NY judge reinstates Rather fraud claim against CBS

NEW YORK, July 21 Tue Jul 21, 2009 6:23pm EDT

NEW YORK, July 21 (Reuters) - A New York judge reinstated part of former TV news anchor Dan Rather's $70 million lawsuit against CBS on Tuesday, although the ruling could be legally meaningless if an appeals court dismisses the entire case.

New York State Supreme Court Judge Ira Gammerman ruled that Rather could sue CBS Corp (CBS.N) for fraud, relating to Rather's claim that CBS made him a scapegoat in a scandal over a 2004 report on then-President George W. Bush's military record.

Rather claims CBS breached his contract and its fiduciary duty in part by not giving him enough on-air assignments after he was removed as anchor of the "CBS Evening News" in March 2005.

In April, CBS argued before a state appellate court that the entire lawsuit should be thrown out. The appeal is pending and, if the higher court throws out the whole suit, Tuesday's ruling would be rendered legally moot.

In September, Gammerman threw out the fraud claim on grounds that Rather could not prove he had lost any income as a result of the network's actions.

On Tuesday, Gammerman accepted an amended complaint showing Rather's income had been reduced by several million dollars following his departure from CBS.

"This was for us a good day," Rather told reporters outside the courtroom, adding, "There's a long way to go."

CBS said it would appeal Gammerman's ruling.

"Today's rulings by Judge Gammerman were on technical and procedural issues, not on the merits of Mr. Rather's allegations," CBS said in a statement. "We also await the appellate division's decisions on pending motions which, we believe will further curtail his claims."

In its report on Bush, CBS later acknowledged that documents used in the Sept. 8, 2004, report could not be authenticated. The network aired the report two months before the presidential election pitting Bush against Democrat John Kerry.

Rather kept reporting for the CBS weekly news program "60 Minutes" but was dropped by CBS in 2006 after 44 years with the network. He spent 24 years as anchor of its flagship nightly news program.

Rather now produces an hourlong news program, "Dan Rather Reports," for cable channel HDNet, available to viewers with high-definition TV sets. (Reporting by Edith Honan; Editing by Ellen Wulfhorst and Peter Cooney)

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