We've Been Served-Oh Wait

$65 million lawsuit filed over 2008 Metroland article

Metroland/April 2, 2009

Capital Region-based company NXIVM has filed a $65 million lawsuit against Metroland. NXIVM, an international company that offers personal and professional training programs, has been accused by detractors of being cultlike. The company was founded by Keith Raniere, and has previously gone by the name Executive Success Programs. Prior to forming ESP, Raniere ran a company called Consumers' Buyline, Inc., which was under investigation by regulators in 20 states when, in 1993, the New York attorney general filed a civil suit alleging CBI was a pyramid scheme. Without admitting wrongdoing, Raniere settled for $40,000.

The lawsuit against Metroland was filed on March 12 with the Supreme Court of the State of New York in Niagara County. It includes 10 separate counts, including product disparagement, prima facia tort (intending to and succeeding in causing harm), defamation, interference with prospective business advantage, and conspiracy. The lawsuit references a March 13, 2008, Metroland article by news editor Chet Hardin that contains the line, "Raniere, according to Ross, is not allowed, by law, to be involved in a discount buyer's club, due to the collapse of CBI," a statement the suit claims is false.

The conspiracy charge involves Rick Ross, an interventionist and writer dealing with groups that have been called cults or cultlike, as well as Morris and Rochelle Sutton. According to Ross, the Suttons hired Ross in 2002 to attempt to persuade their son Michael Sutton to leave NXIVM. The lawsuit claims that Ross, the Suttons, and Metroland conspired to republish false information.

According to Hardin, Ross is a source but he has never met him in person. In reference to the Suttons, Hardin said, "I've never spoken to them." Leon said that he has also never spoken to Ross or the Suttons.

A similar lawsuit was filed against Ross, the Suttons, and Lollytogs (the apparel company owned by the Suttons) on March 5, 2009. According to Ross, they also have yet to be served with a lawsuit.

"It's a virtually identical lawsuit," Ross said. "I assume, and my lawyers assume, that the reason for filing is to maintain the ability to pursue a claim over an article that the statute of limitations was about to expire on." The lawsuit against Metroland was filed one day before the statute of limitations for defamation would have expired.

"It's kind of like they're parking and reserving their right," Ross said.

Ross also defended his statement in the article over which Metroland is being sued.

"I recall that that was part of some kind of an agreement," Ross said. "Raniere may be splitting hairs."

Hardin was notified of the lawsuit by a blogger.

"Ben Arnold, the blogger at (dis)Utopia [of Saratoga Springs], e-mailed me on March 27 and asked for a comment on NXIVM's latest suit," Hardin said.

Past coverage of NXIVM in Metroland includes the previously mentioned article, as well as a small blurb in the 2007 Year in Review issue, and a feature by Hardin titled "Stress in the Family" published in August 2006 that included information from previous members of NXIVM/ESP. Hardin also made blog posts about NXIVM and the inaugural event of the World Ethical Foundations Consortium, conceptually founded by Raniere, featuring the Dalai Lama.

Metroland has not sought legal counsel in response to the lawsuit.

"We have access to legal counsel, but as far as we're concerned right now, it's almost as if there's not a lawsuit because it has not been served to us," Leon said. "They may never serve the lawsuit for all we know."

In an e-mail, Nancy Salzman, the president of NXIVM, stated: "Nxivm filed this suit . . . because of statutory considerations. We have not yet served Metroland or the other parties because it is always our position to attempt a more amicable resolution of differences and damages. We believe Metroland will engage in a meaningful dialogue with us relating to these issues."

Leon said that Metroland's coverage of NXIVM in Metroland has been fair and accurate, and that the lawsuit should not have any effect on future coverage of NXIVM.

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