Lachlan Murdoch has been chairman of News Corporation and Fox Corporation, the parent company of Fox News, for more than a week now after his father Rupert finally officially handed the reins to him.
Beyond the titular changes, how much of a transition is in fact being made is open to question. “I hope to continue an active role in the company,” the elder Murdoch, 92, remarked during the company’s most recent annual shareholders meeting.
Lachlan Murdoch told investors that there will be “no change” in strategy at Fox News, but earlier this week told a dinner in Australia that this was an era of “generational realignment” that would require “clear vision, great courage, and political will” to navigate.
But what Lachlan will inherit in full is a suite of legal claims affecting the TV news division of the slimmed-down Fox empire, many of which are directly or more casually dependent to Fox News’ $787m settlement with Dominion Voting Systems earlier this year.
That case, settled as Dominion’s claim that Fox deliberately promoted 2020 election falsehoods was about to be presented to a Delaware jury, comes with others. At the high end is a $2.7bn claim brought by the separate voting system company Smartmatic in a similar defamation complaint brought in New York.
“We will be ready to defend this case surrounding extremely newsworthy events when it goes to trial, likely in 2025,” said a network spokesperson. “Smartmatic’s damages claims are implausible, disconnected from reality, and on its face intended to chill first amendment freedoms.”
In September, attorneys for Fox News argued for a motion to dismiss Smartmatic’s claim, saying that the company’s request for trial materials from the Dominion case should be denied.
Fox has also claimed that Smartmatic was attempting to use the litigation to entice investors via a UK investment firm, Portman Global Partners. The Dominion case proved highly profitable for the New York private equity fund Staple Street Capital – it walked away with a 1,500% return on the $39m, 76% stake in the company it made in 2018.
In a counter-claim, Fox also accused Smartmatic of improperly trying to restrict free speech by filing a “deeply implausible” demand. “Smartmatic is not Dominion, and as much as they’d hope, they’re never going to be Dominion,” the Fox News attorney Michael Williams said.
Also deriving from the Dominion settlement are claims worth $95.4bn by the state of Oregon and five New York City pension funds that Fox News breached its fiduciary duty when it broadcast false claims about the 2020 election, potentially exposing shareholders to liability. Oregon holds just over $5m in Fox Corp stock; New York has $27m.
The lawsuit alleges that Fox’s board knew that the news network’s promotion of “political narratives without regard for whether the underlying factual assertions were true created significant exposure to defamation charges”. Oregon’s attorney general, Ellen Rosenblum, said in a statement that Fox “took a massive risk in pursuing profits by perpetuating and peddling known falsehoods”.
But claiming financial negligence based on a claim that was settled without an admission of liability, could be difficult to make. Notably, the pension funds do not include any specific financial claim against Fox.
“To prove they intentionally tried to deceive the public, and that the board should have been overseeing that, is a hard one for a court to get their head around,” said Douglas Chia, fellow at the Rutgers center for corporate law and governance, who points out that without a claim for damages there is no real case.
The case that could be presented, Chia says, would argue that the Dominion legal settlement itself is money that could have gone to shareholders. Even then the company could argue that companies get exposed to lawsuits frequently and sometimes they have to settle.
“The company could say we can’t control who is suing us and a settlement is a better option than going to trial and getting stuck with a huge judgment,” Chia said.
Other items in Lachlan Murdoch’s Fox News in-tray include the case of Trump supporter and former marine Ray Epps, who participated in the J-6 protest and then found himself being accused by Fox News commentators, including Tucker Carlson, of being an FBI plant. Epps claims that made him a “character in a cartoonish conspiracy theory” that, in turn, led to people “brandishing weapons and shooting” on his Arizona property.
Fox has moved to dismiss Epps’s lawsuit, arguing that Carlson had simply presented his case and that Epps is a limited-purpose public figure who had chosen to attend the rally-turned-riot and later given news interviews.
And there is the former Fox News reporter and producer Jason Donner’s claim against the outlet that he was was unlawfully fired by the network for his refusal to report false information surrounding both the election and J-6. The suit claims that “Fox’s corporate leadership purged the news division and those reporters who spoke out against claims of election fraud.”
Finally, there is also a claim by Nina Jankowicz that she was subjected to a “malicious campaign of destruction” orchestrated by Fox after she was appointed to Joe Biden’s Disinformation Governance Board widely derisively dubbed the “Ministry of Truth”.
Lachlan, who studied philosophy at Princeton, may also have an issue closer to home.
While businesses are often handed over to heirs, the media often exhibits different dynastic dynamics. With the exception of the Sulzbergers at the New York Times, the Roberts family at Comcast, and Australia’s Packer family, most media empires are dismantled before their founder’s demise or soon after, as in the case of Shari Redstone who is selling off parts of her late father’s collection of media assets, so far including publisher Simon & Schuster.
What Lachlan Murdoch has to worry about most is still his dad, said Professor Bob Thompson at the Bleier Center for Television and Popular Culture at Syracuse University in New York.
“First Murdoch made the announcement, now there’s been this official handover, but the fact remains that Lachlan Murdoch is going to be trying to run the company but Rupert has not gone and has specifically said he plans to show up at the office.
“What did King Lear’s daughters have to worry about? King Lear didn’t want to leave the kingdom, and that didn’t turn out well at all,” he added.
The question of continuity extends to programming. Fox News, Thompson said, has no intention of changing its programming approach of punchy rightwing talk that knows its core Republican audience because it is so successful.
A case in point is The Five and Greg Gutfeld, host of the unscripted late-night Gutfeld! that aired throughout the actors’ strike months when scripted late-night TV was dark. With those shows now back, Fox News has maintained its top spot in prime-time and late-night TV.
“They don’t want to change their programming but there is some need to because of these lawsuits and the liabilities,” Thompson said. The question, he added, “is how do we clone Tucker without the legal liabilities of Tucker? You want people to be Tucker up to the line of being sued – and that’s a difficult line to follow.”
• This article was amended on 25 November 2023 to clarify that Smartmatic is a separate company from Dominion.
