Billionaires vs. the Press in the Era of Trump
Emily Bazelon reports in the NY Times:
In 2005, Tim O’Brien, then a financial reporter at The New York Times, published the book “TrumpNation: The Art of Being the Donald.” O’Brien talked to sources with an up-close view of Donald J. Trump’s finances, who concluded that the real-estate developer’s net worth was $150 million to $250 million, rather than the $2 billion to $5 billion Trump had variously claimed. Trump, who had courted O’Brien by taking him for rides in his Ferrari and private jet, sued O’Brien for libel in New Jersey in 2006. Trump called O’Brien a “wack job” on the “Today” show — while, O’Brien says, continuing to curry favor with him privately. O’Brien’s publisher, Warner Books, was also named in the suit and hired top lawyers who put Trump through an unsparing two-day deposition. Asked about his finances, Trump was caught lying or exaggerating 30 times. “He thought he’d get a friendly judge, and we would roll over,” says O’Brien, who is now the executive editor of Bloomberg View. “We didn’t.” The case went through four judges and was dismissed in 2009.
Trump’s suit against O’Brien is one of seven forays President-elect Trump and his companies have made as libel plaintiffs. He won only once, when a defendant failed to appear. But the standard measure — defending his reputation and achieving victory in court — isn’t how Trump says he thinks about his investment. “I spent a couple of bucks on legal fees, and they spent a whole lot more,” he told The Washington Post in March about the hefty sum he spent on the case against O’Brien. “I did it to make his life miserable, which I’m happy about.”
Trump was wrong: Warner Books spent less than he did, and O’Brien paid nothing. But that doesn’t make Trump’s central idea any less jarring: that libel law can be a tool of revenge. It’s disconcerting for a superrich (if maybe not as rich as he says) plaintiff to treat the legal system as a weapon to be deployed against critics. Once installed in the White House, Trump will have a wider array of tools at his disposal, and his record suggests that, more than his predecessors, he will try to use the press — and also control and subdue it.
This kind of manipulation of the law is unfolding at a keen moment of weakness for the press, which has already been buffeted by falling revenue and mounting public disaffection. Only 40 percent of the public — the lowest rate since at least the 1990s — trusts the media “to report the news fully, accurately and fairly,” according to a Gallup survey conducted in September 2015. This mistrust has been growing for a long time, but it was stoked by Trump during the campaign. He called the reporters who covered him “scum” and whipped up yelling and booing crowds. There is no consensus among his supporters that the press should hold those in power accountable. A recent Pew survey found that only half of Trump backers agreed that it was important in a strong democracy that “news organizations are free to criticize political leaders.”
Media outlets have won many cases by persuading a judge to dismiss them. But since 2010, they have succeeded in only 39 percent of the libel and privacy suits that have gone to trial, a dip from 52 percent in the previous decade, according to the Media Law Resource Center. The median damage award has increased fivefold since the 1980s, to $1.1 million. The figure includes three big verdicts over the last eight months, against Gawker, Rolling Stone and The News & Observer in Raleigh, N.C. These include run-of-the-mill libel suits, and it’s too early to say that the sky is falling on the press. But it’s darkening.
The high bar for winning a libel case in the United States was set in 1964, when the Supreme Court decided New York Times v. Sullivan. In that case, widely hailed as one of the court’s strongest stands for free speech, L.B. Sullivan, a city commissioner who supervised the police in Montgomery, Ala., sued The Times over an ad in the newspaper signed by 100 civil rights supporters. The ad turned out to include minor factual errors. Sullivan said its depiction of how the Montgomery police responded to civil rights protests made him look bad. Under the rules at the time, a libel plaintiff was entitled to victory if he could show that the content that harmed his reputation was false. The Alabama jury agreed with Sullivan on that point and awarded him $500,000 in damages (the equivalent of about $4 million today). With similar cases pending, The Times pulled its reporters out of Alabama.
But when the newspaper appealed to the Supreme Court, the justices threw out the Sullivan verdict and set a far stiffer standard for proving libel. The court wrote that a public figure has to prove that a false and damaging statement about him was published with “actual malice,” translated as “knowing or reckless disregard for the truth.” By the 1980s, the number of libel suits decreased, and if suits did go to trial, they frequently ended in defeat for the plaintiff. In two examples from that era, Gen. William Westmoreland sued CBS, and Ariel Sharon, the Israeli defense minister, sued Time magazine. Neither man won damages. Those outcomes, as well as losses in other high-profile cases, “were a major deterrent for plaintiffs and their lawyers,” says George Freeman, executive director of the Media Resource Law Center (and formerly a lawyer for The New York Times).
Superrich plaintiffs, however, aren’t subject to the same market forces. They can treat suing the press as an investment, with the payoff being, at a minimum, the expense and time required for the other side to produce documents and sit for depositions. In February 2012, the magazine Mother Jones published a story about the Idaho billionaire Frank VanderSloot, a major donor to a “super PAC” that supported the Republican presidential candidate, Mitt Romney. In 1999, in response to a documentary, he sponsored billboards that asked, “Should public television promote the homosexual lifestyle to your children?” The magazine wrote that VanderSloot “outed” a gay reporter, Peter Zuckerman, and “bashed” Zuckerman and his reporting after he helped break a story in 2005 about a history of pedophilia by a Boy Scouts camp counselor in Idaho Falls. The portrayal of VanderSloot was based partly on several ads that he placed in The Idaho Falls Post Register. VanderSloot was upset at the story’s implications for the Boy Scouts, and the ads called Zuckerman a “homosexual” and attacked him for having “a personal ax to grind.”
VanderSloot sued Mother Jones for libel over the article. “They wanted to give me a public beating because I made a sizable donation to Mitt Romney,” he told me. VanderSloot, who owns an online health-shopping club, also said the Mother Jones article cost him customers.
Over three years of proceedings, which included turning over internal emails, Mother Jones racked up about $2.5 million in legal fees. Insurance didn’t cover the whole cost. “The suit was a huge drain on us,” Clara Jeffery, co-editor of the magazine, told me. “We’re still digging our way out.”
Judge Darla Williamson finally threw out VanderSloot’s suit in October 2015, finding that Mother Jones’s statements about him were either substantially true or opinions protected by the First Amendment. But Williamson took the unusual step of including a section in her opinion partially supporting his underlying complaint, accusing the magazine of “mudslinging” rather than recognizing its approach as squarely within the tradition of investigative journalism. Despite his defeat, VanderSloot declared himself “absolutely vindicated” and announced that he was creating a “Guardian of True Liberty Fund” to aid other people who want to sue the “liberal press.” The fund has grown to between $1 million and $2 million, he told me, with five times that amount pledged, so that “as soon as something hits we think is worth it, we can go after it.”
It was another billionaire, Peter Thiel, who realized the full potential of bankrolling other people’s lawsuits. . .