Delaware judge orders Fox to release documents on Rupert Murdoch's governance

A Delaware judge has ordered Fox Corp. to produce hundreds of documents detailing the relationship between media mogul Rupert Murdoch and Jacques Nasser, a former Ford Motor Company executive who served as a key independent director. The ruling, issued Friday, is a significant development in a long-running lawsuit brought by shareholders seeking to hold the Murdoch family and other executives accountable for fostering a corporate culture that repeatedly exposed the company to major scandals and costly legal battles. The documents are expected to reveal how these two figures managed critical governance issues over the past two decades, potentially undermining the claim that Nasser acted as a true independent counterweight to the Murdoch family’s control.

The legal action was triggered by a nearly $800 million settlement Fox paid to Dominion Voting Systems, which accused the network of spreading false conspiracy theories regarding the 2020 presidential election. This settlement is not an isolated incident but part of a pattern that has plagued the media empire. Shareholders argue that the company’s leadership allowed such risks to persist, leading to further litigation, including an ongoing defamation suit by Smartmatic USA, which is seeking $2.7 billion in damages. The lawsuit also highlights other controversies, such as an undisclosed settlement related to the tragic death of Seth Rich and the massive phone hacking scandal in Britain that has already cost another Murdoch-owned entity, News Corp., approximately $1.5 billion. These events suggest a systemic failure in oversight that the plaintiffs say the board ignored.

The core of the current dispute centers on the perceived independence of Jacques Nasser. For over twenty years, Nasser served on various Murdoch corporate boards, earning six-figure annual compensation, and was eventually appointed as the lead independent director for News Corp., 21st Century Fox, and Fox Corp. In this role, he was supposed to act as a check on the power of the Murdoch family, who held both executive and ownership positions. However, the shareholders are challenging this designation, arguing that Nasser’s close, decades-long relationship with Rupert Murdoch compromised his ability to make unbiased decisions. The judge’s order to release these documents will allow the plaintiffs to examine the depth of that relationship and determine if Nasser prioritized the interests of the Murdoch family over the fiduciary duties owed to the company.

If the released documents demonstrate that Nasser was not truly independent, the legal landscape for the case could shift dramatically. Proving that more than half of the board members lacked independence would strengthen the shareholders’ argument that the company’s governance structure was fundamentally flawed during the period in question. This could open the door to greater liability for the executives involved and potentially invalidate certain business decisions made during that time. The outcome of this document production phase is crucial, as it will determine whether the shareholders can establish that the board failed in its duty to protect the company from self-inflicted reputational and financial harm. As the case moves forward, the focus will remain on whether the internal communications reveal a partnership that prioritized loyalty to the founder over the legal obligations to stockholders.