A high-profile gaming defamation case has met its end…probably.
In 2012, self-made billionaire Kazuo Okada of Universal Entertainment sued Reuters over alleged casino bribery implications. But last week, Tokyo’s High Court deemed the claim “groundless,” citing accuracy.
Why Did Gaming Company Universal Sue Media Agency Reuters?
Four years ago, a few Reuters’ reporters were sniffing around Universal’s business dealings and stumbled upon, what they thought, was pay dirt: a questionable compensation, to a shadowy consultant with ties to a former Filipino gaming official.
Universal objected. In their opinion, Reuters didn’t connect the dots properly, which, they argued, led to flagrant defamation by implication. A Universal spokesperson explained:
“Their (Reuters) stories contain misrecognition of facts and biases that could have been easily avoided had Reuters engaged in fair and appropriate reporting. Reuters has reported that our corporate group has given the massive sum of US $40 million to the government and other related institutions between December 2009 and May 2010 in our Philippines’ business. This is a clear misrecognition of the facts.
“Reuters’ reporting is full of malice and our company firmly objects to this. We believe that Reuters should be fully held to account legally for the damage brought about through their biased reporting, and we are exploring the possibility of taking legal actions against them.”
Universal asked for $1.8 million in damages, and a round of apologies.
Court In Gaming Defamation Case: Repetitive Details Don’t Amount To Libel
Detailed, but not defamatory; that’s how Tokyo’s High Court ruled.
During proceedings, Universal argued that repetitious mentions of suggestive facts contributed to the overall impression of wrongdoing. But the court disagreed. In the judges’ eyes, the recurrences provided clarity and detail, not shade.
Judge Yoshihiro Toyosawa summed up the decision:
“The claims made in this case by the appellant are groundless and the rejection by the district court was justifiable.”
Would This Gaming Defamation Case Have Turned Out Differently In A U.S. Court?
This gaming defamation case played out in Japan, but someone asked, “Would a U.S. court likely return the same result?” In a word: yes.
For starters, the United States enjoys defendant friendly defamation laws. To win and American slander and libel lawsuit, plaintiffs must meet sky-high proof standards. Claimants must persuade judges and juries that:
- The defendants made false statements of fact about the plaintiffs. And we’re not talking small mistakes; you can’t win a slander or libel lawsuit because someone said you stole $100, when, in fact, you’d only stolen $77.
- The statement caused harm; not just bruised feelings or pangs of embarrassment, but actual, material harm. Plaintiffs can argue that reputation attacks led to job loss, but they must provide concrete evidence directly linking the actual utterance to a termination, business decline, or some other lost employment opportunity.
- The defendants acted negligently, with reckless disregard for the truth, or with actual malice. To put it another way: plaintiffs must prove that the accused didn’t properly fact check. In the case of public figures, the stakes are even higher; politicians and celebrities are required to show that the defendants knowingly lied.
Concurrence has come to the high-stakes world of billionaire-ranking: HRH Prince Al-Waleed Bin Talal bin Abdulaziz al Saud (“Prince Bin Talal”) and Forbes magazine finally struck a settlement.
In 2013, the Saudi Arabian royal had sued the media outlet for defamation. He felt the magazine under-reported his fortune, which, he claimed, had a deleterious effect on his business dealings. Since the melee began, Forbes, for its part, has stuck with the published numbers – until now.
After two years of litigation and negotiations, the two parties reached a detente “on mutually agreeable terms.”
Business Defamation Lawsuit Summary: Prince Bin Talal v. Forbes – In Ten Seconds
Prince Bin Talal’s Kingdom Holding portfolio includes substantial investments including Twitter, Citigroup, Euro Disney and the famous Savoy Hotel. Bluntly stated: the Prince is a very rich man.
But a couple of years back, just how rich was a contested topic between Bin Talal and Forbes magazine. In its annual ranking of the world’s richest people, the financial media outlet reported the Prince’s wealth to be significantly lower than what the Prince’s business team claimed.
According to an article on BusinessInsider.com, Prince Bin Talal’s calculations diverged from those of Forbes because the two parties originally valued Kingdom Holding’s Saudi-listed shares differently. In addition to the disagreement about his billions, according to the lawsuit, the Prince also felt the Forbes’ characterization of his corporation implicated a lack of transparency at Kingdom Holding. So, he filed a business defamation lawsuit, in London.
The two parties litigated for two years, and in the end, settled out of court. According to businessinsider.com, Forbes and Bin Talal reached a rapprochement once the finance magazine reviewed Kingdom Holding’s performance once the Saudi Stock Exchange opened to direct foreign investment. According to the website, Forbes [is] now comfortable with using Kingdom Holding’s market price in valuing that component of his wealth.
At the time of this writing, Forbes lists Prince Bin Talal the 34th wealthiest person in the world, with a net worth at $22.6 billion.
Consult a Professional Defamation Attorney
Are you facing a difficult professional defamation situation? Is a client, partner or competitor purposefully spreading falsehoods about you or your business? If yes, the slander and libel lawyers at Kelly Warner may be able to help. Our attorneys have successfully assisted over 600 professionals, lawyers and businesses with various online competition and libel legalities.
Can Dov Charney win? The ex-CEO of American Apparel Inc. (“American Apparel”) is suing former hedge fund allies for allegedly killing his business reputation. Does Dov have a strong defamation case? Or is it a shrinking giant’s final act of legal aggression?
It All Began With a Phoenix Plan
Dov Charney makes headlines happen. But the press isn’t always positive. And in 2013, bad Charney buzz was a click-bait staple amongst industry blogs and reputable media outlets, alike. Pundits and passersby publicly wondered: Was the American Apparel boss a profligate louche? Did he really treat employees like Victorian sweat shop workers? Was Dov embezzling corporate dough?
By 2014, American Apparel board members ousted Charney – and his battle-worn reputation – from the company he started.
Tenacious and importunate, soon after the ouster, Charney enlisted the assistance of NY-based hedge fund Standard General. The plan? Reinstate Charney as American Apparel’s head honcho by way of a stock coup. The result? Charney and Standard General wrestled 42% of the controlling interest.
Ostensibly, Charney assumed that controlling interest would mean a Targaryn-esque return to the T-Shirt Throne. But Standard General wanted some facts checked before Dov’s would-be second reign. So, hedge fund executives launched an investigation into Charney.
In Charney’s estimation – and according to the lawsuit – Standard General’s intentions were far from rudimentary, but instead a “sham” and “witch hunt” undertaken to “manufacture” termination justifications and “destroy [Dov’s] character.”
How much does the ex-CEO want for the business reputation slight? A cool $30 million in compensatory and punitive damages.
Business Reputation Accusations
Charney’s main business defamation allegations against Standard General:
- Standard General threatened to destroy his business reputation if he didn’t step down as CEO and Chairman of American Apparel.
- Standard General hired outside legal counsel to gin up fake reasons for termination.
Charney’s opponents don’t seem worried about the lawsuit. When asked about the case, Standard General’s lawyers explained:
“Dov Charney and his associates continue to file frivolous, meritless lawsuits at a breakneck pace. We are confident that Mr. Charney will be held accountable for this knowing, intentional abuse of the legal system.”
What Must Charney Prove To Win This Professional Defamation Lawsuit?
The United States has the most defendant-friendly slander (spoken defamation) and libel (written defamation) laws in the world. For U.S. plaintiffs to win a defamation claim, they must meet strict legal threshold tests. At the very least, stateside slander and libel claimants must prove that the defendants:
- Made unprivileged false statements of fact about the plaintiffs;
- Made statements that caused material or reputational harm to befall the plaintiffs;
- Published or otherwise distributed the contested information negligently, with actual malice, or with reckless disregard for the truth.
In the Charney case, evident is the reputational scar incurred by the very public ousting. But what else must Charney prove to win? First, he’d have to nullify – via evidence – the findings against him. Then, his legal team would have to prove – again, via evidence – that Standard General executives purposefully manufactured – or paid for the fabrication of – trumped-up charges against Charney. It’s gonna be an uphill battle.
Kelly / Warner maintains a successful business defamation practice. We’ve guided over 500 entrepreneurs and companies back to respectable reputations, after online attacks – and our attorneys can get defamatory materials removed from many websites. The statute of limitations for online defamation is short. But the damage can last a lifetime. Get in touch today to learn more about your legal options.
The verdict in Obsidian Financial Group LLC v. Cox is in. Advantage: boutique investment firm. A judge ordered the self-styled “investigative blogger” Crystal Cox to fork over $2.5 million in damages. Financial analysts and bankers are thrilled; First Amendment advocates aren’t impressed.
The Crystal Cox Defamation Lawsuit Background
A self-described whistle blower, Cox is a real estate agent by day and Internet vigilante by night. Among her cadre of “investigative websites” was obsidianfinancialsucks.com, an outlet Ms. Cox used to accuse Kevin Padrick “one of Obsidian’s founding financial executives” of fraud, misappropriation of funds, lie telling, and a litany of other unscrupulous actions. Cox even insinuated Padrick may have hired an assassin to silence her.
As a result of her online accusations, Mr. Padrick decided to sue for defamation. He maintained his company lost considerable business thanks to Ms. Cox’s allegedly misleading statements. Padrick explained that the Internet was awash with disparaging claims that damaged him financially.
Defamation Pro Se Trial
In court, representing herself pro se, Cox argued that her blog posts were journalistic, of pubic concern, and that the Oregon retraction laws should apply to her situation (retraction laws allow journalists to correct or retract defamatory statements in lieu of compensatory damages.).
The Definition of Journalist When It Comes To Online Defamation Lawsuits
Judge, Marco A. Hernandez, however, rejected the assertion that Cox was a journalist.
By applying Oregon law, Hernandez ruled Cox could not be treated as a journalist because:
- She did not have a formal education in journalism
- She did not hold proof of affiliation with a recognized news entity
- She arguably didn’t adhere to journalistic standards such as editing and fact checking
- She did not keep notes of conversations and interviews conducted
- She could not produce evidence that she had a mutual understanding or an agreement between the defendant and his or her sources
- She did not contact the grieved party, before publishing, to get both sides of the story
Offering SEO Services Sunk Cox
In addition to the legal Oregon defamation elements noted above, perhaps the most damning piece of evidence against Cox was an email, presented as evidence by the defense, wherein Cox offered Padrick online reputation management services for $2,500 a month.
In the eyes of the court, the email helped to disqualify Cox for journalistic immunity. After all, the offending email framed Cox as someone who was actively looked to profit off her statements, and thanks to the presence of the email, the defense could argue that Cox was essentially holding Padrick’s business reputation hostage.
The Right Defamation Decision, But At What Cost?
Based on the above defamation definition elements — and the fact that Cox couldn’t prove wrongdoing on the part of Mr. Padrick, it’s no surprise that Obsidian Financial and its executive emerged victorious.
That being said, many people are concerned about the unintended First Amendment ramifications this decision may have on Internet bloggers in the future. Many folks wonder how well bloggers, who work for online magazines or news organizations, fit into the qualifying factors listed by Hernandez. For instance, not every blogger working for a news organization has a journalism degree.
The financial defamation lawsuit of Crystal Cox is sure to play a role in future blogger defamation lawsuits; it’s established legal precedence that is certain to be tested and challenged in the coming years.