"Dominion set the baseline": Experts say Fox News may have to pay a lot more in next defamation suit

Fox News reached a settlement with Dominion Voting Systems on Tuesday, averting a trial that would have exposed how the right-wing network promoted false claims about the 2020 presidential election.

Dominion says Fox has agreed to pay $787.5 million in the largest publicly known defamation settlement in US history involving a media company.

The trial was delayed for nearly two and a half hours on Tuesday as attorneys for both parties engaged in last-minute negotiations. Finally, the deal was announced after the jury had been sworn in at the Delaware Superior Court.

"The case has been resolved and it's been resolved because of you," Judge Eric Davis told the jury before dismissing them.

Dominion had sued Fox for $1.6 billion for damaging its reputation by airing baseless conspiracy theories that claimed its equipment switched votes from former President Donald Trump to Joe Biden.

The judge even established in an earlier ruling that it was "CRYSTAL clear" that none of the allegations about Dominion aired on Fox by Trump allies were true.

But Fox continued to defend itself, saying they were reporting on notable allegations protected by the First Amendment.

"I think Fox settled the case to avoid additional adverse publicity at trial, and the possibility of an even greater payout in the form of punitive damages that could have been awarded by [the] jury," said former U.S. Attorney Barb McQuade, a law professor at the University of Michigan and an MSNBC contributor. "Settlements often come late in hopes that the other side will blink."

Fox settled to avoid "the embarrassment" that resulted from "the mountain of evidence" that Fox and its hosts knew they were promoting lies or recklessly ignored the truth, said John Kaley, former assistant US attorney from the Southern District of New York.

"The picture of Rupert Murdoch and program hosts being cross-examined and confronted with what they said on air juxtaposed by what they said in texts and emails among themselves would have been devastating to Fox, to the hosts and to the Fox brand," Kaley said. "It would have been a cross examiner's delight."

The last-minute agreement between the two parties means that Fox News personalities like Maria Bartiromo, Tucker Carlson, Lou Dobbs, Jeanine Pirro and Sean Hannity won't have to be potential witnesses in the most high-profile media trial of the decade.

"This settlement reflects Fox's continued commitment to the highest journalistic standards," Fox said in a statement Tuesday. "We are hopeful that our decision to resolve this dispute with Dominion amicably, instead of the acrimony of a divisive trial, allows the country to move forward from these issues."

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Fox News and Fox Corporation maintain they never defamed Dominion, and say the case was a meritless assault on First Amendment press freedoms.

Though the case won't be proceeding to trial, Fox has incurred reputational damage for airing falsehoods about voter fraud in their 2020 election coverage. 

"The information disclosed during discovery regarding Fox's decisions to air false claims to help ratings should affect their reputation for credibility, but the statement Fox issued with the settlement does not indicate any remorse, so it may be that Fox is simply calculating that this settlement is a cost of doing business, and it will continue conducting itself just the same way it did before undeterred," McQuade said.

Fox is facing another defamation case from voting technology company Smartmatic seeking $2.7 billion over the network's coverage of TrumpWorld's false claims about the 2020 election. 

Smartmatic said in its complaint that Fox aired "over 100 false statements and implications" about the company. A day after the suit was filed, Fox canceled the show of Lou Dobbs, who was named as a defendant in the suit. 

While that case is still in the discovery process, Smartmatic will have to prove how Fox's coverage of the voting company damaged its reputation. 

"But the amount paid to Dominion sets a baseline that will allow Smartmatic to demand a commensurate amount to settle the case," McQuade said.

Kaley added that Fox's settlement with Dominion signals that they "may not have the stomach for the fight" and is instead willing to pay "a king's ransom to avoid more public humiliation."