The Volokh Conspiracy
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So held Delaware state court judge Eric Davis yesterday, in US Dominion, Inc. v. Fox News Network, LLC, denying Fox's motion to dismiss. It's a long opinion, but here's an excerpt from the legal analysis:
[1.] The "Neutral Reportage" Defense Does Not Support Dismissal.
Fox invokes the neutral reportage privilege—also characterized as the neutral reportage doctrine. Fox argues that it was free to broadcast, without liability, allegations made against Dominion by the Trump Campaign and its attorneys on a matter of public concern.
The neutral reportage defense bars recovery for defamation when the challenged statements, even if defamatory, are "newsworthy." Under the neutral reportage doctrine, the press need not "suppress newsworthy statements merely because it has serious doubts regarding their truth." Instead, under the doctrine, the press enjoys "immunity from defamation suits where the journalist believes, reasonably and in good faith, that his report accurately conveys the charges made."
The neutral reportage defense was developed by a federal court of appeals; however, the defense seems to run contrary to United States Supreme Court precedent as it seems to create a nearly unqualified privilege. The United States Supreme Court has attempted to strike a balance between First Amendment freedoms and viable claims for defamation. In doing so, the United States Supreme Court has declined to endorse per se protected categories like newsworthiness. Instead, the determination of how much protection should be afforded the media has been left to the states.
One of New York's intermediate appellate courts, the Appellate Division, Fourth Department, recognized the tension between the neutral reportage doctrine and binding First Amendment precedent. In Hogan v. Herald Co., the Appellate Division determined the neutral report doctrine could not be reconciled with binding free speech precedent. As a result, the Appellate Division held the neutral reportage doctrine inapplicable under New York law. The New York Court of Appeals affirmed Hogan. Since then, the New York Court of Appeals has restated its rejection of the neutral reportage doctrine. Given this New York precedent, the Court questions whether Fox can raise neutral reportage doctrine or analogous newsworthiness privilege as an absolute defense to liability for defamation under New York law.
Fox attempts to distinguish Hogan on its facts, arguing Hogan rejected the neutral reportage doctrine in the context of "private figure" plaintiffs. As an initial matter, the parties do not discuss whether Dominion is a public or private figure, making this distinction not relevant at this time. Fox's argument, however, fails even if the neutral reportage defense only had been rejected as to private figure plaintiffs. Just because the neutral reportage privilege may have been denied in the context of private figure plaintiffs does not mean, by inference, the defense is available against public figure plaintiffs. Indeed, New York subjects public figure plaintiffs to the actual malice standard, not to a newsworthiness test. The actual malice standard also is the standard under New York's anti–SLAPP statute (if applicable). Fox's private figure argument, at most, reveals New York law has not spoken directly on the issue. It does not establish a neutral reportage defense as a matter of New York law.
The neutral reportage defense would not warrant dismissal here even if the defense were available. To assert and benefit from this defense, a defendant must show that the defendant accurately and dispassionately reported the newsworthy event. As such, Fox's reporting must have been neutral, not "a personal attack" on Dominion, to succeed on this defense. Dominion's well-pleaded allegations, however, support the reasonable inference that Fox's reporting was not accurate or dispassionate.
The Court, reviewing the Complaint's allegations, notes that it is reasonably conceivable that Fox's reporting was inaccurate. As alleged, Dominion attempted to factually address Fox's election fraud allegations. After Fox began connecting Dominion to election fraud claims, Dominion sent Fox executives and television anchors its "SETTING THE RECORD
STRAIGHT" emails. Dominion's emails, which contained analysis from election and related experts, tended to disprove the election fraud claims. Nevertheless, Fox and its news personnel continued to report Dominion purported connection to the election fraud claims without also reporting on Dominion's emails. When Fox guests spread or reiterated disinformation about Dominion, Fox did not use the information Dominion provided to correct its guests or to reorient its viewers. Instead, Fox and its personnel pressed their view that considerable evidence connected Dominion to an illegal election fraud conspiracy.
In addition, the Court notes that it is reasonably conceivable that Fox was not dispassionate. Given that Fox apparently refused to report contrary evidence, including evidence from the Department of Justice, the Complaint's allegations support the reasonable inference that Fox intended to keep Dominion's side of the story out of the narrative. Moreover, the Complaint alleges numerous instances in which Fox personnel did not merely ask questions and parrot responses but, rather, endorsed or suggested answers. Fox therefore may have failed to report the issue truthfully or dispassionately by skewing questioning and approving responses in a way that fit or promoted a narrative in which Dominion committed election fraud.
The Court is not persuaded by Fox's two counterarguments. First, Fox argues it was not required to "defend" Dominion from Fox's guest by reporting Dominion's refutations. Still, Fox's possession of evidence demonstrating the election fraud claims were untrue supports the reasonable inference that Fox made or published statements knowing they were false or with a reckless disregard for the truth. Fox may not ordinarily have a duty to defend the targets of allegations on which it is reporting; however, Fox must report on those allegations accurately and dispassionately under the neutral reportage defense. Second, Fox argues there are instances in which Fox was critical of the allegations against Dominion and in which Fox reported Dominion's refutations. Fox may end up being right. This is the pleadings stage though and, at this stage, this argument raises factual issues the Court must resolve in Dominion's favor. Fox will have the ability to develop this argument during discovery as the case proceeds.
The neutral reportage defense does not apply when the press "espouses or concurs in the charges made by others or who deliberately distorts these statements to launch a personal attack" on the plaintiff. The Complaint's allegations support the reasonable inference that Fox did both. Accordingly, at the pleadings stage, Dominion's allegations support the reasonable inference that Fox was not engaged in neutral reportage.
[2.] The "Fair Report" Privilege Does Not Support Dismissal.
Fox next asserts the "fair report privilege." New York has codified the fair report privilege in Section 74 of the Civil Rights Law. Section 74 provides that a "civil action cannot be maintained … for the publication of a fair and true report of any judicial proceeding, legislative proceeding or other official proceeding." Thus, for the privilege to apply, a publication must be a "fair and true report" "of" an official proceeding. The Court finds that the Complaint's well-pleaded allegations support the reasonable inference that Fox's reporting (i) was not fair or true and (ii) did not concern an official proceeding.
For the fair report privilege to apply, Fox's report of election fraud litigation and investigation must be "substantially accurate." A report is substantially accurate when "it does not produce a different effect on a reader than would a report containing the precise truth," even if it contains minor inaccuracies. In determining whether a report is substantially accurate, New York courts analyze the publication as a whole, rather than individual statements within the larger publication separately. New York courts consider the publication's "effect upon the average reader" when analyzing the publication as a whole.
By statute, the fair and true report must be "of … proceedings." Under New York law, statutory terms are construed according to their ordinary meaning. In this context, the word "of" most naturally means "about," "relating to," and "in respect to." Given that plain meaning, New York decisions hold that the fair report privilege is not triggered unless the report "comment[s] on a … proceeding." Given that requirement, New York decisions teach that a report cannot be "of" a proceeding unless the subject proceeding has been initiated and is pending or ongoing. Doubt regarding whether the report is "of" a proceeding is resolved against the privilege. Moreover, Section 74 does not shield defamatory statements merely because a party has started judicial proceedings incorporating those statements.
The Court recognizes that most of the alleged statements were made before a lawsuit had been filed (e.g., the Powell allegations). As a result, most of the alleged statements, even if true, were not "of" a judicial proceeding. That alone is enough to preclude the fair report privilege.
Fox counters with decisions that, according to Fox, hold the fair report privilege applies to "anticipated" or "forthcoming" lawsuits as well as pending proceedings. To the extent Fox argues its personnel were referring to pending election fraud cases filed throughout the nation, and investigations initiated by the federal government, the Complaint alleges facts that Fox's personnel did not tailor their comments to the allegations in those proceedings. By consequence, the Court finds there is ambiguity, from the viewer's perspective, as to whether Fox was reporting on those proceedings.
Similarly, Fox's report may not have been substantially accurate. At various times, Fox published statements made by guests who stated their allegations were supported by evidence. The Complaint, however, alleges that none of these sources adduced any evidence for these allegations. Fox and its personnel continued, on television and through social media, to perpetuate the narrative that forthcoming lawsuits would expose Dominion's election fraud. In addition, Fox allegedly mischaracterized those allegations on several occasions (e.g., comments reporting that the lawsuits involved "kickbacks"). At this point in the proceedings, the Complaint alleges that Fox's statements evince a substantial deviation from those proceedings' alleged facts.
In reference to the whole publication's effect on the average viewer, the Complaint supports a reasonable inference that Fox repeatedly misstated election fraud allegations to defame Dominion. Because, at this stage, Fox's statements might not amount to a fair and true report of official proceedings, the Motion is denied to the extent it is based on the fair report privilege.
[3.] The Opinion Defense Does Not Support Dismissal.
Fox's final defense concerns the opinion vs. fact distinction—the opinion defense. Fox argues that any defamatory statements made by its news personnel were pure opinion and, therefore, are not actionable. The opinion defense, however, is fact-based. Accepting Dominion's allegations as true, Fox's statements were not opinions. So factual issues regarding whether a reasonable listener would consider Fox's statements to be opinion or fact preclude dismissal.
"Since falsity is a necessary element of a defamation cause of action and only facts are capable of being proven false, only statements alleging facts can properly be the subject of a defamation action." In contrast, "pure opinions" are not actionable. In New York, the difference is a question of law. To ascertain the difference between a pure opinion and a statement of fact, New York courts have articulated a three-factor test:
(1) whether the specific language in issue has a precise meaning [that] is readily understood; (2) whether the statements are capable of being proven true or false; and (3) whether the full context of the communication in which the statement appears … signal[s to] readers or listeners that what is being read or heard likely to opinion, not fact.
An "opinion" is actionable if a "reasonable listener" would find the speaker conveyed facts about the plaintiff. So "[t[he key inquiry is whether [the] challenged expression, however labeled by defendant, would reasonably appear to state or imply assertions of objective fact."
In making this inquiry, courts cannot stop at literalism. The literal words of challenged statements do not entitle a media defendant to "opinion" immunity or a libel plaintiff to go forward with its action. In determining whether speech is actionable, courts must additionally consider the impression created by the words used as well as the general tenor of the expression, from the point of view of the reasonable person.
Here, the Complaint supports the reasonable inference that Fox was reporting on a fact, i.e., that Dominion aided or caused election fraud. Fox's news personnel repeatedly framed the issue as one of truth-seeking and purported to ground interview questions in judicial proceedings and evidence. Reviewing the Complaint, the Court does not read Fox's statements as mere statements of opinion. That said, a line-by-line assessment of whether each commentator's "opinion" is a provably false statement of fact is unnecessary at this stage. Although it seems Fox was stating facts, not opinions, the presence of a "reasonable listener" requirement cautions against an interpretation at the pleadings stage. It is sufficient, at this stage, to hold that the Complaint states a reasonably conceivable defamation claim based on what a reasonable listener could conclude are false statements of fact and defer the question to a fact finder.
Moreover, the Court finds it reasonably conceivable that Fox's reporting comprised opinion "mixed" with false facts. Under New York law, "mixed opinions" are actionable. Mixed opinions are defined in contrast to pure opinions. A pure opinion is defined, in part, as an expressed viewpoint that does not obscure or imply undisclosed facts. A mixed opinion "implies that it is based on facts which justify the opinion but are unknown to those reading or hearing it." So "[w]hat differentiates an actionable mixed opinion from a privileged, pure opinion is the implication that the speaker knows certain facts, unknown to [the] audience, which support [the speaker's] opinion and are detrimental to the person being discussed." Still, even where the speaker discloses the facts underpinning its opinion, the opinion remains actionable if those facts are "incorrect or incomplete, or if [the speaker's] assessment of them is erroneous." Accordingly, to ascertain the difference between a pure and a mixed opinion, the Court must use the same reasonable listener standard and three-factor test noted above.
For substantially the same reasons discussed above, the Court finds it is reasonably conceivable that Fox and its personnel broadcasted mixed opinions that were based on either false or incomplete facts unknown to the reasonable viewer. Many of Fox's reporters made broad election fraud statements that did not disclose their sources clearly, or clearly connect their statements to the election fraud litigations. Although Fox classifies its reporters' remarks as "commentary" that used "loose and hyperbolic rhetoric" for entertainment value, even loose and hyperbolic language can be actionable if it rests on false statements of fact undisclosed to viewers. Accordingly, the Complaint supports the reasonable inference that Fox made unprotected statements of fact that defamed Dominion. At this stage, Fox's arguments do not support dismissal.
[4.] Dominion has adequately alleged actual malice.
Fox argues Dominion's Complaint fails to adequately plead fault (e.g., actual malice). The Court does not agree. At this stage, the Court finds that the Complaint alleges facts that Fox made the challenged statements with knowledge of their falsity or with reckless disregard of their truth….
UPDATE [Dec. 17, 2021, 6:36 pm Eastern]: Fox News Media passed along this statement:
As we have maintained, FOX News, along with every single news organization across the country, vigorously covered the breaking news surrounding the unprecedented 2020 election, providing full context of every story with in-depth reporting and clear-cut analysis. We remain committed to defending against this baseless lawsuit and its all-out assault on the First Amendment.