ABC 'Pink Slime' Lawsuit Goes To Court

(Reuters) -- A South Dakota meat processor's $5.7 billion defamation lawsuit against American Broadcasting Companies Inc, which opens Monday, pits big agriculture against big media, and is a first major court challenge against a media company since accusations of “fake news” by U.S. President Donald Trump and his supporters have become part of the American vernacular.

In the closely watched case, Beef Products Inc. (BPI) claims ABC, a unit of Walt Disney Co., and its reporter Jim Avila, defamed the company by calling its ground-beef product “pink slime” and making errors and omissions in its reporting.

In the aftermath of the 2012 reports, privately held meat processor BPI closed three of its four processing plants and saw its revenues drop 80 percent, to $130 million.

The trial will take place in Elk Point, South Dakota, population 2,000, about 20 miles north of BPI’s headquarters, which employs 110 people. Roughly 6 percent of the area labor force is involved in agriculture and related industries, according to the local chamber of commerce.

Election records show 67 percent of the U.S. presidential vote in Union County, where Elk Point sits, was won by Trump, who uses the term “fake news” to argue that some mainstream media outlets cannot be trusted.

Lawyers for BPI have declined to say if they plan to focus on “fake news” as a tactic at trial. But during a January court hearing, a BPI lawyer, Erik Connolly, said ABC broadcasts and online reports about "lean finely textured beef" (LFTB) used unreliable sources and set out to foment public outrage. The ABC reports amounted to "fake news," Connolly told the judge.

Connolly did not respond to a request for comment.

BPI's signature product, commonly mixed into ground beef, is made from beef chunks, including trimmings, and exposed to bursts of ammonium hydroxide to kill E. coli and other contaminants.

ABC in a series of reports referred to the product as “pink slime” 137 times, according to BPI’s tally.

To win its case, BPI must show the network intended to harm the company or knew what it reported was false when it referred to BPI's LFTB product as "pink slime." BPI also claims ABC made other errors and omissions that unfairly cast its product in a bad light.

"We look forward to the opportunity to present our case and establish for the jury that BPI has suffered significant financial harm because of the wrongful conduct by ABC," said Dan Webb, a former U.S. Attorney representing BPI. ABC has countered that its coverage was accurate and deserved protection under the U.S. Constitution's First Amendment.

ABC denies any wrongdoing and is confident its reporting will be "fully vindicated," a lawyer for ABC and Avila, Kevin Baine of Williams & Connolly, said in a statement.

ABC lawyers declined to comment on whether they expect “fake news” to be introduced by BPI lawyers during the trial.

Not since talk show host Oprah Winfrey in 1998 took on cattle producers in Amarillo, Texas have big media and big agriculture squared off in such a high-profile way on the industry's home turf.

The Texas jury in 2000 rejected claims Winfrey defamed cattle ranches during a "dangerous food" episode of her eponymous show, when she expressed concerns about eating beef at the height of the panic in Britain over "mad cow" disease.

As in the Winfrey case, the lawsuit against ABC is upending a quiet, rural town. To make room for overflow crowds, the county commission earmarked $175,000 to turn the Union County Courthouse basement into an enlarged courtroom and move records into a specially constructed separate building.

BPI moved modular offices into town to accommodate its legal team, the company said.