Fox Disputes Possible Damages as Judge Delays Defamation Trial

Fox News has denied the potential damages that it could be forced to pay in a defamation case over the spreading of misinformation following the 2020 Presidential election. The judge also pushed the start date of the case back by one day.

Fox's claim about possible damages and the postponement in the trial were the most recent twists to the case. The proceedings will continue on Tuesday, said Judge Eric M. Davis late Sunday. He didn't give a specific reason either then or during his brief remarks on the bench shortly after 9 am on Monday.

"This is not unusual for me," said Judge Davis, explaining that it was rare that he participated in a trial without some sort of delay. "I will continue the matter until tomorrow."

In a case where the damages are so significant, it is not unusual for both sides to try and settle at the last minute.

Three people involved directly in the case, however, said that they didn't expect the parties settle. On Monday morning, lawyers for Dominion Voting Systems who brought the lawsuit against Fox filed requests at the court, indicating that they expect the case to be tried on Tuesday.

Dominion Voting Systems: What You Need to Know

What is Dominion? The company has become one of the biggest providers of election technology for the United States, selling, licensing and supporting products like its ImageCast voting machines and Democracy Suite software. Dominion provided services to 28 states during the 2020 elections, including several swing states and Puerto Rico.

How did Dominion start? John Poulos, Dominion's CEO, founded the company in his Toronto basement back in 2003. In 2009, the company won its first American contract by providing voting technology to New York counties. It moved its headquarters the following year to Denver where it has now several hundred employees.

Who is the owner of Dominion Corporation? Staple Street Capital is a New York-based private equity firm that owns the majority of Dominion. Fox stated in a legal document that Staple Street Capital paid $38,3 million to Dominion in 2018 for 76.2 percent. According to Fox, at the time the private equity firm valued Dominion's technology vendor at around $80 million. Poulos holds a roughly 12 percent stake.

Why is Dominion filing a lawsuit against Fox? Dominion claims that Fox broadcasted lies following the 2020 elections, which "deeply damaged " its "once thriving" business. "One of the fastest growing technology companies in North America", with a possible value of over $1 billion. Fox said that the $1.6 billion sought by Dominion was "a staggering number that lacks any factual basis."

Dominion set a financial penalty of $1.6 billion in this case. Fox challenged Dominion's value, pointing out a recent court filing in which Dominion reduced part of its damages request.

A Fox spokesperson said that "Fox made it clear that Dominion’s damages were wildly overstated".

Damages are left to the jury's discretion and can be much higher.

A Dominion spokesperson disputed Fox’s description of the court filing. She said that the damages claim was still valid. "As Fox knows well, our damages exceed $1.65 billion."

It's not only a monetary issue that has prevented a settlement from being reached. Fox, the most successful media company, would be required to apologize to Dominion if Dominion accepted the terms.

Fox News would suffer a major reputational blow if it were to do so. The network has continued to broadcast programs that cast doubt on Trump supporters' guilt in the Jan. 6, 2020 riots.

Both sides are motivated to come up with a solution. Fox might want to avoid an embarrassing trial where damaging or embarrassing details about its business could be revealed. Dominion might want to get some money and avoid the years of appeals it would have to fight if they won the jury trial.

This case opened a window that was never before seen into the inner workings and decisions of the nation's most prominent conservative news network. Fox provided tens and thousands of text messages and emails exchanged between its hosts, producers, and executives in the lead-up to trial. Many of the emails and text messages revealed widespread doubt within the network about former President Donald J. Trump’s false claim that he was cheated out of his victory.

Legal and media analysts have closely followed the case, which is regarded as a landmark test for First Amendment protections of the press. Dominion’s voting machines were the subject of pro-Trump conspiracies that falsely linked the company's technologies to a fake plot to switch votes from President Trump to Mr. Biden.

The courtroom was packed with reporters on Monday from all over the world, waiting to learn when they would hear the opening statements of both parties. They also wanted to know the reason behind the delay.

If the case is brought to trial, Fox News hosts such as Tucker Carlson and Sean Hannity, Maria Bartiromo and Rupert Murdoch - whose family controls Fox Media - are expected to appear.

Dominion Voting Systems filed a lawsuit for libel against Fox, a company that specializes in elections technology, in early 2021. The lawsuit claimed that Fox hosts and their guests had repeatedly told lies about the role of Fox in a fictional plot to steal an election, even though they knew the claims were false.

Fox said that it reported on newsworthy allegations regarding a presidential vote and insisted its broadcasts are protected by the First Amendment under the categories of commentary and news.

Fox's legal case has suffered a number setbacks. In pretrial hearings, Judge Davis ruled that the statements about Dominion are false. The jury will only need to decide whether Fox broadcasted them knowingly. The judge set limits on Fox's First Amendment defenses, stating that the statements made were false and that the free speech protections could not be used.

Both parties seemed ready to proceed to trial in emailed messages sent over the weekend.

In the weeks to come, we will show that Fox spread lies and caused enormous damage to Dominion," said a Dominion spokesperson. "We are looking forward to the trial."

A Fox spokesperson said that the network was "steadfast" in its commitment to protecting the freedom of the press. She added that a negative verdict against Dominion or its private equity investors would have grave implications for the journalism profession.