Fox News Network and its parent company, Fox Corp., continue to face accusatory litigation related to the network's coverage of the disputed aftermath of the 2020 presidential election.

On Thursday, a New York appellate court panel ruled that Smartmatic's $2.7 billion defamation lawsuit brought against Fox News and Fox Corp. could proceed, Reuters reported.

The electronic voting systems company has alleged that the network and its parent corporation allowed, encouraged, and participated in making defamatory statements on-air about Smartmatic's role in alleged election fraud in 2020.

Lawsuit will proceed

Per Reuters, the five-judge appellate panel ruled on Thursday that Smartmatic's defamation lawsuit could proceed since the company had provided sufficient evidence to show that Fox Corp. was "directly liable" for any allegedly defamatory statements made on-air by Fox Network guests and hosts.

However, the same panel also limited Smartmatic's defamation claims against Fox Corp. after the court determined that the company had failed to show that the parent corporation "wholly dominated" the subsidiary network.

The company has alleged that Fox, by way of some of its guests and hosts, knowingly and willfully broadcast false and defamatory claims about Smartmatic and the 2020 election results in order to boost its ratings and appease viewers who supported then-President Donald Trump but were disappointed by his reported loss to President Joe Biden.

Fox had been similarly sued by Dominion Voting Systems but reached a $787 million settlement to avoid trial in 2023.

Both sides ready to fight in court

The Hill reported that Fox Corp., which asserts that the network's 2020 election coverage contained "newsworthy" information and was not defamatory, signaled that it was prepared to go to trial to defend itself against Smartmatic's claims.

A Fox Corp. spokesperson said in a statement, "We will be ready to defend this case surrounding extremely newsworthy events when it goes to trial."

"As a report prepared by our financial expert shows, Smartmatic’s damages claims are implausible, disconnected from reality, and on their face intended to chill First Amendment freedoms," the spokesperson added.

As for Smartmatic, NPR reported that its lead attorney in the suit, Erik Connolly, said of the appellate panel's decision, "Today, the New York Supreme Court rebuffed Fox Corporation's latest attempt to escape responsibility for the defamation campaign it orchestrated against Smartmatic following the 2020 election."

"Fox Corporation attempted, and failed, to have this case dismissed, and it must now answer for its actions at trial," he added. "Smartmatic is seeking several billion in damages for the defamation campaign that Fox News and Fox Corporation are responsible for executing. We look forward to presenting our evidence at trial."

Already settled similar claims against Newsmax

Relatedly, ABC News reported in September 2024 that Smartmatic had similarly sued conservative media channel Newsmax for 2020 election-related defamation claims but reached a confidential settlement agreement with the network on the eve of the trial.

At that time, a Smartmatic spokesperson said of the undisclosed agreement to end the suit, "Lying to the American People has consequences. We are now looking forward to our day in court against Fox Corp and Fox News for their disinformation campaign. Smartmatic will not stop until the perpetrators are held accountable."