Newsmax Settles Defamation Lawsuit with Smartmatic for $40 Million
In a significant development in the ongoing legal battles tied to the 2020 U.S. presidential election, Newsmax, a right-wing media outlet, has agreed to pay $40 million to Smartmatic, a voting technology company, as part of a settlement. This resolution stems from a defamation lawsuit Smartmatic filed against Newsmax in 2021, alleging that the network had falsely claimed its voting machines were used to manipulate the election in favor of Joe Biden. The settlement, reached in September of last year, not only includes a cash payment but also an option for Newsmax to purchase stock in the company. As of now, Newsmax has already paid $20 million, with the remaining $20 million scheduled to be paid by July. This agreement marks a resolution to a legal battle that could have otherwise led to costly appellate actions and other prolonged legal entanglements.
Background of the Lawsuit and Its Implications
The lawsuit was rooted in Newsmax’s coverage of the 2020 presidential election, during which the network aired false claims that Smartmatic’s voting machines had been used to alter the election results in favor of Joe Biden. These claims were widely debunked, and Smartmatic took legal action, asserting that Newsmax’s reporting had damaged its reputation and led to financial losses. The case was nearing trial when the settlement was reached, avoiding what could have been a lengthy and expensive legal process for both parties. In a statement following the settlement, Newsmax acknowledged that a court had determined the allegations against Smartmatic were factually false, stating, “The Court found that allegations regarding whether the [2020 U.S. presidential election] and its results were somehow altered or manipulated by Smartmatic are factually false/untrue.”
The Settlement’s Financial and Legal Ramifications
The settlement not only resolves the immediate legal threat for Newsmax but also provides the company with an opportunity to avoid further financial drain from ongoing legal battles. In its regulatory filing, Newsmax’s management expressed confidence that the settlement would eliminate future legal expenses tied to this case, which could have included costly appellate actions and other related legal matters. By agreeing to the settlement, Newsmax is able to move forward without the uncertainty and financial burden of a prolonged legal fight. The payment structure, which includes both cash and a stock option, suggests a mutually agreed-upon resolution that benefits both parties in the short and long term.
Similar Legal Battles Involving Other Media Outlets
Smartmatic’s legal victory over Newsmax is not an isolated incident. The company has also settled a defamation lawsuit with One America News (OAN), another right-wing media outlet, though the terms of that settlement remain confidential. Additionally, Smartmatic is currently pursuing a similar case against Fox News, with the legal team expressing confidence in their ability to prove their case. J. Erik Connolly, a lawyer representing Smartmatic, stated, “We look forward to presenting our evidence to a jury and finally having the opportunity to hold Fox accountable for its harmful actions.” Fox News, for its part, has maintained that its coverage was focused on newsworthy events surrounding the election.
Fox News and the Broader Legal Landscape
The legal troubles of Newsmax and OAN are part of a larger pattern of defamation lawsuits filed by election technology companies against media outlets that aired false claims about the 2020 election. In a related case, Dominion Voting Systems, another election technology company, settled a defamation lawsuit against Fox Corp., the parent company of Fox News, for $787.5 million in 2023. These lawsuits highlight the potential legal and financial consequences for media organizations that disseminate unsubstantiated claims, particularly those that may harm the reputation of companies or individuals.
Moving Forward: Implications for Media Accountability
The settlements reached by Newsmax, OAN, and Fox News serve as a reminder of the importance of media accountability and the consequences of spreading misinformation. While these agreements bring closure to the legal disputes for the companies involved, they also underscore the need for media organizations to ensure the accuracy and veracity of their reporting, especially when it comes to sensitive topics like election integrity. As Smartmatic continues its legal battle against Fox News, the outcome of that case could further shape the legal and journalistic landscape, potentially setting new precedents for how media outlets report on elections and other high-stakes events. For now, the $40 million settlement between Newsmax and Smartmatic serves as a significant step toward resolving one chapter in this ongoing saga.
