Werner Erhard - Disputes

Disputes

On March 3, 1991, CBS News broadcast an episode of the program 60 Minutes titled "Werner Erhard". The program, which CBS later removed from their archives for factual inaccuracies, featured allegations, which were later retracted, of sexual abuse, incest, and physical abuse made by Erhard's daughters and associates. On March 3, 1992, Erhard sued CBS, San Jose Mercury News reporter John Hubner and approximately twenty other defendants for libel, defamation, slander, and invasion of privacy, as well as conspiracy. On May 20, 1992, Erhard filed for dismissal of his own case and sent checks for $100 to each of the defendants, covering their filing fees in the case. Erhard later told Larry King in an interview that he dropped the suit after receiving legal advice telling him that in order to win it, it would not be sufficient to prove that CBS knew the allegations were false, but that he would also need to prove that CBS acted with malice. Erhard stated to King that his family members (as reported in Time Magazine) had since retracted their allegations, which had been made under pressure from CBS, and that accusations of tax evasion aired in the program were "misunderstandings" that were in the process of being resolved.

Erhard's daughters later retracted the allegations they had made against their father. Celeste Erhard, one of the daughters featured in the CBS program, subsequently sued journalist John Hubner and the San Jose Mercury News seeking US$2 million. Celeste Erhard accused the newspaper of having "defrauded her and invaded her privacy". She asserted that she had exaggerated information, had been promised a book deal to be co-authored with Hubner for revenue of $2 million, and stated on the record that the articles and her appearance on CBS television's 60 Minutes were to get publicity for the book. Celeste Erhard did not dispute the accuracy of the quotes in the newspaper. The case was dismissed in August 1993, the judge ruling that the statute of limitation had expired and that Celeste Erhard "had suffered no monetary damages or physical harm and that she failed to present legal evidence that Hubner had deliberately misled her."

The video of the CBS 60 Minutes program was subsequently withdrawn from the market. Suzanne Snider in The Believer, May 2003, reported that it "was filled with so many factual discrepancies that the transcript was made unavailable with this disclaimer: 'This segment has been deleted at the request of CBS News for legal or copyright reasons.'"

In 1992 a court ruled that "The Forum" had not caused any “mental injuries” to Stephanie Ney. The court entered a default judgment of $380,000 against Werner Erhard – in absentia because Erhard had not personally received the notice to appear and was not present.

In 1993, Erhard filed a wrongful disclosure lawsuit against the IRS, asserting that IRS agents had incorrectly and illegally revealed to the media details of information from his tax returns. In the first half of April 1991, IRS spokesmen were widely quoted, alleging that "Erhard owed millions of dollars in back taxes, that he was transferring assets out of the country, and that the agency was suing Erhard", branding Erhard a "tax cheat". On April 15, the IRS was reported to have placed a lien of $6.7 million on personal property belonging to Erhard. In his wrongful disclosure lawsuit against the IRS Erhard stated that he had never refused to pay taxes that were lawfully due. and in September 1996 he won the suit. The IRS settled the lawsuit with Erhard, paying him $200,000 in damages. The IRS officials admitted that media reports quoting them on Erhard's tax liabilities had been false; however, they took no action to have the media correct these statements.

A private investigator quoted in the Los Angeles Times stated that by October 1989, Scientology had collected five filing cabinets worth of materials about Erhard, many from ex-members of est who had joined Scientology, and that Scientology was clearly in the process of organizing a "media blitz" aimed at discrediting Erhard. According to Harry Rosenberg, Erhard's brother, "Werner made some very, very powerful enemies. They really got him."