May
01
1994

Ruling Shows Corporate Veto Over Reporters

A California appeals court has ruled that public utilities cannot discriminate against reporters—in a case that revealed how much power corporations have in determining who will cover them. The Dec. 27, 1993 decision by the Court of Appeal rein­stated a lawsuit brought by journalist J.A. Savage, who charged that Pacific Gas & Electric Co. got her fired from two publications for writing critical articles about the utility While a lower court had dismissed her suit on the grounds that PG&E was a private company, the appeals court found that PG&E acted improperly in "effectively blacklisting" Savage.

"In the case of a public utility enjoying such extensive monopolistic author­ity," said the court, "there is an important public interest in assuring freedom of the press in reporting on matters lying within the exercise of its franchise."

The unanimous decision by the three-judge court also confirmed what the San Francisco Bay Guardian, a leading alternative weekly, stressed in an editorial (1/5/94): "Pacific Gas Co. will do anything in its considerable mo­nopoly power to silence a critical voice.... The remarkable appeals court decision sheds new light on an old prac­tice. For more than 20 years, PG&E has attempted to marginalize and discredit the Bay Guardian, punish reporters for working here, and ridicule anyone who gives our articles even a scrap of credi­bility."

Savage, in 1979, helped found an anti­nuclear group, the Redwood Alliance, which challenged PG&E's Humboldt Bay nuclear plant. She was last involved with the group in 1986, when she helped it register for public hearings on PG&E's Diablo Canyon nuclear project.

Later that year, she was hired as the West Coast correspondent of Energy User News, a Fairchild Communications trade journal. The appeals court decision cited the testimony of her editor, Cornelia Clay-Fulghum, in finding that "the editorial staff was informed 'since the beginning' that appellant had anti-nu­clear views," yet "she reported for the publication throughout the next 11 months without incurring any criticism for bias."

But when PG&E found out about Savage's connection with the Redwood Alliance, it charged a conflict of interest. In 1987, after complaints to Energy User News from PG&E's manager of news services, David Monfried, she was fired by the publication. ("Soon afterward, Energy User News began getting PG&E advertising," noted the ay Guardian.)

Savage then got a job as a freelance stringer for Knight-Ridder's Journal of Commerce, also a national publication. But when she wrote two stories on PG&E for the Bay Guardian (12/9/87, 1/13/88), PG&E went after her again. PG&E's Monfried "informed her editor, John Maggs, that he would not cooper­ate with appellant for the express reason that she had written two articles for a publication critical of PG&E," the ruling pointed out.

"I informed Mr. Maggs that as a mat­ter of policy, PG&E does not cooperate with the Bay Guardian or any of its re­porters," Monfried testified. "That would, of course, include Ms. Savage." In a cover letter sent with copies of the two ay Guardian pieces, Monfried as­serted: "Frankly, John, I don't see how we can cooperate with Ms. Savage on any story." And she was fired again.

The appeals court, in restoring Savage's suit, stated that "PG&E wields considerable power over the press cov­ering its activities. Without access to PG&E as a news source, a journalist in this field is severely handicapped in the competitive search for news. Its power was dramatically illustrated by the pre­sent case. Appellant lost two successive jobs covering the public utilities industry on the West Coast after PG&E executive David Monfried informed her editors that she was persona non grata with cor­porate management."

Savage—whose case now heads for a jury trial in San Francisco Superior Court—declared that the decision "demonstrated that reporters have a spe­cial responsibility to convey information and that private utilities can't try to ma­nipulate the news by harassing re­porters." 

Karl Grossman is a professor of journal­ism at the State University of New York/College at Old Westbury, the author of Cover Up: What You Are Not Sup­posed to Know About Nuclear Power, and a writer/reporter for TV documen­taries