Another Example Of How The Playing Field Is Tilted In Favor Of Copyright Owners

from the copyright-abuse dept

It's widely known that artists of all kinds often get a raw deal from the contracts they sign. But this kind of legal unfairness is not the only danger they face: copyright can also be turned against creators in other, illegal ways. For example, according to a report on MarketWatch:

Two men have been charged with allegedly running a years-long music royalty scam, in which they collected more than $20 million in payments from YouTube, by falsely claiming to hold the rights to 50,000 Spanish-language songs. 

Things began back in 2017, when the two men allegedly:

approached a third-party royalty management firm identified in court papers only by the initials A.R., falsely claiming to control the royalty rights to the songs. In some cases, Teran and Batista used forged notes from artists claiming they had the rights to manage the music, prosecutors said.

The men allegedly signed a contract with the management firm. Working with an established player seems to have given the accused credibility with YouTube, which then paid them royalties – an astonishing $20 million over the next few years according to the prosecutors. According to court documents, it seems that none of this was passed on to the artists concerned. In addition, YouTubers are alleged to have lost out when their uploads were falsely marked as infringing, and then used to generate income for the accused.

Assuming the details of this case are confirmed during the trial, they show how the digital copyright system takes on trust claims to ownership, if made in the right way – in this case, through an established royalty management firm. That trust contrasts strongly with a widespread reluctance by companies to recognize that people may be able to draw on copyright exceptions when they make copies, and a readiness to assume that it must be an infringement. It's another example of how the playing field is tilted strongly in favor of copyright owners, and against ordinary citizens.

Originally published to the Walled Culture blog.

Filed Under: copyright, royalties, scams
Companies: youtube

NSO Group Facing Even More Money Problems As Debt Manager Says Sayonara And State Of Oregon Seeks To Terminate Its Investment

from the [extremely-Seinfeld-gif-voice]-that's-a-shame dept

NSO Group spent years supplying some of the world's most untrustworthy governments with powerful spyware capable of completely compromising targeted devices. It managed to weather a few years of reports tying its malware to surveillance of journalists and activists, but all hell broke loose earlier this year, resulting in a steady stream of reports linking its tools to surveillance of government officials, journalists, dissidents, government critics, religious leaders, and, in one incredible case, the ex-wife of the king of Dubai.

It couldn't have come at a worse time for NSO. It has racked up an impressive amount of debt, something it likely assumed it would be able to manage as it continued to grow its market. That growth has stalled but the payments must still be made. NSO was downgraded by ratings firm Moodys, which warned that NSO was in danger of defaulting on its debts.

That, combined with Israel drastically reducing NSO's customer base and the blacklisting by the US Commerce Department, has resulted in the company considering shutting down its offensive spyware division (the one responsible for developing Pegasus) and putting its remaining assets up for sale.

It might not be that easy to divest, nor find a way back to solvency. Bloomberg reports that one of NSO's debt managers has decided it's no longer interested in providing these services to this particularly toxic asset.

Jefferies Financial Group Inc., one of Wall Street’s closest allies of spyware firm NSO Group, is resigning from a key administrative role for the Israeli company’s debt, according to a person with knowledge of the matter.

The investment bank privately notified the company’s lenders on Friday of its intention to step down as administrative agent, a role in which Jefferies handles debt payments for the company and other clerical tasks, said the person, who asked not to be identified because the information is private.

That seems like a pretty strong "no confidence" vote on NSO Group. Whether it's because Jefferies thinks NSO can't repay its debt or because of its reputation as the enabler of oppression all over the world was left unsaid.

But that's not the only demonstration of a lack of confidence. Keeping the malware purveyor at a minimum of arms length appears to be a popular move. A state government a couple of steps removed from NSO is looking to divest itself of its holdings.

Oregon's treasurer is exploring legal options with the state attorney general in the state's large investment in a smartphone spyware company — a firm that has been denounced by human rights groups, the U.S. government and tech giants.

In 2017, the Oregon Investment Council unanimously committed $233 million in the state employee retirement fund to a new private equity fund called Novalpina Capital, which later acquired a majority share of NSO Group, an Israeli company that produces smartphone spyware.

This move might be due to NSO's public image, which currently requires the use of a periscope to peer out of the gutter. But it also might be due to the equity fund's internal problems, which has led investors -- including the state of Oregon -- to strip the company of its control of the fund and hand it over to another company entirely.

But this statement from a state official indicates it has more to do with NSO's current PR problems than Novalpina's apparent inability to properly manage an equity fund.

Oregon State Treasurer Tobias Read “supports sanctioning global technology companies that facilitate human rights violations and the oppression of journalists by selling technology to authoritarian regimes," Read's spokeswoman, Amy Bates, said in a statement Thursday to The Associated Press.

It's currently unclear whether the state can get out of this without getting sued for breach of contract. But that's the direction the state would like to go. As for NSO, it continues to claim it's being unfairly punished for the actions of its customers, stating that it values "ethics over revenues" and only sells malware for the purpose of preventing terrorism and serious crime. But the facts say otherwise. And NSO has long since run out of excuses for its willingness to sell powerful spyware to countries with long histories of human rights violations and abuses of surveillance powers.

Filed Under: debt, malware, oregon, spyware
Companies: jefferies financial group, nso group

Open Source 'Matter' Hopes To Make Sense Of The Fractured, Messy Smart Home Sector

from the simplify-all-the-things dept

If you've spent any meaningful time trying to build a "smart home" you've probably run face first into no shortage of problems. Gear is expensive, frequently complicated, and more often than not different devices don't play well together. It's a sector filled with various walled gardens by gatekeepers looking to lock you into one ecosystem, placing the onus on consumers to figure out which devices work with other devices and ecosystems, forcing the end user to spend countless calories trying to fix interoperability issues when they inevitably arrive.

The resulting mess has slowed adoption by those who (quite understandably) find dumb home tech (ordinary door locks, for example) to be the smarter option.

While various standards have tried to unify the space, they've not been particularly successful. In part because the central control of all these devices has been fractured across different standards and technologies (Zigbee, Z-Wave, Wi-Fi, and Bluetooth) all jostling for primary control despite none of them working particularly well. Enter Matter, a new open-sourced connectivity standard created by over 200 companies that's attempting to bring some sanity to the space.

Matter is an emerging communication protocol leaning on numerous existing technologies -- Thread, Wi-Fi, Bluetooth, and ethernet -- with the goal of letting all of your smart home devices communicate with each other locally, without the need for a controlling gateway and hub. The Verge has a great breakdown on how the standard hopes to accomplish this (namely by being IP-based and integrating with existing technologies):

"Its unique feature is it’s an IP-based technology, meaning it uses the same mechanisms to communicate as the internet. So, there is no dependency on bridges or hubs, and yes, you will (eventually) be able to get rid of all those white boxes hooked up to your modem.

To simplify adoption, Matter will start as an application layer on top of existing IP technologies, including ethernet, Wi-Fi, Thread, and Bluetooth (for device provisioning). This means Matter is not reinventing the wheel; it’s adding better technology to the highways our smart homes are driving on.

Granted this isn't our first rodeo with these kinds of efforts, as this old XKCD comic attests:

This time though there seems to be an underlying understanding that simplifying this mess is in everybody's interests, from the biggest companies looking to sell more smart home gear, to the smaller players developing innovative new solutions. As such Matter is being directly supported not just by Amazon, Apple, Google/Nest, and Samsung, but a long line of other smart home and IOT companies like Wyze, Ecobee, iRobot, and others. Matter should find its way into products starting sometime near the end of next year, at which point you'll be able to see if the underlying promise materializes.

Filed Under: home automation, matter, open source, smart home, standards

Judge Albright Names Lawyer For Patent Trolls As New Magistrate Judge For Waco

from the because-of-course dept

With the transformation of his Waco courtroom into the venue for more than 25% of all patent cases in the United States, Judge Albright can’t keep up with all the business he’s “drummed up” for his courtroom. He’s made heavy use of technical advisors—one of whom made more than $700,000 in the first half of 2021 alone—as well as deferring almost all non-patent cases to his magistrates for all pre-trial proceedings.

But even with a magistrate and technical advisors, it seems like Judge Albright needs more help managing the patent docket he created in Waco. Earlier this year, the Judicial Conference authorized a second magistrate judge for the Waco court. And Judge Albright has arrived at his selection for that role, naming litigator Derek Gilliland to the position.

Gilliland is a Texas lawyer, most recently operating out of Tyler in the Eastern District of Texas. But Gilliland hasn’t been a stranger to Waco. Most recently, he was plaintiff’s counsel in multiple NPE (Non-Practicing Entity) lawsuits in front of Judge Albright. Two of them stand out as particularly noteworthy.

In the first case, Gilliland helped represent Profectus in its lawsuit against Google. At trial, a jury found Google didn’t infringe the patent. This probably wasn’t a surprise to Gilliland—after all, Profectus had previously unsuccessfully asserted the same patent against Apple, Samsung, and Dell.

But it’s the second case that really drives home the concern with Gilliland. Gilliland represented Ikorongo in its litigation against Samsung. And in that litigation, Ikorongo engaged in a “bald-faced attempt to manipulate venue,” playing games with assignment of its patent to try to keep the case from being transferred out of Judge Albright’s courtroom. The Federal Circuit rejected this tactic as “collusive,” “artificial,” and “manipulative.” (CCIA filed an amicus brief in this case arguing that Ikorongo’s venue manipulation tactics were impermissible.)

These aren’t the only examples, only the most recent ones. Gilliland has also regularly represented hedge-fund backed NPEs like Intellectual Ventures and Fortress subsidiary DSS.

Charged with finding a magistrate who would engage in the “expeditious, proper, and impartial performance of their duties as judicial officers,” Judge Albright selected a plaintiff’s lawyer who most recently represented a client who engaged in collusive and manipulative tactics to try to keep their case in front of Judge Albright and another client who asserted a patent that had been repeatedly rejected.

If you were looking for a way to “undermine public confidence in the impartiality of the judiciary,” it’d be hard to think of a better one.

Originally posted to Patent Progress and reposted with permission.

Filed Under: alan albright, derek gilliland, npe, patent trolls, patents, texas, waco

Patent Awarded To Clearview AI For Its Innovative, Web-Scraping Fuckery

from the here's-hoping-actual-bankruptcy-will-swiftly-follow-Clearview's-moral-ba dept

Clearview AI has begun travelling the long road back to semi-respectability.

Over the past 18 months, Clearview has gone from unknown to pariah, rejected even by its in-group. It turned web scraping into a surveillance tool, providing everyone from billionaires to repressive regimes with a tool that leverages 10 billion images scraped from the web to create a comprehensive facial recognition system.

Clearview has attempted to reform since gaining international infamy. It claims to have ended all sales to private entities, including retailers and potential VC investors. (Caveat: It has provided no documentation to back this claim up.) It has finally submitted its AI to examination by the National Institute of Science and Technology and received one of NIST's highest accuracy ratings. (Caveat: facial recognition tech is inherently flawed, no matter how accurate it is.) And it has pulled out of a handful of countries where its scraping of the web was found illegal. (Caveat: It has done so only after being placed under investigation and continues to dispute these findings.)

What's next for Clearview and its slow escalation towards begrudging acceptance by governments that haven't banned it yet? Why, it's some IP protection for its AI and its process for matching faces found in Clearview's web-scraped haystack. Alexandra Levine of Politico has the story on Clearview's acquisition of at least one form of government approval.

Clearview AI has gotten the green light on a federal patent for its facial recognition technology — an award that the company says is the first to cover a so-called “search engine for faces” that crawls the internet to find matches.

[...]

The U.S. Patent and Trademark Office sent Clearview a “notice of allowance” on Wednesday, meaning the patent will be approved once the company pays certain administrative fees. The patent covers Clearview’s “methods of providing information about a person based on facial recognition,” including its “automated web crawler” that scans social networking sites and the internet and its algorithms that analyze and match facial images obtained online.

Congratulations, I guess. There's plenty of prior art out there, but Clearview does indeed have a unique product. It's not that it created facial recognition AI that performs in a novel way. It's that it decided it was OK to use the entire web as a source for images and personal information, bundled this all up, and sold it to whoever wanted it. That's the "creative" aspect of it. This is a patent acquired by being a shit-heel -- doing something no other facial recognition company ever considered doing.

The unique aspect -- the one deserving of a patent -- is the most problematic aspect of the company's AI. And with this in its hip pocket, Clearview has now obtained federal government protection for a product that violates laws both domestic and foreign.

For that reason, the only congratulations Clearview will receive are ones it bestows on itself. And it already has. The head of the company somehow views this as a vindication of his godawful invention -- one that relies on the world's population to fill its database. Here's the CEO patting himself on the back for coming up with something universally abhorred.

“There are other facial recognition patents out there — that are methods of doing it — but this is the first one around the use of large-scale internet data,” Clearview CEO and co-founder Hoan Ton-That told POLITICO in an exclusive interview. The product uses a database of more than 10 billion photos, Ton-That said, and he has emphasized that “as a person of mixed race, having non-biased technology is important to me.”

To the first half of that statement: kindly fuck off. That's not an accomplishment. That's a symptom of sociopathy.

And to the second half, may I ask what even the fuck are you talking about? The AI will be biased. There hasn't been one created that isn't. All facial recognition tech tends to do better accurately identifying white male faces. And operator bias will take care of the rest.

Cops will inject their own biases when performing searches and odds are most faces searched by government agencies will be of minorities. Investigators will be free to impose their biases on the search results, discarding those that don't point toward their favored suspects and accepting those that align with the narrative they've concocted. The tools may change but policing doesn't. The only thing Clearview adds is the possibility of cop shops avoiding local restrictions on social media monitoring software use and the ability to engage in their biases at unprecedented scale.

Hats off, Clearview. Enjoy your 20 years of IP protection. Chances are, you won't even need it. Nobody else has tried to emulate your web scraping ways. Maybe that will change over the next couple of decades, but at the moment, you stand alone in your unwavering shamelessness.

Filed Under: facial recognition, patents
Companies: clearview

Wewatch Vision V30 SE Portable Mini HD Wi-Fi Projector

from the good-deals-on-cool-stuff dept

Create cherished memories with family and friends in your favorite outdoor environment, by providing a sharper, crisp image with 1080 pixels resolution. The Wewatch Vision V30 SE projects your favorite content on a 120" screen and supports up to 4K Ultra HD video format. It also allows Airplay & Miracast via Wi-Fi and already has built-in speakers to start streaming right away. With the splash-proof V30 SE’s portability, you can easily create magical cinematic experiences and extraordinary moments surrounded by nature or in your backyard via an extra Bluetooth speaker. It's on sale for $200 and if you use the code MERRY15, you'll get an additional 15% off.

Note: The Techdirt Deals Store is powered and curated by StackCommerce. A portion of all sales from Techdirt Deals helps support Techdirt. The products featured do not reflect endorsements by our editorial team.

Filed Under: daily deal

Beware The CopyLEFT Trolls

from the technicalities-exist dept

For years we've covered the problems of copyright trolls -- abusive schemes in which aggressive lawyers and schemers leverage copyright to shake down hundreds or thousands of people over what may be accidental or incidental infringement. In some cases, copyright trolls have gone even further, deliberately seeding their own works in order to find people to demand money from.

But, over the past few years there's been something of a rise in a different kind of troll -- the copyLEFT troll. Law professor Chip Stewart started calling out the issue of copyleft trolls a few months ago and has published an academic paper about the issue as well. At the heart of it, copyleft trolls rely on widespread misunderstandings of Creative Commons in order to shake people down in the same way that copyright trolls do, though in some ways it's even more nefarious.

I was reminded of Stewart's warnings about this -- and my own interest in writing something about it -- recently when there was a semi-viral story involving the popular Twitterer @foone having their Twitter account suspended over what appeared to be a similar kind of copyleft claim. Foone's explanatory thread (after their account was reinstated), noted that they had taken a CC-by-Attribution photo, but had not appended the attribution, leading to a DMCA claim. In the end that didn't seem as bad as some of the trolling situations Stewart describes.

At the heart of all this, though, is the fundamental nature of how Creative Commons works -- and how some people still are confused about it. Creative Commons was always a sort of clever hack of the copyright system, creating new licenses that were a lot more open, but which still relied on copyright as the backbone. The variety of licenses within the Creative Commons space, however, have at times lead to confusion -- especially regarding its non-commercial licenses. Some people have assumed (incorrectly) that Creative Commons licenses are all "non-commercial" and others have disputed what "non-commercial" actually means. To Creative Commons' eternal credit, the organization has spent a lot of time over the last few years trying to better educate the public, lawmakers, courts, and more about the nature of these licenses and how they work.

However, in the end, they are still licenses, and those licenses are still backed by copyright -- which means that if you don't abide by the specifics of the Creative Commons license, you could very much be liable for copyright infringement. Enter the copyleft trolls. They search for those using CC-licensed works, but not following the exact terms of the license, and then resort to the typical copyright troll shakedown game. From Stewart:

The scam works a little like this:

A photographer posts photographs on Flickr or Wikipedia using the “Creative Commons” tag, a signal to internet users that these can typically be reused online without permission as long as they include proper attribution.

The photographer searches the web for uses of their photos, or hires a company such as Copypants or Pixsy to do the search for them, and they ferret out any uses that omit or otherwise mess up the attribution. This is an easy mistake for a less savvy internet user, particularly when the attribution requires full hyperlinks to the original and a hyperlink to the license itself, burdening any ability to use it as a thumbnail. Hits are investigated for potential noncompliance, and demand letters are sent to each user that doesn’t follow the license requirements perfectly.

Conveniently, the photographer claims an older version of the Creative Commons license (2.0, for example), which terminates automatically upon any error by the licensee. The most recent version of the CC license, updated in 2013, allows correction and reinstatement of the license through proper attribution within 30 days of the discovery of the error, but older ones do not. With the CC license terminated and easy reinstatement off the table, users of the photographs are put in a difficult spot – pay the licensing demand of $750 or $1,500 or $3,500, or else.

If the license demand isn’t paid, a copyright infringement lawsuit is quickly filed in federal court. And these lawsuits are filed in bulk. One German photographer, Marco Verch, has filed 41 such lawsuits in a variety of U.S. District Courts in 2019 and 2020 alone. Verch’s lawsuits usually stem from stock photography he savvily generates to meet market demand; he posted several such as “face coverings, test tubes and people wearing masks” on his website at the start of the COVID19 outbreak in 2020. Using an older version of the Creative Commons license that “includes sophisticated attribution requirements that victims claim have led them into a trap,” he sues after the license automatically terminates. A photographer based in Indiana, Larry Philpot, has been labeled a “copyright troll” by a court after pursuing more than 150 infringement lawsuits in the past decade. In 2020, a federal district judge expressed dismay when Philpot testified that he had made “tens of thousands of dollars” licensing a photograph he had taken of Willie Nelson, when the reality was that he was “describing settlements extracted after (he) confronted the infringer for failing to provide attribution per the ‘Creative Commons’ license,” and that Philpot “is more in the business of litigation (or threatening litigation) than selling his product or licensing his photograph to third parties.”

There are many reasons why this is scammy, but the worst of it is that if people are doing searches deliberately for Creative Commons' licensed works, they're actually trying to be good internet citizens and abide by copyright laws, rather than doing what lots of other people do -- and just copying a work willy nilly from an image search. In short, copyleft trolls are using technicalities to prey on people who are actually trying to be good but who might not be sophisticated enough in copyright law to understand the nuances, and to me that's truly nefarious.

As Stewart notes in his paper, this is clearly against the very spirit of Creative Commons:

The point of copyleft was never to replace copyright, nor was it to remove the possibility of programmers and artists from preventing infringement or from profiting from their work. But the copyleft movement also certainly did not intend to encourage or facilitate high-volume litigation by copyright owners who found harmless or innocent infringing uses scattered around the Web. As Creative Commons itself noted after a German court found a photograph under a CC 3.0 Attribution-ShareAlike license to be enforceable, ordering the political party that reposted the photo online without attribution to take it down, one of the goals of Creative Commons is to limit litigation of this sort.

Creative Commons has updated its licenses to include things like a period of time in which such technicalities can be fixed -- which is a useful addition. However, some courts are also increasingly not looking kindly on these copyleft trolls either. As Stewart highlights, for those who can afford to fight these lawsuits (which is rare in copyright cases), at least some courts are saying the use is non-infringing as fair use, though it seems very context specific:

Nevertheless, some courts have been sympathetic to the transformative use argument in cases brought by Philpot for posting photos in a way he alleged violated the terms of Creative Commons licenses. In 2018, the Eastern District of Virginia found fair use for publication of Philpot’s CC 3.0 licensed photographs of Kenny Chesney and Kid Rock in Philpot v. Media Resource Center. The court held that use of these photos on the website of a non-profit company engaging in political advocacy for conservative and Judeo-Christian causes was “transformative” because, rather than being about their musical performances, the secondary use was for “news reporting and commentary on issues of public concern.” Namely, the transformative purpose was identified as “informing citizens about pro-life celebrities and conservative celebrities running for political office,” in part because they changed “the way in which viewers experience the Photographs.” The Chesney photo was used in an online article entitled “8 AList Celebrities That Are Pro-Life,” and the Kid Rock photo in an article “Kid Rock Announces 2018 U.S. Senate Bid.”

The result was not appealed, and some critics panned the court’s fair use finding. But other courts have extended similar consideration to the transformative use argument by people Philpot sued. These typically have come in response to arguments on motions to dismiss or motions for summary judgment, in which judges are considering the plausibility of arguments the parties made early in the case. Courts have been unwilling to dismiss fair use arguments by defendants due to a lack of evidence on the record at the early stages, thus not handing Philpot an easy win, though also not giving defendants an easy out. One case in particular revealed a court seemingly at odds with itself while ruling on dueling motions for summary judgment coming from both parties.

In Philpot v. WOS, Inc., the Western District of Texas was considering the fair use argument raised by a website publishing news and commentary about country music called “Wide Open Country” that used two of Philpot’s photographs, one of Jakob Nelson and another of Kenny Chesney, without proper attribution as required by the Creative Commons license. The website moved for summary judgment, arguing that the use was transformative because its purpose was for “news commentary” about, in the Chesney photo, a story about a man beaten to death after a Chesney concert, and in the Nelson photo, “commentary unrelated to the image’s subject,” as opposed to the original purpose of depicting these artists performing in concert. The court said a reasonable jury could find that these were actually both “reproduced exactly for the same purpose” and thus were “not transformative.” But the court was no more receptive to Philpot’s own motion for summary judgment on the fair use defense. The court said a reasonable jury may also “conclude that the parties used the works with different purposes” after all, because the website “fully copied Philpot’s photos to draw attention to articles that had nothing to do with the photos themselves.” While the court noted that the use may be, at most, “minimally transformative,” it said a reasonable jury could ultimately give that significant weight in the fair use analysis.

Applying Kelly v. Arriba Soft Corp., in which the U.S. Court of Appeals for the Ninth Circuit found transformative use of an image for use in a search engine, the Northern District of California found a similar opening for transformative fair use of one of Philpot’s photos. Alternet, a news website, posted Philpot’s image of Willie Nelson on Facebook with the quote, “Rednecks, hippies, misfits – we’re all the same. Gay or straight? So what? It doesn’t matter to me. We have to be concerned about other people, regardless. I don’t like seeing anyone treated unfairly. It sticks in my craw. I hold on to the values of my childhood.” Alternet argued that adding the quote was an act of political commentary and altered the purpose of Philpot’s original photo, which the court said was at least “possible,” though not enough to support Alternet’s motion to dismiss in the face of Philpot’s argument that the photo was used “merely for the purpose of identifying who the quote came from.”

Either way, we're seeing the same underlying issue here: copyright allows for sketchy efforts to shake people down for money -- even when they use CC-licensed images, if they get something wrong on a technicality. That's not a knock on Creative Commons, which remains a really useful tool, but on the underlying copyright law that required Creative Commons to exist in the first place... and has enabled greedy people to abuse the law in the manner described above.

Filed Under: copyleft trolls, copyright, copyright trolls, license terms, photographers
Companies: creative commons

Delaware Court Says Dominion Voting Systems Can Continue Suing Fox News For $1.6 Billion In Defamation

from the hope-the-charade-was-worth-it,-Fox dept

Another one of Dominion Voting Systems' many, many lawsuits against Trump loyalists will be allowed to continue. (For a pretty comprehensive rundown of Dominion's election-related defamation lawsuits, check out these comments by Techdirt reader RP.)

This particular lawsuit was filed in Delaware state court against Fox News Corporation, alleging that many of its hosts and commentators lied about Dominion's voting machines and its owners during coverage following Donald Trump's election loss. These false claims continued to be made by Fox News personalities like Lou Dobbs and Maria Bartiromo and amplified by guest commentators (who are also being sued by Dominion elsewhere) like former Trump lawyers Sidney Powell and Rudy Giuliani.

Fox moved to dismiss the lawsuit, claiming there was no defamation here, just a lot of protected speech. Fox's defense is that repeated lies by hosts and guests were heated hyperbole and statements of opinion rather than defamation. Also, Fox contends it can't be held responsible for statements made by its employees. From the decision [PDF]:

Fox argues that multiple constitutional doctrines protect Fox’s alleged defamatory speech. First, Fox contends that truthfully reporting newsworthy allegations made by a sitting president and his legal team on matters of public concern is not actionable. Second, Fox claims that the media is completely protected when reporting and commenting about allegations made in government proceedings. Third, Fox asserts that opinion and hyperbolic rhetoric about newsworthy allegations are constitutionally protected. Finally, Fox claims that none of the challenged individual statements identifies actionable defamation against Fox.

But, as the Delaware Superior Court points out in its refusal to toss the case, Fox News and its hosts were provided facts that contradicted on-air statements. And yet these statements continued unaltered, with Fox News playing up the "stolen election" angle to drive viewers to its broadcasts.

It's that refusal to correct on-air statements that may end up costing Fox News a whole lot of money. Dominion is seeking $1.6 billion, citing the amount of money it has spent fighting months of false claims about its software and hardware, as well as contracts dropped by state officials who bought into the "stolen election" narrative.

The judge says repeating false claims when you have facts in hand can be defamatory. That's called "actual malice" and it's definitely actionable. And the reporting on the election and Dominion Voting Systems was far from neutral, undermining Fox's "neutral reportage" defense.

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.

This doesn't necessarily mean the neutral reportage defense is completely undercut. But at this point -- with Fox having yet to actually respond to the allegations in Dominion's complaint -- Fox can't make this lawsuit disappear.

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 "fair reporting" privilege also does not apply. This covers "substantially true" coverage of court proceedings. Hardly anything asserted by Dominion to be defamatory fits this description.

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.

Hyperbole and opinion? Maybe that defense will work for Fox News once discovery is underway and all the facts can be closely examined. But for now, the court finds too many of the statements made by Fox News hosts possibly actionable to toss out the entire suit.

[T]he 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.

It's those "false statements of facts" that bring in the "actual malice" component of defamation law. The court says Dominion has alleged enough to move forward. Fox's defense that some of its commentators and hosts contradicted claims of election fraud -- perhaps assuming this would mean Fox News as a whole can't be sued -- works against it.

In addition, the Complaint alleges that several of Fox’s personnel openly disclaimed the fraud claims as false. Yet, certain Fox personnel (e.g., Mr. Dobbs) continued to push the fraud claims. The nearby presence of dissenting colleagues thus further suggests Fox, through personnel like Mr. Dobbs, was knowing or reckless in reporting the claims.

That's not to say this won't ultimately result in Fox News escaping this lawsuit. But from what the judge has seen so far, Fox definitely has an uphill battle. Fox execs should have known they were playing with litigation fire by allowing their hosts to traffic in false claims about Dominion voting machines -- especially after the network was given evidence that directly contradicted these claims. But the network apparently felt the "stolen election" angle was for more profitable and more likely to retain viewers unwilling to believe their president was no longer their president.

As multiple lawsuits continue to work their way through the court system, high-profile Trump acolytes are going to discover that their election conspiracy theories are going to cost them far more than their reputations.

Filed Under: actual malice, defamation, e-voting, election, fair reporting, fox news, substantial truth
Companies: dominion voting, fox