‘What game is he playing?’: Lachlan Murdoch, Trump’s election lies and the legal fight against a small Australian website

Rupert Murdoch, so the aphorism goes, doesn't sue.

But his eldest son, it appears, is cut from different cloth.

Lachlan Murdoch is headed to Sydney's federal court, launching a defamation action this week over a news article, not involving his considerable Australian media empire, but instead Fox News's reportage of the febrile denouement to the Trump presidency and the January 6 insurrectionist storm of the US Capitol.

In what is being portrayed as a David and Goliath clash between the billionaire and Crikey, a small Australian independent news website, Murdoch's 40-page statement of claim alleges Crikey has falsely impugned he had illegally conspired with the former US president Donald Trump to "incite a mob with murderous intent" to march on the US Capitol on 6 January, and that he should be indicted as a traitor.

Murdoch, the chief executive and executive chairman of Fox Corporation in the US, is already involved in a monumental $1.6bn defamation lawsuit in the US - on the other side of the bar table - defending allegations by Dominion Voting Systems that Fox News pushed false claims of voter fraud in the 2020 US presidential election in relation to Dominion's voting machines.

But the Australian suit has opened up the possibility that Fox's reportage of the Trump presidency and its aftermath, and the corporation's links to Trump himself, will be publicly aired in forensic detail in a court 15,000km away.

In starting this suit, Murdoch has invited scrutiny of his own organisation's actions and reportage, a potentially high-risk strategy that will not be totally under his control. It has left some to ask: "What game is he playing here?"

Without doubt, it is a supremely high-risk strategy for Crikey too, facing a financial cataclysm if the case is lost. On Friday the site launched a GoFundMe page seeking donations for its legal fees, telling readers "Lachlan Murdoch has unleashed his legal and financial forces against us".

At issue is an analysis piece written in June this year by Crikey's political editor, Bernard Keane.

The piece does not name Lachlan Murdoch individually at any point and is, in large part, not about the Murdoch family, its empire, or its news businesses. It is concerned with evidence given by the former White House staffer Cassidy Hutchinson to the US House select committee on the January 6 insurrectionist assault on the US Capitol building.

Hutchinson did not say the name Murdoch in her evidence.

Keane's alleged defamation does not occur until the final two paragraphs of the piece.

Having discussed Trump's tenacious promulgation of what commentators have dubbed the "big lie" that he won the 2020 US presidential election - he lost by 306 electoral college votes to 232, and the popular ballot by 7m votes - Keane argues "the world's most powerful media company" continues "to peddle the lie of the stolen election and play down the insurrection Trump created".

Keane then draws an analogy between the former US president Richard Nixon - infamously the "unindicted co-conspirator" in the Watergate scandal - with "the Murdochs", arguing they "and their slew of poisonous Fox News commentators are the unindicted co-conspirators" in the events of January 6.

It's a strong line, and seeking to make such an analogy is newsworthy (if perhaps deserving of greater exposition than two unexplored paragraphs at the tail end of an article).

But an editor put the "unindicted co-conspirator" phrase into the headline. Murdoch's people saw it. A five-page letter of concern was fired off within 24 hours.

After weeks of increasingly intemperate legal letters back and forth, Crikey went nuclear, goading Murdoch by taking out advertisements - in the New York Times and the Canberra Times - literally inviting him to sue, and publishing all the legal correspondence on its site.

Legal sources have told the Guardian that Crikey's bombast left Murdoch feeling he had "no other option" but to sue, and that he is determined to see it through.

And so it has come to this, the steps of Sydney's federal court, in the jurisdiction of New South Wales, the famed "defamation capital of the world" - a sobriquet so earned because it is seen as the most applicant-friendly anywhere.

The alleged role of the Murdoch media in contributing to fanning the flames of insurrection that led to January 6 have been extensively canvassed in the US and elsewhere, but presumably he is suing in Australia because that is where he believes his chances are greatest.

He is also seeking aggravated damages, with the claim also alleging Crikey had published the parties' legal correspondence as a strategy for self-promotion and commercial gain, while "falsely suggesting that Murdoch was being unreasonable in his conduct towards them to settle the dispute, in circumstances where he repeatedly told them that an apology was the only further step that needed to occur for the matter to resolve".

He has one of Sydney's most high-profile defamation barristers, the sharp-elbowed Sue Chrysanthou SC, representing him.

Crikey says the imputations asserted by Murdoch are "contrived" and his response "bullying" and an "abuse of media power". The publisher has retained Michael Bradley. The managing director of Marque Lawyers does not have a prominent history in defamation law, but is an experienced lawyer (if occasionally irreverent, he describes himself on his own website as a "shameless self-promoter"). The correspondence revealed this week by Crikey shows he is clearly up for the fight.

Crikey is painting this not only as a battle for its very existence - "the best way to support independent media is to become a member", the co-founder of publisher Private Media, Eric Beecher, beseeched - but also as a broader fight for free journalism itself.

"We didn't start this senseless altercation with Lachlan Murdoch. We may not be as big, rich, powerful or important as him, but we have one common interest: we're a news company that believes in publishing, not suppressing, public interest journalism."

Dr Andrew Dodd, the director of the Centre for Advancing Journalism, told the Guardian a legal showdown between the minnow and the monolith has been looking "increasingly inevitable for some time".

Dodd, who has worked for both the Murdoch-owned News Corp newspapers and for Crikey, says Crikey's editorial position has become more trenchantly left wing, and has increasingly come to see its role as an unafraid and independent media organisation holding influential institutions like Fox and News Corp to account.

Beecher, in particular, has been a decades-long campaigner against Australia's acute concentration of media ownership (65% of national and city daily newspapers are owned by Murdoch).

"This is a defining issue for [Beecher]," Dodd says. "It's wrong to characterise this as simply a commercial exercise. There is a marketing element - Crikey taking on the Murdochs - but this is a marriage of deeply held principle and a commercial decision."

Dodd argues there is an irony in Lachlan Murdoch wanting to claim to have been identified in the Keane article (when the only reference was to "the Murdochs", taken by many to refer primarily to Rupert) but not to confront the criticisms within the piece - that Fox's coverage, and continued succour to the lie of the stolen election, had played a role in fomenting the discontent that inspired the January 6 insurrection.

"What game is he playing here? Is he wanting to beat his chest and say 'I am in charge'. Well, if he is doing that, he should also man up and be responsible for the editorial output of his news organisation, which has a lot to answer for - despite what he might say - a lot to answer for in relation to its coverage in the lead-up to what happened on January 6.

"Lachlan has been very thin-skinned, unable to take one-tenth of the criticism that his organisation dishes out daily."

"News doesn't like a pesky small player like Crikey, it runs contrary to the monopolistic idea at News Corp that small players don't have legitimacy. And when Crikey is kicking it in the shins in the irreverent way that it does, that is triggering for News Corp."

Others with knowledge of the companies and their histories have described Crikey's strategy as "bold" and potentially catastrophic. Picking a fight with the Murdochs will have undoubtedly driven subscriptions, but a loss could end it, or wound the company so greatly as to change it irreparably.

Crikey and Lachlan Murdoch have form. It is the fourth time in five years that Lachlan Murdoch has threatened to sue Crikey: in April last year Crikey had to run an apology at the top of its homepage for 14 days after a piece on Murdoch was shown to contain a series of errors. A year earlier, Crikey was forced to apologise for incorrectly comparing Murdoch to an organised crime boss.

Dr Matthew Collins QC, the president of the Australian Bar Association and a defamation law expert, says the fundamental legal question to be considered by the court is "what does the ordinary reasonable reader of the Crikey piece understand to be conveyed by the piece".

"And here, what's interesting is that Lachlan Murdoch is not named - the reference is to Murdoch and to Fox News, and the imputations derive mostly from the heading and that single sentence at the end."

Perhaps counterintuitively, having written less, rather than more, about Murdoch, leaves greater scope for argument about what the article conveys to a reader.

Collins argues "there are very serious questions about whether the imputations are, in fact, conveyed, and serious questions about whether the article sufficiently identifies Mr Murdoch in circumstances where he hasn't been expressly named".

And he argues the case is ripe to contest the newly introduced "public interest" defence in NSW defamation law: a defence to the publication of defamatory material if the issue is of public interest and it was reasonably believed the publication of the matter was in the public interest.

There is a political element at play too, with a renewed push for a judicial inquiry into media concentration in Australia, aimed largely at the Murdoch empire. And two former prime ministers of Australia have long railed against what they perceive as Murdoch's malign influence on the Australia polity and public.

Malcolm Turnbull this week called the Murdoch lawsuit "hypocritical" on radio, saying "very few people have defamed more people than the Murdochs over the years, their media organisations".

"They're always bleating about freedom of speech and how the defamation laws are too harsh, and they stifle free speech."

And, Turnbull told the ABC, "January 6 could not have happened without the toxic influence of Fox News".

But the timing of this suit is intriguing as Lachlan Murdoch finds himself on the other side of the bar table, on the other side of the world, on the very same issue - the 2020 US election.

In Delaware, Murdoch is defending a $1.6bn defamation action, brought by Dominion Voting Systems, over Fox's post-election coverage.

Dominion has alleged that Fox News broadcast claims it knew to be untrue about the validity of the 2020 presidential election result, alleging that Dominion's voting technology had fraudulently stolen the election from Trump. Dominion's suit alleges several of Fox's hosts repeatedly claimed, without evidence, Dominion's voting machines were faulty, deliberately rigged to disadvantage Trump, or affected by "technical glitches" that distorted results.

Dominion successfully argued Fox News's parent company, Fox Corporation, should be enjoined to the litigation because its two most senior executives, Rupert and Lachlan Murdoch, allegedly played "a direct role in participating in, approving and controlling" reportage that amplified false perceptions of voter fraud.

"Rupert and Lachlan Murdoch allegedly made a 'business calculation' to spread former President Trump's narrative through Fox News even though they did not personally believe it," Delaware superior court Judge Eric M Davis said, ruling that the action against Fox Corporation could proceed.

He determined that Dominion's allegations "support a reasonable inference that Rupert and Lachlan Murdoch either knew Dominion had not manipulated the election or at least recklessly disregarded the truth when they allegedly caused Fox News to propagate its claims about Dominion".

Dominion is confident. "The truth matters," the company's lawyers wrote in their initial complaint.

"Lies have consequences. Fox sold a false story of election fraud in order to serve its own commercial purposes, severely injuring Dominion in the process. If this case does not rise to the level of defamation by a broadcaster, then nothing does."

Fox has defended its coverage on first amendment grounds: "A free press must be able to report both sides of a story involving claims striking at the core of our democracy."

The cases could impact upon each other: Murdoch will have in his possession the court material from the US case, which Crikey could potentially seek to obtain to use in its Australian defence.

Lachlan Murdoch being on the opposite side of the cases on opposite sides of the globe, the cases expose the glaring difference in the operation of defamation laws in the US and Australia.

Defamation is regarded as significantly harder to establish in the US system: public figures in America suing for defamation must prove that false statements were published maliciously. That is with prior knowledge they were untrue or with reckless disregard for whether they were true.

In applicant-friendly Australia, there is no "public figure" defence, nor a constitutional first amendment-like right to free speech. Critics of Australia's laws say they are poorly drafted, and work neither to protect the private right to a reputation nor the public right to freedom of speech and of the press. Some defences, such as honest opinion and qualified privilege, are almost unworkable in Australia. But there have been recent reforms: this case will likely be one of the first tests of Australia's new "serious harm" test which will oblige Murdoch to demonstrate his reputation was damaged by the article, or Crikey's actions thereafter.

Private Media, the company that owns Crikey, is valued at less than $20m by its own reckoning. It is supremely cognisant of - indeed relishing - its role as David to the Goliath of the Murdoch empire, worth billions. It sees a significant part of this battle as being played out, not in the staid surrounds of the federal court, but in the court of public opinion.

In the legal correspondence with the Murdochs that Crikey published this week, it quoted Lachlan's own words back at him. In his 2014 Keith Murdoch Oration (Keith Murdoch was his grandfather), Lachlan Murdoch argued "censorship should be resisted in all its insidious forms".

"We should be vigilant of the gradual erosion of our freedom to know, to be informed and make reasoned decisions in our society and in our democracy."