A Delaware judge ruled on Friday that Fox Corp. must release hundreds of documents to shareholders who are suing the company's leadership. The lawsuit seeks to hold Rupert Murdoch, his son Lachlan Murdoch, and other board members and executives legally responsible for business practices that stockholders allege led to multiple legal scandals and financial losses. The court order requires the company to provide records, including board minutes and emails, that may clarify the relationship between the Murdoch family and a longtime independent director.
The legal action followed a nearly $800 million settlement paid by Fox to Dominion Voting Systems over claims the network aired false information regarding the 2020 election. The shareholders' case also cites a phone-hacking scandal in Britain involving News Corp. and an undisclosed settlement with the family of Seth Rich. Fox Corp. was previously separated from News Corp. in the aftermath of the phone-hacking scandal to protect American television licenses.
Vice Chancellor Bonnie David rejected arguments from Fox attorneys who sought to shield the records, which include approximately 700 documents mentioning "phone hacking" and numerous board meeting minutes. The order also covers emails from the accounts of Jacques Nasser, the former CEO of Ford Motor Co. who served as a lead independent director at Fox until 2023. Attorneys for the shareholders are investigating whether Nasser’s two-decade history with Rupert Murdoch compromised his independence on the board.
The documents may also provide information regarding the deletion of text messages by Rupert Murdoch. Fox attorneys stated in court that Murdoch had a practice of auto-deleting texts until approximately April 2022, though they noted he primarily communicates via email. This issue of "spoliation," or the destruction of evidence, has also been raised in an ongoing $2.7 billion defamation lawsuit filed against Fox by the voting technology firm Smartmatic USA.
The scale of the financial impact involved in the underlying scandals includes the nearly $800 million Dominion settlement, a $1.5 billion cost related to British phone-hacking litigation, and a pending $2.7 billion claim from Smartmatic.
The case also involves questions regarding how corporations preserve digital communications, such as text messages, during active litigation. The disclosure of these documents may influence the ongoing Smartmatic case and future shareholder actions regarding board independence and executive oversight. While the judge has ordered the release of these documents, a specific trial date for the shareholders' lawsuit has not yet been reported.