By Jonathan Stempel
NEW YORK (Reuters) - Authors and publishers of controversial scientific articles, and the companies sponsoring those articles, won broad free speech protection from a U.S. appeals court on Wednesday.
The 2nd U.S. Circuit Court of Appeals in New York said statements of scientific conclusions on matters open to scientific debate, and which are published in a research article, cannot result in damages associated with defamation.
It also said companies may promote excerpts from such an article so long as readers are not misled about the conclusions.
While statements about contested scientific hypotheses are in principle "matters of verifiable fact," for purposes of the First Amendment they are closer to matters of opinion, Circuit Judge Gerard Lynch wrote for a unanimous three-judge panel.
The decision is a defeat for ONY Inc, an upstate New York company that had sued Cornerstone Therapeutics Inc, Italy's Chiesi Farmaceutici SpA, several doctors and the American Academy of Pediatrics.
ONY's case focused on a 2011 article about the effectiveness of drugs meant to help premature infants who face a higher risk of collapsed lungs and respiratory distress to breathe more easily, reducing the risk of respiratory failure and death.
Chiesi had earlier contracted for a study to compare its drug, Curosurf, with ONY's Infasurf and Survanta, a rival drug made by AbbVie Inc.
Parts of these findings were published by some of the doctor defendants in the AAP's Journal of Perinatology, and the article was later used in promotional materials by Chiesi and Cornerstone, which marketed Curosurf in the United States.
ONY said the article contained several incorrect statements of fact suggesting greater infant mortality with Infasurf than Curosurf, and selectively chose data that favored Curosurf.
The Amherst, New York-based company's lawsuit accused various defendants of false advertising that violated the federal Lanham Act, and a New York state law against deceptive business activity, injurious falsehood, and interfering with its dealings with hospitals and health care providers.
ONY sought $10 million in damages, and triple damages against Chiesi and Cornerstone, court papers show.
But in upholding a May 2012 dismissal of the lawsuit by a federal judge in Buffalo, New York, Lynch said "academic freedom is a special concern of the First Amendment," and warned against extending the Lanham Act to intrude on the amendment's values.
"As a matter of law, statements of scientific conclusions about unsettled matters of scientific debate cannot give rise to liability for damages sounding in defamation," Lynch wrote. "We further conclude that the secondary distribution of excerpts of such an article cannot give rise to liability, so long as the excerpts do not mislead a reader about the conclusions."
The decision applies in New York, Connecticut and Vermont, but may be cited as authority in other jurisdictions.
ONY, in a statement, said, "It is unfortunate that the law here failed to protect a vulnerable audience, busy physicians devoting their lives to critically ill infants, from the purely mercenary appeals of persons elevating their own profits over - and under the guise of - objective science."
J. Kevin Fee, a lawyer for the defendants, did not immediately respond to requests for comment. The AAP did not immediately respond to requests for comment. AbbVie is not a party to the lawsuit.
The case is ONY Inc v. Cornerstone Therapeutics Inc et al, 2nd U.S. Circuit Court of Appeals, No. 12-2414.
(Reporting by Jonathan Stempel; Editing by Leslie Gevirtz)