Good evening, I’m Dylan Byers. Welcome back to In The Room, my biweekly private email on the inner workings of the American media industry. Tonight, my colleague Eriq Gardner and I parse the legal nuances of the Dominion v. Fox News case, as well as the public relations scandal that is likely to plague the Murdochs if and when this all goes to trial.

• I've learned that Fox Corp. is currently searching for a new government affairs chief to replace Danny O’Brien, who is leaving the company for a new role elsewhere. The government affairs chief handles all legislative, regulatory and strategic policy matters for Fox. The position comes with a multi-million dollar salary, as well as the heavy responsibility of navigating Fox through this tumultuous moment in the company’s history. But, hey, that's what the money’s for.
• I’ve also learned that Dominion misconstrued the infamous “It’s not red or blue, it’s green” quote that has been widely attributed to Rupert Murdoch in the press as evidence of his willingness to tolerate voter fraud claims—in this case, by My Pillow C.E.O. Mike Lindell—in the interest of profit. In fact, that quote came not from Murdoch but from a Dominion lawyer, and only tangentially pertained to Lindell, none of which is made clear in Dominion’s filing. What actually happened, I’m told, is that during a line of questioning, Murdoch said his company does not screen its advertisers’ political affiliations. “It’s not red or blue, it’s green?” the Dominion lawyer asked. “Correct,” Murdoch replied.

Many of these issues will play out in the court of public opinion, irrespective of what happens in Delaware. But before we get to that, there are the pressing legal questions: Is Fox actually liable for defamation against Dominion? And, if so, what damages are Dominion entitled to? You’ve written quite insightfully about the nuances here. I wonder if Rupert’s testimony has changed or advanced your thinking on any of that?

Eriq: The latest batch of court papers hasn’t changed my thinking whatsoever about what’s likely to happen in this case. Well, except for maybe one thing, which I’ll get to in a second.

As I see it, the judge is likely to throw the issue of liability to a Delaware jury. Fox’s big problem is that it’s fighting an avalanche here. Fox might be able to convince the judge that some of what was broadcast was opinion, or at least not really assertions of fact that exposed Dominion to injury, but that argument isn’t going to cover everything. For example, on one of Lou Dobbs’s shows a couple weeks after the 2020 election, Rudy Giuliani said that Dominion was owned by Smartmatic, and was formed by three Venezuelans close to Hugo Chavez in order to “fix elections.” That was bullshit, of course—but Dobbs replied this was “stunning,” and that it was difficult to get a handle on who owned Dominion and how they were being operated. Of course, Fox News is arguing that this doesn’t add up to actual malice, because Dobbs didn’t know what Giuliani was going to say; and this is where Rupert Murdoch’s deposition comments come into play. Murdoch said that hosts like Dobbs were “endorsing” Trump’s election lies. I’d be shocked if the judge, considering this, decided that a jury shouldn’t make the ultimate determination. Then again, Dominion has its own trial problems. I find the $1.6 billion damages estimate to be shaky, based on what I see, but that’s a whole other story.

Anyway, none of this really surprised me. Where my thinking has evolved is around whether this case gets to trial or ends up in settlement. There are many factors, I initially thought, favoring settlement, including Murdoch and Fox wishing to avoid the embarrassment of having their dirty laundry aired. But clearly they’re willing to let this stuff out, and indeed some of the worst material from the discovery process is already public.

What do you think? When it comes to sensitivities about having a public trial, do you think they care about being discussed in this manner? Or can they just spin that as, “OK, there the mainstream media goes again?”

Dylan: Well, I think the first question is, does Dominion want a settlement—or are they out for more? My sense is that Dominion and its lawyers would relish the opportunity to take this before a jury and expose Fox and the Murdochs to as much indignity as possible, winning themselves their own positive media attention in the process. On the other hand, I agree with your assessment that their $1.6 billion damages estimate is probably too high. So, if the Murdochs offer Dominion a significantly higher settlement than anything they’re likely to win in court, I suppose they might take it.

Now, as for the Murdochs’ priorities, I think they want this to go away as fast as possible, and by whatever means necessary. No company benefits from having its executives and employees deposed, and their texts and emails exposed, especially when the company’s success is built in large part on the reputation of its on-air talent. Every additional revelation implicating a Tucker Carlson or a Sean Hannity chips away at their credibility with viewers. And no, I’m not naïve: I understand that there’s a broad swath of the Fox News audience that will dismiss all of this as some liberal conspiracy, or simply won’t care. Still, I have to imagine that even the most die-hard Fox News fans have a low tolerance for hypocrisy. And the longer this case is in the headlines, the harder that hypocrisy is to ignore.

To that point, what else do we have to look forward to? Do you have a sense of what will be included in the next batch of court papers?

Eriq: I think what’s coming next may be even more revelatory and ties right into the issue of Fox’s sensitivities. First of all, there’s still plenty of stuff that’s redacted in the summary judgment briefs, and news organizations are pushing to make that stuff public. So the judge will need to resolve that. Then comes what might be my favorite stage of any litigation—right before trial, when both sides tell the judge what evidence shouldn’t be introduced to a jury because it’s too prejudicial, or it’s inadmissible for whatever reason. What kind of stuff? Perhaps Fox’s financials. Or its internal discussions about its viewership. Maybe settlement offers.

Finally, at some point, the parties are going to have to figure out how to pick this jury. What sort of voir dire questions will be allowed? That’s going to be a fascinating process. I have no idea how you find impartial jurors for this one.

By the way, one semi-random prediction: This case causes Fox to move where it is incorporated. Obviously, every corporation loves Delaware, but can Murdochville really tolerate jurisdiction in such a liberal state? Especially with all the shareholder lawsuits that may soon be following this Dominion case? So let me be the first to predict that within the next five years, Fox moves. Where? I’m guessing Nevada, but I’ll save my reasoning for another day.

Eriq: The thing that puzzles me most about this case is how it’s being interpreted from a First Amendment standpoint. About a year ago, The New York Times ran a story that deserves Hall of Fame status on candy colored thinking. It was headlined, “First Amendment Scholars Want to See the Media Lose These Cases.” Since the Dominion summary judgment papers have come out, I’ve seen the same kind of thinking echoed on MSNBC and other media outlets. I’m sorry. I just don’t get it. Yeah, I understand that some believe that what was aired on Fox News is beyond the pale, totally unparalleled, and that a liberal news organization would never experience such trouble—but I don’t think that’s particularly imaginative. If, for instance, Joy Reid invited Christopher Steele onto her show to opine that the Russians had interfered in the 2016 election and stolen it for Trump, would that be actual malice? What picture would be painted by her texts and Slack conversations? So when people say that our libel laws only work if a certain result happens in this Fox News case, I think that’s weak thinking. There are fundamental questions that will surely come up for others in the media besides Fox News some day.

Let me also say that Fox News isn’t being particularly clear-eyed about some of this stuff, either. From my discussions with folks there—including some people involved in this case—there seems to be this conception that whatever happens at trial will be reversed on appeal. That the conservative Supreme Court is going to swoop in and save them. I highly doubt that. As we know, Clarence Thomas and Neil Gorsuch want to reassess the actual malice standard. You’re telling me they’re now going to turn around and make it tougher for libel plaintiffs? I find that inconceivable. In fact, I’d much sooner bet on CNN offering up an amicus brief in support of Fox News than Murdoch finding some high court salvation here.

What are you looking forward to most in this case?

Dylan: Well, as a media reporter, I suppose I’m most interested in what else this unearths about the Fox business and the internal dynamics among executives, producers and talent. And I am especially fascinated by what we learn about Rupert. He is, of course, a sort of historic, Shakespearean figure in my world. I’m eager to see how he navigates this scandal and how he balances his regard for his own legacy and reputation with the more immediate interests of Fox News and its talent.

I do believe, as I noted earlier this week, that Rupert is thinking as much about his own legacy as anything else. And as much as he appears to be acknowledging Fox News’s hypocrisy, and perhaps his own, I also think that one of the reasons he’s being so candid is because he sees an opportunity to distance himself from the Trump circus. Remember, Murdoch detested Trump from the beginning, publicly opposed his 2016 candidacy, and privately mocked him as “a fucking idiot.” And sure, he was ultimately willing to tolerate the Trump show for the sake of profit, as evidenced by the testimony. (To be fair, large swaths of left-leaning media also found plenty of ways to profit off the Trump years.) But I don’t think those initial feelings about Trump ever went away. And now that the dirty laundry is out there, I think he sees this as an opportunity to cast himself as a callous and cynical businessman, rather than a mere Trump shill—even if the available evidence suggests that he was, ultimately, both.