NBC 'Dateline' Defamation Lawsuit Revived by Appeals Court

The media company escapes a Fourth Amendment claim, though, after surreptitiously filming a Colorado insurance broker with help from Alabama law enforcement.
Virginia Sherwood/NBC
Chris Hansen

On Wednesday, the 10th U.S. Circuit Court of Appeals ruled that a judge had too quickly dismissed an insurance broker's defamation lawsuit against NBCUniversal, reporter Chris Hansen and others over a 2008 Dateline segment titled "Tricks of the Trade."

"This case is anything but normal," writes Circuit Judge Terrence O'Brien.

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Among other things, the case addressed whether a journalist’s privilege, commonly understood to protect the identity of anonymous sources, extends further in Colorado. It also raises the issue of whether journalists, acting with government cooperation, can enter a private place under false pretenses without violating an individual's or company's Fourth Amendment right against unreasonable searches and seizures.

The lawsuit and appeal were brought by Tyrone Clark and his company, Brokers’ Choice of America (BCA), upset with the way Dateline had used snippets of Clark's two-day seminar for insurance brokers located on the company's property in Colorado. With assistance from Alabama officials, Dateline's crew surreptitiously filmed the seminar, and according to Clark's company, used its own “tricks of the trade” — selective editing and commentary — to present Clark’s statements out of context.

The Dateline segment presented Clark as using or teaching scare tactics to get seniors to buy annuities, but BCA says that a complete viewing of Clark's seminar would show him taking a more nuanced approach to annuities — that Clark said they were not for everyone and urged his students to probe their customers' situations for suitability and obey a code of conduct that included disclosures.

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NBC's primary defense against the lawsuit was that its presentation of statements in the Dateline program were "substantially true," and on a motion to dismiss, a trial judge bought that argument.

On appeal, though, BCA argued that the trial judge should have credited its allegations as true in analyzing whether the claim should go further.

In his published opinion, Judge O'Brien imagines a trial where the aired segment would be compared to the entirety of Clark’s seminar presentation and writes that the "totality of the circumstances must be considered." He looks at the allegations serving as the basis of BCA's claims and in reviving the defamation lawsuit, concludes that BCA "plausibly alleges Dateline selected bits and pieces of Clark’s statements to project an undeserved and shocking image to the audience, leaving it with a false impression of his presentations."

If that was the end of the ruling, it would be noteworthy but hardly significant. After the case is remanded, it still might not survive to trial because, as the 10th Circuit notes, the trial judge can address the allegations on summary judgment, where presumably the judge has more discretion.

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What brings the case to that next level are two things.

First, thanks to the trial judge's doubt about the merits of the claim, discovery was halted, leaving BCA without access to Dateline's unedited film. BCA wanted the footage to show Dateline maliciously or recklessly mischaracterized the gist of Clark's seminar. The defendants asserted Colorado’s journalist’s privilege, which as described above, usually pertains to the disclosure of sources, but here, was used to shield unedited footage.

In past cases, courts have had to balance an individual's interest in his or her own reputation against the "chilling effect" which may result from the disclosure of the editorial process, and in one particular case that went up to the Colorado Supreme Court, a standard of "probable falsity" was imposed on plaintiffs to defeat a presumption of a journalist's statutory privilege.

"But this is not a case involving confidential sources or confidential information," writes Judge O'Brien. "In essence, Dateline wants to pitch the baby out with the bath water."

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The judge adds that it "strains credulity" that the "probable falsity" test be used when nonconfidential information is at issue and allows BCA access to what it demands of NBC. He writes, "The object of discovery — the original footage — is the best and perhaps only evidence from which a fact-finder can determine whether Dateline’s portrayal of the substance of what occurred at Annuity University cast Clark’s teachings in such a way as to leave a false impression of them. BCA’s film from the March seminar will not do. It is not the seminar witnessed by the Dateline producers, nor is it the one on which the allegedly false statements in the program were based."

That's not all.

In order to surreptitiously film Clark's seminar, Dateline producers made a quid pro quo deal with Alabama officials interested in investigating fraudulent sales of annuities to seniors. The officials supplied false credentials, entered them into a national database and otherwise helped Dateline gain access to private premises in return for sharing of information.

Was it a Fourth Amendment violation? Here's what Judge O'Brien says:

"No government actors were present and the Dateline operatives neither represented themselves to be government officers nor demanded entry on behalf of the government. At worst, it is a classic case of government agents sending willing and available operatives to obtain information freely revealed to those operatives. The fake insurance agent credentials supplied by Alabama officials fit easily into the types of deception courts have generally found permissible because it involved no coercion, express or implied. It is, instead, the classic ruse of misrepresented identity. Moreover, according to BCA’s allegations and the available facts of record, the Alabama officials facilitated the ruse for a legitimate investigative purpose. Dateline may have violated state tort law, but no actionable Fourth Amendment violation occurred."

For a sly ploy where journalists (including Hansen, famous for To Catch a Predator) doubled as police informants, NBC will have to face a defamation claim and maybe others like trespass (if the statute of limitations hasn't passed), but it's off the hook for trampling on the U.S. Constitution.

UPDATE: Notwithstanding the fact that the appellate judges weren't tasked with determining the accuracy of the Dateline segment, nor is accuracy fully probative as "truth" is what counts in a lawsuit alleging that comments were taken out-of-context, an NBC News spokesperson says, "Nothing in today’s ruling stated that the Dateline segment was inaccurate. We stand by our reporting."

Email: Eriq.Gardner@THR.com
Twitter: @eriqgardner