Luxury giant Saks Global has filed a lawsuit against Puck News, alleging that the publication did not disclose a reporter’s “conflict of interest” while publishing a series of damaging articles that purportedly cost the company hundreds of millions.
The owners of Saks Fifth Avenue and Neiman Marcus maintain that Puck News columnist William D. Cohan, who wrote the book “House of Cards” about the 2008 financial crisis, created narratives this year suggesting that Saks might file for bankruptcy, which they claim was false.
Interestingly, there’s background here. Cohan has previously mentioned that he was “fired” from a financial firm associated with Saks Global’s primary investor. This revelation, somehow, wasn’t included in the lawsuit’s claims.
The “individuals” in question were founders of Saks Global’s main investor, Rhone Capital, and Cohan’s tenure at Lazard, a New York investment bank, seems to have left a “deeply negative” impression on him.
In a past interview with the Wall Street Journal, Cohan described Lazard as housing “incredibly bright and ambitious people,” yet he also noted the ruthlessness required to succeed there.
The lawsuit calls out Puck’s decision to let Cohan report on Saks Global without addressing his conflicts of interest, labeling it a clear breach of journalistic standards. They argue that this conflict arose multiple times in Cohan’s reporting.
A spokesperson for Puck responded to the claims.
While the lawsuit doesn’t specify exact monetary damages, it indicates that Puck’s reporting led to “hundreds of millions of dollars” lost for the retailer. Saks believes it deserves punitive damages as Puck acted with “actual malice” and refused to correct many of its misstatements.
Throughout this year, around 130 articles have been published about Saks Global, which notably acquired Neiman Marcus last year in a deal worth $2.8 billion, making it the largest luxury retailer in the world.
According to the lawsuit, Puck’s articles were filled with “hit pieces” and falsehoods designed to mislead the public, claiming that Saks miscommunicated information about bonds related to the acquisition.
Specific allegations include Puck declaring that Saks was postponing bonuses for certain executives, stating that its bonds were “trading like s–t,” and predicting that bankruptcy for Saks Global was “inevitable.”
Saks has sought corrections and retractions, but only one minor correction occurred regarding the rating of Saks Global’s bonds—initially reported as CCC+ by S&P but later confirmed as B.
Notably, Puck has portrayed Cohan as “the foremost expert on Saks’ debt situation,” which adds another layer to the supposed bias in their reporting. According to the lawsuit, this was likely an attempt to boost subscriptions to Puck’s Dry Powder newsletter.
The cumulative impact has been severe, with the perception of Saks’ value distorted among lenders and partners, leading to uncertainties regarding job security among employees.
This year, Saks Global cut about 750 jobs amid the merger with Neiman Marcus, followed by an additional 90 layoffs in August as the luxury sector faces significant challenges amid rising prices and economic instability.
The lawsuit points out that this isn’t the first instance where Puck and Cohan’s conflicts of interest have been highlighted. For instance, Cohan was noted in a media article as having ties to Warner Bros. Discovery, which he acknowledged but claimed he disclosed to his superiors.
Cohan stated he would follow through with disclosing such ties as requested, indicating a level of awareness surrounding the potential for conflicts in his reporting.
