Disney Paid $177 Million to Settle ABC ‘Pink Slime’ Case
Disney quietly paid a huge sum of money to settle a controversial defamation case over ABC News’ use of the phrase “pink slime” to describe an additive that the cattle industry prefers to call “lean finely textured beef.”
The settlement, worth at least $177 million, came after South Dakota-based Beef Products sued Disney-owned ABC for $5.7 billion over a series of reports about “pink slime” in 2012.
Disney’s decision to settle will likely alarm free speech advocates who argue the lawsuit sought to silence legitimate reporting about the food industry.
ABC News did not invent the term “pink slime,” which was was first used by a government biologist in a private email to colleagues. The biologist argued that the additive in question—which is created by using a centrifuge to spin off muscle meat from layers of fat and then treating it with ammonia—was not real ground beef.
The series of ABC News reports citing “pink slime” fueled a national outcry over the beef product, which in turn led the industry to stop using it, and to a series of plant closures and layoffs at Beef Products Inc.
Disney’s (DIS) decision to settle the lawsuit, first reported by the Hollywood Reporter, came as a surprise, and occurred in the midst of a weeks-long trial in South Dakota.
The outcome likely reflects fears by Disney that jurors in the trial would feel sympathy for a home-state industry over an eastern media outlet. The $177 million payout thus allowed Disney to avoid rolling the dice on a verdict and facing years of uncertainty on appeal.
Meanwhile, Beef Products appears set to collect significantly more than the $177 million figure, which came to late this week when Disney stated quarterly earnings. As a spokesperson told the Wall Street Journal, the company will receive additional money as a result of payouts from insurance: “As Disney disclosed, $177 million is not the total settlement amount. Based on Disney’s disclosure, it appears that Disney is funding $177 million of the settlement and its insurers are paying the rest.”