Newsmax Media Inc. lost its bid to end defamation litigation brought by Smartmatic USA Corp., which develops vote-counting technology, over the conservative news network’s role in spreading false conspiracy theories about the 2020 election.
Judge Eric M. Davis let the case move forward in Delaware, where he’s presiding over several lawsuits by Smartmatic and Dominion Voting Systems Inc. claiming Newsmax and Fox News pushed the false narrative that Joe Biden’s election victory over Donald Trump was the result of vote flipping.
The judge previously let Dominion advance with similar suits against Fox and its parent company, which seek $1.6 billion in damages, and Newsmax. Smartmatic claims the value of its business fell from $3 billion to $1 billion after the “disinformation campaign.” It has also sued Fox in New York.
Davis, writing Feb. 3, said it’s plausible Newsmax aired and endorsed “allegations so inherently improbable that only a reckless person would have put them in circulation,” such as claims that Smartmatic had close ties to Venezuelan President Hugo Chavez and other dictators.
“Newsmax either knew its statements regarding Smartmatic’s role in the election fraud narrative were false, or at least it had a high degree of awareness that they were probably false,” he wrote in a 34-page ruling for Delaware’s Superior Court.
The allegations, if true, show Newsmax failed to issue a retraction after receiving a demand letter from Smartmatic that fact-checked its reports, the judge found. He cited other allegations indicating the network ignored a wide range of credible sources contradicting the stolen election claims.
Davis rejected Newsmax’s effort to invoke the neutral reporting privilege, which can shield a media organization’s reports about existing controversies of public importance, even if they have the effect of spreading false claims.
“It is reasonably conceivable Newsmax’s reporting was not neutral or dispassionate,” but premised on the foregone “conclusion that the election was stolen,” he wrote.
The judge did hand the network a win on one issue: He found that Smartmatic is a “limited purpose public figure” under the heightened “actual malice” framework for defamation claims. The standard requires showing Newsmax knew the conspiracy theories were false or made no effort to verify them.
Even under that framework, Smartmatic has presented a plausible case, Davis said. He also expressed misgivings about the decision, echoing concerns he voiced in a similar ruling the previous week involving Dominion’s claims against Fox.
“The test seems overly broad,” given “the prevalence of electronic reporting (television, radio, internet, podcasts, social media),” the judge wrote. But the precedent is legally binding, he said.
Smartmatic is represented by Benesch, Friedlander, Coplan & Aronoff LLP. Newsmax is represented by Duane Morris LLP and Todd & Weld LLP.
The case is Smartmatic USA Corp. v. Newsmax Media Inc., Del. Super. Ct., No. N21C-11-028, 2/3/23.
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