A Rough Patch

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AOL CEO Tim Armstrong's not OK with the unprofitable performance of the online company's network of news sites, Patch (see "TUOL" 5/9/13 post), and outlined plans to turn things around during a second quarter earnings call to investors this week, Forbes reported.

Armstrong said by the end of this year, 300 or so Patch sites that are lagging in the earnings department will be shut down, sold off, or possibly partnered, perhaps with money-starved  newspapers whose online editions are not fully developed. Forbes quoted Armstrong as saying the average cost of a Patch site is "much, much lower" than the two-year-old figure of $150,000.

Forbes' Case of Mistaken Preference Prompts Apology to Ireland Prez

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An online article in Forbes magazine that erroneously described the 72-year-old president of Ireland as an "acknowledged homosexual" has prompted the business periodical to apologize to its readers and to the Emerald Isle's leader, the Associated Press reported today.

Michael D. Higgins, a Limerick native who is married and the father of four, has not responded to Forbes' gaffe or apology. Higgins, a poet who was elected President in 2011 defeated, among other candidates, openly gay Sen. David Norris, according to the AP story. Billionaire founder of the magazine, Malcolm Forbes, was outed by a magazine as gay shortly after his death in 1990.

Forbes has since pulled the inaccurate story from its Web site.

Saudi Prince Sues Forbes for Libel Over Low Placement on Rich List

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England's recent defamation law reforms (see "TUOL" post 4/29/13) will be put to the test by billionaire Saudi Prince Alwaleed bin Talal, whom The Guardian Web site (www.guardian.co.uk) reports has sued Forbes Magazine for allegedly under-reporting the extent of his wealth.

The 58-year-old Alwaleed, whose Kingdom Holding investments include swanky hotels the Savoy in London and New York City's Plaza, filed a libel suit in London's High Court against Forbes Editor Randall Lane, along with the business magazine's publisher and two of its reporters. Apparently, Forbes' annual Rich List assessed the Prince's worth at $20 billion, whereas Alwaleed pegs his fortune at closer to $30 billion, and claims Forbes is "demonstrably biased" against Saudi Arabian businesses.

Forbes, according to The Guardian article, said members of the Prince's inner circle lobbied the magazine for higher placement on the Rich List for Alwaleed, who, apparently finds little solace in the fact that his private Boeing 747 jet is equipped with a solid gold throne that no doubt affords him ample leg room. The magazine reported that it calculated Kingdom Holding's worth based on the value of its investments, rather than its stock price on Saudi Arabia's Tadawul stock exchange.

The Prince faces an uphill challenge as England, once decried as the principal destination for libel tourism, will require him to prove that he suffered, or is likely to suffer, serious financial harm as a result of the allegedly libelous lower placement on the Rich List. If he somehow manages to do that, Forbes will look to the SPEECH (Securing the Protection of our Enduring & Established Constitutional Heritage) Act signed into law by President Obama in 2010 that shields U.S. citizens and businesses against foreign libel judgments that run afoul of First Amendment tenets.

That Alwaleed would get his royal knickers in a twist and incur the costs of a quixotic libel suit alleging his reputation was harmed because a media defendant underestimated his wealth may not warrant higher placement on Forbes' Rich List, but certainly is evidence to the staff of "TUOL" that he has too much money for his own good.

UPDATE: Opera-Singing Dentist Flounders in Copyright Aria

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In his pun-filled, 10-page decision in Lee v. Makhnevich (Case No. 1:11-cv-08665, 2013 WL1234829 (March 27, 2013)), United States District Court for the Southern District of New York Judge Paul Crotty recently denied defendant dentist Stacy Makhnevich's motion to dismiss a potential class action suit challenging a Mutual Agreement to Maintain Privacy ("MAMP") form she forced patients to sign as a precondition to treatment that barred online criticism of her work.

As previously reported here (see "TUOL" post 2/2/11), consumer advocacy group Public Citizen filed suit in 2011 on behalf of Huntingtown, Maryland's Robert Lee and his confederates (sorry) claiming patients were entitled to post negative reviews on Web sites such as Yelp! and DoctorBase, as Lee did, pursuant to the fair use exception under the Copyright Law [17 U.S.C. sec. 107].

Dr. Makhnevich, whose Web site notes her skills as a dentist and opera singer, treated Lee in 2010, draining and filling a tooth that caused him discomfort. She insisted that he sign the MAMP form contract sold by North Carolina-based Medical Justice, which required patients to waive public comment about dental services and assigned to the dentist the copyright of any online comments. Lee defied the agreement and criticized the defendant's office over the amount of the bill and for allegedly not submitting reimbursement forms to his insurance carrier.

Attorneys for the dentist threatened to sue Lee for $100k for defamation, breach of contract and copyright infringement, subsequently sending him invoices assessing copyright infringement damages of $100 a day. Public Citizen not only attacked MAMP as violative of patients' First Amendment rights and the fair use exception, but questioned the validity of the contract overall, claiming the dentist's promise not to sell its patients' names to marketers in exchange for the patients' promise not to post online comments was illusory because dentists already are barred from selling patients' names to marketers without the patients' consent under HIPAA (Health Insurance Portability & Accountability Act).

Judge Crotty did not hide his disdain for defense counsel's argument that the suit should be dismissed because it stated no legal claim because no actual controversy existed. "Defendants created the controversy with Lee by attempting to enforce the agreement, which they extracted as a condition for getting dental treatment," Judge Crotty wrote. "[U]nder the totality of circumstances, the controversy is sufficiently 'real' and 'immediate.' Defendants cannot pretend now that their notices to Lee were 'just kidding,' or that Lee lacked any reasonably apprehension of liability."

Judge Crotty further anesthesized Dr. Makhnevich's position, writing: "This lawsuit about a toothache and a dentist's attempt to insulate herself from criticism by patients has turned into a headache. After appealing to his dentist for pain relief, Plaintiff Robert Allen Lee, ironically, is appealing to the court for relief from his dentist."

Soon after Public Citizen filed suit, Medical Justice stopped using the MAMP at issue, according to the  Forbes article.  To its credit, Yelp resisted defendant's demand that Lee's negative comments be taken down. The denial of the motion to dismiss is not dispositive of the outcome of the case, but based on Judge Crotty's acid-laced remarks, defense counsel may need a shot of Novocaine to get through this case.

Consumer Magazines' Ad Pages Continue Freefall in 1Q of 2013

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Half of the 213 consumer magazines tracked by Publishers Information Bureau ("PIB") suffered declining ad pages during the First Quarter of 2013 compared to the same period a year ago, MediaPost.com reported today.

Although the painful drop-off in ad revenues was widespread, celebrity, lifestyle and women's interest periodicals were particularly hard hit, according to the MediaPost article. Ladies Home Journal experienced a 28 percent decrease to 122 ad pages, Maxim saw a 36 percent shrinkage of ad pages down to 53, Forbes dropped 19 percent to 266 ad pages and OK Weekly was not okay with  22 percent fewer ad pages at 263, compared to the periodicals' respective figures for the first three months of 2012.

The PIB survey found that 67 of the titles it tracked lost 10 percent of their ad pages in a 2013 to 2012 comparision, and 31 periodicals sustained more than a 20 percent decrease in First Quarter 2013 ad pages.

Only bad dogs were heartened by the latest financial news, because it won't hurt as much when owners rap them on the nose with ad-deprived, rolled-up magazines.

All Atwitter Over Social Platform's Meteoric Growth

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Buoyed in the U.S. by increased use by the over-55 set and a stronger mobile Internet presence, social media platform Twitter is now being used monthly by 21 percent of the world's Internet population, according to GlobalWebIndex ("GWI") cited in an online Forbes article.

Fourth Quarter 2012 figures revealed a staggering 40 percent increase among active Twitter users, which translates to 288 million tweeters. The GWI measures usage in 31 markets that comprise roughly 90 percent of the global Internet population between ages 16 and 65, the Forbes piece noted. Dating back to July 2009, active tweeters have increased by 714 percent.

Active usage of Twitter grew 94 percent in the U.S., second only to Hong Kong. The over-55 demographic is the fastest-growing group among tweeters, the GWI survey noted, and Americans last year increased their mobile Internet usage of Twitter to 43 percent from 37 percent the previous year.

Bet there are some folks in the respective boardrooms of Google and Facebook who wish their companies had acquired the San Francisco-based microblogger before it learned how to spin gold in 140-character segments.

Village Voice Sold; Jettisons Backpage.com

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Village Voice Media Holdings, which includes its namesake free newspaper and a dozen other alternative weeklies, has been sold for an undisclosed sum to the company's CEO Scott Tobias and a private equity management team, Forbes reports.

Among other papers included in the sale are the Dallas Observer, LA Weekly and Phoenix New Times. Christine Brennan has been tapped to be the newspaper group's Executive Editor.

Former Village Voice Media heads Michael Lacey and James Larkin will retain Backpage.com, the controversial Web site that has attracted harsh public criticism and the interest of authorities over its adult ad services offerings (see "TUOL" posts 6/7/12 & 4/3/12).

News Media Takes a Holiday from Fact-Checking

Image via CrunchBaseRyan Holiday, if one were to believe HARO (Help A Reporter Out), a Web site of source listings for reporters, is an expert in topics ranging from boats and vinyl phonograph albums to insomnia. It turns out, however, according to Poynter.org, that Holiday's expertise is in the field of chain-yanking media outlets, including ABC News, Reuters, and the venerable New York Times.

Holiday, author of Trust Me,I'm Lying: Confessions of a Media Manipulator, who is having a book release party tonight (if one can believe him), was interviewed by Forbes and the Columbia Journalism Review about his exploits, which involved misleading nearly two dozen journalists. Holiday said he wanted to illustrate online journalism problems caused by journalists' reliance on sites such as HARO for sourcing.

Reuters interviewed him as an expert on "Generation Yikes", Manitouboats.com sought his knowledge about winterizing watercraft, while the New York Times talked to him about collecting vinyl records, which he later confessed he doesn't collect.  Most of the snookered news outlets have since published editor's notes, corrections or retracted their Holiday content.

Seems as if the Holiday involved is April Fools Day.

'Huffington.' Digital Magazine on the Horizon

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"Huffington.," a digital magazine specifically designed as an app for iPad and its ilk, is the latest brainstorm produced by the AOL-owned Huffington Post Media Group, Forbes Magazine reports.

Former New York Times journalist turned Huffington Post Executive Editor Tim O'Brien will oversee the project, according to the Forbes article. The period is part of the "Huffington." periodical's title. Vanity Fair was already taken, though there's no lack of vanity involved in the digital moniker.

Publisher Projects Paywall Proliferation

Image via Wikipedia"Good fences make good neighbors," poet  Robert Frost wrote in Mending Wall (1914), but McLean, Virginia-based media conglomerate Gannett Co. believes the 80 paywalls it plans to erect by the end of 2012 for the online editions of the 80 community newspapers it owns will make annual subscription revenues climb 25 percent.

Forbes Magazine reported yesterday that Gannett's Robert Dickey, president of community publishing, said a metered payment system will be in place for Gannett newspapers that likely will offer from five to 15 free articles monthly before Website visitors have to pay for content. Presently, six Gannett dailies have digital paywalls in place (see "TUOL" post 7/1/10).

The Forbes article noted that Gannett's leaky flagship, USA Today, will not follow the paywall route of its sister publications for now, as the nationwide paper is in the throes of upgrading and making over its Website.

Teacher Loses Face, Job After Facebook Rant Against Students

Image via WikipediaPatterson, N.J. elementary school teacher Jennifer O'Brien, who has been on administrative leave since March 2010, because of a derisive comment she posted about her students to her 300 Facebook buddies, should lose her tenured post, Administrative Law Judge Ellen Bass has ruled.

As reported by Forbes via the Mobiledia tech blog, Judge Bass wrote O'Brien "demonstrated a complete lack of sensitivity to the world in which her students live." Following a day last year in which one of her first-grade minions allegedly struck her and another student purportedly stole money from her, O'Brien posted on Facebook: "I'm not a teacher--I'm a warden for future criminals!"

Her virtual outburst sparked protests outside her school by parents and concerns by school administrators that the comment may have been racially tinged.  ("TUOL" is a N.J. native and can confirm that low-income, crime-ridden Patterson is not considered a vacation escape.) Judge Bass' ruling may cause hand-wringing among the social media free speecharati, but a body of case law supports the notion that although O'Brien has a First Amendment right to vent against her pupils, she has no corresponding right to be a teacher when her speech, which was not political in nature, embarrasses her employer.

Esquire Magazine Humor Piece Gives Birth to Defamation Suit

Image via WikipediaThe U.S. District Court for the District of Columbia will hear Joseph Farah, Jerome Corsi et al. v. Esquire Magazine, Inc. et al. (Case No. 1:11-cv-01179), a defamation case arising from a humor article by writer Mark Warren that targets the author of a book questioning the citizenship of President Barack Obama.

As reported by Forbes Magazine, the plaintiffs' Complaint seeks more than $285 million in damages and includes counts alleging defamation, false light invasion of privacy, violation of the Lanham Act and interference with business relations. Farah, WorldNetDaily.com CEO, and Corsi, who wrote Where's the Birth Certificate? The Case That Barack Obama Is Not Eligible to Be President, say they were damaged by Warren's parody that Esquire published May 18, 2011.

Headlined: BREAKING! Jerome Corsi's Birther Book Pulled from Shelves, Warren's piece appeared shortly after President Obama released his long-form birth certificate, defusing all but the most devout followers of the so-called birther movement that maintained the president was not native-born and, thus, ineligible to serve as Commander in Chief. Subsequently, Esquire posted an update on its Website in which it stated, in part: "We committed satire this morning to point out the problems with selling and marketing a book that had its core premise and reason to exist gutted by the news cycle, several weeks in advance of publication."

Satire has proved a successful defense against defamation in the past, as The Rev. Jerry Falwell learned when he sued Hustler Magazine in the '80s. The plaintiffs, who have not been mollified by President Obama's birth certificate, however,  are nothing if not persistent, so stay tuned.

Massive Layoffs Rock Forbes Magazine

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Rumors are still flying, the dust has yet to settle, and management isn't talking at Forbes, the bi-weekly business magazine founded in 1917. Given the numbers being bandied about of editorial employees who were axed this week because of the recession-induced loss of advertising pages and circulation, it's really just a matter of whether to characterize the layoffs as  "catastrophic" or "cataclysmic."

Of  Forbes' approximate 200 editorial employees, The New York Times blogger David Carr reported from 40 to 60 may have been terminated. The Media Jobs Daily blog confirms 27 editorial layoffs, but suggests that including cutbacks on the business side of the fortnightly publication places the number of lost jobs at close to 100.

Bureaus are feeling the impact of the reduction, with London, Los Angeles, and Tokyo bureau chiefs purportedly among the casualties, along with New York's Senior Editor. Ad pages at Forbes  have allegedly declined by at least 30 percent over the first three-quarters of this year, compared to what already were paltry figures in 2008.

No word on whether Forbes may follow the lead of its competitor, Time, Inc.'s  Fortune, which faced with a 35 percent drop-off in ad pages, is reducing the frequency of its publication from 25 to 18 issues annually.

Previously, Forbes slashed 50 positions when it merged its print and Web operations. Unsolicited advice to Steven Forbes  from "TUOL": It may be time to start contacting the "Forbes 400" and the billionaires list the magazine routinely features with hat-in-hand.