CNN management greatly concerned with defamation suit's outcome as trial heats up, insider says

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WATCH LIVE: CNN defamation trial underway after Navy veteran sues network

Navy veteran Zachary Young is accusing the network of defaming him after showing his face on-air while talking about the 'black market' smuggling Afghans out the country for thousands of dollars.

The defamation suit embroiling CNN and worries it could lead to a big payout to the plaintiff are major concerns of network management, all while rank-and-file staffers already grapple with low ratings and pending cuts, insiders say.

CNN is already contending with bottoming-out viewership and reported upcoming layoffs as it prepares to cover the incoming second Trump presidency. 

Now, it's also in a public defamation trial about a 2021 segment that plaintiff Zach Young alleges smeared him by implying he illegally profited when helping people flee Afghanistan on the "black market" during the Biden administration's military withdrawal from the country. 

"It's a big concern of upper management," a CNN insider told Fox News Digital. "All the damning stuff, text messages, etc., has already been published. So I don't think there's concern in terms of exposure. But I think there's definitely concern about the outcome. It seems very likely that CNN is going to have an enormous payout at the end of this."

CNN host Jake Tapper and correspondent Alex Marquardt during the 2021 segment at the center of a defamation lawsuit against the network. (CNN/Screenshot)

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Young argues CNN "destroyed his reputation and business" by branding him an illegal profiteer who exploited "desperate Afghans" during a November 11, 2021, segment that first aired on CNN’s "The Lead with Jake Tapper." 

The discovery process has led to some embarrassing revelations, such as internal communications between CNN employees showing editors were concerned about the initial segment but aired it anyway. Other communications revealed CNN employees used profanities and disparaging language when privately discussing Young. Young also showed a message that he warned CNN correspondent Alex Marquardt, who reported the segment, that he would seek legal damages if he pursued the story.

Yet, since this all concerns a segment from 2021, the CNN insider added it isn't a topic of regular conversation around the network's rank-and-file.

Another CNN insider said the lawsuit is a "big risk" but they said the network's lawyers felt good about the outcome. But they added, because of possible looming layoffs and ongoing ratings woes, there are plenty of other things to be worried about.

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U.S. Navy veteran Zachary Young believes CNN "destroyed his reputation and business" by branding him an illegal profiteer" who exploited "desperate Afghans" during a November 11, 2021, segment that first aired on CNN’s "The Lead with Jake Tapper."?

"I don't know if that pans out. But for some reason it hasn't permeated the org at all," they said. "And that is probably because the org is in toxic shock daily and crisis at its situation, so there are bigger morale fish to fry."

"Ratings, cuts, confusion on strategy, all of the above," they said. "Which isn't unique to CNN but is acute at CNN."

Reached for comment about the suit, a CNN spokesperson said, "When all the facts come to light, we are confident we will have a verdict in our favor."

CNN CEO Mark Thompson, who took over in 2023 after the ousting of CEO Chris Licht, didn't deny to staffers at a town hall this week that layoffs were forthcoming, according to reports.

Puck News reported in November that "hundreds" of CNN employees are expected to be affected by layoffs in the coming months as Thompson aims to implement prioritization into digital. Thompson, who was credited for reviving The New York Times' business model, has already been tinkering with CNN's, rolling out a subscription plan for its news site last year.

A CNN spokesperson pointed to a report showing parent company Warner Bros. Discovery was making an investment of more than $70 million in its digital pivot and called the business "very healthy."

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CNN, along with progressive outlet MSNBC, saw a ratings crash after President-elect Donald Trump's victory. CNN reached another new low in December, finishing the year with its smallest audience in network history in total day, with a paltry 91,000 in the 25-54 age demo and 481,000 in total viewers.

CNN boss Mark Thompson took over the network in 2023. (Sanjit Das/Bloomberg via Getty Images)

The first CNN insider praised Thompson's leadership but said people still remained worried about industry-wide headwinds that have seen layoffs at other major media enterprises over the past year, like the Washington Post, HuffPost TIME, and the Los Angeles Times. 

"I think people still feel right now it's a very uncertain time in the business overall, so I think that there's still a feeling of, 'what's going to happen to CNN,' and that people don't really know about that," they said. 

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Fox News' Joseph A. Wulfsohn and Brian Flood contributed to this report.