Court Dismisses Lawyer's and Client's $120M Libel Lawsuit Against Legal Newspaper

From Beres v. Daily Journal Corp., decided Monday by Judge William Dimitrouleas (S.D. Fla.):

Plaintiff Christopher T. Beres, a Florida lawyer, and Plaintiff Andrew Delaney, one of Beres' clients, bring one count for defamation against Defendant Daily Journal Corporation based on the Daily Journal's publication of a two-part article….

The Amended Complaint alleges that on April 28 and April 29, 2020, the Daily Journal published a two-part article entitled Does Covid-19 Threaten Your Trade Secrets? Yes, It Does. (Part I), and Does Covid-19 Threaten Your Trade Secrets? Yes, It Does. (Part II). Plaintiffs allege that these articles defamed them. In addition to alleging that the headlines themselves are defamatory because "the articles 'conclude' that [P]laintiffs were guilty six days after the case was filed: 'Yes, it does,'" Plaintiffs allege that the following statements contained within Part I are false and defamatory:

Any time there is a termination of an employee, there is potential for misappropriation or loss of trade secrets. Consider the following potential scenarios: …

• A terminated employee cannot find new employment and decides to use the former employer's trade secrets as a source of income. See, e.g., HC2 Inc. v. Delaney, Case No. 1:20-cv-03178 (U.S. District Court for the Southern District of New York) (complaint alleges that a former employee of a legal staffing company tried to extort clients for $450,000 by threatening to release confidential information after they suspended a document review project due to the COVID- 19 pandemic).

Plaintiffs allege that "[e]very part of the first sentence" of the bulleted paragraph is false and defamatory because Delaney was not "a terminated employee [who] cannot find new employment," Delaney did not "decide to use the former employer's trade secrets as a source of income," and because there were no "trade secrets" in the SDNY Action. Plaintiffs also allege that "'threat to disclose confidential information' and 'extortion' in [t]he Daily Journal is a clear reference to Beres's April 7, 2020 employment demand letter to Toyota …, thereby imputing these crimes to him." According to Plaintiffs, the content of the articles "spread like a disease including on social media" and caused substantial damage. Plaintiffs seek twenty million dollars ($20,000,000.00) in compensatory damages and one hundred million dollars ($100,000,000.00) in punitive damages….

No, says the district court:

[1.] Beres, the lawyer, loses "because nothing contained within the article—including the statement, citation, and parenthetical—are 'of and concerning' Beres."

[2.] As to Delaney, "the only portion of the article concerning Delaney, a parenthetical and accompanying citation, contain no material falsities." "The introductory phrase 'complaint alleges' makes clear that the parenthetical merely describes the complaint's allegations, not that it vouches for their veracity." And the parenthetical describes those allegations substantially accurately: "A comparison of the allegations in the SDNY complaint with the parenthetical reveal that the parenthetical is not substantially and materially false."

[3.] Nor can Delaney prevail on the theory that the sentences preceding the citation and parenthetical defame him: That material "presents only a hypothetical 'terminated employee' in a 'potential scenario,'" and the "'see, e.g., denotes that numerous sources indirectly support the proposition,' not that the case is a literal example of what preceded it." (The court cites as authority the Bluebook—likely the most broadly used legal citation manual—and a source related to it; that likely makes sense, I think, given that the article is aimed at a lawyer audience.)

Seems right to me.

Comments

[DaivdBehar]

One of the first questions a plaintiff lawyer may ask of a client is, “What was your damage?” If there is any damage, sue the people causing it. A news story causes no damage except by consequences, so sue the employer, spouse, club, church, licensing board, police investigator who relied on the false news story to financially or physically damage the plaintiff. To deter.

[Illocust]

Sue them for what? Is your spouse required to stay married to you? Are employers required to keep you employed? Friends required to remain friends?

[DaivdBehar]

Get fired for nude pics of you and by being called a hoe on line, by the police department or by the school district, yeah, that is the real money damage, not the pictures or revelation of a private fact. Your nudity and drunken revelry, especially from years ago, are irrelevant to your performance, thus a wrongful cause of firing. The unfairness of at will employment can be debated in court.

That being said, value should be deducted from the damage if you got a much better girlfriend and a higher paying job from the publicity. The notoriety of the beautiful police woman who got fired may have gotten her a job in public relations that doubled her pay. She benefited from the firing. Being called a fiend and a sex offender many get me many more dates by much better girls than my ex-girlfriend who left me. That value should be deducted from the damage. This is a third grade arithmetic word problem.

[DaivdBehar]

The greatest female aphrodisiac to females seems to be publicity and power. Jackie was asked who the sexiest man at a party was. She pointed to Henry Kissinger, the polar opposite of traditional sexiness. That value should be deducted from any damage.

This beautiful girl kept staring at me. After a while, I nasally said, “Whaaat?” She replied, “I heard your 2 minute segment on the radio.”

[DaivdBehar]

The doofy looking kid who got called a racist, and made $millions off left wing media in his defamation claim, do you think he got more dates in college or fewer dates as a result of his picture splashed around the world? The value of that publicity should have been deducted from any hurt fee-fee the story caused. The defense bar is really weak. They owe their job to the plaintiff bar. Deter the plaintiff, lose your defense job. Defense clients have to advocate for themselves, and continually terrorize defense lawyers to get any value from them.

[DaivdBehar]

Tort defendants have Fifth Amendment Procedural Due Process Rights. They have Eighth Amendment rights.

Is it fair for the media to pay damages after the police department fired the girlf for her nude pics? The media has no control over the employer. How can you punish a party for the acts of another? That is crazy.

[David Nieporent]

Behar is mentally ill, but the funniest part of his mental illness is that it manifests in both pathological hatred of lawyers and calls for massively increasing litigation.

[DaivdBehar]

David. I love the lawyer profession. You need to STFU.

[David Nieporent]

That’s what my son says when I tell him to do his chores. He’s saner than you, though.

[DaivdBehar]

David. Your son loves the lawyer profession as much as I do? We should get together. We should help it improve, and move from the 13th Century cesspool in which it is stuck. If he wants to go to law school, I want to inoculate him against the vile garbage indoctrination he will encounter. He should take a college course in Critical Thinking, and one in the Scientific Method. I can save your child.

[Rossami]

Unless Beres (and to a lesser extent, Delaney) had to pay the full costs of answering this frivolous lawsuit, it doesn’t sound completely right to me. But it’s getting closer. If we’re not going to stop the “litigation lottery” approach to lawsuits, we need to at least make the cost of a ticket commensurate with the odds and payout.

[DaivdBehar]

That is a good point. I support the American Rule. However, if a judge declares a claim to be frivolous, the losing party and especially the losing attorney should pay all costs from personal assets, nor from company assets. Any judge failing to report an attorney filing a frivolous claim to the Disciplinary Counsel should be removed from the bench for violating a Judicial Canon. The Disciplinary Counsel failing to pull the license of an attorney violating the Rule requiring meritorious claims should be fired on the spot. To deter. That Rule is never enforced.

[John F. Carr]

The Guardian published a story about Hertz reporting late returns or computer errors to police as stolen cars. The author added a personal experience with a rental company left unnamed for legal reasons. Was it Hertz? You might very well think that. I couldn’t possibly comment.

https://www.theguardian.com/commentisfree/2022/mar/09/a-car-rental-company-has-banned-my-wife-but-compared-with-some-hertz-customers-she-may-have-got-off-lightly

Loading that Guardian story caused an ad on this page to switch to an ad for airport parking.

[David Nieporent]

I was curious, so I looked up the underlying HC2 Inc. v. Delaney case. It’s still ongoing, but Delaney filed for bankruptcy during its pendency and is no longer a party; the bankruptcy trustee has been substituted for Delaney.

[Eric VonSalzen]

I think the court was correct here. However, the newspaper was guilty of sloppy journalism in citing a pending lawsuit to illustrate their point. It would probably have been easier, not harder, to find an ajudicated case in which a “terminated employee cannot find new employment and decides to use the former employer’s trade secrets as a source of income”. And if the newspaper can’t find such a case, well, maybe they ought to rethink their story.

[David Nieporent]

Setting aside that this is a legal journal, not a newspaper, and it primarily publishes columns submitted by practicing lawyers (which this two part column was), the entire point of the story was something prospective that might happen.