Texas Monthly v. New York Times: Where are the damages?

The Texas journalism world has been abuzz over a lawsuit filed by Texas Monthly magazine against The New York Times, over The Times‘ luring away of Texas Monthly editor in chief Jake Silverstein to serve as editor of The Times Magazine.

I suspect that much of the attention is due to the fact that the parties are media entities (the media loves to cover itself), but part of it could be sheer amazement on the part of typically underpaid reporters and editors that one of their own would be so in demand that large companies are actually fighting over him.

Be that as it may, the lawsuit provides a glimpse into the world of executive contracts and just how binding (or non-binding, as the case may be) those contracts are.

Texas Monthly sued The Times alleging tortious interference with an existing contract, claiming that The Times knew Silverstein was under contract until February 28, 2015. Upon learning that Silverstein was being recruited, Texas Monthly‘s general counsel called The Times‘ managing editor and told him that “Texas Monthly expected to be compensated if Silverstein was hired by The Times.”

Texas Monthly is seeking between $200,000 and $1 million in damages.

Here’s where lawsuits like these run into trouble: what are the damages? Unless Silverstein received specific and costly training, the only damages most companies can claim in the event an executive leaves before his or her contract is up are the cost of finding a replacement. And, in this case, Texas Monthly was subject to having to find a new editor in chief in less than a year anyway (since his contract would have been up in February 2015), so the most damages they can claim would be one year of interest on those executive search fees. It’s hard to believe those alleged damages would greatly exceed the filing fees, let alone the attorney’s fees.

Now, it’s possible that Silverstein’s contract contained some unusual language that saddled him with extra liability in the event he left before the end of his contract, but if that’s the case, why isn’t Texas Monthly suing Silverstein?

Indentured servitude is illegal, so Texas Monthly couldn’t legally prohibit Silverstein from leaving. And absent any real damages, it’s difficult to see how this case can go anywhere.

But you never know. Texas Monthly could have some ace up its sleeve that will change the game. So I guess I’ll just have to put this on my watch list.

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