EFFECTEN SPIEGEL AG v. GERMANY
Inadmissible
Isabelle Berro-Lefèvre;Karel Jungwiert;Mark Villiger;Peer Lorenzen;Rait Maruste;Renate Jaeger;Zdravka Kalaydjieva
The applicant, Effecten Spiegel AG, is a corporation (Aktiengesellschaft) registered in Germany. It was represented before the Court by Mr D. Herrmann, a lawyer practising in Karlsruhe. company, may be summarised as follows. The applicant company is the publisher of Effecten-Spiegel, a weekly journal aimed at the investor community. By letter of 5 November 2001 the editor received a press statement by Mr D., a shareholder and former staff member of Audi, a subsidiary of one of the leading German automobile groups, the Volkswagen group (VW). In the statement Mr D. raised several allegations against Mr P., a well-known business leader and manager, chairman of the board (Vorstandsvorsitzender) of Audi until 1992 and chairman of the board of VW from 1993 to 2002. Both companies were listed on the stock exchange and the Federal State of Lower Saxony (Land Niedersachsen) held approximately one-fifth of the shares. Prior to publication, by letter of 6 November 2001 the applicant company transmitted Mr D.'s press statement to the board of Audi and asked for a written comment (schriftliche Stellungnahme). The next day the applicant company informed the board of Audi that for editorial reasons any comments should be sent by 12 November 2001. In its issue of 15 November 2001 Effecten-Spiegel published an article on the basis of Mr D.'s press statement. The article gave an account of parts of Mr D.'s press statement and his allegations against Mr P. In the last paragraph of the article the author commented on these statements, holding that “the whole story stinks to high heaven” (“Das Ganze stinkt zum Himmel”): “The whole story stinks to high heaven! Particularly if it is borne in mind that the Federal State of Lower Saxony indirectly owns 20% of Audi and that therefore particular sensitivity could be expected. Effecten-Spiegel has in the past denounced the fact that big business was ransacking the national economy. If big business will not even invest in the East in a case such as this one, when will it? And the reproach of betraying one's own country in this context seems understandable. But above all, I wonder: VW is trying to squeeze out private dealers and to set up its own branches everywhere, and it cannot equip the east European countries with its own branches, but acts by proxy of a company owned by P., Porsche Holding?!!! That is totally implausible!” The article revealed the source of its contents and Mr D. was presented as an insider source as he had been involved, in 1971, as the main representative of one sector of the board of Audi, in the conclusion of contracts with VW. On 10 November 2002 the Hamburg Regional Court, upon an application by Mr P. for an injunction (Unterlassungsklage), ordered the applicant company to refrain from disseminating certain parts of the article, namely from: “1. disseminating: 'It is known that P. holds shares in Porsche and in 1992, according to D., he apparently grabbed for free (offenbar kostenlos unter den Nagel gerissen) the exclusive distribution rights through Porsche Holding for Audi, Seat, Skoda and VW in Hungary, Slovakia and Romania.' 2. giving the impression that in the context of his activities for VW AG the plaintiff [Mr P.] was involved in decision-making concerning royalty payments in favour of Porsche Holding or other companies in which the plaintiff holds shares, by reporting: 'Moreover [in conjunction with D.'s allegations against the plaintiff], D. addresses the question of royalty payments by Audi AG to Porsche AG or other companies in which P. holds shares.' 3. disseminating that the background to the decision against Magdeburg (namely in favour of building an engine plant in Györ in Hungary) was, in D.'s opinion, that 'Mr P. would like to have a factory as the exclusive distributor, exactly as for the allterrain vehicles in Slovakia'.” The Regional Court held that the dissemination of the above statements violated Mr P.'s personality rights. The first statement (under 1.) consisted of a factual statement because to say that somebody had “grabbed” something implied that this person had acted with the aim of getting something. The statement was also disparaging as it implied that Mr P. had abused his leading position to his own advantage. Hence, the Regional Court found that the burden of proof was with the applicant company, which had not produced any evidence to that effect and had not even contested Mr P.'s submission that he had not been involved in the decision about the exclusive distribution rights. Against this background the statement had to be regarded as untrue and thus was not protected by freedom of speech. Moreover, the court held that there had not been a legitimate interest in the publication of the statement. It was true that even the publication of untrue factual statements could be justified. However, this was only the case if the person disseminating the information had sufficiently tried to verify the facts prior to publication and if any remaining doubts as to the truth of the facts had been made sufficiently clear. In the case at hand, the applicant company had not even come close to having exhausted all possibilities of establishing the facts, as it had not tried to obtain a statement either from Mr P. himself or from the board of VW, that is, from those persons against whom the allegations had been raised. Furthermore, the article was a long way from balanced coverage that also indicated doubts as to the truth of the statements made by Mr D. As to the second statement (under 2.), the Regional Court held that it necessarily gave the impression claimed. This was the case in particular because the statement that Mr D. also “addresses the question of royalty payments” was made in the direct context of the statement that Mr D. had raised serious allegations against Mr P. Any other understanding would render the statement meaningless and empty. The statement, hence, consisted of a factual statement (through the creation of an impression) and had to be regarded as untrue because the applicant company had not produced any evidence. For the same reasons as for the first statement, there had also not been a legitimate interest in the publication of the expression. As to the third statement (under 3.), the Regional Court likewise held that it consisted of a factual statement as it alleged a certain motivation on the part of Mr P., in other words an “internal fact”. Such statements had to be regarded at least as statements of fact if they were connected with certain external events by which these internal circumstances allegedly became perceptible to others. The court found that this was the case as the decision to build an engine plant in Hungary was traced back to an alleged internal motivation on the part of Mr P. as being the real reason for that decision. The existence of this alleged causal connection between the motivation of Mr P. and the decision in question was susceptible to proof – be it by circumstantial evidence or by interviewing Mr P. The statement, moreover, had not been changed into a value judgment by formally adding “in Mr D.'s opinion”. The decisive factor was not the formal terms in which a statement was couched but the way it was understood by the average reader. Otherwise the publisher of a factual statement could easily escape the rules governing publication of statements of fact by adding “according to” or “in the opinion of”. From the perspective of an average reader, the basic purpose of the statement at stake was not to convey information about the personality and the opinions of Mr D. – as might be the case, for example, in a portrait of Mr D. – but about events within the VW group. Finally, for the same reasons as for the first and the second statement, there had neither been a legitimate interest in the publication of this statement. On 18 February 2003 the Hamburg Court of Appeal dismissed an appeal by the applicant company against the judgment and refused leave to appeal on points of law. It confirmed the reasoning adopted by the Regional Court. As to the appellate submissions, the Court of Appeal added that, concerning the first statement, the expression “grabbed for free” could only be understood in the sense that Mr P. had actively influenced the decision about the awarding of the exclusive distribution rights. It pointed out that, contrary to the applicant company's contention, the simple fact of Mr P. being the chairman of Audi was far from being sufficient to influence that decision in the manner claimed. It also expressly confirmed the Regional Court's finding that the applicant company should have interviewed Mr P. or at least the board of VW. Moreover, the article was not even close to mentioning sufficient facts supporting a reasonable suspicion. With regard to the second statement, the Court of Appeal confirmed that it necessarily suggested the impression claimed and re-emphasised that the statement directly followed the information that Mr D. had raised “serious allegations” against Mr P. and that the article ended with the conclusion that “the whole story stinks to high heaven”. Such wording was not of a kind to leave it up to readers to draw their own conclusions. As to the third statement and the argument – also mentioned in the article – that prior to the decision in favour of Györ, Mr P. had given incorrect information about the difference in salaries between Hungary and Germany, the Court of Appeal held that it did not follow from this that the real reason for the decision was the motivation of Mr P. as alleged in the article. On 23 September 2003 the Federal Court of Justice rejected a complaint by the applicant company against the refusal of leave to appeal on points of law (Nichtzulassungsbeschwerde), without giving further reasons. On 21 March 2007 the Federal Constitutional Court refused to accept for adjudication a constitutional complaint by the applicant company. It first held that statements of fact – whether a person's own statements or statements of others incorporated in the person's own statement – fell within the scope of protection of the freedom of expression as guaranteed in the Basic Law (Grundgesetz) as long as their untruthfulness was not established. However, this protection was subject, inter alia, to the limitations laid down by the provisions of general laws, including the protection of the personal rights of others. The interpretation and application of these provisions, the establishment of the facts and the balancing of the different interests concerned were the task of the civil courts, which had to take into account the relevance and the impact of fundamental rights. With regard to the general principles established in its case-law the Federal Constitutional Court underlined that it was of crucial importance whether an expression contained factual elements the truth of which could be verified. If an expression inseparably contained both factual and evaluating elements, it had to be regarded as a value judgment if it was dominated by the evaluating elements. However, the truth or untruth of the factual elements had to be taken into account when balancing the different interests. If the publication of statements of fact, the truth of which was uncertain, interfered with the personal rights of others, there were duties of care (Sorgfaltspflichten) to fulfil. The more intense the interference, the more intense these duties became. One aspect was the question whether the person making the statement had adequately verified the facts and correctly conveyed the state of his knowledge in this regard. The courts had to take into account that these duties of care were an expression of the State's positive obligation to protect the personal rights of others. On the other hand, they also had to take into account the public interest in the information concerned, and the requirements in question should not have a constricting effect on readiness to make use of the freedom of expression. Against the background of these principles, the Federal Constitutional Court did not find a violation of constitutional law. It held that the expressions at stake all contained factual elements, the truth of which had not been established. The Federal Constitutional Court also found that at the time of their publication there had been no legitimate interest in the dissemination of the statements at stake. It held that it might have been excessive for the courts to have required the applicant company to also ask the board of VW and Mr P. for a written comment. However, this had been only one additional aspect amongst others which in themselves formed a sufficient basis to justify the decisions. In particular, the courts had taken into account that the statements in the article were based on one single private source only and that the dissemination of such information was acceptable only if there was a minimum of evidence in favour of its veracity. Lastly, the Federal Constitutional Court also found that the court decisions were not in contradiction with the case-law of the European Court of Human Rights. Referring to different judgments of the latter, it pointed out that there was no breach of Article 10 of the Convention if the domestic courts, when balancing the different interests involved, attached weight to the question whether the person making the statement had conducted his own investigations as to the veracity of the information and whether any remaining doubts had been made sufficiently clear.