Justices to Review Plea to Set Aside Libel Ruling

The state Supreme Court agreed Thursday to review an unusual bid by opposing sides to set aside a milestone libel verdict against the University of California as part of a settlement with a Chico rancher.

The rancher, George Neary, had won a $7-million award from an Alameda County jury, which ruled in 1988 that he had been falsely blamed in a report by UC Davis veterinarians for the deaths of his cattle in 1979.

An agreement was reached, however, to end the costly, 12-year legal struggle. Under its terms, Neary would receive an undisclosed payment--and both sides would seek to have the libel verdict overturned to protect the professional reputations of the veterinarians.

But last March, a state appeal court refused the request, concluding that to set aside an otherwise valid verdict--just to achieve a settlement--would “undermine the integrity of the entire judicial process.” Both sides then urged the high court to review the appellate ruling, and the justices in a brief order Thursday agreed to do so.

Jerome B. Falk Jr. of San Francisco, an attorney for the university and the veterinarians, welcomed the high court’s intervention. “They (the veterinarians) felt very, very strongly that what they had done was proper, honest and truthful,” Falk said. “With the verdict being undone, they didn’t win, they didn’t lose, but at least it was settled--and that was very important to them.”

David J. Meadows of San Francisco, an attorney for the rancher, said the justices’ ruling would resolve an important issue that has divided lower courts. “If the Supreme Court reaches a different result than the Court of Appeal, it will allow a great deal more flexibility to reach a settlement rather than having to drag a case through multiple levels of the courts,” he said.

The case arose after Neary bought 848 pregnant heifers in Oregon and took them to a ranch he owns near Chico. State agricultural authorities, fearing the herd had been infested with scabies mites, decided to treat the cattle with the chemical Toxaphene.

Soon after, however, about 95 heifers and more than 400 newly born calves died. The three UC Davis veterinarians investigated the deaths and issued a report absolving the state and placing the blame on Neary for inadequate care of the herd.

Neary then brought his libel suit, winning a verdict that was the first of its kind involving an academic report issued by a college or university in the state. After the settlement was reached, both sides went to the state appeal court in San Francisco to try to void the libel finding.

The appellate panel rejected the request in an opinion by Justice J. Anthony Kline, joined by Justices Jerome A. Smith and John Benson.

The appeal court acknowledged that settlements before trial were desirable to avoid expense. But in this case, the panel said, “massive amounts” of time and money had been spent during years of pretrial litigation and a trial that lasted four months and resulted in 13,000 pages of testimony.

The duty of courts, Kline said, was not merely to satisfy parties in a lawsuit “but to say what the law is and apply it in particular cases.”

” . . . The reversal of a judgment not thought to be legally erroneous simply to effectuate a settlement would trivialize the work of the trial courts and undermine the integrity of the entire judicial process,” Kline wrote.

In other action Thursday, the state Supreme Court unanimously upheld the death sentence of Henry Earl Duncan for the murder of Josephine Eileen DeBaun, a cafeteria night manager at Los Angeles International Airport, during a 1984 robbery.