A U.S. Navy veteran’s defamation lawsuit against CNN could cost the cable news network far more than previously thought, according to a blockbuster motion filed Friday in the case.
During the pre-trial phase, there were numerous discovery disputes.
As Zachary Young and CNN prepare to present their respective arguments to jurors, the plaintiff is requesting that the judge overseeing the case enter an order regarding a surprising revelation about the network’s cash flows and balance sheets.
Such an order would most likely have a significant impact on potential damages if Young wins his case.
Young is suing CNN in Bay County, Florida, for a 2021 segment aired on “The Lead with Jake Tapper.” In his lawsuit, Young claims that the network falsely portrayed him as a “illegal profiteer” exploiting “desperate Afghans” with “exorbitant” extraction fees in the aftermath of President Joe Biden’s chaotic withdrawal from Afghanistan.
So far, two judges in two states—Florida and Delaware—have ordered CNN and its parent company, Warner Bros. Discovery, to turn over a slew of financial documents. These rulings represent a significant loss for the network in a case where punitive damages could make a Young victory very costly for the defendants.
In a 25-page motion in limine regarding punitive damages evidence, Young claims that a deposition of CNN executives revealed that complex financial data for the mainstream media outlet simply does not exist.
Remember that Young and his attorneys have been attempting to obtain financial documents they claim are relevant to the case for some time but have complained that CNN has not provided such discovery.
Now, the plaintiff claims, 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,” according to the petition.
“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 media conglomerate has long maintained that the documents requested by Young are not among the records it keeps.
“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 from Fox News.
“We have told them twice now that such information does not exist,” Ying allegedly stated. “They’ve refused to accept that. We cannot create information that does not already exist.
CNN has now apparently gone on record under oath in the Sunshine State, with an explanation outlined in the heavily redacted motion in limine.
Young, for his part, is now willing to accept the current situation, with the caveat that the company may face severe penalties.
Based on 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 prevent CNN from arguing its own finances to jurors if they lose the defamation lawsuit.
This would be legally incorrect, Young claims, because CNN claims they do not know enough about their own finances to share with the plaintiff. As a result, their potential liability should be determined based on Warner Bros. Discovery’s actual financial records.
Relying on the parent company, Young claims, only makes sense in the circumstances described by CNN during the deposition.
“WBD apparently manages all aspects of CNN’s cash flows,” the motion states 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 throughout the proceedings, even as the two sides prepare for trial.
In turn, the veteran has secured a number of pre-trial victories.
On December 6, the court ruled on a slew of motions for summary judgment and motions in limine, allowing Young to present his allegations to a civil jury against television’s first 24-hour cable news network.
In another clear victory for Young — and a significant procedural loss for the network — the court ruled that punitive damages are permitted. This means that if the veteran proves his basic claims in the lawsuit, CNN could be liable for millions of dollars.
Judge William Henry of the 14th Judicial Circuit Court is overseeing the case.
Young, a US citizen living in Austria and 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 in question, which aired on November 11, 2021, and featured correspondent Alex Marquardt’s reporting on Jake Tapper’s show, featured 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 lawsuit’s central claim is that the phrase “black market” implied Young was involved in something criminal, nefarious, or otherwise unethical and defamatory.
The defendant claims that “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.
According to Henry, in his most recent decision, “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 his most recent motion, Young also seeks discovery sanctions for the network’s refusal to produce financial documents, which would be largely relevant to a punitive damages determination if he can prove he was defamed.
“Granting Young’s motion in limine would avoid the need to sanction CNN for its discovery abuses, which have been flagrant,” it continues.
“CNN repeatedly promised, including in a sworn interrogatory, to provide documents sufficient to identify CNN’s assets and liabilities, as well as to prepare its corporate representative to testify about CNN’s net worth.
However, during the corporate representative deposition, Plaintiffs discovered that CNN never intended to produce documents demonstrating assets and liabilities (because they do not exist) and were confronted with a witness who claimed [redacted], including the [redacted] CNN reported in a sworn interrogatory response.”