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‘Does the Next Case Spell Doom for Fox News?’: Answering the Biggest Questions About the Settlement

Well, technically it didn’t admit that. Photo: Chip Somodevilla/Getty Images

The media trial of the century came and went faster than Rupert Murdoch’s latest engagement. Most court cases settle, so the last-minute settlement between Dominion Voting Systems and Fox News — resulting in a massive $787.5 million payout to Dominion from the network and its parent company — was not exactly unfathomable, but the result was clearly a disappointment for observers who hoped that a weeks-long trial would further expose and embarrass the network’s top brass and on-air personalities.

Instead, Dominion walked away with a huge chunk of cash while Fox issued a literally laughable statement claiming that the settlement reflected the network’s “continued commitment to the highest journalistic standards.” No retraction, no apology, no remorse.

In the wake of the settlement, the media has been engaged in the usual postmortem analysis, which seems already to have blurred into some wishful thinking. Here are three of the more dubious themes to have emerged — and some corrective analysis.

Was the trial going to be a bloodbath for Fox? 
There is no question that Fox was in a terrible position headed into this trial and that it had been on track to lose the case for months, but every big court case is its own unique drama — filled with all sorts of unexpected twists and turns and unanticipated wrinkles. Clearly we have all been deprived of weeks of entertaining testimony from Fox’s biggest names, but it is unwise to assume the trial would have unfolded in exactly the way that Dominion presented it in court filings: as a clean and unambiguous story of deliberate companywide malfeasance.

It is one thing to file court papers in which you selectively excerpt documents and deposition transcripts and another thing entirely to try a case with live witnesses, who can push back and contest your characterization of their words. (Does anyone seriously think that Tucker Carlson was simply going to fall apart on the witness stand?) Fox obviously wanted to avoid this spectacle, but Dominion’s decision to settle the case reflects a standard and legitimate concern over unpredictable litigation risk.

In fact, if you read Dominion’s papers closely, you could detect some holes in the overarching narrative that the company had advanced. The company claimed that it had been “continually” defamed over “a months-long timeframe,” but in fact, pretty much the whole case was about a series of segments spread out over a single month that were relegated largely to the shows of Lou Dobbs, Maria Bartiromo, and Jeanine Pirro. To the extent that there was any sort of singular corporate mandate, it appears to have been to adopt something of a high-low editorial strategy — one in which Fox’s primetime hosts were essentially free to steer clear of the most brazen lies while others were free to indulge the Trumpiest fringe of the network’s audience.

To be clear, as a legal matter, this would not have absolved the network of liability for the allegedly defamatory segments. As an editorial matter, it is also far from laudable and is in fact grotesque in its own way. But if we had had the benefit of live testimony, my guess is that we would have been in store for a more factually subtle and perhaps more interesting story than the one Dominion’s lawyers had primed the public to hear.

Does the next case — the suit brought by Smartmatic — spell doom for Fox?
Shortly after news of the settlement broke, the media’s coverage began to focus on the other major lawsuit that Fox faces from a voting-technology company — this one from Smartmatic, which is seeking $2.7 billion from the network and other defendants. The not-so-subtle implication in much of the coverage has been that the Smartmatic case might manage to achieve what Dominion’s was supposed to — an existential knockout for the dominant conservative-media outlet — but in fact, the settlement with Dominion suggests that Fox’s legal team may finally have a litigation exit strategy.

When major companies face multiple credible lawsuits over similar alleged misconduct, the lawyers are keenly aware that they need to manage the whole portfolio of exposure with a view toward eventually settling most if not all of the claims. The first settlement is a particularly important benchmark in this regard because it sets what is effectively a rough market rate for the value of the claims at issue and can serve as a template for resolving the outstanding lawsuits.

As a result, it is very likely that Fox’s lawyers had already priced out the cost of a potential settlement with Smartmatic using whatever methodology was used to structure the Dominion settlement. Of course, we do not know how exactly the parties ultimately came to their nearly $800 million figure — whether, for instance, it had to do with some combination of the number of segments at issue, the number of allegedly defamatory statements in those segments, the number of total viewers, or a comparison between the pre- and post-election financial performance of Dominion using some sort of agreed-upon financial metrics. This is not to say that Fox needed a precise formula — just some rough set of principles and guidelines that could also be used to settle the Smartmatic case on financially acceptable terms. (Much of the coverage has focused on the amount of money that Smartmatic is seeking, but the amount of the plaintiff’s topline demand is not going to be the thing that dictates the outcome for either side.)

Of course, Smartmatic is under no obligation to settle its case. For now, the company’s lawyers are doing what they should be doing and claiming that they will destroy Fox in litigation. Dominion was doing the same thing until Tuesday afternoon.

Was this settlement a loss for democracy? 
In the wake of the settlement, the media was forced to grapple with the result on the terms in which many outlets had framed the case — as some sort of larger referendum on the cost of election lies or Fox’s evident disdain for the democratic process. For some observers, or at least Dominion’s lawyers, the large amount of the payout was all they needed to know, but others lamented the fact that Dominion chose to forgo a trial without so much as an apology or retraction, much less an extended public airing of the underlying facts. This was supposed to be Fox’s dramatic comeuppance, and then it was just … not.

In hindsight, at least, it seems clear that Dominion’s case got far too intertwined with the post-2020 lexicon of democratic salvation and election integrity than it should have been. Dominion was very smart in advancing and exploiting this theme both in court and in the press, but at the end of the day, this was a company advancing a legal claim against another large company. It got nothing but money from Fox and appears to have been very happy to take it, because that is generally what companies try to do both in business and in litigation — maximize their own profits. It was unrealistic to have expected anything else.

Trite as it may seem, the actual business of American democracy resides with the American people. At the end of the day, an election-technology company is still just a company.

Answering the 3 Biggest Questions About the Fox Settlement