On the eve of the trial, Newsmax and Smartmatic resolve their 2020 election defamation dispute.
The pro-Trump network Newsmax and the voting technology firm Smartmatic resolved a significant 2020 election defamation lawsuit in an unexpected agreement on Thursday, avoiding a high-stakes trial.
The specifics of the settlement were not disclosed immediately. The deal was announced hours after jury selection commenced in a Wilmington, Delaware, courtroom, with opening arguments slated for Monday. Both parties and the court declared the settlement in the afternoon.
Newsmax was glad to announce the resolution of the Smartmatic lawsuit through a confidential settlement, as stated in their statement.
Smartmatic's attorney, Erik Connolly, echoed this sentiment, saying, "Smartmatic is extremely satisfied with the completion of the Newsmax case".
Connolly added, "Lying to the American public has consequences". "Smartmatic will not rest until those responsible are held accountable."
This highly anticipated trial would have been the inaugural one out of numerous high-profile lawsuits against right-wing media companies to make it to a jury, aiming to establish whether Newsmax had defamed Smartmatic by disseminating false allegations that the company manipulated the 2020 election results against Donald Trump.
Newsmax denied any wrongdoing, asserting their right to protect their coverage through the First Amendment.
Discussions for a settlement had stalled earlier but reemerged intensely on Thursday morning. The legal teams were absent from the courtroom while negotiating privately, a source informed CNN.
A defeat in court could have imposed significant financial obligations on Newsmax, totalling tens of millions of dollars, potentially jeopardizing the small cable network.
Cooper, an attorney for Newsmax, had noted earlier that this was a "bet-your-company" case for Newsmax.
However, as the trial drew near, Smartmatic's position weakened dramatically, heightening the possibility of a settlement.
Smartmatic has claimed that false information broadcast by Newsmax, Fox News, and other Trump allies ruined its reputation and caused the company billions of dollars in losses. However, Smartmatic's legal team reduced the damages claim to approximately $370 million, reducing their demands by almost $1 billion, as per both parties' statements.
This decrease was partially influenced by Delaware Superior Court Judge Eric Davis, who ruled on Monday that Smartmatic could only seek compensation for verifiable losses, excluding the opportunity for additional "punitive damages" that might result in a substantial damages award.
Smartmatic also abandoned its pursuit of damages for potential losses beyond 2023, as it could result in potentially damaging testimony concerning Smartmatic's executives being charged this year in an unrelated Philippines bribery scandal (Smartmatic denies any criminal involvement).
"Settlements are a common outcome in civil lawsuits, particularly as the trial proceedings approach," stated Eric Robinson, a media law expert instructing at the University of South Carolina. "This is also typical of defamation cases such as this one. It usually makes sense to settle instead of incurring the expenses of a trial and possible appeals."
The settlement marks the latest in a series of 2020 election defamation cases that have reached an out-of-court agreement before trial. Notably, Fox News settled with Dominion Voting Systems last year for $787 million, and Smartmatic reached a settlement with the far-right channel One America News earlier this year.
Newsmax is still engaged in a separate defamation lawsuit involving similar allegations against Dominion. Newsmax denies all misconduct in that case.
However, the most significant lawsuit still pending against a media outlet for its continuous broadcast of 2020 election lies is Smartmatic's case against Fox News and its parent company, Fox Corporation, set for trial next year.
"We are now looking forward to our court day against Fox and Fox News for their disinformation campaign," Connolly, the Smartmatic lawyer, said in his statement on Thursday.
Fox News maintains that they were reporting "extremely newsworthy events" at the time and did not defame the company.
Newsmax expressed satisfaction with the confidential settlement of the Smartmatic lawsuit, avoiding potential financial obligations that could have impacted their small cable network. Smartmatic's attorney, Erik Connolly, acknowledged the settlement, emphasizing that lying to the public has consequences and they will continue to seek accountability.
