What code section, regs, and cases apply to : T.J. Taxpayer, CLU, has owned an insurance agency in Santa Rosa, California since 1960. As an independent agent, he represented five companies selling auto, home, commercial, and life insurance. Because of his excellent reputation in the community, T.J. has built a very successful agency. Last year, T.J. applied for an agency license from the American Life Insurance Co. in order to broaden his life insurance business. In reviewing his application, American requested a credit report from Federal Credit. Federal Credit provided copies to American life as well as other insurance companies. The credit report contained numerous false accusations. In addition to questioning Taxpayers integrity, the report stated that T.J. seldom returned phone calls from clients and lacked understanding of basic insurance practices and concepts. As a result, American Life denied T.J. a license to sell its life insurance. Because the report adversely affected his ability to work with existing clients and to attract new business, T.J.s profits declined considerably. T.J. sued Federal Credit for libel, claiming that the credit report was issued with intent to damage his business or professional reputation. The jury found that Federal Credit had committed libel and awarded him $100,000 in compensatory damages. T.J. did not include any of the award in taxable income.