By Marjorie Johnson, J.D.
A federal district court in New York threw out a lawsuit brought by a former Fox executive who, after being fired in the wake of allegations that he sexual assaulted a female Fox News contributor, claimed that the network was part of a far-reaching conspiracy to disparage and defame him by issuing a joint statement with his accuser that became part of a New York Times article describing the alleged assault. The court dismissed his claims for breach of contract, fraudulent misrepresentation, civil conspiracy to defraud, intentional interference with contractual relationships, defamation per se, libel per se, and slander per se (Cortes v. Twenty-First Century Fox America, Inc., January 9, 2018, Sweet, D.).
Assault revealed. Francisco Cortes, a former VP of Fox News Latino, was fired by the network in October 2016, after Fox News contributor Tamara Holder accused him of sexually assaulting her. A few months before Holder reported him to Fox, New York Times (NYT) reporter Emily Steel contacted her as part of the newspaper’s reporting of sexual harassment allegations against then-Fox News Chairman Roger Ailes. Holder had nothing to say about Ailes but said that she “knew” somebody who was sexually assaulted by Fox News executive Cortes, and she described the alleged sexual assault. Steel did not publish her statements at that time.
Settlement agreements. About two weeks after his firing, Cortes entered into a severance and general release agreement with Fox News that contained a “non-disparagement” clause. At around the same time, Holder presented defendants with a complaint that contained claims against Fox News and Cortes. Defense counsel asked Cortes if he would testify against her in a mediation, but he refused since he believed it would violate the non-disparagement clause.
Holder’s claims were resolved in February 2017, at which time Cortes signed a settlement agreement in which he assented to two specific paragraphs. One contained a clause by which he “knowingly and voluntarily” released and discharged the “Released Parties” from future claims. The other contained a non-disparagement agreement. The portions of the agreement to which he did not assent included other signatories, but they were redacted.
NYT article contains joint statement. On March 8, 2017, NYT published an article that described Cortes’ alleged sexual assault of Holder. It referenced a joint statement by Fox News and Holder, which reflected that she had reported an incident of sexual assault at Fox News headquarters from the prior year; that Fox News “promptly investigated the matter and took decisive action, for which Ms. Holder thanks the network; and that “Fox News is grateful to Ms. Holder for her many contributions during her tenure at the network and wishes her continued success.”
Court blasts “conspiracy theory.” The court squarely rejected as unfounded Cortes’ alleged conspiracy theory, which it found “worthy of its own Martin Scorsese thriller” involving the corporate defendants, the NYT, defense counsel, and others. Specifically, Cortes suggested that the Holder settlement agreement was a “payment” by Fox News to Holder to breach its non-disparagement clause with Cortes and share her allegations with a “sycophant journalist” formerly employed with the Wall Street Journal—a publication owned by News Corporation, an entity affiliated with defendants—who as a coconspirator published the statements in the NYT. The “overarching purpose” of this conspiracy was to choose Cortes, a Latino, as a scapegoat to demonstrate that defendants handled sexual harassment complaints aggressively. This then allowed News Corp. to acquire the British Sky Broadcasting (BSB), protect the identity of two non-Latino signatories to the agreements and benefit the co-conspirators.
No breach of contract. Turning to the merits, the court first tossed Cortes’ claim that that defendants breached their contractual obligations by disparaging him through the joint statement in the NYT article. Since the Holder settlement did not provide a definition of “disparagement,” the court looked to Black’s Law Dictionary, which defines “disparage” as “to unjustly discredit or detract from the reputation of (another’s property, product, or business).” Under that definition, the Joint Statement could not have been plausibly read to disparage Cortes.
It’s not about you. The joint statement indicated that Holder reported an incident of sexual assault, Fox News promptly investigated and took action, and that Fox News was grateful for her contributions. Because it did not mention Cortes by name or any other identifying facts, it could not be read plausibly to indicate anything, let alone anything discrediting, about him. The rest of the news article, which was written by the NYT reporter and based on statements told to her and not the defendants, could not sustain liability against the defendants.
No fraudulent misrepresentation or conspiracy. Cortes also failed to plausibly allege that defendants “intentionally misrepresented material facts” when Fox News’ attorneys told him that the Holder settlement agreement was presented to him redacted “solely to protect and shelter” other signatories, and its non-disparagement clause referred only to requests by government authorities. He not only conceded that these statements were not false, but he failed to plausibly allege that he relied to his detriment on the alleged misrepresentations.
No civil conspiracy or intentional interference. Since a claim for conspiracy must be based on an independent actionable tort, and his fraudulent misrepresentation was implausible, the court also tossed his civil conspiracy claim. He also couldn’t advance his claim that defendants intentionally interfered with the Holder settlement agreement because they were a party to the agreement and one cannot tortiously interfere with their own contract as a matter of law.
No defamation. Finally, the court tossed Cortes’ remaining defamation claims. The only public statement made by the defendants was the joint statement incorporated in the NYT article, which he didn’t allege was false. He also couldn’t plausibly allege that it was “concerning” him since he was not “clearly identifiable,” and it was implausible that an “average reader would understand the statement” to be a reference to him. Though the statement was later incorporated into the NYT article, this did not create liability for defendants since they were not responsible for what else was written.
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