Report Details ABC Decision In Lawsuit
The Walt Disney Company’s decision to settle President-elect Donald Trump’s defamation lawsuit against ABC News for over $15 million has opened a Pandora’s box of speculation, internal discord, and public criticism. With reports trickling out about the motivations and potential fallout, the settlement shines a glaring spotlight on Disney’s corporate calculations and the fragile state of its news division.
According to reports from The New York Times and The Wall Street Journal, Disney faced significant risks in taking the case to trial. The company feared a Florida jury—representing a state that overwhelmingly backed Trump in the November election—might sympathize with the president-elect and award damages far exceeding the settlement amount.
Moreover, Disney’s legal team worried that the case could escalate to the Supreme Court, where justices might revisit New York Times v. Sullivan, the landmark decision that provides robust protections to media outlets in defamation cases. A shift in this precedent could have seismic implications for the media landscape, potentially exposing Disney and others to greater liability in the future.
From a financial perspective, the $16 million settlement—including $15 million for Trump’s future presidential foundation and $1 million to cover his legal fees—is a rounding error for a company that reported nearly $89 billion in revenue last fiscal year. Yet the reputational stakes were much higher, especially as ABC News faced the prospect of Trump and anchor George Stephanopoulos being deposed in a protracted legal battle.
The controversy stems from a March Good Morning America broadcast in which Stephanopoulos repeatedly and incorrectly stated that a jury found Trump “liable for rape” in the E. Jean Carroll case. In reality, the jury found Trump liable for “sexual abuse,” a significant legal distinction. Despite Disney’s decision to settle, the damage to ABC News’ credibility may already be done.
Reports suggest that Stephanopoulos was blindsided by Disney’s move and may be considering an exit from the network. This would be a seismic shift for ABC, as Stephanopoulos has been a fixture of its news programming and a key player in its political coverage. Meanwhile, leaks from within ABC News reveal deep internal frustrations, with journalists reportedly pitting themselves against Disney executives for prioritizing corporate interests over editorial independence.
Disney’s decision wasn’t just about minimizing financial exposure. The company likely sought to prevent embarrassing details from emerging during discovery, which could have further tarnished the network’s reputation. Additionally, executives worried that a protracted legal battle would hamper ABC News’ ability to compete effectively during Trump’s second term, particularly in a politically charged environment.
Dana Walden, the Disney executive overseeing ABC News and a close friend of Vice President Kamala Harris, has been conspicuously absent from these reports. Her potential involvement—or lack thereof—in the settlement decision remains an open question, but her proximity to Democratic leadership adds another layer of intrigue to the story.
For Disney, settling the lawsuit was a calculated risk, balancing financial costs with reputational damage and long-term legal concerns. While the settlement spares the company a potentially disastrous trial, it leaves lingering questions about journalistic accountability and corporate decision-making at one of America’s largest media conglomerates.