to a third party.
  [8]  However, the publication in this instance is subject to a qualified
 privilege and is, therefore, permissible.  A communication made between
 officers within the organizational structure of a church, or a corporation for
 that matter, made in good faith, on any subject in which the one communicating
 has an interest or in which there is a duty, is privileged if made to a person
 having a corresponding interest or duty, even though it contains matter which,
 without this privilege, would be actionable.  Such is the case even though the
 duty is not a legal one but only a moral or social duty or obligation.  John
 W. Lovell Co. v. Houghton, 116 N.Y. 520, 22 N.E. 1066 (1889); Garriga v.
 Townsend, 285 App.Div. 199, 136 N.Y.S.2d 295 (1954); Doyle v. Clauss, 190
 App.Div. 838, 180 N.Y.S. 671 (1922); 26 Brooklyn L. Rev. 147.
  [9]  Allan Ferguson saw a copy of the writ in the normal course of his
 duties as Executive Secretary World Wide for Scientology and as a member of the
 Executive Council.  The writ was properly brought to Ferguson by a LRH
 Communicator or by the Deputy Guardian of the Church, both executive officers.
 Assessed within the light of the peculiar structure of the Church of
 Scientology, such communication to Ferguson was subject to a qualified
 privilege and does not constitute a publication.
  [10]  On the totality of the evidence the Greens have failed to show
 publication on the part of the Church and, *805 indeed, "until the
 publication, the act is not complete in its mischief.  Before it is dispersed
 abroad, it can produce no present or actual injury, either to the public or to
 the individual, and until then there is a locus penitentioe on the the part of
 those concerned in the composing and writing."  Youmans v. Smith, 153 N.Y.
 214, 218, 47 N.E. 265, 266 (1897).
                               CONCLUSIONS OF LAW
  1.  The court has jurisdiction over the subject matter of the litigation and
 the parties hereto.
  2.  Defendants Bernard Green and Barbara Green have failed to prove that
 plaintiff, Church of Scientology of California, Inc., published or caused
 publication of the alleged libelous statement.
  3.  Plaintiff, Church of Scientology of California, Inc., is entitled to
 judgment dismissing the counterclaim but without costs.
  Settle judgment on notice pursuant hereto.
                                   APPENDIX I
                                (GOLDENROD PAPER)
                                WRIT OF EXPULSION
  December 3, 1969
  To:  Those Concerned
  From:  MAA AOLA
             Subject:  Additions to Writ, 19 November-Bernard Green.
  1.  Further evidence found indicts Bernard Green of attempted blackmail of
 parishioners he has counselled.
  2.  He is, further, guilty of contributing to the destruction of a high
 ranking Church member by his vicious and damaging rumours concerning the Church
 and Scientologists of good standing.
  3.  He has continued to pretend connections to the Church of Scientology,
 and is continuing his misuse of counseling materials.
  4.  Prosecution for the illegal use of copyrighted Church counselling
 materials will follow.
  5.  BEWARE of the person.  He is not to be trusted in any way.
   Ens. Clarice Jackson
   MAA AOLA
   for
   Ens. Fred Hare
   Captain AOLA
   for
   Cmdr. H. Eltringham
   Deputy Commodore Flotilla
  HE:FH:CJ:dr

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