Chris Ruddy, the CEO of Newsmax, was speaking on the first day of the CPAC Washington, DC conference at the Gaylord National Harbor Resort & Convention on March 2, 2023 as captured in a photo by Lev Radin/Sipa USA (Sipa via AP Images).
Newsmax will pay voting software company Smartmatic $40 million to settle a defamation lawsuit filed years ago in Delaware state court.
In September 2024, the resolution to a previous legal dispute that had caused contention was reached. However, this resolution was only recently disclosed in a Newsmax investment prospectus or circular that was published on the Securities and Exchange Commission’s website earlier this month.
To date, the media company has paid out $20 million of the settlement agreement — which also includes significant stock options.
The details in the filing state, “As of the date hereof, the Company has made payments under the settlement agreement totaling $20 million. Payment of the remaining balance will be made in installments of $10 million on or prior to each of March 31, 2025, and June 30, 2025.”
In sum, the stock options have an initial value of $10 million, if exercised, and allow Smartmatic to purchase up to 5,000 shares of the right-wing network over the course of five years — by way of a “cash exercise warrant” at the price of $2,000 per share.
The agreement between the two companies extinguishes all of the many claims leveled in the defamation case where Smartmatic sought compensatory, consequential and punitive damages over the network’s coverage of 2020 election conspiracy theories.
“Management believes the settlement with Smartmatic will, subject to the payment of all consideration in a timely manner, eliminate future legal expenses the Company would have expected to bear related to this suit, which could have included costly appellate legal actions and other matters,” Newsmax tells potential investors.
In December 2020, Smartmatic threatened legal action against Newsmax for taking part in an alleged “disinformation campaign.”
“Smartmatic had nothing to do with the ‘controversies’ that certain public and private figures have alleged regarding the 2020 U.S. election. Multiple fact-checkers have consistently debunked these false statements with stunning consistency and regularity,” the company said in a press release lambasting Newsmax, Fox News, and One America News Network for focusing on false claims of electoral fraud in the aftermath of Joe Biden’s victory over Donald Trump.
In November 2021, the election technology company made good on that threat. In its 240-page lawsuit, Smartmatic accused Newsmax of publishing “dozens of reports indicating that Smartmatic participated in a criminal conspiracy to rig and steal the 2020 U.S. election and that its technology and software were used to switch votes.”
A defamation lawsuit against OANN was filed the same day in Washington, D.C., federal court; the voting software company previously sued Fox News in February 2021.
In May 2024, Smartmatic upped the ante by accusing Newsmax’s chief executive of deleting key evidence — including texts and other communications central to the allegations. Newsmax, for its part, categorically denied those discovery spoliation claims.
As Law&Crime previously reported, Smartmatic and OANN entered into a confidential settlement agreement in April 2024.
Now, among the trio of news networks sued by the widely-disparaged software company, only the Fox News lawsuit remains.
“We entered into a confidential settlement with Newsmax in September to resolve litigation and cannot comment further on the details,” Smartmatic attorney J. Erik Connolly told Law&Crime. “We are now focused on our litigation against Fox News for defaming Smartmatic and knowingly lying to their viewers about Smartmatic’s role in the 2020 election. We look forward to presenting our evidence to a jury and finally having the opportunity to hold Fox accountable for its harmful actions.”
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