Dominion did not lose three-quarters of a billion dollars from Fox’s alleged defamation. It’s unlikely they actually lost very much at all; indeed they probably gained considerable credibility and additional business. This was especially so since the judge made findings favorable to Dominion’s professionalism. Had the case gone to verdict, and had Fox lost, the network probably would have been required to pay a relatively small amount of damages — certainly nothing approaching the amount for which they settled.
Moreover there was a substantial chance that Fox could have won this suit, either at trial or on appeal. Dominion had a heavy burden to demonstrate that Fox was guilty of actual malice, that is, a reckless disregard for the truth. The trial judge denied — in my view erroneously — Fox its constitutional right under the 7th Amendment to challenge Dominion’s narrative. He essentially found as a matter of fact that Fox had lied — an issue that should have been left to the jury. Even so, Dominion may not have been able to meet the high standard required to prove actual malice.
Finally, two justices of the Supreme Court have raised questions about the actual malice standard — and this case might very well have made its way to the high court. Once before the justices, virtually any outcome would have been possible.
Accordingly, from a purely rational cost-benefit analysis, this settlement — which gave Dominion an enormous windfall — is incomprehensible. No good lawyer, evaluating the trial and appellate prospects and the lack of actual damages, would have recommended such a settlement. Something else must have been at play — and part of the reason for the settlement is almost certainly to prevent the public from learning the actual reason why Fox settled.
Some infer that, despite the fact that much of its dirty laundry had already been spread out for all to see in the early discovery phase of the case, there was even dirtier laundry that might have been uncovered had the case gone forward and had the special master been allowed to rummage through more emails and other communications. We may never know the real reasons why Fox threw in the towel.
We may also never know the precise impact this settlement may have on freedom of speech. Among the most pernicious forms of censorship is self-censorship, which tends to be invisible. Media companies such as Fox may be chilled by the prospect of further lawsuits. Indeed, other lawsuits are still pending against Fox and other media outlets. They may self-censor out of caution.
It is often forgotten that freedom of speech is a two-sided coin. One side is the right of the speaker, such as Fox, to express controversial and unpopular views. The other side is the right of the viewer and listener to see and hear those views. When the speaker self-censors, the listener is generally not even aware that they have been denied a basic freedom. I know, from personal experience, about several situations where media have censored First Amendment-protected material out of fear of expensive lawsuits. Fox is not the only media outlet that has been sued by Dominion. Others have too, including Newsmax.
I frequently appear as an unpaid guest on Fox and as a paid legal expert on Newsmax. In both instances I speak only for myself and not for the networks, as I also do in this column. I am also suing CNN for having doctored the tape of my appearance before the United States Senate so as to make it appear that I said the opposite of what I actually said. So I am not an unbiased observer with regard to these lawsuits.
With that said, as an advocate of maximum freedom of speech for more than sixty years, I fear for the First Amendment. The one-sided settlement made by Fox may, on balance, have served its interests. It certainly fattened Dominion’s bottom line but it was not good for the First Amendment and for the rights of Americans to hear the diversity of views on important subjects of public interest.
I believe that the 2020 election was essentially fair and produced the right result. Accordingly, I think that Fox presented the views of guests and commentators that were false. Newsmax was different. It reported a diversity of viewpoints, but without embracing allegations that turned out to be false. In my view Newsmax has a stronger case than Fox, both as a matter of facts and law. I don’t know whether Newsmax will litigate. I hope it does and I hope it wins.
It is interesting to note that these cases could not have been brought against internet platforms that are protected from defamation action by a federal statute designed to encourage maximum diversity of viewpoints on the internet. No such protection is accorded to other media companies. Congress is reconsidering the internet exemption and may limit it. And the courts may well rethink media defamation law in general.
So stay tuned. The law of defamation, as constrained by the First Amendment, is very much in play. The Fox settlement may have an impact on how the law develops over time. What that impact may be is anyone’s guess.
