A court exhibit highlights a CNN chyron from a segment aired on Nov. 11, 2021, along with a picture of Zachary Young (via court documents).
A U.S. Navy veteran’s defamation lawsuit against CNN could prove far more costly for the cable news network than previously imagined, according to a blockbuster motion filed Friday in the case.
Discovery disputes have been rife during the pretrial period.
As Zachary Young and CNN prepare to make their respective arguments to jurors, the plaintiff is asking the judge overseeing the matter to enter an order about a surprising revelation concerning the network’s cash flows and balance sheets. Such an order would likely have a significant impact on potential damages should Young win his case.
Young is suing CNN in Bay County, Florida, over a 2021 segment that aired on “The Lead with Jake Tapper.” In the lawsuit, Young claims the network falsely painted him as an “illegal profiteer” exploiting “desperate Afghans” with “exorbitant” extraction fees amid the fallout of President Joe Biden’s chaotic withdrawal from Afghanistan.
So far, two judges in two states — Florida and Delaware — have ordered CNN and parent company, Warner Bros. Discovery, to turn over a bevy of financial information. Those rulings amount to a marked loss for the network in a case where punitive damages could potentially make a Young victory quite expensive for the defendants.
In a 25-page motion in limine regarding punitive damages evidence, Young says a deposition of CNN brass revealed that complex financial information for the mainstream media outlet simply does not exist.
Recall that Young and his attorneys have been trying to obtain certain financial documents they claim are relevant to the case for some time but complain that CNN has not been forthcoming with such discovery.
Now, the plaintiff says, he knows why.
“During financial discovery, CNN repeatedly claimed, despite conceding its net worth was recently more than [redacted], that it did not have cash flow statements or balance sheets,” the motion reads. “These representations made no sense to Plaintiff until the deposition of CNN’s CFO, whose testimony demonstrated that this is because CNN’s parent company, Warner Brothers Discovery Inc., is a conglomerate that operates CNN and its other business segments like some kind of subsidiary slush fund, thus ensuring that CNN has virtually no control over or visibility into the cash generated by its business.”
The multinational mass media conglomerate has long maintained that the documents requested by Young are not records they keep.
“If it doesn’t exist, we can’t be compelled to produce anything,” Jennifer Ying, representing Warner Bros. Discovery, told the judge in Delaware, according to a courtroom report by Fox News.
“We have told them twice now that such information does not exist,” Ying reportedly continued. “They have refused to accept that. We cannot create information that simply does not exist.”
Under oath in the Sunshine State, CNN has now apparently gone on the record to say the same — with an explanation outlined in the highly-redacted motion in limine.
From the motion, at length:
[W]hen asked how to evaluate CNN’s ability to pay a punitive damages award, CNN’s corporate representative explained [redacted]. Instead, CNN’s corporate representative and CFO instructed Plaintiffs to look to [redacted]. In other words, he testified that CNN’s ability to pay is limited only by WBD’s ability to pay.
Fine. The Court should enter a motion in limine reflecting the positions CNN has taken. Specifically, the Court should [redacted] and order that the financial statements of CNN’s parent company — Warner Bros. Discovery (“WBD”)—be used for purposes of assessing CNN’s ability to pay a punitive damages award. At minimum, the Court should give the jury the option of considering WBD’s financial statements when evaluating CNN’s ability to pay. Additionally, the Court should preclude CNN from introducing evidence and argument on its net worth, given that it [redacted].
Essentially, Young wants the court to keep CNN from arguing its own finances to jurors in the event they lose the defamation case.
This would be legally improper, Young says, because CNN claims they do not actually know enough about their own finances to share with the plaintiff. So, therefore, their potential liability should rely on the financial records actually kept by Warner Bros. Discovery.
Relying on the parent company, Young says, only makes sense under the circumstances attested to by CNN during the deposition.
“WBD apparently manages all aspects of CNN’s cash flows,” the motion reads at one point. “It collects virtually all of CNN’s cash directly and immediately commingles it with cash generated by WBD’s other subsidiary business segments.”
Young has repeatedly accused CNN of bad behavior during the pendency of the proceedings — even as the two sides prepare for trial.
In turn, the veteran has racked up a series of pretrial wins.
On Dec. 6, deciding a bevy of motions for summary judgment and motions in limine, the court determined Young can take his allegations and plead his case against TV’s first 24-hour cable news network before a civil jury. In another clear victory for Young — and a significant procedural loss for the network — the court ruled that punitive damages are on the table. This means that should the veteran prove the basic claims in the lawsuit, CNN could be on the hook for potentially millions of dollars.
The case is being overseen by 14th Judicial Circuit Court Judge William Henry.
Young, a U.S. citizen who lives in Austria and is the president of Florida-based corporation Nemex Enterprises, sued CNN for defamation per se, defamation by implication, group libel and trade libel, claiming that his efforts to save lives in Afghanistan as a security consultant were distorted by “lies published for sensationalism.”
The segment at issue, which aired on Nov. 11, 2021, and featured correspondent Alex Marquardt’s reporting on Jake Tapper’s show, displayed a photo of Young over chyrons that read: “AFGHANS TRYING TO FLEE TALIBAN FACE BLACK MARKETS, EXORBITANT FEES, NO GUARANTEE OF SAFETY OR SUCCESS” and “AFGHANS AND ACTIVISTS REPORT DEMANDS OF $10K-$14K FOR ATTEMPTS TO GET FAMILY MEMBERS OUT OF COUNTRY.”
The heart of the lawsuit is the argument that the phrase “black market” implied Young was engaged in something criminal, nefarious, or otherwise untoward and defamatory.
The defendant has argued “all the information CNN uncovered in its research supported the gist of what it reported,” and that the network’s “journalists, in fact, believed the truth of what” was reported.
In his latest ruling, Henry said, “the record evidence could support a conclusion that Defendant aired and posted the Pieces knowing the gist was false or with reckless disregard as to whether the gist was false or not.”
In Young’s latest motion, he alternatively pleads for discovery sanctions over the network’s decision not to produce financial documents — which, again, would largely be relevant to a punitive damages determination if he proves he was defamed.
“Granting Young’s motion in limine would avoid the need to sanction CNN for its discovery abuses, which have been flagrant,” the motion goes on. “CNN repeatedly promised, including in a sworn interrogatory, that it would provide documents sufficient to identify CNN’s assets and liabilities and that it would prepare its corporate representative to testify about CNN’s net worth. But at the corporate representative deposition, Plaintiffs learned that CNN never intended to produce documents showing assets and liabilities (because they don’t exist) and were confronted with a witness who claimed [redacted], including the [redacted] CNN reported in a sworn interrogatory response.”
