Determination
44
Minnesota
News Council
In the Matter of the Complaint of
Arne Carlson against Corporate Report Minnesota
Minnesota State Auditor Arne H. Carlson complained
that an article in the magazine falsely implied that he was involved
in a conspiracy to gain control of investment of public pension funds
for improper purposes. He further complained that the publication
failed to properly correct the article's errors after he had brought
them to its attention.
Background: Corporate Report is a regional
business magazine headquartered in Minneapolis. The article at issue,
entitled "A Capital Fight," was published in its September
1981 issue and portrayed a bitter political struggle underway for
control of the investment of Minnesota's public employee pension funds.
The article described the workings of the Minnesota State Investment
Board, which managed and invested some $4.3 billion in pension monies,
including the pension funds of the Public Employees Retirement Association
(PERA), the Teachers Retirement Association, and the Minnesota State
Retirement System.
The main thrust of the article was that John Allers,
a union leader and a PERA director, was critical of the Investment
Board's performance and was seeking to withdraw PERA's funds from
the Investment Board's control so that PERA could manage its own pension
funds. Also involved in this effort was Michael McLaren, another PERA
director and, according to the article, a "point man" for
John Allers.
Response of the news organization: While the magazine
admitted it had been inaccurate, it claimed its article did not accuse
Carlson of collusion or conspiracy, as Carlson had appeared in the
article as only a secondary player. Carlson had clearly aligned himself
with the pension fund directors in their effort to withdraw funds
from the Investment Board, and such errors in the article were technical
and minor, said the magazine.
Corporate Report conceded that it failed to promptly
correct the errors, but asserted that it had always been willing,
and remained so, to print Carlson's response to its article in a form
"both adequate and appropriate."
Determination of the Council: The Council finds
there were factual errors in the magazine's article relating to Carlson.
The article wrongly implied that he worked in concert with others
to obtain control of pension money away from the Investment Board
for improper motives.
The Council proposes a two-step remedy: that the magazine,
at its next opportunity, publish a correction of the errors of fact;
and that Carlson take advantage of its offer to use its "Executive
Forum" space to respond to those portions of the article offensive
to him.
The complaint against the magazine is upheld.
Concurring: Allen, Brooks, Carlson, Egert,
Fairbanks, Foley, Forsythe, Fushan, Higgins, Holloran, Kramer, McCollough,
Miles, Myers, Peek, Selby, Simonett, Ryan, Ziegenhagen.
Partial Dissent by Earley: While the article
contains some factual errors, it does not necessarily imply that Carlson
shared the personal motivations of other critics and worked in concert
with them to obtain control of the pension money.
October 30, 1981
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Determination 45
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