Defamation lawsuit against CNN could expose company’s financial secrets as court seeks to expose net worth

CNN faces a defamation lawsuit over a 2021 story centered around the chaotic Afghanistan withdrawal and a recent ruling could expose financial secrets as the court seeks to determine the cable network’s net worth.

The plaintiff, Zachary Young, alleges that CNN smeared his security consulting company, Nemex Enterprises Inc., by implying it illegally profited when helping people flee Afghanistan during the Biden administration's military withdrawal from the country in 2021. A civil trial is scheduled to begin on Jan. 6, 2025, in front of Judge William Henry in the Circuit Court for Bay County, Florida. 

Last week, Henry paved the way for Young to issue a subpoena for CNN to hand over a plethora of sensitive financial information that the cable network presented to its parent company, Warner Bros. Discovery. 

"Essentially, this will act as a way to double check to see if CNN was being honest with the financial documents they were turning over as part of discovery; comparing what they turned over to Young’s legal team vs what they told corporate," NewsBusters associate editor Nicholas Fondacaro wrote when covering the hearing. 

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Jake Tapper anchored the program at the center of a defamation lawsuit.  (CNN/Screenshot)

Puck reporter Eriq Gardner wrote that the judge’s decision "sent a jolt through CNN’s executives offices."

"Young has won a green light to seek punitive damages," Gardner wrote. 

"Accordingly, Young’s attorneys will soon be receiving documents to assess CNN’s net worth, so they can argue before a jury just how big a penalty Young should receive," he continued. "The judge has also ordered a deposition for Jake Tapper, who will likely have to disclose his salary and contract negotiations.

Tapper’s salary will be particularly interesting to now-former CNN employees who were let go during a recent round of cost-cutting headcount reductions. The network announced in July that roughly 100 staffers would be let go. 

Gardner also reported that CNN’s lawyer Charles Tobin "visibly bristled at the ruling" and told the judge that the Oct. 11 deadline to comply "upends" his plans. 

Young, a U.S. Navy veteran, believes CNN "destroyed his reputation and business by branding him an illegal profiteer who exploited desperate Afghans" during a Nov. 11, 2021, segment on CNN’s "The Lead with Jake Tapper," which was shared on social media and also repackaged for CNN's website.

Tapper began the segment by informing viewers that CNN correspondent Alex Marquardt discovered "Afghans trying to get out of the country face a black market full of promises, demands of exorbitant fees, and no guarantee of safety or success."

Tapper tossed to Marquardt, who said "desperate Afghans are being exploited" and need to pay "exorbitant, often impossible amounts" to flee the country. Marquardt then singled out Young, putting a picture of his face on the screen and saying his company was asking for $75,000 to transport a vehicle of passengers to Pakistan or $14,500 per person to end up in the United Arab Emirates.

"Prices well beyond the reach of most Afghans," Marquardt told viewers. 

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Plaintiff Zachary Young’s photo was aired by CNN during the segment in question.  (CNN/Screenshot)

"We got Young’s number and called, but he didn’t pick up. In a text message, he told CNN that ‘Afghans trying to leave are expected to have sponsors pay for them. If someone reached out, we need to understand if they have a sponsor behind them to be able to pay evacuation costs which are highly volatile and based on environmental realities,’" Marquardt continued. "Young repeatedly declined to break down the cost or say if he’s making money." 

No other people or companies were named other than Young. 

"In another message, that person offering those evacuations, Zachary Young, he wrote, ‘Availability is extremely limited and demand is high’… he goes on to say, ‘That’s how economics works, unfortunately,’" Marquardt told viewers.

Tapper responded, "Unfortunately, hmm," before thanking Marquardt for the report. 

Young alleged that CNN, using the terms "black market," "exploit" and "exorbitant," painted him as a bad actor preying upon desperate people. 

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CNN’s Jake Tapper is caught up in a lawsuit over a 2021 story centered around the chaotic Afghanistan withdrawal. (Getty Images)

CNN did not immediately respond to a request for comment. 

It will be interesting to see if CNN chief media analyst Brian Stelter covers the story, as he recently returned to the network after being fired by previous management. His media newsletter didn’t return until Monday and he did not post about the defamation suit on X while he was away from the network. 

Earlier this year, judges with the First District Court of Appeal for the State of Florida ruled on June 12 that Young offered enough evidence that he was able to move forward with a defamation suit against CNN for punitive damages. 

"Young sufficiently proffered evidence of actual malice, express malice, and a level of conduct outrageous enough to open the door for him to seek punitive damages," the court document states. "Whether Young can ultimately prevail is not the issue before us."

The judges wrote, "Young proffered CNN messages and emails that showed internal concern about the completeness and veracity of the reporting — the story is ‘a mess,’ ‘incomplete,’ not ‘fleshed out for digital,’ ‘the story is 80% emotion, 20% obscured fact,’ and ‘full of holes like Swiss cheese,’" but the network aired it anyway. 

"Young also proffered a message exchange he had with Marquardt just hours before publication where he advised there were factual inaccuracies in the reporting. CNN published anyway," the judges wrote, adding that other internal communications show CNN staffers "had little regard" for Young and used profanities and disparaging language when privately discussing him.

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"Marquardt referred to him as 'f---ing Young' and quipped, "it’s your funeral, bucko,'" according to the court document.

"On appeal, CNN argues it did not intend to harm; its language was either opinion or ambiguous; and the internal communications were journalistic bravado that reflected a sincere belief in the reporting," the judges wrote.