Trump v. Trump: Journalists' Urging Source to Breach Nondisclosure Contract Is Constitutionally Protected

From Wednesday's decision [UPDATE: link added] by New York trial court judge Robert R. Reed; (for a similar case from the California courts, though not involving the Trumps, see here):

In this lawsuit, Donald J. Trump …, a former president of the United States, asserts various claims against his niece, Mary L. Trump …, The New York Times Company d/b/a The New York Times … [and] journalists Susanne Craig …, David Barstow … and Russell Buettner …, for their actions related to the publishing of The Times' 2018 article, "Trump Engaged in Suspect Tax Schemes as He Reaped Riches from His Father." …

The crux of plaintiff's claim is that a reporter for The Times caused his niece, Mary Trump, to take 20-year-old tax and financial documents held by her lawyer and disclose them in violation of a 2001 settlement agreement. The Times, it is alleged, then used those documents to publish a lengthy article in 2018 that reported that plaintiff had allegedly participated in dubious tax and other financial schemes during the 1990s. In this action, plaintiff does not specifically dispute the truth of any statements made in the article. Rather, plaintiff alleges that The Times defendants' interaction with Mary Trump resulted in her breach of certain confidentiality provisions of the 2001 settlement agreement, rendering The Times and its journalists liable for tortious interference with contract, aiding and abetting tortious interference with contract, unjust enrichment, and/or negligent supervision. Plaintiff demands $100 million in damages.

Plaintiff's claims against The Times defendants, as an initial matter, fail as a matter of constitutional law. Courts have long recognized that reporters are entitled to engage in legal and ordinary newsgathering activities without fear of tort liability—as these actions are at the very core of protected First Amendment activity.

Plaintiff's claims also fall short inasmuch as they fail to assert the necessary elements of tortious interference, unjust enrichment, and negligent supervision. More particularly, plaintiff's tortious interference claim is dismissed because The Times' purpose in reporting on a story of high public interest constitutes justification as a matter of law. Plaintiff's unjust enrichment claim fails because it is duplicative of his other claims. His claim for negligent supervision, moreover, is dismissed due to the lack of any allegations that The Times reporters committed any wrongful act falling outside of the scope of their normal work duties. Finally, the newly amended anti-SLAPP law mandates that plaintiff pay defendants' attorneys' fees and costs because plaintiff's claims plainly constitute a strategic lawsuit against public participation, and, contrary to plaintiff's argument, New York's anti-SLAPP law is directed to more than just defamation-based lawsuits.

An excerpt from the free speech analysis:

Plaintiff argues that The Times' conduct is not constitutionally protected because its actions were tortious in nature and it is well established that "[c]rimes and torts committed in news gathering are not protected by the First Amendment." According to plaintiff, The Times defendants' activities, even if considered within the scope of activities covered by the New York Constitution, were nonetheless coercive, harassing, vindictive, misleading, purposeful, and in blatant disregard of the plaintiff's contractual rights, and, as such, deserve no protection.

Plaintiff is mistaken. His characterization of The Times' actions as tortious does not, on its own, remove the constitutional protections that are extended to the press during the process of ordinary newsgathering (see, e.g., Nicholas v. Bratton, 376 F Supp 3d 232, 279 [SDNY 2019] ["[E]ntrenched in Supreme Court case law is the principle that the First Amendment's protections for free speech include a constitutionally protected right to gather news"]; Higginbotham v. City of NY, 105 F Supp 3d 369, 379 [SDNY 2015] "[T]he First Amendment goes beyond protection of the press and the self-expression of individuals to prohibit government from limiting the stock of information from which members of the public may draw" quoting First Nat'l Bank of Bos v. Bellotti, 435 US 765, 783 [1978]). This protection is based on the longstanding recognition that "without some protection for seeking out the news, freedom of the press could be eviscerated" (Branzburg v. Hayes, 408 US 665, 681 [1972])….

Plaintiff principally relies on two cases to support his argument that The Times' conduct qualifies as a tort. Plaintiff argues that The Times' conduct is not constitutionally protected under Le Mistral, Inc. v. Columbia Broadcasting System, a case that established that "[c]rimes and torts committed in news gathering are not protected by the First Amendment" (61 AD2d 491, 494 [1st Dep't 1978]). But other than offering one selective quote from Le Mistral, plaintiff does not engage further with the decision. In Le Mistral, the Appellate Division held that the First Amendment does not protect a defendant, who in order to report on a story, entered the plaintiff's private premises without permission, thereby committing a trespass. Despite numerous requests to leave, the reporter continued recording plaintiff's premises, and later claimed that the First Amendment protected his actions. The Appellate Division, in reviewing the lower court's order, disagreed with the defendant, holding that, considering the facts of the case, the reporter was not allowed to commit a trespass and then rely on the First Amendment to excuse his conduct (id.). Plaintiff also relies on United States v. Sanusi for a similar proposition (813 F Supp 149, 155 [EDNY 1992] [ordering CBS to disclose a videotape made when a reporter illegally trespassed in a criminal defendant's home to film the execution of a warrant)].

Here, plaintiff has not alleged any remotely similar facts. Plaintiff attempts to make an analogy between this action and the trespass cases by arguing that Craig engaged in illegal activity because she "directed" Mary Trump to pilfer documents against the advice of her attorney. But Mary Trump's book—which plaintiff concedes is incorporated into the complaint—demonstrates that Mary Trump's attorney gave her permission to take those documents (opening br. ex. B at 187). More importantly, plaintiff does not dispute this critical point: Mary Trump owned the files she disclosed to The Times, and thus there was nothing wrongful about Craig requesting them (Bronx Jewish Boys v. Uniglobe, Inc., 633 NYS 2d 711, 713 [Sup Ct NY Cnty 1995] ["[A]ttorneys have no possessory rights in the client files. In other words, the file belongs to the client"]). Given these facts, the trespass cases that plaintiff relies on are inapposite.

Plaintiff does not cite a single case where any court, whether state or federal, has held that a reporter is liable for inducing his or her source to breach a confidentiality provision. In fact, New York courts have consistently rejected efforts to impose tort liability on the press based on allegations that a reporter induced a source to breach a non-disclosure agreement. In Highland Capital v. Dow Jones & Company, Inc., the First Department affirmed dismissal of an investment adviser's claim that a Wall Street Journal reporter engaged in tortious conduct by obtaining information from employees bound by non-disclosure agreements (178 AD3d 572, 574 [1st Dep't 2019]). In doing so, the court highlighted that dismissal was appropriate because "defendants' conduct as alleged in the complaint was incidental to the lawful and constitutionally protected process of news gathering and reporting" (Highland Cap., 178 AD3d at 574 citing Bartnicki v. Vopper 532 US 514, 534]). Other New York decisions dismissing tortious interference claims against the press are in accord (see, e.g., Huggins v. NBC, 1996 WL 763337, at [Sup Ct NY Cnty 1996] [dismissing tortious interference claims against NBC because "any interference that occurred was merely incidental to defendants' exercise of their constitutional right to broadcast newsworthy information"])….

And some more from the court's analysis of the elements of the interference with contract tort, which forms an independent basis for the court's decision:

To state a claim for tortious interference, a plaintiff must allege "[i] the existence of a valid contract between the plaintiff and a third party, [ii] defendant's knowledge of that contract, [iii] defendant's intentional procurement of the third-party's breach of the contract without justification, [iv] actual breach of the contract, and [v] damages resulting therefrom." Plaintiff's tortious interference claim is dismissed because The Times defendants' purpose in reporting on a newsworthy story constitutes justification as a matter of law.

Justification provides an absolute defense to a tortious interference claim. New York courts have consistently held that the right to engage in newsgathering activities constitutes such justification. In Povitch, the court dismissed a tortious interference claim against Maury Povitch—a syndicated talk show host—for inducing plaintiff's ex-wife to speak about their divorce proceedings during his talk show, in violation of a confidentiality provision in the couple's divorce settlement. Defendant Povitch was previously put on notice as to the non-disclosure provision but decided to disregard the notice and proceed with the interview. In dismissing the claim against Povitch, the court adopted the defendant's argument that the First Amendment freedom of the press to report on newsworthy subjects is an appropriate justification that will preclude a claim of tortious interference. More specifically, the court declared that it agreed that:

"a broadcaster whose motive and conduct is intended to foster public awareness or debate cannot be found to have engaged in the wrongful or improper conduct required to sustain a claim for interference with contractual relations. Here the broadcaster's first amendment right to broadcast an issue of public importance, its lack of any motive to harm the plaintiff, and the obvious societal interest in encouraging freedom of the press, negate essential elements of the tort."

Previously, and utilizing the same reasoning, the court also dismissed a tortious interference claim against NBC for purportedly inducing the same woman to breach the same confidentiality provision and discuss publicly her divorce proceedings with the same plaintiff (Huggins v. NBC, 1996 WL 763337, at [Sup Ct NY Cty 1996]). Other jurisdictions are in accord with the New York law (see, e.g., Seminole Tribe of Fla v. Times Publ'g Co., 780 So2d 310, 317-18 (Fla Ct App 2001) [dismissing a tortious interference claim against reporters for soliciting tribal employees to reveal confidential documents about the tribe's gambling operations and explaining that reporters' conduct was "routine news gathering"]; Jenni Rivera Enters., LLC v. Latin World Ent Holdings, Inc., 36 Cal App 5th 766, 800 [Ct. App. 2019] [dismissing a tortious interference claim against a broadcaster for reporting confidential information obtained from the plaintiff's former manager in violation of a nondisclosure agreement, because the broadcaster's actions were "not sufficiently 'wrongful' or 'unlawful' to overcome the First Amendment newsgathering and broadcast privileges"]).

In his opposition papers, plaintiff does nothing to contradict or distinguish any of the cited cases. Instead, plaintiff cites a single case, Lindberg v. Dow Jones, in which a federal judge permitted the plaintiff to amend his complaint as it relates to a tortious interference claim, on the basis that factual questions may exist regarding whether the defendant publishers' conduct was justified (2021 WL 5450617). In Lindberg, however, the district judge applied the federal pleading standard—not CPLR 3211(g)—and expressly declined to apply the First Department's protection for conduct that is "incidental to the lawful and constitutionally protected process of news gathering and reporting," in favor of a balancing test set forth in Jews for Jesus v. Jewish Cmty Rels Council (Lindberg, 2021 WL 5450617 at n.92).

This court, however, must, and will apply the reasoning of the First Department's decision in Highland, which is also in accord with other New York decisions, holding that "the First Amendment freedom of the press to report on newsworthy subjects is an appropriate justification that will preclude a claim of tortious interference." Accordingly, because The Times defendants were undisputedly engaged in routine newsgathering, plaintiff's tortious interference claim is dismissed.

Congratulations to David E. McCraw & Demetri Blaisdell, who represent the NYT Company, and Chris Duffy (Vinson & Elkins) and Thomas S. Leatherbury, who represent David Barstow.