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3 CNET Reporters Will Sue HP Seeking Punitive Damages - What's That?
Monday, May 07 2007 @ 12:13 PM EDT

Now, here's a subject after my own heart: three of the CNET reporters that HP surveilled intend to sue over it. Yes, Groklaw will cover it from start to finish, although I expect there will at some point be a settlement. So let's start with explaining punitive damages, because that is what the three, Stephen Shankland, Dawn Kawamoto, and Tom Krazit, are asking the courts for.

Punitive damages is a legal term that basically means enough money so you are not tempted to do it again. Damages means money. It's money the court awards you if the actions of another hurt you. If I fraudulently sell you land for you to build your summer home on, and when you go there to start building you find out it is located in the middle of the ocean 20,000 leagues under the sea, you can tell the court how much you paid me for land you can't build a house on. You are damaged by that amount for sure, and you can aim an arrow right at that check as clear proof of what your actual damages are.

But punitive damages are something quite different. Here's the definition in my Law Dictionary, 2d ed., by Steven H. Gifis:

Compensation in excess of actual damages; a form of punishment to the wrongdoer and excess enhancement to the injured; nominal or actual damages must exist before exemplary damages will be found and then they will be awarded only in instances of malicious and willful misconduct.

Of course, in the law, everything has a definition, and here's how 'LectLaw explains malice and reckless disregard of rights:

Conduct is malicious if it is accompanied by ill will, or spite, or if it is for the purpose of injuring another.

Conduct is in reckless disregard of plaintiff's rights if, under the circumstances, it reflects complete indifference to the safety and rights of others.

Punitive damages, then, are a civil court's method of punishing. Civil law recognizes that sometimes people do bad things willfully and with malice aforethought or with reckless disregard to harm to others, and punitive damages are designed to cover that kind of bad actor, kind of as a civil punishment, because in civil law, you can't throw the guy in jail. That's criminal law. So in civil actions, when you'd like to throw the guy in jail, you can instead sue for punitive damages. Here's how one attorney put it:

"Punitive damages are really, in many respects, an alternative to criminal prosecution," says Paul Jess, general counsel of the Academy of Florida Trial Lawyers.

That makes a certain practical sense, because money sometimes makes a person more whole than having the bad guy sit in jail, particularly when it's a civil and not a criminal matter, where one might need to protect the community from the bad guy. Both remedies tend to alter the bad guy's behavior, but with punitive damages, you not only get your money back that you lost, your actual damages, you get to see the bad actor punished by the court by having to pay you punishment money, and you get to spend some money you otherwise would not have.

It's not about greed. It's about altering bad behavior by punishing it, and as a deterrent preventing it from happening again. As I've explained before, money is the principal remedy in civil court. No jury can give you back your leg after a doctor cuts it off by mistake, but they can surely make your life a little bit better by making sure you can afford to call a cab when you need to go somewhere. And they can make sure the doctor, or the hospital, never is careless again, out of the fear of having to pay through the nose again. It would be great if everyone was just nice all the time and everyone lived by the Golden Rule, but courts deal with when they are not and they think about themselves more than the rest of us. That is the idea behind punitive damages, so in telling us that the three reporters will seek punitive damages, they are saying they believe what HP did was bad enough to deserve to be punished. They want such conduct to stop, as the lawyer for the New York Times expressed it:

David E. McCraw, a lawyer for The New York Times, said Hewlett-Packard’s spying operations were “designed to interfere with our journalism and, ultimately, to deprive our readers of information of importance to them.”

He added that the newspaper was not looking for financial gain, but a settlement with the money donated to a worthy cause.

In short, they wish the incident to make enough of a dent on corporate consciousness that it doesn't happen again. That is the purpose of punitive damages. McCraw again:

“The New York Times Company appreciates the steps that H.P. has taken to remedy the situation,” Mr. McCraw said, “but we believe H.P. can and should do more to acknowledge the harm that was done and to demonstrate to other companies that may be tempted to engage in similar conduct that this is not an offense that carries no consequences.”

HP can't do a thing to make these journalists truly whole. Nothing. Their view of the world is altered forever. They and their families will never feel completely, fully relaxed, the way we do when we are all alone and know no one is watching us. We can let our hair down, walk barefoot, scratch, pick our noses, whatever we do in private that we'd never do in public where issues of propriety rule. There's an interesting essay that I read as part of a course Berkman Center ran on privacy in cyberspace that said that our humanness actually depends on that kind of privacy. It's how we renew and are our true selves. The essay is still available in the readings for the course which are laudably still made available to the world, "Privacy Matters: In Defense of the Personal Life," by Janna Malamud Smith. One of the worst punishments is total surveillance, the essay points out, where you can't even go to the bathroom in privacy:

One way of beginning to understand privacy is by looking at what happens to people in extreme situations where it is absent. Recalling his time in Auschwitz, Primo Levi observed that "solitude in a Camp is more precious and rare than bread." Solitude is one state of privacy, and even amidst the overwhelming death, starvation, and horror of the camps, Levi knew he missed it.... Levi spent much of his life finding words for his camp experience. How, he wonders aloud in Survival in Auschwitz, do you describe "the demolition of a man," an offense for which "our language lacks words."...

Our function of privacy is to provide a safe space away from terror or other assaultive experiences. When you remove a person's ability to sequester herself, or intimate information about herself, you make her extremely vulnerable....

The totalitarian state watches everyone, but keeps its own plans secret. Privacy is seen as dangerous because it enhances resistance. Constantly spying and then confronting people with what are often petty transgressions is a way of maintaining social control and unnerving and disempowering opposition.... And even when one shakes real pursuers, it is often hard to rid oneself of the feeling of being watched -- which is why surveillance is an extremely powerful way to control people. The mind's tendency to still feel observed when alone... can be inhibiting. ... Feeling watched, but not knowing for sure, nor knowing if, when, or how the hostile surveyor may strike, people often become fearful, constricted, and distracted.

That article deeply affected my thinking, and it's one reason why I cherish my privacy and have never been interested in being a celebrity. While the article focuses on the extremes, in the part I quoted, I can extrapolate, and it's why to this day, I keep up with privacy issues and why I try to protect not only my privacy, but yours. It's why I've never allowed Google ads, for example, relying instead on the community's contributions, even though I could have made a lot of money personally from Google ads, with our traffic. The article goes on, by the way, to define solitude and privacy, beginning here. I highly recommend reading all the excerpts. You will surely find it worth your time. There was a second course on the same subject in 2002, just so you don't get confused.

Those CNET journalists have a touch of that feeling described in that essay, and they always will. I know because I have it too. Until it happens to you, you can't even imagine what it feels like to be spied on. Try, though, and then multiply by a thousand. That will give you a small idea of the damage, the psychological damage. HP will of course argue that it didn't as a corporate body intend to do these things, that it was a few rogues, and in any case, it had no malice. Of course, that doesn't answer the reckless disregard issue. But if it's true, as I recall them stating at the time, that it's commonplace for corporations to do surveillance and investigations, what is the effect on journalism now? On our culture? I think you can see why journalists would be concerned.

As you read in the legal definition, you can't sue for punitive damages unless there have been actual damages. So what might those be here? Think about what a journalist does for a living. He looks for news, something no one yet knows about. That's the job. Or a big part of it. So journalists depend very much on people feeling free to contact them and tell them little bits of news that they can follow up on. Journalists work to develop such contacts. For the journalists that we know were followed and pretexted, detectives and maybe others got lists of who called them on the phone and who they called and when and where. Will folks want to call them now? Will they pick up the phone if they see on Caller ID it is one of those reporters? If you were telling a journalist something that your company would prefer you not tell, would you now? Who wants to call up a reporter with a scoop whose name is plastered all over the world as being spied on by a honking huge corporation if you need anonymity? Journalists are brave, by definition, in that what they do can be dangerous and they realize that. Just look at the stats sometimes on which jobs have the shortest life expectancy. But their informants may or may not be brave.

Not only that, but some media entities have certain regulations about what a reporter can cover. At CNET, for example, none of the three can now cover HP. So is there damage to those journalists' careers? Obviously that will be the argument made in court to demonstrate actual damages. If you are a tech reporter, and now you can't cover a major tech company, are you damaged? Worse, might a cynical corporation wishing to get a good journalist off a story deliberately tail them so as to get the journalist banned from covering them from that point on? After covering SCO, one thinks of everything as being conceivable. And then, speaking of SCO, there's the issue of using whatever is dug up to try to discredit a journalist.

So that is what the lawsuit will be about, I gather. Can you see why journalists care about this issue so much? Why they should care? What if every corporation starts to investigate all journalists who they can't get to hop into their pockets and report only what the corporations want reported? What happens to news then? You know what happens? It becomes press releases. So the New York Times is also pursuing legal relief, not just its reporter, John Markoff. And CNET may sue separately from its reporters.

All three of the CNET reporters are represented by Kevin R. Boyle, a lawyer in the Los Angeles firm of Panish, Shea & Boyle. The BusinessWeek reporters and John Markoff of the New York Times are represented by a San Francisco lawyer, Terry Gross, who also represents the Times. HP is represented by Morgan, Lewis & Bockius of Philadelphia. What about the other victims? They are continuing to pursue settlement talks, which means further litigation is possible. The two reporters from the Wall Street Journal do not seek compensation, which in my view is a shame, although I do understand not wanting to be bothered with litigation.


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