Ruling Clears Way for Trial Against Disney Unit

Walt Disney Co.’s publishing arm isn’t entitled to 1st Amendment protection for allegedly fraudulent claims it made on jacket covers for the “Beardstown Ladies Investment Club” books, because the claims are commercial speech, California’s First Appellate District ruled. The decision, which sets a legal precedent in California, means a San Francisco man’s false advertising lawsuit against Disney’s Buena Vista Books Inc. can proceed to trial. The appellate court said Disney is responsible for its own advertising claims, which must be judged independently from a book’s content to see if they conform with California’s Unfair Trade Practices Act. Russell Keimer sued Disney in April 1998 over promotional statements on five books and a video based on the investment advice of the women’s club in Beardstown, Ill. One claim said the women earned 23.4% on their investments from 1984 to 1993. Auditors later discovered their actual rate of return was 9.1%. A spokeswoman for Disney’s Hyperion Press, the brand name for Buena Vista Books, said she couldn’t comment on pending litigation.