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CNN BREAKING NEWS

No Damages in "Rosie" Lawsuit

Aired November 12, 2003 - 11:36   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

DARYN KAGAN, CNN ANCHOR: Breaking news out of New York City. The trial between Rosie O'Donnell and her publisher of her now defunct magazine "Rosie" is over. And the judge in the case has ruled there will be no damages. This was the case where the publisher was suing Rosie O'Donnell for $100 million for breach of contract and Rosie O'Donnell was countersuing for $125 million.
Let's get some legal perspective on this and bring in Kendall Coffey. Kendell, it's been an interesting business trial to watch, as it's laced with celebrity testimony.

KENDALL COFFEY, FORM. FEDERAL PROSECUTOR: And like any celebrity divorce case, because that's what this is, a business divorce. You're getting plenty of dirty laundry flying from both sides. Ultimately, the judge decided apparently that there were irreconcilable differences, probably some fault on both sides. And based on what she reported said no damages to either side.

KAGAN: And so when you have one side suing for $100 million, other side for $125 million, sounds like the judge is saying you got together, it didn't work out. Now just go away and kind of be on your own and move on past this.

COFFEY: It's a bad marriage. Go away. And to some extent Rosie O'Donnell may see this as a victory because the publisher took her to court. They are the ones that launched the war. And they basically held, based on what the judge said, that she has no financial responsibility for whatever the publisher is complaining about.

So to some extent she may claim victory. But in reality both sides are losers here. Both have suffered reputationally. What began as a very promising joint venture, a very exciting publication, has fallen and shattered.

KAGAN: And so there might not be any damages. But the legal fees are going to be huge.

COFFEY: They are colossal. And what we haven't seen is whether in some sense there's something in the order that says as a technical matter one side or the other is the prevailing party. We don't know exactly the basis for the ruling.

But the big thing is always the money. Since neither side got any money it's hard to say there's any winner.

KAGAN: I think even a single witness for Rosie O'Donnell cost $450,000 for the testimony and all the background that they did on an accounting matter.

COFFEY: Whether it's divorce of a marriage or business it's a reminder that it's a mighty good idea to avoid court if you can. Catastrophically expensive stuff.

KAGAN: Absolutely. And there's word they did try for a settlement but couldn't quite get there. Perhaps some lessons learn.

COFFEY: Yes. And obviously I think what we're seeing in this situation is when you put celebrities or any other human being under the microscope we're all going to say things and act in ways that aren't always so pretty.

As we talked about, one of the many reasons why -- settle, beginning with Abe Lincoln. Talked about how a bad settlement is better than a good lawsuit. This is another reminder of that.

KAGAN: We have some microphones set up on the streets of New York City just outside of this courthouse. Perhaps if someone comes to the mike or the attorneys, we will take that live and show it.

An interesting thing about this, Kendall, is just how public and verbal Rosie has been conducting part of her trial outside on the streets to the public.

COFFEY: Well, one of the things to remember is that whatever happens in court, the largest part of her life isn't Rosie O'Donnell the litigant, it's Rosie O'Donnell the celebrity, a major role model for many millions of people.

So I think she very properly kept that emphasis in mind. If you win $20 million in court and lose a lifetime of earnings and success and impact throughout the community and throughout the nation, then the litigation pales in comparison, obviously, to her public impact and public presence.

KAGAN: Kendall, why don't you stay with us. I want to bring in our Mary snow who was inside the courtroom, perhaps can tell us more about the ruling -- Mary.

MARY SNOW, CNNfn CORRESPONDENT: Well, Daryn, what the judge said in terms of damages, he said that he felt in his opinion that neither client really established or neither side really established that there were damages outside of the client -- of the attorney fees. Saying that really wasn't proven is the fact that this magazine would have been a successful venture.

So he said it had been the plaintiff's obligation, in his words, to inform the client. This was an ill-conceived lawsuit. And he said there was no point to award damages except for some of these attorneys fees. He is saying that aside -- seemed to him aside from dealing with bragging rights -- there was a substantial time on both sides to do that -- he questioned whether it made sense to do that.

So pretty much what he was saying was that (UNINTELLIGIBLE) publisher initially bringing this lawsuit against Rosie O'Donnell, saying they did not really establish that her departure from "Rosie" magazine cost them a lot of money in terms of damages. They had sued for $100 million, because, the judge said, that the company had established that this magazine wasn't really doing all that well financially.

Now, the judge had made that comment. He did not make a decision about liability, which this case was brought, to find out who was liable for breaching the contract. Rosie O'Donnell for leaving the magazine, or the publisher for seizing editorial control from her. Those were the arguments made on both sides.

Now, the judge is still in there. Rosie, at the end of this decision, had raised her hand, was talking to some lawyers. We expect to hear more momentarily. She has said before going into the courtroom today that she would make a statement when this is all over. We could always potentially hear from the publisher -- Daryn.

KAGAN: Rosie O'Donnell was in the courtroom when the judge was speaking. What was her reaction as she was hearing this?

SNOW: Well, she raised her hand and indicated that she wanted to say something but that wasn't allowed in court. And we haven't really gotten a chance to hear directly from her. Lawyers were huddled and we're expecting some more news momentarily.

KAGAN: We're going to cut you loose so you can gather that news. We do have the microphones set up on the sidewalks of New York so if Rosie comes out or the other side, we will be able to hear from them. Our thanks to Kendall Coffey as well in dealing with this breaking news.

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