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Fox News Moves to Dismiss Smartmatic’s $2.7B Lawsuit: Our Network ‘Did Exactly What the First Amendment Protects’

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Lawyers for the Fox Corporation and Fox News on Monday night filed a motion to dismiss a $2.7 billion lawsuit against the cable news behemoth by Smartmatic, a maker of electronic voting technology. Smartmatic sued Fox News and Lou Dobbs, Maria Bartiromo, and Jeanine Pirro in New York state court for reports and commentaries about the role of Smartmatic machines in the 2020 election cycle. Also named as defendants were Donald Trump’s attorney Rudy Giuliani and Sidney Powell, an attorney who pressed the series of unsuccessful election fraud cases collectively known as the “Kraken.”

“This suit strikes at the heart of the First Amendment,” said Fox News attorney (and former U.S. Solicitor General) Paul Clement of the firm Kirkland & Ellis. “Smartmatic’s theory is fundamentally incompatible with the reality of the modern news network and deeply rooted principles of free speech law.”

The core of the motion to dismiss leans heavily on the First Amendment. Put simply, Fox argues that when the President of the United States and his surrogates publicly allege that an election was rigged, stolen, or otherwise improperly (or at least questionably) conducted, the press has a constitutional right to be able to disseminate and dissect those comments in the public sphere.

“FOX News has moved to dismiss the Smartmatic lawsuit because it is meritless,” Fox said in a statement. “If the First Amendment means anything, it means that Fox cannot be held liable for fairly reporting and commenting on competing allegations in a hotly contested and actively litigated election. We are proud of our election coverage which stands in the highest tradition of American journalism.”

In the court papers, Fox even calls Donald Trump’s attack on the election as “unconventional.” But the network and its corporate parent say their broadcasts fairly reported the assertions made by Trump and his surrogates. The Fox court papers say that Fox News content relied on documents on file with state and federal clerks of court — which are matters of public record that can be reported with impunity.

Additionally, Fox argues that Smartmatic, as a corporate entity, is at least a limited purpose public figure for the purposes of defamation law. Under the relevant case law, including New York Times v. Sullivan and its progeny, reports about “public officials” and “public figures” must be made with “actual malice” in order for a plaintiff to successfully recover damages in a defamation lawsuit. (A recent addition to New York State’s anti-SLAPP law also imposes an “actual malice” standard. The new anti-SLAPP law, signed by Gov. Andrew Cuomo on Nov. 10, 2020, makes it easier for defendants to dismiss defamation claims. SLAPP stands for “Strategic Lawsuit Against Public Participation.”)

To review the legal terms at play, defamation is (1) a false statement of purported fact, (2) of and concerning a plaintiff, (3) that is published or communicated to another person, resulting in (4) damages that can be compensated. A private figure must prove that a defendant’s statements were made with mere negligence in order to successfully recover damages; however, public officials and public figures must prove “actual malice.” That standard tests the defendant’s attitude not towards the plaintiff, but towards the truth. Under New York Times v. Sullivan, if a defendant published defamatory material “with knowledge that it was false or with reckless disregard of whether it was false or not,” then the defendant is in legal trouble.

In its motion to dismiss, Fox, the defendant, argues that Smartmatic is a public figure and has not adequately pleaded “actual malice.” Critically, Fox says that its hosts repeatedly reported that Smartmatic had denied the accusations against it and that Smartmatic refused to further respond to or to participate in Fox’s coverage. Generally speaking, it is difficult for a plaintiff to win an “actual malice” argument when it refused to engage with the journalistic process of uncovering the truth.

“As the story unfolded, and as Smartmatic denied many of those allegations, Fox covered the denials too, including by reporting Smartmatic’s position, offering Smartmatic the opportunity to tell its side, and soliciting the views of disinterested third parties on the veracity of the allegations against Smartmatic, sometimes in a debate-like format,” the  court documents state. “In short, FOX did exactly what the First Amendment protects: It ensured that the public had access to newsmakers and unquestionably newsworthy information that would help foster ‘uninhibited, robust, and wide-open’ debate on rapidly developing events of unparalleled importance.”

More broadly, Fox argues that political speech—such as arguing over an election—is highly protected under the First Amendment.

The Fox motion to dismiss the case was filed on behalf of the Fox Corporation and Fox News Network. The network’s talent will respond separately via their own lawyers with likely similar arguments. Law&Crime has learned that the individual talent will also be represented by Kirkland & Ellis — the same firm which is representing the Fox corporate entities.

“Smartmatic has not identified any statement by FOX itself that could be actionable as defamation,” the motion says. It also argues that Smartmatic “fails to allege that FOX published the challenged statements with actual malice.”

Moreover:

Smartmatic’s effort to saddle FOX with billions of dollars of liability just for covering all sides of a vigorous debate of profound national importance must be dismissed.

[ . . . ]

When a sitting President and his surrogates claim that an election was rigged, the public has a right to know what they are claiming, full stop. When a sitting President and his surrogates bring lawsuits challenging the results of an election, the public has a right to know the substance of their claims and what evidence backs them up, full stop. In that context, interviewing the President’s lawyers is fully protected First Amendment activity, whether those lawyers can substantiate their claims or not. Here, FOX was providing precisely that kind of newsworthy information — typically allowing the President’s surrogates to explain their allegations and evidence themselves.

The motion to dismiss concludes by arguing that Smartmatic’s position is illogical: the voting machine company, per Fox’s lawyers, is trying to convince a judge “that the press must censor all discussion of even the most newsworthy of public controversies to escape imputation of actual malice, even in the context of statements by objectively newsworthy third parties during live television interviews.” That, they argue, is an assault on the First Amendment.

Law&Crime’s coverage of the original Smartmatic filing is here.

Fox’s attorneys spent several paragraphs re-alleging Smartmatic’s ties to Venezuela. Here’s the relevant section of the motion to dismiss, according to Fox (citations omitted):

Smartmatic is an electronic voting-technology company founded by Venezuelan entrepreneurs in Venezuela two decades ago. According to Smartmatic’s 2004 website, “[s]even years ago”—i.e., in 1997—“we were the Research and Development Unit of Panagroup in Venezuela.” According to corporate records, Smartmatic was incorporated in Caracas under the name “Tecnología Smartmatic de Venezuela C.A.” in 1997.

Smartmatic quickly moved from being a small startup to a major player in the election- related technology market—and just as quickly found itself embroiled in the kind of public controversy that comes with the territory. Although “Smartmatic was a little-known firm with no experience in voting technology,” “it was chosen by the Venezuelan authorities to replace the country’s elections machinery ahead of a contentious referendum that confirmed [Hugo] Chávez as president in August 2004.” Opposition parties immediately “question[ed] the results.” Claiming “they could not trust the automated voting system run by Smartmatic,” opposition parties boycotted the 2005 National Assembly elections, enabling Chávez’s supporters to obtain “overwhelming control.” Smartmatic continued to operate in Venezuela for more than a decade. But in 2017, Smartmatic ceased operating there after it discovered that vote manipulation had marred the Constituent Assembly elections.

[ . . . ]

Although Smartmatic continued to operate in several U.S. jurisdictions, it has primarily focused on expanding into other international markets. Reflecting that focus, Smartmatic’s ultimate parent corporations are based in the Netherlands and the United Kingdom.

Read the full motion to dismiss in its entirety below:

Smartmatic v Fox News – Def… by Law&Crime

Editor’s note:  this piece began as a breaking news report and has been updated since its initial publication with additional details from the court papers.

[Photo illustration by Law&Crime]

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Aaron Keller holds a juris doctor degree from the University of New Hampshire School of Law and a broadcast journalism degree from Syracuse University.  He is a former anchor and executive producer for the Law&Crime Network and is now a Senior Editor for the Law&Crime website. DISCLAIMER:  This website is for general informational purposes only.  You should not rely on it for legal advice.  Reading this site or interacting with the author via this site does not create an attorney-client relationship.  This website is not a substitute for the advice of an attorney.  Speak to a competent lawyer in your jurisdiction for legal advice and representation relevant to your situation.