New York, July 4 - It's the Fourth of July here in the U.S., but something was brewing between IBT Media and Newsweek CEO Dev Pragad. On the eve of Independence Day, July 3, Newsweek published a rare, bombshell headline about itself, "IBT Media Sues Newsweek CEO, Demanding He Return the Magazine." Newsweek reporter Alex Rouhandeh revealed that the ownership of Newsweek assets was being legally challenged and Newsweek published the story on the heels of HNGN breaking the same story, and only after HNGN had contacted a Newsweek reporter for comment. As of press time, Rouhandeh has not responded to requests for comment.
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The IBT Media lawsuit details how Pragad carefully calculated and systematically deceived the owners of IBT Media. In the same lawsuit, it described how the CEO fabricated a carefully crafted public image as the one who 'saved the news,' replete with his fraudulent efforts celebrated as part of a Harvard case study.
"He collected false acclaim and awards and touted his claimed achievements with Newsweek in digital magazines, podcasts, and even a case study at Harvard Business School," the suit says. "And ultimately, Pragad took steps towards betraying his friends and welching on his deal."
The article omits huge portions of the lawsuit that accuses Pragad of fraud, greed, and betrayal and of weaponizing the Newsweek newsroom. Due to Pragad's allegedly repeated violations of law, including "Fraudulent Inducement," -- the lawsuit seeks relief from the court that any transfer of shares to Pragad be declared "void and unenforceable." The lawsuit further seeks relief, asking the court to declare "that IBT holds title to 100% of the membership interest in Newsweek, LLC."
On behalf of Pragad, Newsweek's counsel Robert Weigel of Gibson Dunn & Crutcher LLP, said, "IBT's lawsuit against Newsweek and its CEO Dev Pragad flies in the face of express written agreements. It is a desperate attempt by IBT to avoid its clear obligations and it's wholly without merit." He went on to connect the issue to unrelated issues of inter-company debt and again to Olivet University, which is not a party to the suit.
Although it is expected that Pragad's lawyer will support him, the story itself is written to support Pragad and downplay the suit. Despite substantial and full of never-seen-before revelations about Pragad's dealings and the company's origin, Newsweek did not link to the suit directly, and instead only pointed back to past Newsweek articles that attack Johnathan Davis, the owner of Newsweek, and other entities he has distant relationships with, such as Olivet University and other entities.
As for the substance of the lawsuit, Newsweek appears to have covered it in a manner primarily calculated and aimed at skirting the core allegations contained in the lawsuit.
For instance, Newsweek states that "IBT Media sold its 50% stake in the magazine's publisher to Dev Pragad", though the sale was never consummated in the first place.
Even the opening lines of Newsweek's description take text from the suit, reading that "this case is about the rightful ownership of the famed Newsweek brand," but abruptly ends mid-sentence omitting the crucial characterization that it is also about "Pragad's betrayal and greed."
The article then dives into a robust defense for Pragad and Newsweek, leaning on a statement "supplied" by an unnamed spokesperson at Newsweek itself. This is a common tactic for the company as it attempts to cover itself.
In an April 22 Newsweek article about Olivet, where another or possibly the same -- unnamed company spokesman failed to reach their own CEO, who "did not respond to comments," but was able to declare, "Dev Pragad is not a target of any federal investigation" -- something only Pragad would be able to verify.
On top of favorable spin and omission of facts, Rouhandeh and Newsweek Editor Nancy Cooper failed to check the most basic facts before publishing the story. The article claims that IBT Media received a money-laundering charge years ago, though HNGN has confirmed that is not the case.
This follows a common pattern at Newsweek of making false allegations and influencing sources in an effort to write a story with a pre-determined narrative. As HNGN has reported before, Newsweek has been accused of playing a "certain" role in swaying the New York State Department of Education in the Olivet University case and continues to do so in other cases.
As noted in the lawsuit and by HNGN coverage, this article is one of many in a series of Newsweek articles lashing out against Newsweek's owner, Davis. However, Newsweek's audience seems not to have been pleased with the coverage. Commenters noted that "the article was one of the worst they've seen Newsweek cover," while another mentioned that "Newsweek hasn't been good since the internet." One Newsweek reader sarcastically noted in response to the latest piece: "If you have ever seen any real news on this page, that would be breaking news."
This story was covered by HNGN's contributor writer, Ryan Lee, following the developing story of Newsweek CEO Dev Pragad.
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