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By Linda Koco
“Dateline,” the NBC television show that pilloried misleading annuity sales practices in 2008, is back in the headlines — but this time as a defendant in a defamation lawsuit, not as a purveyor of an exposé about annuity sales practices involving seniors.
A U.S. circuit court has handed down a ruling that could result in “Dateline” and NBC having to make original, unedited video involving annuities available to court proceedings.
This is footage the producers obtained with hidden cameras and that was used later used in creating “Dateline’s” now-controversial segment on annuity sales practices.
The court decision represents a break for Tyrone M. Clark and his company, Brokers’ Choice of America (BCA). A lower court had ruled against Clark and BCA when it requested access to (“discovery” of) the unedited footage for use in its lawsuit against NBC Universal (NBC) and “Dateline” employees. The annuity firm had sued the mega-media company for defamation stemming from its “Dateline” show on annuities.
The case will be closely followed not only by the insurance industry but also by the news media.
In the annuity industry, the case opens up old wounds. The “Dateline” segment depicted several instances of purported misrepresentation in annuity sales to seniors. Veteran annuity professionals complained that the broadcast focused only on problems and presented a distorted view of the annuity business, effectively tarnishing the image of the entire industry. Bitter feelings have festered ever since.
As for the news media, the case peers into protections long afforded to news reporters’ work product and confidential sources. Normally, such material is protected from discovery in legal proceedings, with limited exceptions. The circuit court’s decision, involving an insurance firm’s request for access to certain non-aired news material, could expand those exceptions.
It its suit, Clark and BCA had contended that “Tricks of the Trade,” a “Dateline” segment aired in April 2008, had used innuendo, very selective editing and commentary to present Clark’s statements out of context in order to create a false impression thereby defaming him.
In the telecast, reporter Chris Hansen showed several vignettes purporting to demonstrate misrepresentation in annuity sales and the calculated use of scare tactics to sell inappropriate products to seniors.
Regarding BCA, Hansen introduced snippets of Clark taken from a two-day seminar he had given in October 2007. The seminar was for insurance brokers attending Annuity University at BCA’s property in Colorado.
The snippets were filmed via hidden cameras brought in by two producers who had obtained false insurance licenses from Alabama officials, according to the circuit court. The snippets depict Clark as teaching misleading sales tactics to agents, but quoting a “mere 112” of Clark’s own words.
Clark and BCA sued in district court for defamation among other reasons. As part of the case, Clark and BCA sought access to the unedited footage and transcripts of the 2007 lectures — for use in substantiating their claims.
NBC and “Dateline” objected to providing the materials on grounds of a newsperson’s privilege under Colorado’s Shield Law. The lower court dismissed the defamation claim, noting that BCA didn't have sufficient facts to “plausibly establish that its aired statements were false."
However, Clark and BCA appealed to the 10th Circuit Court of Appeals in Colorado. In July, the court reversed the lower court’s dismissal of the defamation claim and remanded the case “for further proceedings consistent with this judgment.”
About the raw footage
The 41-page circuit court decision covers several points of law raised in the Clark/BCA appeal. But it is the court’s discussion about access to the unedited footage that is raising eyebrows.
BCA had contended that Clark’s seminars, when considered in their entirety, ”teach and encourage ethical conduct by presenting a balanced approach to saving and investing, and, while touting the advantages of annuities, emphasize that they are not right for everyone,” wrote Judge Terrence O'Brien on behalf of the three-judge circuit panel.
However, NBC did not make the actual footage from the October 2008 seminar available for viewing by judge or jury.
“The object of discovery — the original footage — is the best and perhaps only evidence from which a fact-finder can determine whether ‘Dateline’s’ portrayal of the substance of what occurred at Annuity University cast Clark’s teachings in such a way as to leave a false impression of them,” O’Brien wrote.
BCA does have a film of a March 2007 seminar that is similar to the October 2007 seminar. However, the court held that this earlier film will not do.
“It is not the seminar witnessed by the ‘Dateline’ producers, nor is it the one on which the allegedly false statements in the program were based,” the justice wrote, adding that “BCA would be greatly prejudiced in its ability to prove the defamation claim without access to the unedited film.”
The court said that while the tape of the March 2007 seminar may have been sufficient to support BCA's complaint, “this does not mean it will be sufficient to carry the heavy burden of proof required at trial."
Regarding “Dateline’s” privileged news argument, the court provided detailed commentary. This includes review of the Colorado Supreme Court decision (Gordon v. Boyles) that presents three exceptions that can be used to “defeat” the general newspersons privilege rule, as well as discussion of First Amendment protections for newspersons who rely on confidential sources.
The court found that BCA met all three exception requirements and that the case does not involve confidential sources or confidential information. BCA is, it said, “only asking for a copy of the unedited film and it would seem to be the only entity with a colorable claim to confidentiality.”
The court concluded that BCA’s factual allegations are sufficient to warrant discovery of the unedited film. “The Colorado statue is a shield, not a sword,” it said.
Linda Koco, MBA, is a contributing editor to AnnuityNews, specializing in life insurance, annuities and income planning. Linda may be reached at firstname.lastname@example.org.
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