935 F. Supp. 2d 644
S.D.N.Y.2013Background
- Chau and Harding Advisory LLC sue Lewis, Eisman, and W.W. Norton for defamation over 26 statements in The Big Short, Chapter 6.
- Defendants move for summary judgment; court grants summary judgment for defendants.
- The Big Short is a non-fiction book with extensive research; Eisman is a source profiled in Chapter 6.
- Chapter 6 portrays Chau and CDO managers; several statements are disputed as to whether they are factual or opinions.
- New York defamation framework is applied, distinguishing pure/mixed opinions from actionable statements and considering context and truth.
- Court analyzes the statements’ content, context, and substantiation to determine if actionable defamation exists.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Are the challenged statements actionable defamation or protected opinions? | Chau argues statements are factual assertions about him and his business practices. | Statements are expressions of opinion or non-actionable rhetoric within a narrative. | Most statements are opinions or not actionable; summary judgment for defendants. |
| Are the statements 'of and concerning' Chau sufficient for liability? | Chapter 6 targets Chau personally as a central figure. | Many statements target CDO managers or the industry; not clearly about Chau alone. | Multiple statements fail the 'of and concerning' requirement; granted for defendants on those points. |
| Is truth/substantial truth a defense to the defamation claim? | Some statements are false representations about Chau's role and finances. | Many statements are true or substantially true and do not misrepresent the gist. | Statements 6, 8, 14, 15, 20, 24 are substantially true or completely true; defense succeeds for these. |
| Are statements about CDO managers generally actionable as group libel? | Group-wide criticisms imply individual defamation of Chau. | Statements referring to CDO managers generally are not attributable to Chau specifically. | Statements 9-13 deemed not actionable for 'of and concerning' requirement. |
| What is the proper interpretation of the statements within the book's context? | Context supports treating statements as factual disclosures about Chau. | Book is narrative, opinionated, with disclaimers; context supports non-actionability. | Context supports non-actionable interpretation; no defamation found on remaining statements. |
Key Cases Cited
- Levin v. McPhee, 119 F.3d 189 (2d Cir. 1997) (libel elements and opinion/factual distinction)
- Steinhilber v. Alphonse, 68 N.Y.2d 283 (N.Y. 1986) (pure vs mixed opinions in defamation)
- Gross v. New York Times Co., 82 N.Y.2d 146 (N.Y. 1993) (contextual analysis of statements and facts)
- Brian v. Richardson, 87 N.Y.2d 46 (N.Y. 1995) (four-factor test for distinguishing fact from opinion)
- Silsdorf v. Levine, 59 N.Y.2d 8 (N.Y. 1983) (whether challenged opinions rely on disclosed facts)
- James v. Gannett Co., 40 N.Y.2d 415 (N.Y. 1976) (average reader perspective in defamation analysis)
- New York Times Co. v. Sullivan, 376 U.S. 254 (U.S. 1964) (public figure standard and actual malice framework)
- Price v. Viking Penguin, Inc., 676 F. Supp. 1501 (D. Minn. 1988) (truth as a defense and substantial truth doctrine)