ABC News Faces Backlash Over Trump Regulation, George Stephanopoulos

On the eve of a jury trial in June 2017, Disney settled a defamation lawsuit brought by a beef company for a whopping $177 million. The case stems from a series of ABC News reports in 2012, led by star anchor Diane Sawyer, who dubbed processed meat “pink slime.” At the time, it was the largest settlement or jury award ever obtained for a defamation case and has since been eclipsed only by Alex Jones ($1.438 billion for the Sandy Hook families) and Fox News ($787.5 million for Dominion Voting Systems).

Fast forward to 2024, and George Stephanopoulos is now the face of ABC News and one of the highest-paid television anchors, earning up to $18 million a year. And inside Disney's C-suites on the Burbank lot, there was a sense of deja vu thanks to a looming defamation lawsuit filed in March by former and new President Donald Trump, a far more powerful adversary and vehement as a food processor from South Dakota. But a prolonged fight with the president-elect would prove just as unpredictable and potentially devastating.

According to a source close to ABC's inner workings: “It was 'Pink Slime II: The Sequel'.”

In a move that stunned ABC News' core journalists within the network and in the broader journalism community, Disney CEO Bob Iger authorized a $15 million settlement and an additional $1 million to cover Trump's legal costs as well as a quasi-apology. on December 13. According to sources, Stephanopoulos was blindsided, unaware that Disney would back down in such a public manner until hours before the news broke. (Disney and Stephanopoulos declined to comment.)

As CEO, Iger has long been a champion of Stephanopoulos, despite the anchor's wackier tendencies, as “GMA” has had to rely more on pop culture and celebrity for its ratings. (The morning show averaged 2.69 million viewers last week, behind today's average of 2.83 million.) When Stephanopoulos began floating the idea in 2020 that he might leave With ABC's four-year contract about to expire, Iger directly helped steer the program. negotiations to keep him in the fold — giving the anchor a lucrative new deal that also allowed him to produce documentaries for Hulu such as “Pretty Baby.”

But with Stephanopoulos' current deal set in early 2025, ABC insiders are unsure whether he will remain with the network given the recent turn of events. Sources say Stephanopoulos expressed his displeasure with the settlement and apology. For ABC, the economics of paying a mainstay $18 million a year may not make sense because “GMA” is no longer the advertising cash cow it once was. (Hoda Kotb recently announced her departure from her full-time anchor position on “Today” after NBC attempted to cut her salary.)

Trump's decision to sue ABC News and the settlement provide a window into what the future could hold for journalists during his second term. “We are appalled,” says a senior media executive who oversees network television news. “It is a capitulation, but it is also a reward for the negligence of the press. We should have been more motivated and ready for this.

For observers who monitor First Amendment issues, the regulation will have a chilling effect.

“It sends the message to keep quiet,” says Katie Blankenship, senior director of PEN America, which advocates for free speech. “It sends a message to err on the side of caution.”

In a statement, the executive director of the Society Professional Journalists, Caroline Hendrie, said she “is concerned that the largely unexplained decision to settle the case risks setting a troubling precedent for the will of the governing bodies.” press to defend their journalists in court.”

But Disney faced major hurdles with the lawsuit, which stemmed from the on-air host's comments that falsely claimed, “Donald Trump was found guilty of rape by a jury.” (In fact, a jury verdict found Trump responsible for sexually abusing writer E. Jean Carroll in the 1990s.) Stephanopoulos repeated the mistake 10 times during a March broadcast on “This Week », the Sunday news show that he hosts.

Stephanopoulos isn't the only high-profile figure to use the word “rape.” Illinois Gov. JB Pritzker called Trump a “tried rapist” during an interview with Jen Psaki on MSNBC, as did Rep. Jamie Raskin during a conversation with CNN's Dana Bash. Actor Bradley Whitford used that exact phrase at a rally for Kamala Harris in Wisconsin in October.

But ABC News is held to the highest journalistic standards and an anchor's failure is different than a guest's, making Stephanopoulos an easy target. Still, many wonder why Disney gave up so early in the legal process. In July, a federal judge in Florida ruled against Disney's attempt to dismiss Trump's lawsuit, allowing it to move forward. But it was not yet guaranteed that the case would go to trial, when the actual expenses of the trial come into play.

As such, the settlement sent “shock waves” through the media legal community, said Katie Townsend, legal director of the Reporters Committee for Freedom of the Press.

“It’s honestly quite disturbing,” she said. “The concern is – particularly given the timing and nature of the settlement – that this will encourage and embolden President Trump and people in his inner circle to pursue even more of this type of litigation, but also threats of litigation.”

Townsend said she was surprised that ABC did not pursue the case through the discovery process to a decision on summary judgment. (That's exactly what the network did in the “pink slime” affair, as did Fox News in its battle with Dominion, the latter opening the network to embarrassing emails and text messages indicating bias collected over the course of the discovery process.)

Chad Milton, a media consultant who specializes in liability insurance, said he also found it a bit surprising that ABC did not pursue viable legal defenses. ABC could have argued both that Stephanopoulos' description was “substantially true” and that he did not act with “actual malice,” that is, willful disregard for the truth.

“I heard rumors that people thought this was a capitulation to Trump,” Milton said. “Sometimes commercial considerations will be a factor. The bigger the business, the more complex it is. »

Some believe the deal was winnable for the network.

“I felt from the beginning that ABC and George Stephanopoulos had an extremely strong case to defeat this lawsuit,” says Ted Boutrous, a First Amendment lawyer who fought the first Trump administration over press access. “There were multiple legal and constitutional defenses that put them in a very strong position.”

Bourous predicts the settlement will have a “ripple effect across the journalism landscape” and gives Trump “the green light to pursue further litigation.”

Others say a settlement now — a month before Trump takes office for a second term — was the best option. Disney, which reported worldwide revenue of $88 billion in 2023, did not want to start 2025 in a prolonged fight with Trump, who could have continually trashed movies, TV shows, theme parks and the company's derivative products for the benefit of the 77 million Americans who voted. for him from his seat in the highest office in the land.

Gregory Doll, an attorney at Doll Amir & Eley in Los Angeles, calls Disney's move “just smart business.” He adds: “It was just going to be a cloud hanging over them. ABC News is going to want to have interviews with [Trump’s] cabinet and other officials.

Additionally, Disney is already engaged in a battle with billionaire Elon Musk, who was chosen to lead Trump's “Department of Government Effectiveness” along with Vivek Ramaswamy. Musk is supporting actress Gina Carano in a lawsuit against Disney over her firing from the series “The Mandalorian” due to social media posts the company deemed offensive. Disney has not fought multiple battles with Trump and his closest associates.

But Townsend argued that ABC's motives are less important than the ultimate effect the litigation might have on others. She said politicians had already abused the legal system to go after their critics.

“I don’t see any signs of it slowing down,” she said. “We can predict that this will probably increase.”

Case in point: Immediately after the settlement, Trump filed a civil suit against the Des Moines Register for publishing J. Ann Selzer's poll days before the election, which showed Harris leading Trump by three points in the state, citing a margin of error. by plus or minus 3.4 percentage points. Trump would win Iowa by 13 points.

As one of the largest companies in the world, Disney is capitalized enough to cover $16 million and deal with a few days of bad press. After all, the company this week reached a $233 million settlement in a class-action lawsuit over wages, an issue that has also placed Disney in a negative light, with everyone from progressive politicians to heiress Abigail Disney, lambasting the company for its labor practices. But any focus on pay disparities at Disney was also quickly overshadowed by another controversy involving the company: its pulling of a transgender storyline from Pixar's streaming series “Win or Lose.” In a fast-paced news cycle, this too will likely be replaced by some future unnamed headache. Given that the culture wars have negatively impacted Disney's bottom line in recent years, Iger seems more willing to grit his teeth and take a few short-term hits in exchange for staying out of politics.

Doll says: “I don't think they want to be in a constant state of acrimony. »

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