WILMINGTON, Del. (Legal Newsline) - The conservative TV network Newsmax must defend itself against a multibillion-dollar lawsuit claiming it knowingly broadcast false claims the election software company conspired to steal victory from former President Donald Trump in the 2020 election.
Delaware Superior Court Judge Eric M. Davis rejected all of Newsmax’s arguments, ruling Smartmatic had presented more than enough evidence the network had plenty of public information available to refute claims of election fraud made by Rudolph Giuliani, Sidney Powell and others on its shows.
“It is reasonably conceivable Newsmax’s reporting was not neutral or dispassionate,” the judge wrote in a Feb. 3 decision. “The neutral reportage privilege applies only when the reporting is accurate and disinterested.”
The decision adds to the financial risks Newsmax and Fox News are facing as they have failed to halt lawsuits by Smartmatic and Dominion Voting Systems claiming biased and false reporting cost them billions of dollars in market value and potential business. A Delaware court allowed Dominion’s case against Newsmax to proceed last year and Fox is defending itself against similar lawsuits in New York.
Smartmatic was founded in 2004 by Antonio Mugica and Roger Piñate to produce banking software but switched to election technology and operates in 25 countries. In 2004 Smartmatic provided technology for the first automated election in Venezuela and it served Los Angeles County, its sole U.S. client, in the 2020 election.
Newsmax’s ratings leaped after it began broadcasting Trump’s allegations that the election had been stolen. On Nov. 14, 2020, Brian Kennedy appeared on Steve Bannon’s “War Room” broadcast and said Smartmatic’s chief executive was “a Venezuelan national, and a leftist” who sold machines with Chinese components that could be hacked. On Nov. 16, Newsmax aired six programs including interviews with Rudolph Giuliani and Sidney Powell that had been recorded on Fox News’ “Sunday Morning with Maria Bartiromo,” stating the Smartmatic system had a back door to monitor votes in real time so outside parties could intervene in an election.
In that Fox interview, Sidney Powell said Trump won by “millions of votes” and “this is massive election fraud” facilitated by Smartmatic’s software. Similar claims were made by guests on Newsmax shows hosted by John Bachman and Howie Carr. Attorney L. Lin Wood told Carr the Smartmatic software was embedded in Dominion machines and was designed “to go and buy an election in any given country.”
“They did it in Argentina. They’ve done it in Chile,” Wood said. “Now they’ve sold it to someone with the interest in manipulating the presidency for the United States.”
Other guests said Smartmatic had been “deplatformed in many states as a result of poor performance” and was behind a Democratic victory in Harris County, Texas. Smartmatic, in its complaint, said Newsmax knew there was no evidence supporting claims its software was used anywhere but Los Angeles County.
On Dec. 11, Smartmatic sent Newsmax a retraction demand, stating why its reporting was false. Dominion did the same. In November 2021, Smartmatic sued Newsmax for defamation per se, which is when someone is falsely accused of committing a serious crime. Newsmax moved to dismiss the case in June 2022, arguing it is protected by the “neutral reporting privilege” and “accurately reported unprecedented allegations without endorsing those allegations.”
The court declined to decide whether to apply the law of New York, where some of the broadcasts originated, or Florida, where Smartmatic is headquartered. But the court agreed with Newsmax that Smartmatic is a limited purpose public figure facing a higher standard of proof under the 1974 U.S. Supreme Court ruling Gertz v. Robert Welch, which includes people who are “drawn into” public controversy regardless of whether they wanted to be.
The court criticized Gertz as “overly broad” and protective of publishers.
“Given the prevalence of electronic reporting (television, radio, internet, podcasts, social media), a person or entity could be `drawn into’ pretty much anything,” the court wrote. “However, Gertz is controlling as Supreme Court precedent.”
Regardless, the court rejected Newsmax’s arguments the case should be dismissed because the challenged statements weren’t all referring directly to Smartmatic. “Newsmax argues that because the name `Smartmatic’ is not in several of the alleged defamatory statements, these statements cannot refer to Smartmatic,” the court said, but it “cannot engage in this type of reading of the complaint.”
The court also found it plausible that Newsmax acted with actual malice, the standard required for libeling public figures. Newsmax argued it wasn’t improbable that Venezuelan dictator Hugo Chavez had something to do with Smartmatic but the company provided enough information to show Newsmax had plenty of public facts available to refute the claims made on its shows, the court ruled.
The neutral reporting privilege also doesn’t apply, the court ruled, in part because it isn’t clear it is available in New York or Florida. But either way, Smartmatic presented plenty of evidence that Newsmax was biased in favor of the premise the election was stolen and reported untrue allegations in that light.