Overview
On May 3, 2024, Cohen Milstein filed an amended shareholder derivative complaint on behalf of New York City’s five pension funds and the State of Oregon, by and through the Oregon State Treasurer and the Oregon Department of Justice, on behalf of the Oregon Investment Council and the Oregon Public Employee Retirement Fund, against various directors and officers of Fox Corporation, the corporate parent of Fox News Network, LLC. The amended complaint alleges that Fox News’s leadership breached their fiduciary duties by adopting a business model that promoted or endorsed defamation, by failing to establish systems or practices to minimize defamation risk, and by persisting in defamatory broadcasting despite the known risk of liability for that content. Cohen Milstein’s co-counsel include Friedlander & Gorris and Lieff Cabraser.
On December 29, 2023, the Court of Chancery of the State of Delaware appointed the New York City Funds and Oregon to lead the matter. The Court noted that distinguishing factors favored the appointment of their counsel to lead the litigation because they “prepared a stronger complaint”; brought an “intentional, thoughtful, and client-centered” approach to the case; and had superior diversity of skills and experience
Case Background
The New York City Funds and the State of Oregon seek to hold Fox Corporation’s leadership accountable for the corporate trauma resulting from their breaches of fiduciary duty. The complaint alleges that, at all relevant times, Fox News operated under a business model wherein the network promoted political narratives without regard for whether the underlying factual assertions were true. Rather than follow written standards or practices for what it broadcast, the complaint alleges that Fox News chose to profit from defamation and treat potential tort claims and settlements as unlikely or as a cost of doing business.
The complaint sets forth a pattern of Fox Corporation engaging in defamatory coverage, including broadcasting false claims that election technology companies Dominion Voting Systems and Smartmatic USA illegally switched votes cast for Donald Trump to Joe Biden. On April 18, 2023, Fox settled Dominion’s defamation claim for $787.5 million on the first day of a jury trial. Smartmatic’s case against Fox News is ongoing.
Case name: In re Fox Corporation Derivative Litigation, Case No. 2023-0418, Court of Chancery of the State of Delaware (Del. Ch.)