Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Litigation has always been a rough business. But lately the line between hardball legal tactics and flat-out extortion has been near impossible to find � particularly for an already cynical public that views lawyers as only slightly more trustworthy than politicians. And why shouldn’t people be skeptical? Look, for instance, at the cases of two recent high-profile targets of sexual harassment claims, former New Jersey Gov. James McGreevey and Fox News’ Bill O’Reilly. When then-Gov. McGreevey was threatened with a sexual harassment suit exposing a homosexual affair with the state’s former head of homeland security, he shocked the nation by abruptly announcing his resignation and explaining why. He also took the threats to the U.S. Department of Justice. Months have passed since McGreevey’s Aug. 12 revelations, and his former paramour has not filed any lawsuit against him. The Federal Bureau of Investigation is still looking into the incident. When O’Reilly, a conservative talk show host, was threatened with a sexual harassment suit by a former producer, he too questioned the motives of his accuser. In fact, O’Reilly filed suit against both the producer and her attorney to allege extortion, claiming that they were seeking nearly $60 million in return for her silence. To no one’s surprise, the case, which promised an endless supply of tabloid fodder, was settled several days into the public controversy with all charges withdrawn and under terms that will never be disclosed. McGreevey and O’Reilly took the offensive, pre-emptively exposing the allegations and counterattacking the other side. What we don’t know is how many others, threatened with an avalanche of negative publicity about very personal matters, choose to pay off their accusers to go away quietly. The central charges leveled by McGreevey and O’Reilly remain unresolved: Were they fair targets in a world of high-stakes litigation, or were they victims of a new form of legalized extortion? How can anyone distinguish anymore between legitimate litigation strategy and a good old-fashioned shakedown dressed up as a lawsuit? SHOW ME THE MONEY The fact is, it isn’t easy. Since the full facts underlying the McGreevey and O’Reilly cases remain a mystery, it is difficult to say if the accusers and their attorneys crossed the line. But the picture is disturbing. The reality is that where accusations are presented in the guise of potential litigation, a prosecution for extortion is almost impossible to prove. In retrospect, old-fashioned celebrity blackmail looks almost quaint. Recall, for example, the woman who threatened to go public with the claim that she was comedian Bill Cosby’s illegitimate daughter. She simply made demands for cash in exchange for maintaining her silence, while threatening to go to the press if he failed to pay. Cosby took her threats to law enforcement authorities, and the young woman was charged and convicted of extortion. Her mistake � or one of her mistakes � was not to lay out a legitimate legal claim when she approached Cosby. A critical difficulty in distinguishing between legal tactics and extortion attempts is that it is not unusual for lawyers to contact their adversaries in advance of the actual filing of a complaint. Such threatening of litigation is not itself extortion. Indeed, this practice is encouraged in order to avoid clogging the court system with unnecessary disputes and to foster early settlement through good faith negotiations. Attorneys will even go so far as to provide their adversaries with draft copies of the complaint that they intend to file, if only to emphasize the seriousness of their threatened claims. And targets of threatened lawsuits have been known to appreciate the warning � that is, to the extent the matter can then be resolved out of the public eye. So when does the threat of litigation cross the line to become a veiled extortion? Extortion is essentially defined as the taking of something of value from another with his consent but through unlawful means. The unlawful means can be a threat of violence, economic harm, or even damage to reputation. What makes the threat extortion is the use of some form of fear illegitimately induced. Cash demands backed by the threat of going public with embarrassing information, even if that information is true, would seem to make a clear case of extortion. But couch those same threats in the language of future litigation, and suddenly the picture grows cloudy. The critical question here is whether the threat and actual filing of a lawsuit is a legitimate use of the judicial system by a plaintiff whose primary purpose is to seek redress in the courts for a violation of some legally cognizable right, or merely an attempt to use the courts to extract money by otherwise illicit means. Is it litigation or “legal extortion”? . . . OR ELSE I’LL SUE The legal extortion strategy is a powerful one because claims made in litigation are generally immune not only from criminal prosecution for extortion but also from defamation charges by the defendant. A lawyer (or anyone else) can be held liable for defamation based on what ultimately prove to be inaccurate statements about his adversary made directly to the media. Not so if he makes the same charges by directing journalists to the clerk’s office to obtain copies of documents filed in a court case. As a result, the use of the court system to disseminate charges, in essence, cloaks unsavory allegations with an almost impervious shield against claims of defamation. Could this practice ever expose a plaintiff and his attorney to criminal prosecution? Yes, but not likely. Either the legal claims would have to be so utterly lacking in merit or the demands for settlement so vastly excessive when compared to the claimed damages that a jury could conclude that the lawsuit was little more than a scheme cooked up between lawyer and client to shake down the victim. The reality is that this is one tough standard. In a world in which even the most frivolous lawsuits are rarely sanctioned, judges would be extremely reluctant to criminalize conduct surrounding the filing of a lawsuit for fear of scaring off victims with legitimate legal claims. True, many civil suits are routinely settled for money and silence. In the end, one could argue, the results are the same. Indeed, defense lawyers have been known to argue exactly that. But permitting colorable legal claims to be settled on confidential terms is the price we pay to foster settlement. Threatening litigation without any good faith basis and little or no intention of ever allowing the charges to go to trial is an altogether different matter. COUNTING THE COST In the future, you have to wonder how many others seeking cash for silence will be so naive as not to hire a lawyer and dress up the proposed transaction in legal garb. And you have to wonder how many future targets will dare to be as aggressive as McGreevey and O’Reilly. In the McGreevey scenario, once the governor called the bluff and went public with his previously concealed homosexuality, the alleged victim blinked: He retreated to his home in Israel, and his attorney never filed suit. Does that suggest a lack of good faith? Perhaps. It is certainly fair to wonder why, after negotiations purportedly aimed at settling claims worth millions of dollars broke down, the putative plaintiff has not sought his day in court. And yet to defend himself, McGreevey was still forced to sacrifice his political career. Likewise, Bill O’Reilly doesn’t emerge untainted. It’s inevitable that people will ask why, if the allegations were entirely unfounded, the talk show host acquiesced so quickly to a settlement. Was it fear induced by a legitimate legal risk, or an effort to protect his privacy? We can only guess. While the McGreevey and O’Reilly cases may be extreme examples, the warning signs should be clear. As long as lawyers are willing to channel demands through the legal system with the knowledge that these claims have a shot at settling in the millions of dollars without being put to their proof, the line between courtroom showdown and backroom shakedown will be difficult to draw. Robert A. Mintz, a former federal prosecutor, heads the securities litigation, government investigations, and white collar criminal defense practice group in the Newark, N.J., office of McCarter & English.

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]

Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.