Hustler Owes Less for Nude Pics of Slain Wife

(CN) - Hustler does not have to pay any punitive damages for publishing nude photographs of Nancy Benoit after she was killed by her professional wrestler husband, the 11th Circuit ruled, toppling a $20 million verdict that was already reduced to $250,000.

Authorities discovered the bodies of Nancy Benoit, her 7-year-old son and her husband, Chris, at their Fayetteville, Ga., home in June 2007. Investigators quickly concluded that Chris, a wrestler with World Wrestling Entertainment, strangled his wife and son, placed a Bible next to their bodies, and then hanged himself.

In the wake of the grisly discovery, Larry Flynt Publishing Group bought 20-year-old nude photos of Nancy, who was a former model and professional wrestler, and published them in the March 2008 issue of Hustler.

Nancy's family filed suit, claiming that Hustler exploited Nancy's tragic death for financial gain by publishing the images, which were taken when she was 20 years old.

In October 2008, a federal judge dismissed the lawsuit for failure to state a claim, concluding that Nancy Benoit's death was "a legitimate matter of public interest and concern."

But the 11th Circuit ruledin June 2009 that the nude photographs did not fall within the newsworthiness exception to Georgia's right-of-publicity law, since the published photographs were in no way related to the "incident of public concern," Benoit's death.

The court ruled that Hustler was financially responsible to Benoit's family for publishing Benoit's photos without her permission and without compensating her estate.

In June 2011, a jury awarded Benoit's family $19.6 million in punitive damages, finding that Hustler had acted with intent to harm the plaintiffs.

U.S. District Judge Thomas Thrash overturned the jury's verdict the same afternoon. The court ruled that the award could not exceed Georgia's $250,000 cap on punitive damages. Coupled with $125,000 for compensatory damages, he ordered the magazine to pay the family a total of $375,000.

Maureen Toffoloni, as personal representative of the Benoit estate, appealed to reinstate the eight-figure award, while Flynt's company said punitive damages are not available for honest mistakes.

Flynt testified the photos were published because they were newsworthy, and therefore he did not think they required permission to be used.

An Atlanta-based three-judge panel agreed Tuesday.

"We agree with LFP that no reasonable jury could find clear and convincing evidence to support the imposition of punitive damages," the unsigned decision states. "There was substantial, consistent, and uncontroverted testimony from numerous LFP employees showing that they honestly and reasonably (albeit mistakenly) believed at the time that the photographs fit under the newsworthiness exception to the right of publicity." (Parentheses in original.)

"Toffoloni presented no testimony or evidence to contradict the conclusion that LFP's employees honestly believed the photographs to be newsworthy," the judges added.

"Supporting the reasonableness of LFP's beliefs is the fact that its legal team was consulted at least three times with respect to the photographs: (1) before LFP bought the images, (2) before the March 2008 issue was published, and (3) when Toffoloni's counsel sent a letter demanding that the photographs not be published. Each time, the legal department told LFP that it was permissible to publish the photographs."

"The strongest evidence supporting our conclusion that this mistake on LFP's part was reasonable is the fact that the district court in this case initially dismissed Toffoloni's case because the court agreed with LFP that the photographs met the newsworthiness exception," the decision concludes.

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