Time Takes a Hit in Indonesia

The Indonesian Supreme Court’s stunning 1 trillion rupiah (US$129 million)

libel award against Time Magazine in favor of ailing 86-year-old former

strongman Suharto contains elements of both justice and injustice. It seems undeniable that Suharto and his six

children looted the country to the tune of billons of US dollars during his

long reign, but, according to journalists investigating the same story at the

time, the newsmagazine didn’t nail it down to the extent that would keep it

from being sued, especially in Indonesia’s notoriously malleable courts.

In Time’s 1999 story, written in the chaotic aftermath of the 1997-1998

Asian financial crisis, and after Suharto had been pushed from power after 32

years of strong-arm rule, it was alleged that he and his children had stashed

as much as US$15 billion overseas, including as much as US$9 billion in a bank

in Austria.

The practical implications of the damage award remain to be worked out. The

magazine’s only legal recourse is to file a request for judicial review, for

which under Indonesian law it would need to produce new evidence, or claim a

procedural dispute, something the Indonesian high court is unlikely to grant.

In any case, Time has no assets in Indonesia, and it is questionable

whether Suharto could put a claim on assets outside the country. It is rare

that libel cases cross international boundaries.

“Time has not received any notification from the court regarding a judgment,

so we are unable to comment at this time," said Michelle Shao, regional

public relations director for Time Asia in Hong Kong.

However, Todung Mulya Lubis, Time’s

lawyer in Jakarta,

told a news conference that “we will use all means available to fight this

ruling. What’s at stake here is not only

Time but also the freedom of the press.”

It was the second major setback this year for a US

news organization in Indonesia.

In June, Richard Ness, an executive with the US

mining giant Newmont, filed suit for US$64 million in damages against the New

York Times after an Indonesian court acquitted Newmont of criminal charges for

polluting a bay in northern Sulawesi. The charges

stemmed largely from a series of stories in the Times alleging that the company

had dumped tons of toxic waste into the bay from a now-defunct gold mine. The

Times said in May that it would “vigorously defend” the libel suit. Prosecutors

had wanted to jail Ness for three years in a

drawn-out case closely watched by foreign investors and environmentalists.

But in both cases, neutral observers have raised questions about the quality

of the reporting. Petty professional jealousies aside, the general feeling

among journalists covering Indonesia when the Time Magazine story ran is that

there was little doubt Suharto, who was driven from office in 1998, might have

stolen a massive amount of money, but Time hadn’t nailed down its facts

completely. Indeed, the lead Time

correspondent spent subsequent months post-publication doing extra research

trying to get the facts that colleagues say should have been in hand before

publication. He ultimately left the magazine and went into public


In the New York Times case, many thought that the Times had allowed its

concerns over the environment to overrule basic facts about Newmont’s


“The (Time) article has damaged the reputation and honor of the grand general

of the Indonesian armed forces and former President of Indonesia," Supreme

Court spokesman Nurhadi told reporters Monday.

“The lower level courts have wrongly applied the law. Therefore their

decisions have been annulled."

Despite the allegations of corruption and the collapse of the regime, the

Suharto family continues to have a strong influence in Indonesia,

particularly among rural dwellers and especially in Java, where his family

remains powerful. He came to power in 1967 when, as an army general, he pushed

aside Sukarno, the country’s first president, following a bloody 1965 counter

coup mounted against communist elements in the government. Hundreds of thousands

of people are believed to have died in indiscriminate purges, mostly against

ethnic Chinese.

By some accounts, the billions of dollars that accrued to the family

represented the same kind of loot that Javanese rulers had accumulated for

centuries, and much of it was dispersed to followers in a traditional fountain

of largesse. But still, until the Asian Financial Crisis, Indonesia

underwent striking economic growth as it was pushed forward by US-trained


But few of even Suharto’s most fervent advocates could stomach the looting

of the country by his children, particularly Tommy, whose serial monopolies

ranged from cars to highways, or his daughter, Tutut, who was accused of a wide

variety of corruption from bus companies to construction work.

A spokesman for the Committee to Protect Journalists in Bangkok said by email that the Asian arm of

the organization had no reaction to the decision. However, The New York-based CPJ, in a

statement to the Reuters news agency, called the ruling "absurd" and

said it threw the reputation of Indonesia's

legal system into question. The ruling "sets an onerous precedent that

could have a chilling effect on journalists investigating corruption in Indonesia,"

CPJ said.

Despite the fact that he and his children were charged with graft after his

fall from power, Suharto has had a long-running series of strokes, real or

politically expedient, and other illnesses whenever the law has come too close.

He escaped prosecution previously when it was ruled that he was too ill to

stand trial. Although he has escaped prosecution repeatedly, the feeling in Jakarta is one of outrage that the massive award flies in

the face of some of the most egregious corruption in Southeast

Asia. In the years of his stewardship of the country, he rewarded

cronies with massive incomes. His sons

and daughters profited massively.

The court, in a decision made on August 30 but not announced until Sept 10,

ordered that Suharto be paid the massive award in immaterial damages and that

an apology be published in Indonesian newspapers as well as in three Time

titles. Suharto originally sought more than US$US27 billion in the defamation


Before the ruling was confirmed, Todung Mulya Lubis, Time’s lawyer, told the

afternoon newspaper Sinar Harapan that, if it was true, "it means they

[the court] have taken a step backward".

"What Time published was based on journalistic ethics. It was fair and

covered both sides. It would be a step backward for the Indonesian press,"

he was quoted as saying.

Unfortunately, if the story itself had been tighter, the defense would be