Money Rehab with Nicole Lapin - Why Is Defamation So Expensive? Inside the Baby Reindeer's $170M Lawsuit

Episode Date: June 12, 2024

You don't often see defamation lawsuits for a couple thousand bucks. Typically, the figure is more like $170 million, which is exactly the amount of money that Fiona Harvey is suing Netflix for over what is allegedly a depiction of her in the series Baby Reindeer. Today, Nicole follows the money trail of this lawsuit, along with some other famous examples, to illustrate why defamation is so expensive.

One of the most stressful periods of my life was when I was in credit card debt. I got to a point where I just knew that I had to get it under control for my financial future and also for my mental health. We've all hit a point where we've realized it was time to make some serious money moves. So take control of your finances by using a Chime checking account with features like no maintenance fees, fee-free overdraft up to $200, or getting paid up to two days early with direct deposit. Learn more at Chime.com slash MNN. When you check out Chime, you'll see that you can overdraft up to $200 with no fees. If you're an OG listener, you know about my infamous $35 overdraft fee that

I got from buying a $7 latte and how I am still very fired up about it. If I had Chime back then, that wouldn't even be a story. Make your fall finances a little greener by working toward your financial goals with Chime. Open your account in just two minutes at Chime.com slash MNN. That's Chime.com slash MNN. Chime. Feels like progress. Banking services and debit card provided by the Bancorp Bank N.A. or Stride Bank N.A. Members FDIC. SpotMe eligibility requirements and overdraft limits apply. Boosts are available to eligible Chime members enrolled in SpotMe and are subject to monthly limits. Terms and conditions apply. Go to Chime.com slash disclosures for details.

I love hosting on Airbnb. It's a great way to bring in some extra cash, but I totally get it that it might sound overwhelming to start or even too complicated if, say, you want to put your summer home in Maine on Airbnb, but you live full time in San Francisco and you can't go to Maine every time you need to change sheets for your guests or something like that. If thoughts like these have been holding you back, I have great news for you. Airbnb has launched a co-host network, which is a network of high quality local co-hosts with Airbnb experience that can take care of your home and your guests. Co-hosts can do what you don't have time for, like managing your

reservations, messaging your guests, giving support at the property, or even create your listing for you. I always want to line up a reservation for my house when I'm traveling for work, but sometimes I just don't get around to it because getting ready to travel always feels like a scramble, so I don't end up making time to make my house look guest-friendly. I guess that's the best way to put it. But I'm matching with a co-host so I can still make that extra cash while also making it easy on myself. Find a co-host at Airbnb.com slash host. I'm Nicole Lappin, the only financial expert you don't need a dictionary to understand. It's time for some money rehab. If you've been Netflix and chilling recently, and I'm literally not the euphemism, you've probably seen the show Baby Reindeer trending on Netflix. And maybe you've clicked on it. If you did,

you know the story. It's a miniseries starring Richard Gad, who created the show around a true story of his own experience being stalked by a woman that he names Martha in the series. But the quote true story element of this series is now being contested by the real Martha, whose name is Fiona Harvey. Harvey is suing Netflix for $170 million over alleged defamation and intentional infliction of emotional distress. Defamation lawsuits are tools of justice. These suits can award monetary damages to someone who's been seriously wronged. But defamation goes beyond just hurting somebody's feelings. Today, I'm going to unpack what defamation really means, how this price tag is so cuckoo bananas, the burden of proof you need to meet if you're bringing a

defamation lawsuit against someone, and some real-life examples of when that burden of proof was met and when it wasn't. By the end of the episode, I want you to be able to decode the fallout from this baby reindeer lawsuit as it continues to unfold with these staggering numbers and maybe know what you need to do if you're ever itching to sue someone for defamation. So like I said, defamation is not just saying something mean about someone else. Defamation is a legal term that describes a scenario where someone makes a false statement about a person but presents it as fact, and that false statement damages the character of the person it's about. There are two biggie forms

of defamation. Libel, which is written defamation, like defamation in articles, books, Instagram captions, and slander, which is spoken defamation, like defamation that happens in speeches, conversations, podcast interviews. We don't do that here, of course, so no one accuse me of slander, please and thank you. The presentation is key here. For a statement to be considered defamatory, it must be false but presented as fact, not presented as opinion. So if I say, I think Bob is a terrible person, that's just my opinion, not defamation. But if I say something like Bob is a thief without any factual basis for the accusation, it could be considered defamatory if it harms Bob's reputation and is proven false.

As part of a defamation case, there will be a case for monetary damages. There are typically three types of monetary damages in defamation trials. First, there are compensatory damages, which exist to compensate someone for lost earnings, loss of future earnings, or emotional distress. Then there are punitive damages. I like to think of that as a punishment tax. Punitive damages are designed to serve as a penalty that deters future defamation. And lastly, there are nominal charges. These are small amounts awarded when defamation is proven, but substantial harm isn't shown. The breakdown of Harvey's $170 million,

according to the complaint, is at least $50 million for compensatory damages, including mental anguish, loss of enjoyment of life, and loss of business. at least $50 million for compensatory damages, including mental anguish, loss of enjoyment of life, and loss of business, at least $50 million for all profits from baby reindeer, and at least $20 million for punitive damages. If you're suing someone for defamation, you're saddled with meeting the burden of proof that has a pretty high bar. You need to prove the statement about you was false, that the statement was communicated to at least one other person, that the statement caused harm to your reputation, career, or mental health, that the statement was not protected by any legal

privilege, and if the person you're accusing is a public figure, you would need to prove malice. In other words, that public figure made a statement about you knowing full well it was completely wrong, or they just didn't care about the truth, or if the person you're accusing of defamation is a private individual, you just need to prove that they were negligent. So let's double click on the burden of proof in the baby reindeer case. Fiona Harvey needs to prove that the statements about her were false, but presented as truth. About a minute and a half into the first episode, text on the screen reads, this is a true story, dot, dot, dot. So she'll probably be able to check that presented as truth box. She also needs to prove that these statements were communicated to more than one person.

Another easy one. The show was trending on Netflix. A whole lot of people watched it. That's that. Harvey also needs to prove that the statements in the show caused her harm, so she'll need to show evidence of loss of income, mental anguish, or financial records showing lost business. Then we get to an even trickier territory, privilege. Harvey needs to prove that the statements in Baby Reindeer are not protected by privilege, meaning deserving of protection. Some legal experts are predicting that Netflix will use the First Amendment defense. Free speech is certainly protected, so that's going to be a tricky argument on both sides. Now, how hard is it for someone to win a defamation case over a huge company like Netflix? Well, similar cases have been won before.

In 1981, the beloved comedian Carol Burnett sued the National Enquirer for libel after the tabloid falsely claimed she was drunk and disorderly in a restaurant. In the trial, Burnett presented evidence that she was not drunk or disorderly, and she testified about the emotional distress and potential damage to her career that this piece had caused. Burnett won the suit and was awarded $1.6 million in damages. And because malice was shown on the part of the inquirer, included in that $1.6 million was $300,000 in punitive damages. Again, the punishment tax. Defamation trials are by no means a slam dunk. In 2022, Sarah Palin lost a defamation case that she brought against the New York Times in 2017 that falsely linked an ad from Palin's PAC to a mass shooting that occurred months later. In that case,

Palin was unsuccessful because her lawyers did not sufficiently prove that the incorrect statement was an intentional misrepresentation. And also some defamation cases can be unsuccessful even if they win. In 1997, McDonald's won a defamation lawsuit against activists in a legal showdown that's known as the McLibel case. In that case, McDonald's sued environmental activists for distributing pamphlets that accused McDonald's of various unethical practices, including mistreatment of workers and animals and contributing to environmental degradation. McDonald's proved that some of the claims in the pamphlets were false and that the pamphlets

harmed its reputation and caused financial losses. However, the court only awarded McDonald's 40,000 pounds in damages. The publicity from the trial and the fact that the activists were able to prove that some of their statements were indeed true ultimately did more harm to McDonald's public image and probably caused more monetary damage than the initial pamphlet caused in the first place. Fiona Harvey's case will possibly take years to resolve. Earlier this month, in fact, Netflix settled a defamation lawsuit brought on by Linda Fairstein, the former Manhattan prosecutor involved in the Central Park Five case, who was depicted in a 2019 docuseries about the case. Fairstein filed the suit in 2020,

and it was settled four years later. So following the $170 million money trail of this baby reindeer case will certainly not be quick, but it will be juicy. For today's tip, you can take straight to the bank. If you're a freelancer, here a reminder to create an llc for your business if god forbid you're sued for something you created through your work if you have an llc in place you can be protected from the suit targeting your personal assets one of the most stressful periods of my life was when i was in credit card debt i got to a point where i just knew that i had to get it under control for my financial future and also for my mental health. We've all hit a point where we've realized it was time to make some serious money moves. So take control of your finances by using a Chime checking account with features like no maintenance fees, fee-free overdraft up to $200,

or getting paid up to two days early with direct deposit. Learn more at Chime.com. When you check out Chime, you'll see that you can overdraft up to $200 with no fees. If you're an OG listener, you know about my infamous $35 overdraft fee that I got from buying a $7 latte and how I am still very fired up about it. If I had Chime back then, that wouldn't even be a story. Make your fall finances a little greener by working toward your financial goals with Chime. Open your account in just two minutes at Chime.com slash MNN. That's Chime.com slash MNN. Chime feels like progress. Banking services and debit card provided by the Bancorp Bank N.A. or Stride Bank N.A., members FDIC. SpotMe eligibility requirements and overdraft limits apply.

Boosts are available to eligible Chime members enrolled in SpotMe and are subject to monthly limits. Terms and conditions apply. Go to Chime.com slash disclosures for details. I love hosting on Airbnb. It's a great way to bring in some extra cash. But I totally get it that it might sound overwhelming to start or even too complicated if, say, you want to put your summer home in Maine on Airbnb, but you live full time in San Francisco and you can't go to Maine every time you need to change sheets for your guests or something like that. If thoughts like these have been holding you back, I have great news for you. Airbnb has launched a co-host network, which is a network of high quality local co-hosts with Airbnb experience that can take care

of your home and your guests. Co-hosts can do what you don't have time for, like managing your reservations, messaging your guests, giving support at the property, or even create your listing for you. I always want to line up a reservation for my house when I'm traveling for work, but sometimes I just don't get around to it because getting ready to travel always feels like a scramble, so I don't end up making time to make my house look guest-friendly. I guess that's the best way to put it. But I'm matching with a co-host, so I can still make that extra cash while also making it easy on myself.

Find a co-host at Airbnb.com slash host. Money Rehab is a production of Money News Network. I'm your host, Nicole Lappin. Money Rehab's executive producer is Morgan Lavoie. Our researcher is Emily Holmes. Do you need some money rehab? And let's be honest, we all do. So email us your money questions, moneyrehab at moneynewsnetwork.com to potentially have your questions answered on the show or even have a one-on-one intervention with me. And follow us on Instagram at moneynews and TikTok at moneynewsnetwork for exclusive video content. And lastly, thank you. No, seriously, thank you. Thank you for listening and for investing in yourself,

which is the most important investment you can make.