Wheeler v. Twenty-First Century Fox

Citation322 F.Supp.3d 445
Decision Date02 August 2018
Docket Number17 Civ. 5807 (GBD)
Parties Rod WHEELER, Plaintiff, v. TWENTY-FIRST CENTURY FOX, Fox News Network LLC, Malia Zimmerman, in her individual and professional capacities, and Ed Butowsky, in his individual and professional capacities, Defendants.
CourtU.S. District Court — Southern District of New York

Rod Wheeler, pro se.

Douglas Holden Wigdor, Jeanne-Marie Bates Christensen, Kenneth Daniel Walsh, Michael John Willemin, Wigdor LLP, New York, NY, for Plaintiff.

Dane Hal Butswinkas, Kevin Taylor Baine, Katherine Anne Petti, William Jefferson Vigen, Williams & Connolly LLP, Washington, DC, David H. Stern, Pro Hac Vice, Dechert LLP, Carolin Sahimi, Hughes Hubbard & Reed LLP, Los Angeles, CA, Joseph M. Terry, Pro Hac Vice, Williams & Connolly LLP, Daniel Haym Weiner, Hughes Hubbard & Reed LLP, New York, NY, David Butler Harrison, Carolyn Beth Rendell, Jeffrey Alan Shooman, Short Hills, NJ, for Defendants.

MEMORANDUM DECISION AND ORDER

GEORGE B. DANIELS, United States District JudgePlaintiff Rod Wheeler brings this action asserting claims for defamation per se and, in the alternative, defamation and libel per quod , against Defendant Fox News Network LLC ("Fox News"), its parent company, Defendant Twenty-First Century Fox, Inc. ("21st Century Fox" and, with Fox News, "Fox"), Fox News investigative journalist Defendant Malia Zimmerman (with Fox, "the Fox Defendants"), and Fox News contributor Defendant Ed Butowsky. (See Am. Compl., ECF No. 56,) Plaintiff's allegations principally arise out of Fox News's coverage of his investigation into the murder of Seth Rich, a former Democratic National Committee ("DNC") employee who was rumored to have leaked sensitive, private emails from DNC servers to WikiLeaks.1 (See id. )

Defendants move to dismiss Plaintiff's lawsuit in its entirety for failure to state a claim pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure.2 (ECF Nos. 74 and 78.) Butowsky also moves for sanctions against Plaintiff and Plaintiff's former counsel pursuant to Rule 11. (ECF No. 43). Both Butowsky and Plaintiff request an award of attorneys' fees and costs in connection with the Rule 11 motion. (Mem. in Supp. of Butowsky's Mot. for Sanctions ("Sanctions Mem."), ECF No. 44, at 4; Pl. Mem. in Opp'n to Butowsky's Mot. for Sanctions ("Sanctions Opp'n"), ECF No. 57, at 1.)

Defendants' motions to dismiss for failure to state a claim are GRANTED. Butowsky's motion for sanctions and Butowsky's and Plaintiff's requests for attorneys' fees and costs are DENIED.

I. FACTUAL BACKGROUND

On July 10, 2016, Seth Rich, a Democratic National Committee ("DNC") staff member, was murdered. (Am. Compl. ¶ 77.) The Washington D.C. Metropolitan Police Department ("MPDC") believed that the murder occurred in the course of a botched robbery. (Id. ) In the weeks after the murder, some individuals theorized that Rich was the source of DNC emails leaked to the media organization WikiLeaks during the primaries for the 2016 presidential election, and that his murder was related to the leak. (Id. ¶ 78.) However, others believed that Russian hackers leaked the emails to WikiLeaks in an attempt to sway the election in favor of then-candidate Donald Trump, and that Rich's murder was unrelated to the emails. (Id. ¶¶ 76–78, 85.)

Butowsky, a Fox News contributor, spoke with Seymour Hersh, an investigative journalist, who claimed that he had received information regarding an FBI report about Rich's murder. (Id. ¶ 86.) Though he had not seen the report, Hersh said he had learned from "somebody on the inside" that the FBI report stated the MPDC had obtained a search warrant for Rich's home and recovered Rich's computer. (Id. ¶¶ 87–88.) According to Hersh, the report indicated that the FBI, at the MPDC's request, accessed the contents of Rich's computer and found Rich submitted a series of DNC emails to WikiLeaks. (Id. )

On February 23, 2017, Butowsky contacted Plaintiff, who has his own private investigative consulting company, and explained that the Rich family wanted to hire an investigator to conduct an independent investigation of Rich's murder. (Id. ¶¶ 6, 82–83.) On February 28, 2017, Plaintiff met Butowsky and Zimmerman, an investigative journalist for Fox News who had been investigating Rich's death for several months, to discuss Plaintiff's possible investigation of Rich's murder. (Id. ¶ 92.) According to Plaintiff, if the investigation confirmed Rich was murdered for leaking the emails, Butowsky and Zimmerman hoped to use the information to discredit theories that Russians had done so to influence the 2016 presidential election. (Id. ¶ 9.)

Plaintiff had multiple conversations with the Rich family over several weeks. (Id. ¶ 94.) On March 14, 2017, the Rich family and Plaintiff entered into a written agreement that Plaintiff would conduct his own independent investigation "with regards to the official police investigation surrounding the death of Seth Rich." (Id. ¶ 95.) The agreement expressly stated that Butowsky would pay the costs of the investigation. (Id. ¶ 99.) Thereafter, Plaintiff began interviewing Rich's relatives, co-workers, and friends. (Id. ¶ 102.) Plaintiff also reviewed evidence made available to him through the MPDC. (Id. ) While conducting his own investigation, Plaintiff kept Butowsky and Zimmerman informed of the steps he was taking, the people he had spoken to, and what records he had reviewed. (Id. ¶ 105.)

On April 25, 2017, Plaintiff met with Detective Joseph Della-Camera of the MPDC, who stated that he believed Rich's murder was the result of a botched robbery. (Id. ¶ 108.) Della-Camera said he had no information indicating Rich's murder was related to the DNC emails and no knowledge of any FBI involvement with the murder investigation. (Id. )

On May 10, 2017, Butowsky and Zimmerman informed Plaintiff that they had a source at the FBI who confirmed emails were sent between Rich and WikiLeaks. (Id. ¶ 112.) On May 11, 2017, Zimmerman sent Plaintiff a draft of an article regarding Rich's murder (the "Article"). (Id. ¶ 113.) The draft did not contain any quotes from Plaintiff suggesting that Rich had sent emails to WikiLeaks or suggesting that the DNC, Democratic Party, presidential candidate Hillary Clinton, or former president Bill Clinton were involved in a cover-up of Rich's murder. (Id. )

On Monday, May 15, 2017, Zimmerman emailed Plaintiff that the Article would be published imminently. (Id. ¶ 119.) Plaintiff told Zimmerman that he was traveling and would be unable to review drafts of the Article that she sent him throughout the day. (Id. ¶ 120.) However, at Zimmerman's request, Plaintiff sent Zimmerman quotes for the Article. (Id. ) A text message containing one of Plaintiff's quotes read, in part:

Joe said that when I called the [MPDC] right after that Donna Brazil[e] called him and was asking him why was I snooping around asking questions about the death of Seth [Rich] .... I also spoke with another source today who informed me that not only was Donna Brazil[e] snooping around ... but also ... Debbie Wasserman Schultz was snooping around wanting to know how much it was I [was] learning.

(Decl. of David B. Harrison in Supp. ("Harrison Deck"), Ex. 6, ECF No. 80-6, at 4–5.3 ) The text message also stated, "you can add that I do strongly believe that the answers to who murdered [Rich] sits on his computer on a shelf at the [MPDC] or FBI headquarters!" (Id. at 5.)

That evening, the news program Fox 5 interviewed Plaintiff. (Id. ¶ 122; see also Decl. of Joseph M. Terry in Supp. ("Terry Decl."), Ex. 5, ECF No. 76-5.) During the Fox 5 Interview, when asked, "You have sources at the FBI saying that there is information ... that could link Seth Rich to WikiLeaks?" Plaintiff responded, "Absolutely. Yeah. That's confirmed." (Terry Decl., Ex. 5, at 3:17–23.)

In the same Fox 5 Interview, Plaintiff stated that neither "[t]he [MPDC] nor the FBI have been forthcoming; they haven't been cooperating at all. I believe that the answer to solving [Rich's] death lies on that computer, which I believe is either at the police department or ... the FBI." (Id. at 4:10–15.) Plaintiff further explained:

I have a source inside the [MPDC] that has looked me straight in the eye and said, ‘Rod, we were told to stand down on this case and I can't share any information with you.’... I don't think it comes from the Chief's office, but I do believe there is a correlation between the Mayor's office and the DNC and that is the information that's going to come out tomorrow.

(Id. at 3:23–4:8.)

The next day, Fox published the Article as the lead story on the FoxNews.com homepage. (Am. Compl. ¶ 126.) The Article, entitled Seth Rich, Slain DC Staffer, Had Contact with WikiLeaks, Say Multiple Sources , listed Zimmerman as the author. (Am. Compl., Ex. A ("Article"), ECF No. 56-1, at 1.) The Article stated, among other things, "A federal investigator who reviewed an FBI forensic report ... detailing the contents [of] Rich's computer said he made contact with WikiLeaks," and quoted the investigator as stating, "I have seen and read the emails between Seth Rich and WikiLeaks." (Id. at 1–2.)

The Article noted that the FBI investigator's "revelation is consistent with the findings of Rod Wheeler." (Id. at 2.) In discussing Plaintiff's findings, the Article attributed a quote to Plaintiff (the "Email Quote") stating, " ‘My investigation up to this point shows there was some degree of email exchange between Seth Rich and WikiLeaks,’ Wheeler said. ‘I do believe that the answers to who murdered Seth Rich sit[ ] on his computer on a shelf at the [MPDC] or FBI headquarters.’ " (Id. ) Another quote attributed to Plaintiff in the Article (the "Murder Investigation Quote") stated, " ‘My investigation shows that someone within the D.C. government, Democratic National Committee or Clinton team is blocking the murder investigation from going forward.’ Wheeler told Fox News. ‘That is unfortunate. Seth Rich's murder is unsolved as a result of that.’ " (Id. at 3.)

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