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Rupert Murdoch pays a high price for his Fox News buccaneers

Shortly before his exit, Logan Roy, the anti-hero of the HBO drama Succession, rallies the journalist “pirates” at his television news network in New York City. “This is not the end. I’m going to build something better, something faster, lighter, meaner, wilder,” he shouts defiantly. “And I’m going to do it from in here, with you lot.”

Fiction perhaps, but it captures nicely the dark energy of Rupert Murdoch, chair of Fox Corporation and the closest real-life model for Roy. It also gets his old-fashioned attachment to tabloid newsrooms and insurgent cable news studios. “I’m a journalist at heart. I like to be involved in these things,” he admitted last year in a legal deposition.

It cost him dearly this week. Fox News, the network known for rightwing hosts such as Tucker Carlson and Sean Hannity, agreed to pay Dominion Voting Systems, the technology group, $787.5mn for defamation following the 2020 presidential election. It settled the case in Delaware before Murdoch and other Fox executives were forced to testify publicly.

This is his biggest financial and reputational blow since the closure of the News of the World in 2011, amid a phone-hacking scandal that is estimated to have cost News UK more than £1bn. The bill for spreading Donald Trump’s conspiracy theories is also bound to rise: Fox also faces a $2.7bn claim from Smartmatic, a voting technology group, and potential investor lawsuits.

The enigma of the Dominion debacle is why Murdoch failed to block Fox hosts such as Lou Dobbs from entertaining the vote-rigging claims made by Trump’s lawyers, Rudy Giuliani and Sidney Powell, after Trump lost to Joe Biden. As emails and messages disclosed in the case showed, Murdoch thought Trump “sounded really crazy” and so did other executives.

“I could have [stopped Giuliani appearing]. But I didn’t,” he admitted to Dominion’s lawyers in his deposition. For a man with a reputation for telling his tabloid editors what to write — he personally approved the New York Post’s scorning of Trump’s fantasies — he emerges as curiously laissez faire about how Fox News’ hosts behaved.

One possibility is that he did not think it mattered financially if a couple of Fox’s lesser hosts entertained the lies. It has been very hard for a public figure to succeed in a claim of libel in the US since a 1964 case involving The New York Times. The Supreme Court ruled that claimants had to prove “actual malice”, rather than reporters simply being damagingly wrong.

But it was clear enough that Dominion would not take lightly to having its reputation destroyed: it bombarded Fox with 3,600 messages that disproved the vote-rigging claims. Fox’s own reporters found no truth in them and Viet Dinh, Fox’s top lawyer, warned executives including Murdoch’s son Lachlan that Hannity was “awfully close to the [legal] line” on his show.

More likely, Murdoch recognised the danger but thought the bigger financial risk would be for Fox to denounce Trump. There is plenty of evidence that executives feared alienating its Trump-backing viewers by giving them the truth bluntly. “We need to make sure they know we aren’t abandoning them,” Fox News’ chief executive, Suzanne Scott, told Murdoch.

Tucker Carlson, its most popular prime time host, walked the line adroitly. He told Powell privately, “if you don’t have conclusive evidence of fraud . . . it’s a cruel and reckless thing to keep saying”, but he neither endorsed it nor told viewers that he knew it was nonsense. Ambiguity worked: his show still draws 3.2mn viewers, while Fox dispensed with Dobbs in 2021.

There is a third possibility: Murdoch enjoys chaos. Succession’s writers are not alone in comparing their version of him to an outlaw. “When you’re a pirate, there are going to be big bounties and spectacular failures. Rupert never wallows or reflects too much. He fires a couple of people and moves on,” says one person familiar with Murdoch’s empire of his likely response.

His style is to assemble a crew, give them an establishment target to attack, and indulge their aggression. This has brought big rewards: it was the way he built Fox as the fourth US network, turned The Sun into a bestselling tabloid and created Sky television in the UK. It also worked at Fox News, which Roger Ailes ran before leaving in 2016.

But it gets expensive: News of the World journalists hacked celebrities’ phones to find stories, and Ailes was brought down by a sexual harassment scandal. The chief buccaneer must appear occasionally in public, disown his crew’s abominable conduct and pay compensation. “This is the most humble day of my life,” Murdoch assured a committee of MPs in 2011.

Although he avoided having to testify in court by settling with Dominion this week, the bill is huge. Fox can pay this time: it has $4bn in cash and equivalents, and remains highly profitable, unlike The Sun in the UK, which lost £127mn last year due to the legal costs of phone-hacking cases. The question is how badly Fox will be weakened by having to finance further payouts.

At 92, Murdoch is not going to change his ways: he will remain in the heat of journalistic battle, no matter how great the legal danger. But the old pirate will need plenty of loot.

john.gapper@ft.com

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