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Alphabet web the loser in fraud, libel suits

Last week was not a good one for ABC News – or broadcast journalism in general – in court.

First, on Wednesday, the network found itself on the losing end of a $10 million libel suit filed in Miami by a savings and loan executive who claimed “20/20” portrayed him in a maliciously criminal light.

Then on Friday came the nuclear bomb in Greensboro, N.C., when a federal jury ruled that ABC News and several of its staffers committed fraud and trespassing when reporters for “PrimeTime Live” were assigned to go undercover as employees of the Food Lion supermarket chain to expose unsanitary conditions.

Food Lion contended that the 1992 broadcast cost the chain – which operates more than 1,100 stores in 14 states – between $1.7 billion and $2.5 billion in lost sales and devalued stock. The jury was ordered to return to court on Dec. 30 to decide on a damage award, if any.

Legal experts were predicting Friday that the Food Lion decision could imperil the future of hidden-camera reporting and indeed the field of investigative journalism itself, opening a new line of attack for companies burned by such exposes as the “PrimeTime Live” piece.

That story disclosed purported unsanitary conditions that included rat-infested cheese on display and spoiled chicken washed in bleach at the Food Lion markets.

The company sued for fraud, rather than libel, alleging that the ABC journalists lied to get their jobs and illegally spent company time as infiltrators with an agenda rather than workers earning a living.

In its decision, the jury ruled that “PrimeTime Live” producers Lynne Dale and Susan Barnett committed fraud, breach of loyalty and duty and trespass. Also ruled to have committed fraud were “PrimeTime Live’s” executive producer at the time the story aired, Richard Kaplan, and ABC producer Ira Rosen.

The ABC network was ruled to have committed fraud through the actions of attorney Jonathan Barzilay, who gave the “PrimeTime Live” reporting team the legal go-ahead to conduct their undercover operation at Food Lion.

In a statement responding to the decision, ABC said, “The truth of the ‘PrimeTime Live’ report on Food Lion was not questioned in this trial. Instead, Food Lion chose to challenge the way in which ‘PrimeTime Live’ obtained information about their stories. We never engage in undercover activities lightly, but sometimes they are necessary to bring stories of real importance to the public’s attention. Our report on Food Lion was such a story.

“Food Lion is asking the jury to punish the messenger without challenging the message.”

Richard Wyatt Jr., an attorney representing Food Lion, said Friday, “Certainly, we would hope the media would be mindful of this decision and accept it as establishing some appropriate guidelines and limitations. I have no idea whether it will actually change investigative reporting.”

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