There's no written decision, and no transcript of the hearing yet; but I've found IJ to be highly reliable in the past, so I thought I'd pass along its statement on the matter (from Tuesday):
This afternoon, Judge Jon E. Fredrickson of the Racine County Circuit Court granted the Institute for Justice's (IJ's) request to dismiss a defamation suit brought by Mount Pleasant Village Attorney Chris Smith against local political activist Kelly Gallaher from the bench. During a controversy over a proposed change to the term lengths of members of the Mount Pleasant village board, Smith told a local newspaper that the change had been discussed "since 2018." This struck Kelly as wrong, and she followed up by sending Smith a public-records request for all records of public discussions since 2018. Told there were no records dating that far back, Kelly went public, accusing Smith of lying in emails to reporters and in social media posts.
Smith responded promptly, telling Kelly he would sue her for defamation unless she publicly posted a retraction that he wrote himself and "refrain[ed] from publicly referencing [him] in any comment, regardless of whether such comment is written or spoken." Kelly, who is not a lawyer and was frightened by the cost of a potential lawsuit, posted the retraction he wrote for her. And Smith sued her anyway.
