Representing the Oregon Public Employees Retirement Fund (OPERF), Attorney General Ellen Rosenblum has begun an investigation into a potential stockholder derivative action against the board of directors of Fox Corporation, the corporate parent of Fox News, for breach of fiduciary duty. The Oregon Public Employees Retirement Fund is a Fox investor.
“Treasurer Read and I believe that Fox’s board of directors breached its fiduciary duties by allowing Fox News to broadcast false claims that Dominion and Smartmatic rigged the 2020 presidential election,” said Rosenblum. “We hope to hold the board accountable and protect the long-term value of Oregon’s investment in Fox Corp.”
The DOJ/Treasury investigation will explore leading a suit against Fox’s management on behalf of the company’s harmed investors, which include Oregon’s public employees. Fox directors and senior officers manage the company on behalf of its investors. They have a duty to manage the company competently, honestly, and in a manner that prevents foreseeable and catastrophic financial harm like that inflicted upon company’s shareholders by the Dominion and Smartmatic suits.
The investigation will explore whether the board of directors of Fox should be held responsible for the $787.5 million incurred by Fox to settle Dominion’s defamation claim, and other legal costs connected to the defamatory broadcasts by Fox News.
“We invest for Oregon’s public servants and we aim to hold Fox’s board of directors, including Rupert and Lachlan Murdoch, accountable for their decisions,” said Treasurer Tobias Read, who is a member of the Oregon Investment Council, which sets state investment policy. “Investigating Fox’s books and records is a necessary and significant step in fulfilling our obligation to our beneficiaries.”
In the aftermath of the 2020 presidential election, Fox News repeatedly broadcast false claims that electronic voting machines operated by Dominion and Smartmatic had been manipulated to swing the vote count against then-President Trump. Subsequent litigation by Dominion revealed that Fox News broadcast these false claims of election fraud by Dominion and Smartmatic even though senior executives of Fox News and the on-air anchors knew they were false. That litigation led to Dominion settling its defamation claim with Fox for $787.5 million; the Smartmatic litigation is ongoing.