November 9, 2008 - 10:00 pm
In libel law, truth is an absolute defense.
The three-year legal battle waged by Las Vegas casino operator Sheldon Adelson against Review-Journal columnist John L. Smith came to a sudden halt this past week when Adelson agreed to dismiss with prejudice his libel lawsuit over passages in Smith’s book “Sharks in the Desert.” Adelson also will pick up some of Smith’s expenses incurred in defending himself from the libel suit.
Adelson sued over what his attorneys say were false implications in the book that Adelson “was associated with unsavory characters and unsavory activities.”
Adelson originally filed suit in California, where he said he had a residence, and sought $15 million. That was back when he was the third-richest man in America, before his stock in Las Vegas Sands tanked.
After spending what must have been millions on some of the priciest lawyers in legaldom, what could have prompted Adelson to scrap the case? In court on Monday, one of his attorneys offered a feeble explanation that he was satisfied with a settlement reached with the book’s publisher, Barricade Books.
Attorney Kathryn Catherwood told the court one libel judgment was enough and Adelson was satisfied with the $250,000 he had won in a New York bankruptcy court.
She made that statement in bankruptcy court here, where the libel case has landed because Smith filed bankruptcy as a result of his legal expenses and medical bills resulting from his daughter’s continuing fight against brain cancer.
U.S. District Judge Bruce Markell, who had read the New York settlement, later put it in perspective, noting that the $250,000 settlement was last in line behind a number of other creditors, and that Barricade Books wasn’t worth $250,000 “soaking wet.”
What really prompted Adelson to suddenly settle?
As a part of the discovery process while preparing for a scheduled trial in December, Smith’s attorney, Don Campbell, managed to gain access to confidential Gaming Control Board records relating to Adelson’s gaming license. That was a feat of legal skill and audacity accomplished only one other time in history.
Had the case gone to trial, Campbell could have placed those documents in evidence, possibly showing that what Smith had written in his book was substantially correct, even though he admittedly did make a couple of mistakes.
Since the trial has been called off, those records remain confidential.
Campbell said in court that Adelson would have pursued the case “to the end of the Earth” but that since he obtained those gaming records Adelson now “wants to call it off and walk away.”
At several points during the hearing, Judge Markell raised doubts about the strength of the libel lawsuit, specifically questioning Adelson’s attorneys about the lack of any evidence of malice. In libel cases brought by public figures such as Adelson, not only must the statements in question be false, but they must be made either with malice or with reckless disregard for the truth.
“I have not seen any evidence that Mr. Smith acted with malice,” the judge said.
Markell also noted that as a journalist and author, Smith’s reputation is a valuable asset. He made it clear several times, despite the settlement by the book publisher, that Smith is the “prevailing party” in this case and that any characterization to the contrary by Adelson might itself be defamatory.
And Campbell noted that the settlement “deprives Mr. Smith of the opportunity to clear his name at trial.”
In an affidavit filed in response to Adelson’s motion to dismiss the case, Campbell wrote that the “most compelling reason for Adelson’s dramatic desire to dismiss was unquestionably the fact that Smith was about to acquire evidence from the Gaming Control Board which would, by any reasonable analysis, lend itself to thoroughly impeaching critical portions of Mr. Adelson’s sworn testimony as it related to his personal and business history. …
“In short, Adelson’s claims were about to be exposed for what they were … false and vindictive.”
After all the money that’s been spent on this litigation, Adelson’s attorneys are quibbling over the amount of the expenses. What brass.
The truth may not always set you free, but it is a very good libel defense.
What is in those Gaming Control Board records, anyway? Why should background information about a gaming licensee be kept from the citizens and taxpayers of Nevada?
Thomas Mitchell is editor of the Review-Journal and writes about the role of the press and access to public information. He may be contacted at 383-0261 or via e-mail at tmitchell@reviewjournal. comis blog at http://www.lvrj.com/blogs/mitchell/.