infodatos Chapter 279 Suing the Media
Chapter 279 Suing the Media
James Lee was already in the small conference room. He was wearing a better-fitting dark gray suit today and carrying a leather folder. When he saw Ling Yun enter, he stood up with a professional smile on his face.
"Good morning, Mr. Ling." He shook hands with a moderate pressure.
"Mr. Li, thank you for coming so early."
The two sat down. The waiter brought coffee, then left the room and closed the door.
"We've discussed yesterday's proposal internally," James said, opening the folder. "Representative Thompson agrees in principle to your terms: 0.8% options, with an exercise price of half the current valuation and a three-year lock-up period. In return, we will ensure the State Department of Consumer Affairs' investigation concludes within a week with a finding of 'no wrongdoing.' Furthermore, Representative Thompson will publicly express his support for innovation in the technology industry, emphasizing the 'importance of global collaboration.'"
"When should the public statement be made?"
"Tomorrow morning," James said, "is the perfect time to respond to today's media reports."
"But the core issue in media reports is national security. Can the state legislator's statement affect that?"
James smiled, a seasoned, all-knowing smile. "Mr. Ling, the essence of politics is deals and leverage. Representative Thompson, chairman of the State Assembly Commerce Committee, will announce tomorrow the launch of a legislative study exploring the feasibility of 'data localization'—requiring all tech companies operating in California to store U.S. user data on California servers."
He paused, observing Ling Yun's reaction.
"If this legislation passes, it will be a blow to all multinational technology companies, including Microsoft," James continued. "But the key point is that Representative Thompson will emphasize that this legislative study is 'based on the equal protection of user privacy' and is not targeted at any particular country or company. He will specifically mention that Chinese companies, European companies, and American companies should all abide by the same rules."
"Using legislative threats to balance public opinion," Ling Yun said.
"Yes." James closed the folder. "Microsoft can bribe the media, but not the legislative process. If Representative Thompson actually pushes for data localization legislation, Microsoft's operating costs in California will increase significantly; that's their Achilles' heel."
"So, what does Congressman Thompson need us to do?"
"First, we hope that StarCraft Technology will send executives to the press conference tomorrow morning to express their support for the legislative research," James said. "Second, the option agreement for that 'digital innovation consulting firm' was signed today. Third..." He leaned forward, "Associate Thompson hopes you will take strong legal action against today's media coverage."
"Legal action?"
“Yes.” James’s eyes sharpened. “Those reports are suspected of racial discrimination and commercial defamation. Representative Thompson recommends that you immediately sue The Wall Street Journal and The San Francisco Chronicle for damages and a public apology. He will issue a statement in his capacity as a representative condemning ‘discriminatory reporting based on nationality.’”
"The lawsuit will be lengthy and very difficult to win."
"Winning or losing isn't important," James said. "What's important is the attitude. You need to let the media know that StarCraft Technology isn't a pushover and won't let them smear us. Besides, once litigation begins, the media will be more cautious in their reporting—nobody wants to get into a lawsuit."
"And the cost? Lawsuit fees could be tens of millions of dollars."
"But it comes in exchange for political protection." James leaned back in his chair. "Congressman Thompson will make sure that no state-level regulators bother you during the litigation. And if you win—even if it's just a settlement—it'll be a huge boost to your public image. The story of a minority entrepreneur who dares to stand up to the mainstream media is very inspiring."
Ling Yun remained silent. He looked at the coffee cup on the table; a thin film had formed on the surface of the dark brown liquid.
"I need to discuss this with my legal team," he said.
"Of course," James stood up. "But please do it quickly. I need your decision by 5 p.m. today. Otherwise, tomorrow's press conference may be canceled."
A handshake, then goodbye.
After James left, Ofina came in. "How did the talk go?"
Lingyun repeated James's words.
"Litigation..." Ofina frowned. "Our legal budget is already very tight. If we sue two major media outlets at the same time, the annual legal fees could exceed five million. Moreover, these kinds of lawsuits usually last two or three years."
"But James is right, posture is important." Ling Yun walked to the window. "Microsoft wants us to be on the defensive, to explain, clarify, and apologize. But if we turn around and sue, we become the attackers."
"The risk is very high."
"I know." Ling Yun turned around. "Call the legal team for a meeting at nine o'clock. Also, contact Richardson and ask if Goldman Sachs has any lawyers specializing in handling media lawsuits. And have the marketing department prepare a plan for the ICQ press conference—we can't let them monopolize the media spotlight tonight."
"clear."
The legal meeting at 9:00 AM was held in the largest conference room. Fiona, the legal head of Xingchen Technology, three partners from an external law firm, a media litigation expert recommended by Goldman Sachs, and Fiona and Lingyun sat around a long table.
Screenshots of two articles were displayed on the projection screen, with key paragraphs highlighted in red.
“From a legal perspective, we have several possible grounds for litigation,” began John Carter, a senior partner at an outside law firm. In his sixties, with completely white hair and thirty years of experience in media law, he said, “First, commercial defamation. The article implies that Xingyu has a security backdoor, but there is no substantial evidence. Such speculative reporting can be sued if it causes commercial damage.”
"The difficulty lies in the fact that the article uses phrases like 'unnamed expert' and 'analysts point out,' without making direct accusations," another lawyer added. "The court may consider this an expression of opinion rather than a statement of fact."
"Second, racial discrimination." Carter turned to another page. "The article repeatedly emphasizes Mr. Ling's Chinese background and links it to security threats. This constitutes suspected discrimination based on nationality. California has strict fair employment and housing laws, but the scope of application in the media reports..."
"Third, unfair competition." The lawyer recommended by Goldman Sachs is a woman in her forties named Sarah Chen, specializing in antitrust and commercial infringement in the technology industry. "If we can prove that these reports are a smear campaign orchestrated by Microsoft and ICQ, it constitutes unfair competition. But proving collusion is difficult; it requires internal emails or testimony."
The meeting lasted an hour. The lawyers debated the pros and cons, odds of success, and costs of various strategies. Numbers accumulated on the whiteboard: preliminary investigation fees of 200,000, evidence preservation fees of 150,000, expert witness fees starting at 300,000, and trial costs of 20,000 to 50,000 per day…
"If we fight to the bitter end, the total cost could be between five and ten million," Carter concluded. "And there's no guarantee of winning. The media is protected by the First Amendment, and courts generally tend to protect free speech."
"But if we don't fight back," Ling Yun said, "similar reports will increase. Today it's two media outlets, tomorrow it might be ten. Users will have doubts, partners will waver, and valuations will drop."
"This is a business decision, not a legal one," Carter said. "Legally, we have grounds to sue, but our chances of winning are slim. Business-wise, you need to weigh the costs and benefits."
The meeting room fell silent, and everyone looked at Ling Yun.