FBI Director Patel and foundation win defamation lawsuit against blogger, awarded $250,000
Patel and the Kash Foundation were awarded a total of $250,000 in compensatory and punitive damages against the Substack blogger and podcaster Jim Stewartson in an order on Aug. 5 by Judge Andrew Gordon in U.S. District Court in Las Vegas.
The order was first reported by the online news site Court Watch.
Gordon issued the default judgment favor of the longtime Trump loyalist Patel after Stewartson did not respond in court filings to the lawsuit, which cited a series of social media posts and other comments by Stewartson.
Patel had sought $10 million in damages on claims of defamation, injurious falsehood and business disparagement.
The judge said punitive damages were warranted in the case "in part to deter Stewartson and others from engaging in defamation."
"Factual criticism of, and opinions about, public figures are protected speech and must be tolerated," Gordon wrote. "But defamatory falsehoods made with actual malice are not protected, even if directed at public officials.
"The complaint and the motion adequately demonstrate Stewartson acted with malice."
Stewartson told CNBC in a text message on Friday, "I was never served with this lawsuit. I just found out about the judgement from trolls on Twitter last week."
He said that Patel's lawsuit, and another pending defamation complaint against him by former Trump national security advisor Michael Flynn in Florida state court, are "intended to intimidate me because I have been accurately and diligently reporting on Patel and Flynn's involvement in the QAnon movement and their participation on January 6th for five years."
"It is a preposterous, frivolous lawsuit and neither of them will receive a dime," Stewartson said. "In fact, I intend to pursue my own case against them for their years-long campaign of abuse of me and the legal system."
The FBI said that Patel would have no comment on the decision. CNBC has requested comment from his lawyers.
Patel's attorneys said in a court filing in March that after filing the suit in June 2023, Stewartson for months "dodged" accepting service of the complaint, which, as a rule, is required for a civil case to proceed.
The attorneys said they finally completed service of the lawsuit in late October 2023, when a person at Stewartson's home in California accepted a copy of the complaint.
Gordon wrote in his order that he "found good cause to grant" a request for the default from Patel's lawyers.
But Gordon also said that the motion by Patel's lawyers "offers scant evidence of harm or damages to either plaintiff."
He noted that an expert's report "states that Mr. Patel's 'image has been deeply hurt by the defamation accusing him of working against the government, corruption, and crime. Apart from the business already lost, this impacts future opportunities and relationships.'"
"But the report offers no examples of 'business already lost' and how Mr. Patel's image was hurt by the defamatory statements themselves, as opposed to the myriad non-defamatory attacks Mr. Patel has suffered as a result of being a public figure," Gordon wrote.
"To the contrary, after the defamatory statements, Mr. Patel was confirmed by the United States Senate as Director of the F.B.I." the judge wrote.
"Clearly his reputation was not significantly sullied by the defamatory statements."
Gordon said there was "almost no concrete evidence of harm or damages suffered by" Patel's foundation.
"All of the defamatory statements were directed at Mr. Patel individually," the judge noted.
But Gordon said that both compensatory and punitive damages were warranted in the case.
"Stewartson's statements were defamatory and caused presumed damages," the judge wrote.
"Falsely stating as fact that a public figure 'attempted to overthrow the government,' planned the January 6 insurrection, was a 'Kremlin asset,' and paid people to 'lie to [C]ongress' ... inflicts real injuries, personally and professionally," the judge wrote.
The judge awarded Patel $100,000 in compensatory damages and the same amount in punitive damages.
He awarded the foundation $25,000 in compensatory damages, and the same amount in punitive damages after accepting as a reasonable estimate a claim that at least seven donors had stopped giving to the group.
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