Document Type

Article

Publication Date

2025

Abstract

In 2023, Fox Corporation settled U.S. Dominion’s defamation action over Fox News’ broadcast of false election fraud claims after the 2020 presidential election for the staggering sum of $787.5 million. Now, a shareholder derivative action is pending in Delaware against the company’s board of directors for breach of state corporate law fiduciary oversight duties for their failure to prevent such defamatory programming. Beyond the specifics of the case, this development portends the emergence of a new politico-legal strategy—using corporate governance requirements as a weapon to promote press accountability and combat misinformation in public discourse. The question addressed in this Essay is whether corporate governance rules should be extended to impose board liability for oversight failures regarding editorial judgments of news media companies under this public-regarding rationale.

Without expressing approval for the programming decisions of Fox News on election coverage, the Essay argues that it is too threatening to the social value of freedom of the press to use the Fox case to expand board oversight duties of corporate-owned media companies to include defamation risk as a way to combat misinformation. We have dual social and democratic commitments—to the value of the free press and to the value of truthful political discourse—but need to be careful in their calibration. Expansive board oversight duties addressing news content and editorial decisions are both unworkable and too chilling for news organizations. And the likely effectiveness of corporate governance law in limiting political misinformation is uncertain. These circumstances advise caution in deploying shareholder derivative suits against the press lest the resulting journalistic self-censorship ironically serve to undermine informed political discourse in the long run. This is particularly true at a time when the Executive branch is demanding—and obtaining—exceptional press capitulation from a vulnerable industry.

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