Pesutto clings to party leadership after defamation drubbing

State Opposition Leader John Pesutto has vowed to stay on in his role despite a damning Federal Court judgment finding he defamed ousted MP Moira Deeming and revelations the high-stakes case could have been settled for $99,000.

Pesutto was ordered on Thursday to pay $300,000 in damages and savaged over his time in the witness box in a 250-page judgment that found he injured Deeming’s reputation by repeatedly and falsely implying that she knowingly associates with neo-Nazis.

John Pesutto faces the media at Parliament House after Thursday’s judgment. Credit: Eddie Jim

Angry Liberal MPs were on Thursday night discussing whether to move against their leader of the past two years. Their mood was further darkened by the news that had Pesutto taken up a settlement offer from Deeming in February, the case could have avoided court.

A source familiar with negotiations leading up to the trial revealed Deeming offered to walk away for a payment of $99,000 plus costs with no other conditions. Her demands eventually ramped up towards $2 million with assurances of her return to the Liberal party room, which Pesutto refused.

On top of the $300,000 damages payout, Pesutto now faces a hefty legal bill with costs, yet to be determined, set to reach upwards of $1.5 million for Deeming alone, according to three sources familiar with the case. The state branch of the Liberal Party had refused to indemnify Pesutto’s legal costs.

The opposition leader’s backers insist there is no obvious alternative candidate to lead the party, the Deeming scandal is not front of mind for voters and that anger within the party room will dissipate because of a positive trend in polls and the Christmas break.

Pesutto refused on Thursday to concede any regrets or acknowledge any lessons from the saga. He described the judgment as “personally disappointing” and left open the possibility of appeal but said no MP had asked him to resign.

“We need better leadership in Victoria. That’s why I have this job. That’s why I intend to continue in this role,” he said. “I’ve always been a fighter, and I’ve always been a fighter for the right reasons and the right people, the Victorian people, and that is why I will continue in this role.”

Deeming described the judgment as “cathartic” and said there was no reason for her not to be invited back into the party room.

“My door is open if anyone wants to speak to me.”

Neo-Nazis square off against police at the Let Women Speak rally in March 2023.Credit: Chris Hopkins

Justice David O’Callaghan found Pesutto’s evidence contained untruths, that he was “infuriatingly unresponsive” during cross-examination, and that he had given “dubious” explanations and calculated answers in an attempt to defend Deeming’s claim against him.

But critically for Pesutto, O’Callaghan found he was not dishonest and subjectively believed he had acted in the public interest.

The court found Pesutto’s move to expel Deeming from the party room after she spoke at a Let Women Speak rally that was gatecrashed by neo-Nazis in March 2023 was fuelled by a “preoccupation” with the political advantage the then premier, Daniel Andrews, would extract from the episode.

O’Callaghan rejected each of Pesutto’s defences of public interest, honest opinion, qualified opinion and contextual truth.

Pesutto and Moira Deeming outside the Federal Court during the defamation trial.Credit: The Age

Pesutto’s party room backers described the outcome as damaging but not disastrous.

His detractors said they were led to believe he would stand down in the event of a loss, were furious at his lack of contrition, and believed there was no other way forward than to spill the leadership.

“If people wish to do that, then that is their prerogative to do that,” Pesutto said. “I have to fight every day to prove I’m worthy of this role.”

There is no Liberal party room meeting scheduled until February, and the party requires five signatures to call an extraordinary meeting. With most MPs about take holidays, any spill could be pushed into the new year.

Former Liberal premier Jeff Kennett backed Pesutto to lead the party to the 2026 election and vowed to raise the funds necessary to meet legal costs.

Kennett, one of three former Liberal leaders who stepped in to help cover Pesutto’s legal costs, said it was critical that O’Callaghan had found that Pesutto believed he was acting in the interests of the party.

“He hasn’t acted dishonourably; he has acted as honestly as he could and in many cases he was representing the party’s view,” Kennett said. He urged Liberal MPs to back Pesutto.

“This is now a test of everyone in the party,” Kennett said. “I want to focus on the main game. We have got to change the government.”

A handful of MPs, along with former prime minister Tony Abbott, believe Deeming should be welcomed back into the party, but that is unlikely to get majority support.

Liberal member for Narracan Wayne Farnham, whose signature was one of five on the successful expulsion motion against Deeming in May 2023, said he would not accept her back.

“I would not accept her back in the party room because she has voted with Labor on numerous occasions. Ms Deeming claims to be Liberal, but her actions tell me otherwise.”

Deeming said she had no other way to defend herself than to take court action.

“I was never the aggressor, and all I did was defend myself. Apparently, all I did wrong was refuse to defame innocent women without any evidence.

“We will never be crushed, and we are going to survive whatever it is that you want to throw at us, and then we will win.”

Pesutto said he was already on record that he wouldn’t support Deeming’s return to the parliamentary party, but he said that ultimately it was a matter for MPs to decide.

Deeming, who now sits on the crossbench, had helped organise the Let Women Speak rally.

Neo-Nazis were among several groups of protesters that arrived at the steps of parliament that day. She condemned the men, said they were not there to support her cause and told the court she did not see them until they were escorted away by police.

Pesutto moved to expel Deeming from the parliamentary party in the following days. She was instead suspended in a last-minute compromise, but was ultimately expelled weeks later after threatening to bring in lawyers.

UK activist Kellie-Jay Keen, who organised the rally, celebrated Deeming’s win.

“Moira Deeming stood firm, for all of us, and held the dishonest cowards to account,” she said.

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