[Hague-jur-commercial-law] Murray Mottram on cross border defamation cases

[love@cptech.org]

This is a pretty interesting article about the Australian Dow
Jones/Gutnick defamation case.  Apparently Dow Jones has presented a
witness who has suggested the judge declare the Internet "a libel-free
zone."   Also, it mentions that a few years ago, the Melbourne PC Users
Group was sued in London by British academic Laurence Godfrey, for an
item posted on an Internet news groups, and ended up paying Godfrey to
settle the case. Then there was this account of another case involving
Godfrey:

	the High Court was told Godfrey entered websites 
	in Thailand, Germany and Canada and made 
	insulting postings in a cynical attempt to 
	provoke a response that would give him grounds 
	to sue. On the Thai site, he allegedly said, 
	among other things, "Thai girl is synonymous 
	with prostitute the world over" and "frankly 
	I am surprised to learn Thai men have scrotums 
	at all because they certainly don't have any balls".

	In that case, Godfrey received a settlement of 
	$40,000 and costs of about $600,000 from Demon 
	Internet Ltd for failing to remove defamatory 
	material falsely posted in his name. 

http://www.theage.com.au/news/state/2001/06/09/FFXZKVAUONC.html
 

He's caught in the Web, hypothetically speaking  

By MURRAY MOTTRAM
Saturday 9 June 2001

Even in court, Geoffrey Robertson likes to play a version of his TV
Hypotheticals. This week, in the Victorian Supreme Court, he laid out a
scenario that would change the world for anyone who writes an e-mail,
posts information on a website or is mentioned in an e-mail or website.

Robertson, the Australian-born QC famous for championing underdog
causes, had flown in to represent an American publisher against Joe
Gutnick, the Melbourne mining magnate with a similar knack of gaining
publicity as the battler's friend.

But the sort of publicity given to Gutnick in last October's issue of
Barron's magazine, published by Robertson's client, Dow Jones, Diamond
Joe can do without.

The court was told the 7000-word article, also available to Dow Jones'
Internet subscribers, portrayed Gutnick as a devious businessman given
to stock scams, money laundering and fraud. Gutnick denied the claims
and sued for defamation.

On Monday, Robertson outlined the options he saw for Justice John
Hedigan in ruling on Dow Jones' application to have Gutnick's case
struck out in Victoria.

Gutnick's legal team would argue that because Barron's could be
downloaded in Victoria, it was technically published here, so the case
should be heard in Melbourne. Robertson argued the material originated
from Dow Jones Internet servers in New Jersey and 98 per cent of those
who read it were in the United States, so the case should be heard
there. (This would have the benefit of Gutnick having to prove
defamation under American law, which is far harder than under Australian
law).

But there was a third possibility, Robertson said, one that would
delight those who see the Internet as a new frontier of free speech.

That was to declare the Internet "a libel-free zone". The basis for this
would be a 1928 decision, Webb v Bloch, in which the judge ruled
"publication is only effected when the document, the words, are made
known and made intelligible to a recipient". 

"It may well be when your honor looks at the technical evidence that in
fact they (the words) are not (published)," Robertson said. "The Web
server does not make an intelligible response ... to the request message
and there is, in effect, a break in the chain ... and the material is
not published until a hard copy is taken and shown to someone else by a
searcher."

Legal commentators regard such a ruling as unlikely, but this only
serves to highlight the dangers faced by the thousands of Australian
companies, universities, clubs, organisations and individuals who use
the Internet as their voice to the outside world.

Because that voice now carries into any country with a phone line (about
190), the potential damage caused by a factual error or bad-taste remark
goes way beyond the old-fashioned newsletter.

Some Victorians have already found you don't have to have the profile of
Gutnick, or the publishing power of Dow Jones, to find yourself in court
- and paying financial penalties that are not hypothetical.

Melbourne PC Users Group, a non-profit association of computer
enthusiasts, was sued in London by a British academic, Laurence Godfrey,
for an item posted on one of its Internet news groups.

Three years ago, the group decided that rather than foot the bill of
mounting a defence in London, it would settle the case. Godfrey is
believed to have received a payout of about $20,000.

In another British case involving Godfrey two years ago, the High Court
was told Godfrey entered websites in Thailand, Germany and Canada and
made insulting postings in a cynical attempt to provoke a response that
would give him grounds to sue. On the Thai site, he allegedly said,
among other things, "Thai girl is synonymous with prostitute the world
over" and "frankly I am surprised to learn Thai men have scrotums at all
because they certainly don't have any balls".

In that case, Godfrey received a settlement of $40,000 and costs of
about $600,000 from Demon Internet Ltd for failing to remove defamatory
material falsely posted in his name. 

Although the issue of links forwarding Internet surfers from one site to
another has yet to be tested, decisions like Godfrey's throw up other
hypotheticals.

Let's say a book club in Hawthorn has a chat room for members' reviews.
A member posts a review that speculates about the sexuality of a
well-known British author, on the assumption his thoughts will go no
further than Riversdale Road. But if the club's site were linked to a
federation of British book clubs, the club or the risque reviewer could
be dragged into court in London, facing a payout the size of an eastern
suburbs mortgage.

The PC Users Group has taken out expensive insurance to cover any future
slip-ups by its 10,000 members. Its president, George Skarbek, says the
volume of material that comes through the news groups - equivalent to an
encyclopaedia every day - makes it impossible to screen every posting.

In 1999, in an effort to protect companies that provide Internet and
e-mail services, the Federal Government introduced changes in the law
designed to protect Internet service providers (who transmit Internet
material) and Internet content hosts (who run websites). 

Essentially, the changes protect them from defamation action if they are
unaware of the nature of the material they are carrying.

But according to Matt Collins, a Melbourne barrister who has written a
book on Internet defamation, this has had the "perverse" effect of
encouraging website hosts to make no effort to screen scurrilous
material in case they lose immunity.

He points out the blanket immunity given to Internet service providers
in the US, which means Australians whose reputations are sullied by
websites there have virtually no redress.

And there is something else disadvantaging Australians in the global
reputation marketplace, Collins says. 

In general, Australian courts will uphold defamation judgments made by
British or American courts so they can be enforced here. But American
courts will not recognise Australian defamation judgments - like the one
Gutnick would have if he won against Dow Jones in Victoria - because the
US considers Australian law gives insufficient rights of free speech.

Collins says Australia should adopt the regime being introduced by the
European Union, which sets different levels of protection against
defamation for different categories of operators.

Those who merely transmit e-mails and material for websites are immune
from libel actions. Those who produce Web pages stored on a hard-drive
disc, and are thus able to monitor what they are presenting, will have
to take offending material down as soon as possible after a complaint.
Individuals remain liable for what they say online in the same way they
are in print or on television.

Collins says the Gutnick case, which is being closely watched by lawyers
around the world, is significant because it may establish whether
Victoria can effectively impose its standards on the rest of the world. 

"If Gutnick succeeds in Victoria, the effect will be to say to any US
publisher they will be held liable for material, circulated
overwhelmingly in the US, according to Australian standards," Collins
says. This could lead to multinational corporations coming to Australia,
where the laws are "plaintiff friendly", to take defamation action
against Internet agitators.

Few Internet defamation cases in Australia have yet reached the courts,
leaving the legality of much cyberspace behavior uncertain. 

 
    
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