I don't agree with the judge on this. The threats made by people to Dominion are a direct result of the lies that FOX spewed about the company.
This gets into some of the fun details of defamation. Two elements of defamation are implicated here. First, the allegedly false statement must have been communicated to at least one third
1 party. Second, the plaintiff has to prove injury to his reputation. Ostensibly, pointing to people who endangered Dominion and its employees on the basis of Fox News' reporting seems to establish both elements: communication and injury.
However, there are certain categories of statement that are considered defamation
per se. That is, by their very nature they are considered injurious to one's reputation without having to prove the element of injury. One of those exceptions is being accused of a "heinous crime," (a felony). Accusing a company falsely of fixing an election is defamation
per se. So in the fact-finding portion of the trial, it's superfluous to show that people acted on the false statements and threatened or otherwise took steps against Dominion. In this context that makes it prejudicial. Fox's accusation—if it satisfies the other elements of defamation—is
presumed in this case to cause injury to Dominion's reputation. Fox is entitled to a ruling
in limine that prevents irrelevant damaging evidence.
Further, Fox News wouldn't be liable for how people acted upon statements they made on air, unless it rose to the level of incitement. That's pretty hard to prove. You have to show the statements caused "imminent lawless activity." Hearing something on Fox News and then later doing things based on believing what you heard, is not imminent enough. Informally we all agree that Fox should bear some responsibility for the effects of their influence on their viewers. But in formal law, this is addressed more meticulously.
The check on this is to imagine an alternate universe where Dominion
did influence the election and Fox accurately reported this. Viewers who, upon that information, made death threats against Dominion employees would still be criminally liable for those threats even if the information that motivated them were true. Legally, the behavior of viewers must be considered separate from the behavior of the broadcaster.
Now in the penalty phase—when the jury is considering the amount of damages—the consequences of Fox News' defamation become relevant. Presuming Dominion prevails in the verdict, the idea that people who watched Fox News subsequently made death threats and did other things becomes arguably relevant in determining how much compensation Fox owes to Dominion, because Fox should have known that their reporting might cause some of their viewers to act in that way. And because a verdict against Fox would establish malice, you could show that those viewers would not have acted as they did but for the malicious behavior of the defendant. But generally the people who made threats
etc. are individually liable for their actions, not the sources of information that those actors looked to for inspiration. So for the fact-finding phase, the judge is correct to disallow that evidence.
And it may even be legally irrelevant in the penalty phase too. That's one of those "lawyer-brain" ways in which procedural justice and substantive justice don't perfectly align. There is no question Dominion was injured by Fox's irresponsible reporting, and by the behavior of those who believed the reporting. But a court will want to correctly apportion blame among Fox and its rowdy viewers, and this trial considers only Fox's liability.
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1 A 1L drinking at my bar, closest to our law school, amused her colleagues by having become confused over the phrase "one third party." She initially parsed the professor's statement as "one-third party,"
i.e., 1/3 or 33% of a party. She was puzzled at the notion of a fractional party.