Two top editors for the doomed media startup The Messenger are suing the defunct “centrist” news site’s founder Jimmy Finkelstein for breach of contract over unpaid severance, alleging the media mogul also “attempted to restrict negative coverage of personal friends” on the site.
In a complaint filed in New York County on Monday, former Messenger news director Neil Sloane and ex-Business and Finance Editor Ciro Scotti claim that Finkelstein welched on his vow to pay them hundreds of thousands of dollars of severance if they were terminated without cause. Both editors claim that Finkelstein violated New York labor law by not paying them the severance packages promised by their employment agreements.
This is at least the third lawsuit filed by former employees of The Messenger after the site went belly-up just months after its much-ballyhooed launch last spring. After raising $50 million amid promises of massive traffic and $100 million of annual revenue, Finkelstein shuttered the site in late January after he was unable to convince investors to throw more cash at the project, leaving hundreds of workers suddenly jobless.
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Neither Finkelstein or the editors’ lawyer immediately responded to a request for comment.
While the class action suit on behalf of rank-and-file staffers and the complaint filed by three business-side executives seeking severance pay cited only The Messenger as the defendant, this most recent lawsuit also explicitly names Finkelstein. According to the complaint, Finkelstein was intimately involved in both the editorial process and Sloane’s and Scotti’s day-to-day activities.
The naming of Finkelstein in this lawsuit comes after the former owner of The Hill recently informed ex-Messenger employees by email that a trustee would be taking care of the wind-down of the company, suggesting that it was soon heading into bankruptcy.
According to the complaint, Finkelstein lured Sloane away from his lengthy stay at The New York Post by not only giving him a base salary of $400,000 but also adding a substantial severance package in the event his employment unexpectedly came to an end.
“Should the Company terminate your employment without ‘Cause’ during the first three (3) years of your employment, the Company shall pay you your base salary for a period of nine (9) months, less applicable taxes and withholdings (‘Severance’),” the lawsuit states, citing Sloane’s employment agreement.
Scotti, meanwhile, was paid $325,000 a year and promised two months’ severance pay in the event of a layoff or other termination without cause. Other former Messenger staffers have also revealed that Finkelstein coaxed them to jump ship from their comfortable media jobs with above-average salaries and considerable severance packages.
Both Scotti and Sloane allege that Finkelstein was extremely hands-on with their staffing decisions and the stories published on the site.
“During Sloane's employment, Finkelstein was keenly involved in Sloane's work on nearly a day-to-day basis, emailing or calling Sloane (or instructing Michelle Gotthelf, The Messenger's Deputy Editor, to do so) and directing which stories he wanted covered by The Messenger,” the complaint claims. “Finkelstein was directly involved in hiring and salary decisions for Sloane's news staff (as well as for Sloane himself), and Finkelstein required Sloane to prepare a memorandum for each potential hire, setting forth recommendations for hiring, salaries and benefits.”
The lawsuit adds: “Finkelstein regularly attended meetings with Sloane and other editors and department heads at The Messenger. Finkelstein would begin sending articles from other news outlets to staff at 5:00 a.m. and provide direction and control over which stories were covered by the Messenger. Finkelstein even attempted to restrict negative coverage of personal friends. Finkelstein also contacted Sloane to question or object to editorial content. And, regularly, Finkelstein praised Sloane's work and the ‘traffic’ Sloane generated on The Messenger's website.”
The Daily Beast reported on Finkelstein’s early-morning calls to Gotthelf and other top editors berating them over the tone of the site’s coverage. Additionally, Semafor first noted that Finkelstein implored the editorial team to pull any stories of Donald Trump’s civil fraud trial from the site’s homepage. (Finkelstein considers the former president a close friend.)
Meanwhile, the Washington Post reported that shortly after The Messenger launched last year, Sloane had passed on a “BS” story about an alien spacecraft crash-landing in Las Vegas, only for the site to publish a piece on it hours later.
Scotti also alleges that Finkelstein was “directly involved concerning which stories were covered by The Messenger,” regularly called him and other top editors very early in the morning with story suggestions, and tried to influence the site’s coverage of his own associates.
Both editors also take issue with Finkelstein closing up shop at the end of January and telling employees that there would be “no entitlement to severance benefits under Company policy,” claiming that those “assertions fabricate the existence of a so-called company policy or otherwise is not applicable to the written employment agreement.” In the end, they state, Finkelstein was in a position to meet the company’s obligations to its employees.
“Finkelstein was fully aware of the financial situation at JAF and was in the unique position to close The Messenger while funds were still available to pay the severance packages due and owing to the Plaintiffs, but failed to do so,” the lawsuit states. “Additionally, as owner of, and investor in, JAF, Finkelstein had the ability to continue funding JAF in order to pay the severance owed to Plaintiffs. The decision to close The Messenger was Finkelstein’s to make.”
