The jury reasoned that Philadelphia-based Franklin Prescriptions
had not suffered any harm as a result of the defamation by
implication, and no damages were awarded.
Franklin Prescriptions specialises in the market for infertility
drugs. However, it does not sell on-line and its web site does not
even include an e-mail address. But in October 2000, a screenshot –
or "web-grab" – of its site appeared alongside a New York Times
article, headlined "A Web Bazaar Turns Into a Pharmaceutical Free
for All."
The article described "unscrupulous" and "cloak and dagger" web
sites that take e-mail orders for controlled infertility drugs, in
particular without requiring a doctor's prescription. It also
talked of "unscrupulous on-line pharmacies" that "intentionally
muddy the water by operating multiple sites from numerous places,
all of which can be shut down at a moment's notice and moved
elsewhere."
The article did not refer to Franklin Prescriptions, and its
address and telephone number were deleted from the screenshot; but
nor did the article identify Franklin as a legitimate practice
rather than an unlawful one.
The company, which has been building its reputation for over 30
years, complained about the implication of the image from its web
site being used with the article. A correction appeared in The New
York Times the following day, clarifying that the image had been
used in error, that Franklin did not sell drugs on-line, and that a
prescription was required for any purchase. But the pharmacy sued
for defamation.
According to the Law.com report the jury found that there was a
"defamatory implication" in the article that would be understood by
readers and would be "applied" to the pharmacy. The jury also found
that the implication was "substantially false" and that The New
York Times acted intentionally, recklessly or negligently when it
published the defamatory implication.
However, the jury then found that the pharmacy had not suffered
any "actual harm that was substantially caused by the article"
after lawyers for the newspaper pointed out that Franklin's
accounts had shown a rise in sales of $100,000 a year, and that the
month after publication of the article sales had risen by
$10,000.
