Scottie Pippen Loses Seventh Circuit Defamation Suit Against Media Outlets Claiming He Filed For Bankruptcy

Although I am not really a sports fan, even I remember the glory days of the Chicago Bulls during the 1990s. My dad forced me to watch NBA basketball whenever possible, probably hoping that some of the televised talent would inspire me to athletic greatness as well (alas, it did not). I also remember that Michael Jordan did not do it alone; he had his loyal sidekick, Scottie Pippen, to play the Robin to his Batman.

I love that this series of trading cards is called “Supreme Court.” Also: those are very short shorts.

So where is Scottie Pippen now? As it turns out, he has gone on a litigious bender, taking some of his claims all the way to the Seventh Circuit Court of Appeals. Last week, the Seventh Circuit issued an opinion in Pippen v. NBCUniversal Media, LLC dismissing claims of defamation that Scottie brought against various news organizations.

As the court’s decision explained, Scottie has fallen on hard financial times as a result of bad investments. He sued several of his former financial and legal advisors for what he believes was bad advice, and the media took note. Unfortunately, the media got the story wrong when reporting about these lawsuits: according to the complaint,  CNBC.com published a story entitled “15 Athletes Gone Bankrupt” which said Pippen lost “career earnings worth $120 million, including over $4 million for a corporate jet that was grounded just months after he bought it.” As Judge Easterbrook explained in the decision, “several news organizations reported that he had filed for bankruptcy. This is false; he has not.”

Scottie then sued these news outlets, alleging in the Northern District of Illinois that their statements were defamatory and that they “impaired his ability to earn a living through product endorsements and personal appearances.” The district court dismissed his complaint because it found that “the falsehoods did not fit within any of the categories of statements recognized by Illinois law to be so innately harmful that damages may be presumed” and because there was no evidence that the news outlets published the stories with malice. Scottie appealed.

In examining defamation per se, the Court of Appeals for the Seventh Circuit compared cases in which statements were made that businesses intentionally defrauded customers. It differentiated Scottie’s claims:

A similar taint does not attach to the reputation of people who go bankrupt. Many innocent reasons lead to financial distress. Readers of the defendants’statements who mistakenly believe that Pippen is insolvent readily could conclude that his advisers bear the blame. … Pippen has been employed since he retired from basketball as a goodwill ambassador for the Chicago Bulls, a basketball analyst, and a celebrity product endorser. Bankruptcy does not imply that he lacks the competence or integrity to perform any of these jobs.

His post-retirement employability derives from his pre-retirement stardom (for his endorsement and appearance work) and basketball knowledge (for his work as an analyst), not his financial prudence or investment savvy. Reports of personal bankruptcy would not so impugn his job performance that they necessarily constitute defamation.

As to defamation per quod, the court was similarly skeptical.

Since Pippen’s opportunities diminished after the statements were made, he believes they must have diminished because the statements were made. This theory of causation is weak for professional athletes, whose earnings related to past stardom drop as time passes since their playing days.

Basically, the court called Scottie a fading star. Ouch. Further, even though the defendant media outlets had countless very simple ways to verify whether Scottie had actually filed for bankruptcy, their failure to investigate the truth of the matter (even if your job is to do just that) “is insufficient to establish reckless disregard for the truth…actual malice cannot be inferred from a publisher’s failure to retract a statement once it learns it to be false.”

Finally, in a matter of first impression, the Seventh Circuit held that even though online news outlets can correct misstatements with ease (when compared with print publications), “a publisher’s degree of control over its content does not matter to Illinois’s test for whether redistribution of a defamatory statement amounts to a republication. Instead, courts must ask whether the ‘act of the defendant [was] a conscious independent one.’” The defendants’ “passive maintenance of a web site” is not a republication under this standard.

It looks like this decision is not the end of Scottie’s involvement with the courts. He was recently sued for $4 million after allegedly assaulting a man at a California restaurant who was trying to take his picture. Perhaps he may still have to file for bankruptcy after all.

3 responses

  1. Pingback: Hilary Young, “Adding Insult to Injury in Corporate Defamation Damages” | THE TRIAL WARRIOR BLOG

  2. Pingback: Scottie Pippen bankruptcy update | GatorCountry.com

  3. Pingback: Scott Pippen Charges Dropped

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