One of the lead attorneys in Dominion Voting Systems’ defamation case against Fox News said he had brought family members to watch his opening statement at the April 18 trial and ended up almost as surprised as others when news of the record-breaking $787.6 million settlement broke. 

“I fully expected that they would bring the jury back in and start opening statements,” Stephen Shackelford, Susman Godfrey partner, told Axios in an interview he gave along with Dominion CEO John Poulos and the company’s private-equity backer, Hootan Yaghoobzadeh of Staple Street Capital. “I had a feeling that there were discussions going on, but I had no idea whether things were close.”

Internally, company executives had been saying all along they weren’t interested in settling. 

“We made sure that all the attorneys understood that settlement was like a curse word,” said Yaghoobzadeh, whose company invested in Dominion in mid-2018 to enable early investors to exit their position. “Our strategy was to go to trial, get to a verdict and accomplish three goals.”

Those three goals were to expose the truth, hold Fox accountable and compensate the company for the damage the network caused.

But when Delaware Superior Court Judge Eric Davis made a last-minute mediation request, Yaghoobzadeh said, the Dominion team felt like it had to make the effort.  

“We took the judge's urging very seriously, and made sure we were always acting in good faith,” he said. 

Dominion and Fox had tried mediation earlier, in December, but the two sides couldn’t settle. 

“The best thing they could have done, which they still could do, is to go on to all their shows where they broadcast these lies and, in a believable way that's not like a hostage video, tell their audience the truth,” said Shackelford. “And maybe things might have been somewhat different had they done that at any point, let alone early on.”

Business disruption 

The company had no choice but to sue because the unfounded accusations were destroying its business, Poulos said. 

“I had customers calling in the middle of procurement saying, ‘Boy, there's no way that I could buy from you,’" he said. “We saw customers that had initiated their renewals prior to the defamation and were in the last stages of the formal approval. After the defamation, as soon as December 2020, they had their funding pulled by their boards.”

The company’s employees were being harassed, too, and in some cases kept from working with officials on the voting machines. 

“We had an employee getting a noose thrown on their front lawn,” said Poulos. “We had very detailed death threats that would be called in with employees' specific addresses. Most of our employees were helping election officials. In a lot of cases that was in the field. That's a very difficult task in the best of times. In this case, it was just unbelievably difficult.”

In the immediate years after he invested in the company, Yaghoobzadeh said, business grew by 4.5 times, and then everything stopped when the accusations started airing. “The world collapsed for us,” he said.

Before the lawsuit, the company gave Fox opportunities to set the record straight, Yaghoobzadeh said, but “they continued to double down and triple down. We said, ‘OK, they're putting their head in the sand.’”

Once the lawsuit was filed and the legal team started collecting material through discovery, the facts of the case quickly became clear. 

“There were a lot of smoking gun documents,” said Shackelford. 

He referenced the text in which Rupert Murdoch of Fox called it “terrible stuff” after watching the Nov. 19 press conference with Trump attorney Rudy Giuliani. 

“He knew the truth and yet his enormous asset, Fox News, kept broadcasting the lies,” Shackelford said. “It was obvious to everybody that this was crazy and we expected to see internal acknowledgment that this was crazy and false. And that's what we ended up seeing.”

Shackelford drew a straight line between the terms of the settlement and the later firing of Tucker Carlson, even though the dismissal of Fox’s top-rated program host wasn’t one of the terms. 

“The very fact that that's what resulted out of all of this [is] traceable from the work that Dominion and Staple Street set in motion,” Shackelford said. 

“These results are much more profound than some disingenuous apology or forced statement that would not have any credibility, or would have been disingenuous from actors that have had a track record for making statements that are disingenuous,” said Yaghoobzedah. 

Editor’s note: Eric Davis was earlier referenced as a Chancery Court judge.