Nationwide v. Belo Corp.

On July 29, 2003, the Dallas Morning News published in print and on its website an allegedly defamatory article by financial writer Scott Burns about an accelerated mortgage program offered by Nationwide Bi-Weekly Administration, a company that provides mortgage payment services for borrowers. The article, among other things, accused Nationwide of engaging in deceptive business practices.

Nationwide filed a complaint in Ohio state court on July 28, 2004, asserting claims for defamation, tortious interference with prospective business relations, and business disparagement against the Dallas Morning News, its owner Belo Corp., and Burns. Nationwide did not, however, serve the complaint on any of the defendants until June 2005. Shortly thereafter, Defendants successfully removed the case to federal court in Ohio, whereupon the court transferred venue to the Northern District of Texas.

On May 30, 2006, Defendants filed a motion to dismiss, arguing that Nationwide had failed to state a claim upon which relief could be granted because Texas' 1 year statute of limitations for libel claims barred Nationwide's lawsuit.

On October 16, 2006, the court granted Defendants' motion, holding that Nationwide failed to exercise diligence in serving the defendants and that under the single publication rule, the limitations period expired in July 2004.

Nationwide appealed the decision and on December 21, 2007, the Fifth Circuit affirmed the dismissal, holding that

the continued availability of an article on a website should not result in republication, despite the website’s ability to remove it. Perhaps more important than the similarities between print media and the Internet, strong policy considerations support application of the single publication rule to information publicly available on the Internet. See Firth, 775 N.E.2d at 466 (discussing the “potential for endless retriggering of the statute of limitations, multiplicity of suits and harassment of defendants” and warning of a corresponding chilling effect on Internet communication). We agree that these policy considerations favor application of the single publication rule here and we note that application of the rule in this context appears consistent with the policies cited by Texas courts in adopting and applying the single publication rule to print media: to support the statute of limitations and to prevent the filing of stale claims. See Holloway, 662 S.W. 2d at 691.

As to the business disparagement and tortious interference claims, which are normally entitled to a 2 year statute of limitations under Texas law, the court stated that when allegedly defamatory statements form the sole basis for a business disparagement or tortious interference claim, defamation’s one-year statute of limitations applies.