The Fox-Dominion Settlement Was No Parking Ticket

With Tucker Carlson's firing, we're seeing the large costs, financial and non-financial, that are befalling Fox for its lies.

Dear readers,

I was befuddled last week by some of the disappointed reactions to the $787,500,000 settlement in the Dominion v. Fox lawsuit.

Trust me, nobody wanted to see this case go to trial more than I did — I’m a co-host of a legal affairs podcast and was expecting weeks of sweet, sweet content. But when you’re offered a settlement this enormous, you take it. And I don’t get it when people look at this payout — about half of last year’s total annual Fox Corporation profits — and conclude the network got off easy.

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A lot of the disappointment around this massive settlement is about a lost opportunity for schadenfreude: that there won’t be weeks of courtroom drama, more embarrassing disclosures, and shameless cross examinations of Fox figureheads. But as my Serious Trouble co-host, Ken White, points out, lawsuits are designed to address disputes among litigants, not provide satisfaction to the broad public. Even a dramatic trial in court — which anyway would not have been televised — is “ill-suited to deliver the sort of visceral satisfaction or cultural vindication you may be looking for.” Ken writes:

Lawyers and trials won’t fix what’s wrong with America. At best, they will compensate victims like Dominion for being wronged and deter other wrongdoers. Three quarters of a billion dollars is a lot of compensation and a lot of deterrence.

Of course, it’s important to note that the settlement payment wasn’t the entirety of the consequences Fox faces. The network still faces litigation from Smartmatic, another voting machine company subjected to damaging lies on its air.

And a very important consequence of the Dominion litigation is that it has had collateral effects for Fox, seen most dramatically this week in the severing of the network’s relationship with Tucker Carlson.

Fox has offered no official explanation for the firing, and the “insider” accounts that are all over the news this week differ widely in the explanations of Carlson’s firing. But what nearly all the theories have in common is that they are knock-on consequences of the election lies and the litigation that followed — if Fox had never lied about Dominion Voting Systems, Carlson would likely still be on air at the network. This is true despite the fact that — as Carlson correctly protests — the primary culpability for spreading lies about Dominion lies not with him but with other hosts at Fox and the executives who were supposed to supervise them.

Why does it matter why Carlson was fired? The main thing is that Fox has paid a price that goes beyond the (very large) financial settlement it will pay to Dominion. The network got itself into a position where it needed to fire its most prominent and highest-rated prime-time host, who has the potential to go elsewhere and take a chunk of the network’s audience with him. Getting sued and being a defendant can make you very vulnerable, especially when you really are liable, and not just because some other entity is seeking a remedy for your actions. It forces you to air dirty laundry and can lead to internal conflicts, bad feelings and lost business. That’s what happened here, and it should teach Fox executives a lesson about how damaging it can be to get caught up in litigation with someone who has a strong defamation claim against you.

Here is a not-mutually-exclusive list of factors stemming from the Dominion suit¹ that may have contributed to Carlson’s firing:

• According to the Wall Street Journal, discovery in the Dominion lawsuit revealed messages in which Carlson trashed Fox management — in at least one instance calling a senior Fox executive a “cunt” — which offended the senior managers who eventually fired him. Importantly, we haven’t seen all of Carlson’s messages — some of them were subject to a protective order so they haven’t been disclosed publicly yet, and may never be publicly disclosed at all — but attorneys and senior management at Fox and Dominion have seen them. If Dominion had never sued, Fox likely would never have reviewed these messages.

• According to the New York Times, there was another problem with Carlson’s texts: they contained “highly offensive and crude remarks that went beyond the inflammatory, often racist comments of his prime-time show and anything disclosed in the lead-up to the trial,” and which Fox was concerned would become public in the Dominion litigation or other future litigation.

• The WSJ reports one of the key factors that drove a wedge between Carlson and Fox management was Carlson’s dissatisfaction with the Fox PR department’s handling of the Dominion litigation. He didn’t think they were making sufficiently clear that it was other hosts, like Maria Bartiromo and Jeanine Pirro, who gave the most credulous treatment to election conspiracy theories, while he had even called out Sidney Powell on his show for making accusations without evidence. As Ken noted on this week’s Serious Trouble episode, Fox had good legal reasons not to highlight this fact — that other people at the network saw through Powell makes it worse, not better, that some shows put her on the air — which is a good example of how the Dominion litigation caused Fox’s legal needs to conflict with its business needs.

• Abby Grossberg, a former booking producer for Carlson’s show, is suing the network for gender and religious discrimination that she says she faced while working for Carlson. Many news stories have cited this lawsuit as a factor that may have contributed to the firing. While Grossberg’s suit is not primarily focused on matters related to Dominion, it seems unlikely she would have sued Fox if not for the Dominion litigation. That’s because one of her key grievances is her view that Fox’s attorneys disserved her when they prepared her to be deposed in the Dominion case — her suit says the lawyers encouraged her to give “misleading” answers that she felt led to an unreasonable share of blame for the network’s failures in covering Dominion being placed on her and Maria Bartiromo, whose weekend show she was booking at the time surrounding the 2020 election.

• The NYT says: “Over the past two years, the Murdochs’ patience began to wear thin... Mr. Carlson emerged as an almost unaccountable figure who drew new headaches with conspiracy theory programming that included falsely portraying the Jan. 6, 2021, attack on the Capitol as possibly orchestrated by the federal government.” The article doesn’t say why the Murdochs were impatient with Carlson’s penchant for conspiracy theories, but one obvious reason would be that, after taking such a bath on Dominion, they are increasingly attuned to the risk that a loose cannon like Carlson could expose them to further legal and PR disasters, for example by broadcasting claims that Ray Epps was a Fed. This last possibility is the most hopeful one — it suggests the Murdochs have an eye on preventing future defamatory statements that could produce expensive future judgments or settlements.

All in all, it looks very likely that we can draw a line from Fox broadcasting lies about the election, to the Dominion lawsuit, to Fox deciding to sever its relationship with Carlson — a reflection of how committing torts and getting sued over them can cause all sorts of trouble beyond the need to pay claims.

When people say the Dominion settlement was a “parking ticket,” they mean it’s a cost Fox bore as part of a strategy to keep serving its right-wing fan base exactly what they demanded — including defamatory lies, if the demand was for defamatory lies. In the immediate aftermath of the 2020 election, Fox executives panicked as viewers deserted the network for more right-wing, more conspiratorial competitors like Newsmax and OANN, and the election lies were a core part of the course correction to win the viewer base back. Even if it required an expensive settlement, the theory goes, this strategy worked, and Fox will make the settlement cost back in future profits.

The problem with this theory — aside from the enormous financial cost of the settlement itself — is that Carlson’s firing means the course correction hasn't worked. They’ve had to cut loose their highest-profile star, and they’re already losing viewers to Newsmax again. Wherever Carlson goes may prove a significant viewer draw in the future. And going forward, if Fox wants to avoid further legal liability, the network will need to be more careful about whether the statements it airs are defamatory. Needing to follow an approach like this is a reason to fire an “unaccountable figure” like Carlson and replace him with someone who will closely follow instructions from management. But this will make it difficult to follow the viewer base down rabbit holes in the way the network did in November 2020.

To be clear, I am not claiming the settlement has “fixed” Fox. I think it is likely that the litigation and the settlement will work as a deterrent, but what Fox is likely to be deterred from is actionable defamation: I expect the network to be persistently more careful about whether it’s knowingly or recklessly airing lies that materially damage the reputations of specific living individuals or corporations that might plausibly sue the network and win. Fox has a gross history of doing exactly this — look at their promotion of conspiracy theories about Seth Rich, which included allegations about his living relatives — but I don’t think it’s the main kind of dishonesty that Fox critics are concerned about. There are lots of ways to lie without meeting the legal standard for defamation, and there are even more ways to mislead — much of what people talk about as “dishonesty” in the media isn’t even literally false. The legal system won’t save us from that kind of dishonesty on Fox, nor will it stop Fox from putting a conservative spin on news events or using its influence to try to push public opinion rightward.

And maybe that’s why some observers were disappointed with the settlement — it didn’t produce an end to Fox as a strong political force that pushes in a direction they don’t like. Of course, that’s not something this litigation ever could have done. But even if it only serves to deter the network from future actionable defamation, that will be a positive outcome.

Very seriously,

Josh

1. The only theory of the firing I’ve seen that seems wholly unrelated to Dominion v. Fox comes from Gabriel Sherman in Vanity Fair, who says Rupert Murdoch was put off by religious themes in a speech Carlson gave to the Heritage Foundation last Friday. Sherman also says Murdoch called off his recent engagement because his ex-fiancée, Ann Lesley Smith, had told people Carlson was “a messenger from God,” and that Murdoch was perturbed by an impromptu bible study that Carlson and Smith conducted at a dinner last month. This is all very amusing, but you will forgive me for not buying that this was the primary driver of the firing, because, come on.