ABC News suffered a legal setback on Thursday when a judge ruled against its opposition, and allowed a lawsuit against the Disney-owned entity to be relocated to South Dakota state court.
Beef Products, Inc., is suing ABC News for $1.2 billion due to the network's reporting on its product, specifically its use of the phrase "pink slime" when discussing it. Beef Products says this has caused it tremendous financial harm, as well as created damage to its reputation that can never be restored.
Diane Sawyer and ABC News correspondents did an expose on the meat product, discussing the fillers and trimmings that went into it. Beef Products alleges that the report was full of "false and misleading and defamatory" statements about its products, which led to consumer backlash. That backlash caused it to close three plants and lay off 650 employees.
ABC News is using the First Amendment in its defense and wanted the case thrown out, saying that it was "vitally important" that the claims "be addressed at the outset, because libel claims directly challenge free speech, and the mere pendency of these cases threatens to inhibit additional speech."
Judge Karen Schreier did not see it that way, saying that at this point it was unnecessary to "make a determination about the merits" of those claims.
"Here, the court needs to determine whether BPI Tech is a real party in interest to determine whether it has authority to hear this case, i.e., whether diversity jurisdiction exists. Defendants’ argument, however, proposes that the court first entangle itself with the facts of the case in order to make a legal determination about whether BPI Tech’s claim has merit. Put simply, defendants are suggesting that the court make a determination about the merits of BPI Tech’s claim before even deciding whether it has the authority to make such a determination. This is putting the cart before the horse," she said in her ruling, adding that BPI Tech is a real party in interest.
BPI's hope in this case is likely to get a sympathetic judge whose town has had workers affected by the "pink slime" reports.
What do you think is going to happen with this case?