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Fredrick K. Price's Defamation Suite to Move Forward

A federal appeals court has ruled a defamation lawsuit California pastor Frederick K.C. Price filed against ABC and its former 20/20 correspondent John Stossel can move forward.

Price, founding pastor of Crenshaw Christian Center in Los Angeles, claims his words were taken out of context in a 2007 20/20 report about businessmen, pastors and politicians who seem to live extravagant lifestyles.

In Stossel's "Enough" segment, 20/20 showed Price, who is well-known for his teaching on financial prosperity, telling a crowd: "I live in a 25-room mansion. I have my own $6 million yacht. I have my own private jet, and I have my own helicopter, and I have seven luxury automobiles."

It was not clear in the clip, however, that Price was preaching about a hypothetical person who was unfulfilled despite his wealth. ABC ultimately ran a correction. Stossel now works for Fox Business Network.

In its decision Tuesday, the Ninth Circuit Court of Appeals said the context in which Price's words were presented materially changed their meaning.

"Because Price has a reasonable possibility of proving that the Clip, as broadcast, was false, and because Defendants relied exclusively on the issue of non-falsity in their motion to dismiss ... we must reverse the dismissal of the express defamation claim and remand," the court ruled.

Price's attorney, Anthony Glassman, said ABC must now produce editor notes and footage to determine whether the network intended to air false statements, Reuters news service reported.

"It's been a long, hard struggle and we look forward to trying this case against Mr. Stossel and ABC News," Glassman said.

An ABC spokesman said the network is confident it will prevail, noting that the court did not comment on whether Price could satisfy other conditions of a defamation lawsuit.

The case will now return to the lower court.

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