Fox News Must Face Lawsuit From Seth Rich's Family, Appeals Court Rules

Seth Rich - Publicity - H 2017
Courtesy of the Democratic National Convention

In a rather stunning turn of events, the 2nd U.S. Circuit Court of Appeals has revived a lawsuit brought by the parents of slain Democratic National Committee staffer Seth Rich against Fox News. On Friday, the federal appeals court rejected the cable news outlet's First Amendment arguments with a provocative opinion that suggests media companies can be held liable for inflicting emotional distress.

Rich was fatally shot in July 2016 in what police said was a mugging gone wrong, but conspiracy theorists suggested that Rich was murder because he — and not Russian hackers — had leaked the DNC emails to WikiLeaks. Although there was no evidence for Rich playing a role in the dissemination of the hacked emails that disrupted the 2016 presidential election, and while this theory was refuted by Special Counsel Robert Mueller and the U.S. intelligence community, who attributed blame to Russia, the conspiracy proved irresistible to some Trump supporters — and Fox News pundits — looking for any way to undercut a Trump-Russia connection and the investigations that followed.

In May 2017, Fox News ran a story about Rich that quoted the family's hired investigator, Rod Wheeler, who claimed to have evidence the Rich had been in contact with WikiLeaks. After the story came out, the Rich family issued a statement condemning the article. Within 24 hours, Wheeler had retracted his claims. Fox News removed the article and promised an investigation but never apologized.

In their lawsuit, the Riches say they experienced post-traumatic stress disorder because of the reports and attempted to hold the network, its reporter Malia Zimmerman and financial guest commentator Ed Butowsky — the man who'd put Wheeler in touch with the Rich family in the first place — liable for intentional infliction of emotional distress (IIED), tortious interference with the Riches' contract with Wheeler and negligent supervision.

An August 2018 dismissal from a federal judge seemed to confirm conventional wisdom in media law — that one can't defame a dead person because that individual's reputation goes to the grave. Dressing up a defamation claim by artfully pleading emotional distress doesn't suffice.

Now, 2nd Circuit Judge Guido Calabresi, writing for a three-judge panel, concludes this decision was in error and gives media lawyers much to think about.

Here's the opinion.

Under New York law, a claim for IIED requires a showing of extreme and outrageous conduct; intent to cause, or disregard for causing severe emotional distress; and indeed emotional distress.

The trial judge ruled that statements in an article about an FBI report didn't rise to extreme and outrageous conduct, but Calabresi agrees with the Riches that a series of acts, taken together, might amount to a "campaign of emotional torture." This includes allegations of fabricated sources and unsubstantiated information. Additionally, Calabresi writes that Zimmerman and Butowsky "had enough specific knowledge of the family and the circumstances surrounding Seth’s murder to be keenly aware of the Riches’ susceptibility to emotional distress," further rejecting the contention that there exists some privilege for publications that may have awareness —but not intent — toward the possibility of emotional distress. In any event, the appellate opinion goes on to add that the Riches have at least described "a particular form of recklessness."

The section of the opinion that is likely to provoke the most discussion pertains to defamation and Fox News' argument that what the Riches are attempting to do is to bring such an impermissible claim on behalf of a dead person.

"But, in fact, IIED of the parents and defamation of the son are two distinct torts claims, as a simple hypothetical demonstrates," writes Calabresi. "Suppose Seth had not died but had instead survived the shooting in a comatose state. If the Appellees acted in the exact same manner and published the exact same articles as has been alleged here, Seth could certainly have brought a defamation suit against them; he would have complained about the false accusations that the Appellees made against him — that is, that he leaked DNC emails to WikiLeaks. But, in this hypothetical scenario, the Riches could also have brought a separate lawsuit — this lawsuit — claiming that the Appellees’ actions directed at them were extreme and outrageous enough to constitute IIED."

As the 2nd Circuit sees it, the lawsuit isn't claiming injury based on Seth Rich's reputation but rather his parents' own injuries.

The First Amendment arguments are characterized as "smokescreens," with Calabresi turning to the famous Supreme Court decision involving Reverend Jerry Falwell, who once sued over a parody ad that portrayed him as a drunkard who had sex with his mother. While Falwell failed there, the 2nd Circuit notes that the high court would allow an IIED claim over speech not protected. And here in the lawsuit from the Riches, Calabresi continues, a false statement made with actual malice wouldn't fall under protected speech.

The 2nd Circuit also revives a tortious interference claim, which is itself worth attention given that reporters are routinely dealing with sources under confidentiality obligations. In this instance, the Riches hired Wheeler to investigate their son's death and he promised secrecy. Rich's parents allege that Fox News tortiously interfered with this agreement by pushing Wheeler to divulge information about his investigation to its reporter.

The trial judge rejected the tortious interference claim because Wheeler lacked a good faith intention to carry out his obligations in his agreement to the Rich family. In other words, causation couldn't be established because the Riches had trouble showing that but for Fox News' conduct, the contract would have been honored.

The appeals court agrees that the proper question is whether, in the absence of Fox News' alleged interference, the breach would have occurred. But there's nuance given the timing of acts.

"We hold that, at least where there allegedly is tortious interference after contract formation, the fact that there also was allegedly interfering conduct before the agreement was signed doesn’t preclude a complaint from stating but?for causation," states the opinion. "The allegations here plainly claim that, but for the Appellees’ conduct before and after Wheeler and the Riches entered into this agreement, the breach would not have occurred. In the face of these allegations, the degree to which the contract would have been breached anyway is a question properly left for discovery and, perhaps, jury determinations. At this stage, we conclude that the complaint sufficiently pleaded causation."

Calabresi adds that the connection between the breach and the alleged damages is sufficiently strong and that the Riches have stated a plausible case that Fox News "had no legally sufficient justification for intentionally procuring Wheeler’s breach of contract."

In reaction to the opinion, Fox News sent out a statement that reads: "The court’s ruling today permits Mr. and Mrs. Rich to proceed with discovery to determine whether there is a factual basis for their claims against Fox News. And while we extend the Rich family our deepest condolences for their loss, we believe that discovery will demonstrate that Fox News did not engage in conduct that will support the Riches’ claims. We will be evaluating our next legal steps.”

“We would not wish what we have experienced upon any other parent — anywhere,” the Riches said in a statement. “We appreciate the appellate court’s ruling and look forward to continuing to pursue justice.”