While in the weeks leading up to the Superbowl, the attention of NFL fans should be on the teams actually participating -- the Pittsburgh Steelers and the Green Bay Packers -- the owner of the 6-10 Washington Redskins managed to insert himself into the national conversation, in his own hilariously inept way.
Daniel Snyder purchased the Washington Redskins in 1999 from the estate of Jack Kent Cooke. Previously, the team had been owned by Washington, D.C. power lawyer Edward Bennett Williams. During the Williams-Cooke years, the 'skins were one of the league's marquee fanchises, winning superbowls in the '80s, and '90s under legendary coach Joe Gibbs and reaching the playoffs five straight years in the '70s under George Allen. Time was, rooting for the Redskins was what passed for bipartisan activity in the nation's capital. With no baseball team since the departure of the Washington Senators long before, D.C. was a football town, and part of some great matchups with division rivals the New York Giants, the Philadelphia Eagles (my team of choice), and, especially, the Dallas Cowboys.
Since Snyder owned the team, however, they have been a constant mediocrity. Their on-field performance has lagged, and their off-field misadventures providing something of constant comic relief. While a decade of bad play might not necessarily reflect on the owner (every team has peaks and valleys), the Redskins strike many as terrible precisely because of the bizzare meddling of their owner.
This has not escaped the notice of D.C. fans or media personalities. The Washington City Paper's Dave McKenna, accordingly compiled the fans' grievances in one place: "The Cranky Redskins Fan's Guide to Dan Snyder." The article is structured as an encyclopedia, and points out his many, many failings as an owner and a person. Broadly speaking, the entries break down into three categories: Dan Synder's bad decisions that hurt the team on the field, Dan Snyder's bad decisions that hurt the fans, and Dan Snyder's misadventures in his other businesses, chiefly his ownership of a direct marketing company and his service on the board of directors of the company that runs the Six Flags theme parks. As if to indicate the article was a bit tongue in cheek, the cover photo is a picture of Snyder defaced with a moustache and devil horns, not unlike the way a middle school student might deface a picuture of George Washington in a history textbook. More on this later. The first two categories are the most numerous, my personal favorites being the time Snyder added a "security surcharge" to tickets after the 9/11 attacks, without actually investing in stadium security and when he served year-old bags of peanuts at games that he bought from a bankrupt airline, with the airline logo still on them.
Snyder reacted to this article as one might expect a micro-managing, dubiously ethical, megalomaniac to react. He threatened litigation. In a letter to the owner of the City Paper, Atalaya Capital Management, L.P, a Redskins team lawyer (who was representing Snyder in his personal capacity for reasons unclear but possibly of interest to the taxing authorities), urged that McKenna be fired. Or else Snyder would sue, and promised that "the cost of litigation would presumably quickly outstrip the asset value of the Washington City Paper."
Dan Snyder was as good as his word, though, and did file suit in New York State Supreme Court (New York's name for its trial courts), naming Atalaya, the City Paper (actually, a corporation named Creative Loafing, Inc.), and McKenna, alleging libel and defamation of character. I like sports, and I like the First Amendment, so I thought I'd break it down. Believe me, I had more fun writing this than you will reading it.
The Allegations in the Law Suit:
Count 1: libel
Out of a long list of statements about Snyder, the complaint identifies four of them as defamatory (Par. 21). First, that Dan Synder was caught forging names as a telemarketer. Second, that Dan Snyder caused Agent Orange to be used on federally protected land. Third, that Dan Synder bragged his money came from diabetes and cancer patients. Lastly, that Snyder was "tossed off" the Six Flags board. And that cover photo? It constitutes "anti-Semitic imagery."
This all sounds bad, but first a primer on libel laws. Dan Snyder is a public figure and thus can only successfully sue for libel if he demonstrates that the statements about him were made with "actual malice," under the New York Times v. Sullivan standard. This does not mean, as the name suggests, libel claims can go forward if the speaker really doesn't like the target. Rather, it means that the statements have to be more than just wrong. They have to be made with, at minimum, reckless disregard as to whether they're true or not. The reason for having a tough bar for libel for public figures is they can access the media and correct any disinformation about themselves. In the specific case of Dan Snyder, he actually owns some D.C. radio stations. (Complaint Par. 17). It additionally creates some space for public comment, reasoning that the threat of libel could limit the ability of people to criticize governmental or other public officials, and it's better to tolerate a few false statements of fact than to chill discourse. Against this background, there are two other key defenses to libel. First, if the statement in question isn't actually libelous, or doesn't say what the plaintiff in a law suit says it said. Second, truth is an absolute defense. Third, statements of opinion, rather than fact, are protected speech.
Against this standard, the lawsuit is laughably bad. Two are dealt with more quickly than others. The statement about Agent Orange? The introductory paragraphs assert Snyder "made a great view of the Potomac River for himself by going all Agent Orange on federally protected lands." (That is, Dan Snyder, himself is the carcinogenic exfoliant.) Further down, the article states:
Unobstructed View: What Snyder wanted of the Potomac River from the back of his Montgomery County home. To accomplish this, he cut down trees protected by the National Park Service.
The entry links to a Washington Post article entitled "Parks Official is Blamed in Snyder Tree Cutting." Mr. Snyder has not, as far as anyone knows, sued the Post for libel.
The allegation that Dan Snyder made money from cancer and diabetes patients? If that one is untrue, it's because Snyder somehow defamed himself. From McKenna's article:
Market Segments: How Snyder viewed cancer patients and diabetics during his marketing days. In a 2000 interview for a PBS show called CEO Exchange, Snyder told host Jeff Greenfield that his business depended on coming up with “$5 million niches” that he could sell goods and services to. Asked for examples of his methodology, Snyder said, “We were looking at trend lines. We saw that the aging baby boomer demographics were coming on strong. That meant there’s going to be a lot more diabetic patients, a lot more cancer patients, etc. How do we capture those market segments?”
The complaint doesn't deny Snyder said this.
The two remaining allegations are somewhat more complicated, but if they weren't true, they're at least well enough supported there can be no allegation of "actual malice." Snyder's firm really did pay a $3.1 million fine to settle charges brought by Florida state officials that they switched customers' long distance phone service without authorization. Snyder may not have done this personally, and the fine was assessed after he left the company (but dealing with actions that took place when he owned it.) But the forging? "The state Attorney General's Office said representatives of Bethesda, Md.-based Snyder Communications forged thousands of customer signatures to switch them to service provided by GTE, which is now Verizon." While the same article reporting this says they "denied wrongdoing," they still paid the fine. This is precisely the type of situation for which the "actual malice" standard was defined. (Anyway, does Dan Snyder really want this claim to go forward and have his direct marketing techniques the subject of an 8 hour deposition?)
And was Dan Snyder "tossed off" the Six Flags' board? When Six Flags was coming out of bankruptcy, if made a public filing that stated that Six Flags's CEO Mark Shapiro had the right to nominate a director, "provided, however, that such remaining director shall not be Daniel M. Snyder without the consent of [Six Flags’ new investors].” Snyder claims that he was offered a directorship verbally but turned it down since he no longer held stock in the company. If so, it's hardly "actual malice" for McKenna not to know that. And what's more, if that were true, why would there need to be some specific writing in an 8-K stating the new director wouldn't be Snyder? Clearly, the company believed investors would be more likely to buy stock if they knew Snyder would go back to mismanaging the Redskins.
Count II: Defamation of Character
This cause of action specifically mentions the "anti-Semitic imagery," alleging "The Misrepresentations, taken together with the anti-Semitic depiction of Mr. Snyder . . . imply to the readers of the Article[] that Mr. Snyder is an unethical businessman who habitually engages in misconduct and fraud in his dealings and personal life." (Par. 32). Well, now. This claim stands or falls on the strength of the first claim, but as for the "anti-Semitic imagery point," I just don't see it that way, and I don't think a court would either. For another, the article doesn't mention Dan Snyder's religion, and until I read the lawsuit I didn't even know he was Jewish. It's also an intriguing claim from someone who calls his team the "Redskins," which term I"m only using here because it's a proper noun. Snyder also doesn't allege as false an allegation in McKenna's article that he told a Six Flags employee who happened to be Asian that he should act like Charlie Chan.
Additional things Snyder doesn't sue over also undercut this claim. Many people might find adding a security surcharge after the 9/11 attacks unethical. Others might object to claiming "pedestrian safety" as a reason for keeping people from walking to the stadium on game days, when really the objective was to monopolize parking concessions. Still others might object to humiliating head coach Jim Zorn as a way to get him to quit without having to fire him and pay severance. (The decision to hire Zorn in the first place does not reflect well on Synder, by the way.) Others might point to the separate incidents in which he underpaid a domestic nanny and refused to pay stadium employees for overtime. The four specifically identified statements hardly scratch the surface. No, this claim is an unconvincing effort to get damages for the other claims in the article Snyder either cannot or will not say are false.
Why Sue In New York?
So far, I just looked at the merits of the suit, or lack thereof. In order to get damages, Snyder would have to show his reputation was injured by these statements. Given the sum total of everything the article says about Snyder, that is going to be hard. But the decision by a D.C. based businessman to sue a D.C. based reporter and newspaper in New York City, itself, suggests that he does not believe a D.C. jury would take his side. If so, it's hard to see how he was damaged, at all.
The only connection to New York alleged is that Atalaya, based in New York, owns the Washington City Paper. But why should a parent company be liable for the torts of a separate company it owns and that company's employee? (This is how "corporate personhood' is supposed to work.) The complaint alleges that the City Paper and McKenna libeled Snyder at Atalaya's direction. This does not make any sense. Atalaya came on the scene in 2009, when the supposed "campaign" started. But the complaint also alleges that the McKenna "reached back many years" to complie the article. In many cases the article relies on pre-2009 reporting by McKenna himself. (It also would make it very hard for Snyder to claim the telemarketing abuses couldn't be put back on him, personally.)
But let's assume that Atalaya, an investment fund, took the time and effort to tell an employee of one of its portfolio companies to defame Snyder. Why does that mean McKenna and the City Paper can be sued in New York? Can a Wal-Mart employee in Hawai'i be sued in Arkansas? The answer has to be "no."
But New York's laws regarding jursidiction over out of state defendants are not confusing on this point. There is a specific statute, CPLR 302(a)(3), providing that New York does not exercise jurisdiction over out-of-state individuals who commit acts of defamation of character outside of the state. New York's legislature has passed a law saying it specifically does not want to hear the type of case Snyder purports to bring, and yet he brings it anyway. Even if libel weren't explicitly disclaimed as a basis for jurisdiction, a wrongful act committed outside of New York by a non-New Yorker would still only provide a basis for jurisdiction if it had some effect in New York. Synder's "reputation" is located by and large where he's located, so there still wouldn't be any justification to hale McKenna and the City Paper into New York's court system. This isn't just legal formality stuff, but these rules exist to protect fundamental, and Constitutionally protected, rights to due process.
That leaves just Atalaya, but they can't be found liable, even assuming there were a real lawsuit here to begin with, because there are no facts in the complaint that would tell us why the court should disregard Creative Loafing's separate corporate existence such that its actions can be imputed to Atalaya. The theory on which the owner is brought into the case doesn't even pretend to have justification, and it is such a blatant and ridiculous end-around New York state law, one can only think this is intentional. It further shows that the lawsuit is nothing more than how a spoiled rich brat reacts when he doesn't get his way.
What Happens Next?
I cannot imagine this case suffers any fate but to be tossed out of court at the first opportunity. The Redskins' attorney's borderline-malpractice decision to write that the lawsuit would eat up the City Paper's asset value also is as close to an admission as there can be that the lawsuit was filed without any care as to whether it had merit or not, and, as such is begging to be included as Exhibit A in the defendants' motion for legal fees, at minimum. The only thing that saves that threat from malpractice, incidentally, is that it seems likely to me Snyder made that threat with open eyes. Suing in New York when there's a statute telling you there's no jurisdiction, well that might also be malpractice, though those laws protect the client, and I think the client shares equally in the blame.
Snyder is, as one might expect, being eviscerated in D.C. press and on sports blogs. Deadspin is linking to the McKenna article every day until the case is tossed from court (like Snyder was tossed from the Six Flags board). He has tried to defend the claim, saying he just wants an apology (though he asked the court for millions of dollars). He also said he's doing this to protect his wife. That same wife who is not mentioned in the lawsuit and about whom the article made no claims. Did the article say Snyder himself exploited his wife's cancer for personal gain? Of course not. The problem is, people who've watched Dan Synder all these years couldn't hate him any more than they already do. And Dan Snyder knows all he'd have to do to be loved again is to return the team to the glory days of the Hogs. The problem is, Dan Snyder is simply not capable of running winning football operation, and deep down I suspect he knows it.
No, the most interesting question is what is the NFL going to do. Here you have a league that depends on good relations with the media, especially going into labor negotiations that will likely be fought in courts of public opinion and courts of law. The league is also not shy about suspending players for off-field conduct that is detrimental to the league. There seems a good reason in my mind to suspend Dan Snyder for this blatantly abusive law suit. (Though as an Eagles fan, I hope he owns the team forever.)
I am very much looking foward to seeing Synder get his comeuppance. Though somehow I doubt he'll ever learn. There are very few consequences that can be visited on a billionaire with no shame.