WILMINGTON, Delaware, April 18 (Reuters) – Fox Corp ( FOXA.O ) and Fox News on Tuesday settled a defamation lawsuit against Dominion Voting Systems for $787.5 million, avoiding a trial that would have put one of the world’s leading media companies in the crosshairs above it. coverage of false claims of vote fraud in the 2020 US election.
The settlement, which legal experts say is the largest to ever hit an American media company, was announced by both sides and the judge in the case at the 11th hour.
The jury had been selected earlier in the day and the trial was set for opening statements in Wilmington, Delaware. Dominion is seeking $1.6 billion in damages in a lawsuit filed in 2021.
Dominion CEO John Poulos called the settlement “historic.”
“Fox admitted he lied about Dominion causing great harm to my company, our employees and our customers,” Poulos said in a statement.
“True media reporting is essential to our democracy,” Poulos said.
At issue in the lawsuit is whether Fox is liable for airing false claims that Denver-based ballot counting machines were used to manipulate the presidential election in favor of Democrat Joe Biden over former President Donald Trump, a Republican.
Tuesday’s settlement spares Fox the risk of having some of its most prominent people called to the witness stand and subject to possible cross-examination, including executives such as Rupert Murdoch, the 92-year-old chairman of Fox Corp, as well as on-air hosts Tucker Carlson, Sean Hannity and Jeanine Pirro.
Fox anchor Neil Cavuto entered his news show “Your World” around 4:30 pm Eastern Time to report on the trial. A statement by Fox was read on air.
“We are pleased to have reached a settlement in our dispute with Dominion Voting Systems,” the statement said. “We acknowledge the Court’s decisions that found certain claims about Dominion false. This settlement demonstrates FOX’s continued commitment to the highest journalistic standards. We hope that our decision in Resolving this dispute with the Dominion in an amicable manner, rather than the acrimony of a divisive trial, allows the country to move forward from these issues.”
FOX HAS BILLIONS IN CASH
Fox Corp shares closed slightly higher at $34 per share, but fell 1% in after-hours trading after the settlement value was disclosed. Fox has cash to pay in a settlement. It committed $3 billion to buy back shares in the first quarter after earnings beat estimates. Fox Corp. CEO Lachlan Murdoch told Wall Street analysts in February that the company has about $4 billion in cash on hand.
Dominion’s lawyers declined to answer questions about whether Fox News would issue a public apology or make changes.
[1/5] Dominion CEO John Poulos and lawyers spoke to the media after Dominion Voting Systems and Fox settled a defamation lawsuit for $787.5 million, avoiding trial, over Fox’s coverage of the denied claims of election fraud, at the Delaware Superior Court, in Wilmington, Delaware, US April 18, 2023. REUTERS/Eduardo Munoz
Fox News is the most-watched US cable news network.
The $787.5 million settlement is the largest sum of money paid to settle a libel case in the American media, said Richard Tofel, principal of Gallatin Advisory. The previous highest payment occurred in 2017 when Walt Disney Co paid $177 million, in addition to insurance recoveries, to settle a “pink slime” defamation case against its ABC network Beef Products Inc.
Dominion is suing Fox Corp and Fox News, arguing that its business was harmed by false claims of vote fraud aired by the news outlet known for its roster of conservative commentators. The trial was to test whether Fox’s coverage crossed the line between ethical journalism and the pursuit of ratings, as Dominion has argued and Fox has denied. Fox portrayed himself in the pretrial skirmishing as a defender of press freedom.
Delaware Superior Court Judge Eric Davis, who presided over the case, ordered a one-day postponement of the trial on Monday. Fox is continuing settlement talks, two sources familiar with the matter said. Davis delayed the trial Tuesday, as both sides appeared to have cut the deal privately.
The main question for jurors was whether Fox knowingly spread false information or recklessly ignored the truth, the standard of “actual malice” that Dominion must show to prevail on a defamation case.
In February court filings, Dominion cited a trove of internal communications in which Murdoch and other Fox figures privately acknowledged that vote-rigging claims had been made about Dominion on – air lie. Dominion said Fox inflated the false claims to boost its ratings and prevent its viewers from migrating to other right-wing media competitors.
ANOTHER LAW SUIT IS PENDING
Adding to the legal risks for Fox, another US voting technology company, Smartmatic, is pursuing its own defamation suit seeking $2.7 billion in damages in New York state court.
“For many plaintiffs, a court holds, and the defendant’s admission of falsehood, is more important than any actual monetary damages,” said Mary-Rose Papandrea, a law professor at constitution of the University of North Carolina School of Law.
Fox had previously argued that the claims made by Trump and his lawyers about the election were inherently newsworthy and protected by the First Amendment to the US Constitution. Davis ruled in March that Fox could not use the arguments as a defense, finding that its coverage was false, harmful and not protected by the First Amendment.
The lawsuit cites instances where Trump allies including his former lawyers Rudolph Giuliani and Sidney Powell have appeared on Fox News to advance false allegations.
Murdoch internally described the election fraud claims as “absolutely insane” and “damaging” but refused to use his editorial power to suppress them and admitted under oath that some Fox hosts even “endorsed” the baseless claims, Dominion told the court in a filing.
Under questioning from a Dominion attorney, Murdoch testified that he thought everything about the election was “on the up-and-up” and was skeptical of claims of fraud from the beginning, according to the filing. said Dominion.
Asked if he could have intervened to prevent Giuliani from continuing to spread lies on the air, Murdoch replied, “I could. But I didn’t,” the filing said.
Reporting by Helen Coster in Wilmington and Jack Queen in New York; Editing by Will Dunham
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