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LinkedIn Billionaire Funds Voting Firm Smartmatic as It Battles Fox News in 2020 Election Defamation Case
Brendan McDermid/Reuters
Reid Hoffman, a major Democratic donor and billionaire venture capitalist, is providing a multimillion-dollar investment to Smartmatic to help the voting technology company in its legal battle against Fox News and Newsmax.
CNN New York —
LinkedIn co-founder Reid Hoffman is providing significant financial power to Smartmatic as the voting technology company battles Fox News and Newsmax over the right-wing networks’ repeated airing of lies about the 2020 election.
Hoffman, a billionaire venture capitalist and major Democratic donor, framed his multimillion-dollar investment in Smartmatic as a way to shore up the company’s global operations as it moves forward with costly defamation lawsuits.
“Smartmatic has built a global business using technology to better engage citizens, regardless of party or ideology, by making voting simple and trustworthy,” Hoffman said in a statement. “After Donald Trump lost in 2020, however, Smartmatic became a target of the smear campaign to overturn his defeat.”
Hoffman, who said he has known Smartmatic CEO Antonio Mugica for years, said he is “thrilled” to support Smartmatic and help Mugica recover “what is owed to him.”
Investment terms first reported by The Washington Post, were not released.
A person familiar with the matter would not say exactly how much money Hoffman invested in Smartmatic, but told CNN the eight-figure investment was worth more than $10 million.
“This is not litigation funding,” the person said, adding that Hoffman “thinks the company is massively undervalued” and will make money on his investment if Smartmatic is successful in the future. Furthermore, while Hoffman’s investment is significant, he “does not have the power” to order Smartmatic’s lawyers to settle the lawsuits, the person added.
“Fox’s strategy was to spend us into the ground,” the person said. “This is the response.”
The investment comes as Hoffman steps up his criticism of Trump. The LinkedIn co-founder told CNN Earlier this month, Hoffman said business leaders are afraid to speak out against Trump for fear the presumptive Republican nominee will retaliate. Hoffman argued that President Joe Biden is the more “pro-business” candidate because he respects the rule of law and Trump does not.
Mugica, CEO of Smartmatic, welcomed Hoffman’s support.
“The lies told by Fox News and Newsmax not only defamed and damaged our business, but also directly attacked the integrity of the nonpartisan civic work we have supported for more than two decades,” Mugica said in a statement.
Smartmatic is seeking billions of dollars in damages from Fox News, Newsmax and other right-wing figures who falsely accused the company of rigging the 2020 election. On social media and in TV interviews, top allies of Donald Trump have repeatedly claimed, without any evidence, that Smartmatic’s software fraudulently switched millions of votes from Trump to Biden.
Voting technology company’s defamation lawsuit against Fox News is still in the “discovery” phase of fact-finding and is not expected to go to trial until 2025. Earlier this year, the New York judge overseeing the case allowed Smartmatic will expand its lawsuit to include Fox Corporation, the parent company of the cable news giant.
The Smartmatic-Newsmax lawsuit is scheduled for trial in September in Delaware Superior Court unless there is a last-minute settlement. And the small pro-Trump propaganda network One America News recently settled a lawsuit brought by Smartmatic over similar allegations.
All of these media outlets and Trump allies deny wrongdoing.
A Fox News Media spokesperson said Smartmatic is trying to “freeze First Amendment freedoms” with its lawsuit, “so its alliance with a high-profile Democratic donor and longtime supporter of President Biden to fund its lawsuit is entirely predictable.”
“We remain ready to defend this case involving extremely newsworthy events when it comes to trial next year,” the spokesperson added.
In response to Hoffman’s investment, a lawyer for Newsmax told CNN that the company “fairly reported on both sides of the 2020 election.” The lawyer also noted that Smartmatic executives were recently implicated by the Department of Justice in a bribery scheme involving a top Philippine election official. Smartmatic denies the allegations.
Smartmatic is also suing Trump 2020 campaign attorney Sidney Powell and MyPillow CEO Mike Lindell — two of the most egregious peddlers of election disinformation. A representative for Powell did not immediately respond to requests for comment.
“It appears that Mr. Hoffman is trying to copy the Fox deal and copy Staple Street’s investment in Dominion to get a quick return,” Lindell’s attorney, Christopher Kachouroff, said, referring to the private equity firm which holds a majority stake in Dominion and benefited from its $787 million town with Fox News.