MSG revives legal theory that once haunted ‘60 Minutes’

In the 1990s, CBS infamously spiked a damning “60 Minutes” interview with whistleblower Jeffrey Wigand about the tobacco industry because the network’s lawyers feared it could be sued for encouraging him to violate a nondisclosure agreement with his former employer, a tobacco company.

Three decades later, Madison Square Garden is trying to use the legal theory that CBS’ lawyers once feared, now against Wired magazine.

MSG’s new lawsuit is the latest example of a private litigant trying to wield a legal claim known as “tortious interference with contract” against journalists who rely on sources bound by confidentiality agreements. (The lawsuit includes defendant Katie Drummond, Wired global editorial director and Freedom of the Press Foundation board member. Drummond had no involvement in this article.)

Under the First Amendment, the claim is baseless, but that doesn’t make it harmless. Lawsuits like these discourage investigative reporting by making newsgathering riskier and more expensive, and by putting confidential sources at risk of being exposed.

The MSG suit stems from Wired’s reporting on a “talent database” maintained by the company that labeled some celebrities by race, gender identity, and sexual orientation. Much of the attention has focused on its defamation claim, which accuses Wired of falsely implying that the company used the database to discriminate against LGBTQIA people. Others have already explained the extraordinary legal weakness of this part of MSG’s case.

But alongside the defamation claim is another that has received far less attention. MSG’s second claim of “tortious interference” attacks the newsgathering process itself, and especially the use of confidential sources.

Wired’s article quotes a confidential source describing how MSG security monitors celebrities’ social media posts and marks them with a “risk score.” The lawsuit claims that Wired interfered with MSG’s contractual relationships by encouraging an employee to violate a company handbook and code of conduct to provide that information. It also threatens to force Wired to turn over communications with its sources during discovery in the lawsuit.

Taken together, the claim and the discovery demand amount to a one-two punch against investigative reporting: First, threaten journalists with liability for talking to insiders. Then, use the litigation to try to uncover who those insiders are, since sources bound by NDAs often ask journalists to keep their identities confidential.

MSG isn’t alone in using tortious interference against the press. In 2021, Donald Trump brought a similar claim against The New York Times and its reporters, arguing that they unlawfully induced his niece, Mary Trump, to violate a confidentiality agreement by leaking his tax returns.

Trump’s lawsuit against the Times failed, and for good reason. The First Amendment protects newsgathering, including asking sources for information, even when they may be gagged by a contract. Dismissing Trump’s claim, a New York court held that imposing liability on the Times for this kind of routine reporting would violate the Constitution. Or, as Times reporter Susanne Craig put it: “I knocked on Mary Trump’s door. She opened it. I think they call that journalism.”

The New York court’s decision in the Trump case was consistent with other courts’ recognition that the First Amendment bars tortious interference claims against the press for speaking to sources. Judges in California and Florida have dismissed similar claims on First Amendment grounds. Many states, including New York, also have reporter-source shield laws that would prevent private plaintiffs from forcing journalists to reveal their confidential sources.

But even when tortious interference claims and attempts to dig into reporters’ confidential sourcing fail, they can still chill journalism. They force news organizations to spend money defending lawsuits or fighting to shield their confidential sources’ identities, and they send an ominous message to potential whistleblowers that the reporters they talk to may not be able to protect them.

The sting from tortious interference lawsuits can be lessened by anti-SLAPP laws, which allow journalists and others to recover their attorney’s fees when they face meritless lawsuits based on their speech. But not every state has an anti-SLAPP law. Even in states that do, like New York, anti-SLAPP statutes don’t eliminate the upfront costs and uncertainty of defending a lawsuit. A national newsroom may be able to absorb the expense until it can be recouped. But a local news outlet or independent reporter may not.

As a result, regardless of its merits, a tortious interference claim can discourage reporters and newsrooms from asking sources for information and publishing newsworthy information if it comes from a source bound by an NDA. That’s exactly what happened when CBS backed away from airing the Wigand interview decades ago: Important information about a dangerous industry stayed hidden for months.

That’s why these claims deserve attention, and courts must continue to clearly reject them. By making the very process by which journalists uncover information legally risky, tortious interference claims help powerful institutions keep their secrets.