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Dan Rather's $70 Million Breach of Contract Lawsuit Dismissed--Court Rules in Favor of CBS

September 30, 2009

As California Labor and Employment Lawyers, we have been following television news anchor Dan Rather's high profile two-year employment lawsuit--dismissed yesterday in the Appellate Division of the New York State Supreme Court.

The ruling, handed down by a five-judge panel, dismissed Rather's claims against CBS network for breach of contract, fraud, breach of fiduciary duty, and ruining his reputation. Rather claimed that CBS forced him take the fall for the controversial 2004-news story profiling George W. Bush's participation in the Texas Air National Guard during the Vietnam War. The judge dismissed Dan Rather's $70 million lawsuit, claiming it had no merit.

Rather filed the lawsuit in the state Supreme Court in Manhattan in 2007, claiming that CBS intentionally mishandled the aftermath of the 2004 broadcast. Rather narrated the news story, accusing President George W. Bush of relying on high political influence to dodge responsibilities during his service in the Texas Air National Guard. The broadcast incorporated copies of documents by Bush's commanding officer, supporting aspects of the story.

Rather received harsh criticism from conservative partisans following the broadcast, accusing him of trying to influence the 2004 presidential race. Critics questioned the authenticity of the documents, and CBS conducted an independent investigation into the production. CBS determined that the story was inaccurate, and fired the producer and Rather, forcing Rather to apologize for the alleged journalistic errors. According to the lawsuit, Rather was used as a "scapegoat" and shoved into the spotlight by CBS, making him take the fall professionally to "pacify" the White House--costing him significant financial loss and damage to his reputation. As a result the media called the episode, "Rathergate."

Rather stepped down from the Evening News in May 2005, continuing to report for 60 Minutes until his job was permanently terminated in June 2006. Rather claimed in the suit that CBS "warehoused" him during this time, and failed to properly compensate him for the final 15 months when he could have sought other employment. The appeals panel cited the CBS "pay or play" provision in the ruling--claiming that although Rather was not used as frequently in his final 15 months, CBS did not violate the terms of Rather's contract, because they continued to pay him "applicable compensation." Rather's annual CBS salary of approximately $6 million was paid until June 2006.

The appellate division also wrote that Rather had no grounds on which to claim fraud, and that he failed to support his allegation that CBS damaged his future career opportunities. The judges also wrote that he could not sue for breach of fiduciary duty because CBS didn't owe Rather a fiduciary duty.

Yesterday's ruling was a big disappointment to Rather, who has made a career effort to champion journalistic freedom and independence from political, governmental, corporate or personal interests. This case was tried over five months ago before the appellate division and yesterday's ruling threw out Judge Ira Gammerman's previous decision to reinstate the claim. Rather sought $70 million in substantial damages, both compensatory and punitive from the defendants for their wrongful acts. He plans to appeal.

Rather spent 44 years as an employee of CBS, 24 years of which as the anchor of the CBS Evening News, and now produces an hour-long news program for cable station HDNet.

Rather has another employment fraud lawsuit pending against CEO of CBS Leslie Moonves and former President of CBS News Andrew Heyward.

Dan Rather's Lawsuit Against CBS Dismissed, CNN, September 29, 2009

Court Tosses Dan Rather's Lawsuit Vs. CBS, CBS News, September 29, 2009

Breaking: Appellate Court Dismisses Dan Rather's Lawsuit Against CBS; Rather Vows to Appeal, Los Angeles Times, September 29, 2009

Dan Rather's Lawsuit Against CBS Dismissed, TV Guide, September 29, 2009

Judge Tosses Dan Rather's CBS Lawsuit, UPI.com, September 30, 2009

Related Web Resources:

Dan Rather Files $70 Million Lawsuit Against CBS, Parent Company Viacom, Fox News/AP, September 29, 2007

At Howard Law, PC in Anaheim, California, our qualified Labor and Employment Lawyers are experienced in working with employees to obtain breach of contract compensation. Contact us today for a free consultation at 1-800-872-5925.