Lachlan Murdoch’s federal court defamation action against Private Media Pty Ltd, publisher of Crikey, was never likely to end well. His decision on Friday morning to discontinue the proceedings was, nonetheless, stunning.
Murdoch is the CEO and executive chairman of Fox Corporation, which operates the Fox News channel. He sued over a 29 June 2022 article by Crikey’s politics editor, Bernard Keane. The article concerned former US president Donald Trump’s false claim that the 2020 presidential election was stolen from him.
Referring to coverage of that claim by Fox, and the parlous state of American democracy, Keane opined that “the Murdochs and their slew of poisonous Fox News commentators are the unindicted co-conspirators of this continuing crisis”. Murdoch identified 14 defamatory imputations that he said arose out of Keane’s article. The central imputation was said to be that Murdoch had “illegally conspired with Donald Trump to overturn the 2020 presidential election result”.
The bringing of the proceedings was surprising enough. At the time Murdoch sued, Fox was already the defendant in multiple suits in the US. The first and most prominent was brought by Dominion Voting Systems, which produces electronic voting machines that were used to process votes in 28 states during the 2020 election. Dominion claimed US$1.6bn in damages, arguing that its business had been damaged by Fox broadcasting false statements by Trump and others to the effect that its machines had caused votes that had been cast for Trump to be counted for the winner of the election, president Joe Biden.
Because of the idiosyncrasies of American defamation law, whether Fox’s executives and presenters knew that those claims were false, and had amplified them for commercial benefit, was centrally in issue. As the pre-trial processes unfolded, a slew of embarrassing internal messages and other documents came to light. Murdoch, his father Rupert, and other Fox executives, were deposed on oath, giving rise to admissions and statements that would have provided fertile ammunition had the Dominion case proceeded to trial. Fox’s competitors were no doubt salivating at the prospect of wall-to-wall coverage of the Dominion trial, including the cross-examination of Rupert and Lachlan Murdoch in addition to Fox’s star presenters, including Sean Hannity, Jeanine Pirro and Tucker Carlson. The case was an ongoing nightmare for Fox and the Murdochs.
That nightmare was entirely foreseeable, even at this distance.
It is one thing to be an unwilling defendant in an action with the potential for embarrassment, reputational damage and financial consequences. No one chooses to be sued. It is quite another, however, while that nightmare is unfolding, to open another front, as a plaintiff, in relation to related subject matter, on the other side of the world, against a minnow of a publisher.
Murdoch’s decision to sue Crikey is even more remarkable when one reflects upon the players. Proprietors of media organisations argue, with real force, that Australia’s defamation laws inhibit freedom of expression and of the press to the detriment of healthy public discourse. Yet in this instance, one such proprietor, with unlimited access to platforms to put his side of the story, exercised his right to seek a remedy under those same laws against a fledgling competitor.
On Wednesday, Dominion and Fox settled their dispute in the US. As with most commercial settlements of litigation, the parties compromised. Fox agreed to pay Dominion $US787.5m (A$1.17bn), about half the amount Dominion had claimed. Fox acknowledged that it had aired falsehoods about Dominion, well short of the admissions Dominion was seeking.
The settlement spared Fox the embarrassment and reputational damage of a trial. It spared Dominion the risk of not reaching the high threshold required to succeed in a defamation action in the US, as well as the likelihood of cascading appeals, whatever the outcome. Considering the stakes for both sides, the fact that they worked to reach and achieved a settlement is not particularly surprising.
Prior to the settlement, however, the Dominion litigation was reverberating on our shores. On 11 April, the Crikey defendants amended their defence to plead reliance on a large volume of admissions and other statements made by Murdoch and others in their depositions in the Dominion case. They also added a defence of contextual truth, signalling that they would seek to prove – relying substantially on revelations from the Dominion case – that Murdoch was morally and ethically culpable for the violent storming of the Capitol on 6 January 2021, because Fox News, under his control and management, had knowingly promoted and peddled Trump’s lies.
It can hardly have come as a shock that developments in the litigation in which Fox was a defendant in the US – developments that were themselves foreseeable – might provide fodder in the case in which Murdoch was a plaintiff in Australia.
The amendments to Crikey’s defence upped the stakes. Instead of the focus being upon whether Keane had crossed the line in describing the Murdochs as the “unindicted co-conspirators” of the crisis in American democracy, the battleground shifted to whether Murdoch was in fact ethically and morally culpable for that crisis.
On Friday, unexpectedly, Murdoch discontinued his action. There was no compromise. He simply dropped the case, almost certainly meaning that he must pay Crikey’s costs of the entire proceeding. The most his solicitor, John Churchill, could say, when announcing the discontinuance, was that while Murdoch remained confident of victory, he did not wish “to further enable Crikey’s use of the court to litigate a case from another jurisdiction that has already been settled and facilitate a marketing campaign designed to attract subscribers and boost their profits”.
The amendments to Crikey’s defence and the settlement of the Dominion case certainly provided cover for that explanation. It leaves unanswered, however, how anyone could have thought it was a good idea to bring the case in the first place.
• Matt Collins KC is a media law barrister and a former president of the Australian Bar Association and the Victorian Bar
