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Guarding Against Libel Lawsuits 

In September of 2002, I wrote about the Gutnick v. Dow Jones case in Australia. That case concerned how publication is defined in cyberspace: i.e., whether material is published when it is uploaded onto computer servers, or when it is downloaded by readers. The lower Australian court decided that publication occurred when the information is downloaded.

In December, the High Court of Australia decided Dow Jones’ appeal and held in Joseph Gutnick’s favor. Consistent with the lower court ruling, the High Court ruled that it had jurisdiction to determine the libel suit based upon the download within Australia.  This reinforced the notion that in a defamation lawsuit, jurisdiction is appropriate where the damage to reputation occurs. 

Online Defamation is Different than Other Legal Claims

If jurisdiction is premised on the place where the message is read, the sender’s geography is no longer an important consideration.

The Internet has introduced new complications into defamation suits generally, and the meaning of publication in particular. Technology has made it possible for a message to be retrieved by a reader anywhere in the world regardless of its intended geographic audience. If jurisdiction is premised on the place where the message is read, the sender’s geography is no longer an important consideration.

Jurisdiction to make laws and determine disputes has historically been based upon geography: If a person committed a wrongful act within the country, the king could inflict punishment upon that person. Unless the king were prepared to go to war, his ability to punish fell apart if the wrongful act were committed outside of his territory.

Defamation is different than other legal claims because it requires an unprivileged, derogatory comment to be published to another person.  Typically we think of publication occurring when we make the comment -- not when it is read or heard. In other words, as long as I keep my comments about my coworkers to myself, there is no defamation; but, if I gossip to others about my colleague, and they shun him, I’m guilty of defamation. By introducing the notion that publication occurs upon download, the equation has changed.

The High Court of Australia felt that the risk of such a situation fell squarely on the publishers, which the court felt, is in a position to know the reach that its information may have. Chief Judge Murray Gleeson wrote, “In particular, those who post information on the World Wide Web do so knowing that the information they make available is available to all and sundry without any geographic restriction.”

In other words, if you libel someone, the fact that you are in a foreign country when you do it is not going to shield you from jurisdiction. As the court put it, “[i]n defamation, the same considerations that require rejection of locating the tort by reference only to the publisher’s conduct, lead to the conclusion that, ordinarily, defamation is to be located at the place where the damage to reputation occurs. ... It is only when the material is in comprehensible form that the damage to reputation is done and it is damage to reputation which is the principal focus of defamation, not any quality of the defendant’s conduct. .... It is where that person downloads the material that the damage to reputation may be done.  Ordinarily then, that will be the place where the tort of defamation is committed.”

Avoiding Defamation

Although it may sound trite, the best defense is to avoid defamation. But the task is daunting in an interconnected world: How can a small Web publisher be expected to learn the laws of every country where its content might be viewed?

The imponderable nature of foreign defamation laws should not preclude application of common sense. Good reporting requires thorough fact investigation, research, documentation and accuracy of quotes, fairness and balance. These principles should guide most enlightened nations and protect journalists from frivolous lawsuits.

Implementing Defensive Strategies

I’ve argued for strong terms and conditions statements in previous columns. And, within the terms and conditions I advocate that Web site operators clearly specify choice of forum and choice of law provisions. 

If the terms and conditions of use are reasonable and not unduly restrictive, they should be accepted. Who knows what would have happened to Gutnick’s case if the subscription in Australia required claims of defamation to Dow Jones’ corporate headquarters.

In addition, nothing can take the place of good legal advice. A small publisher may never have considered a legal budget, but they should. And, publishers and Web site operators should obtain media insurance or comprehensive general liability insurance (CGL) policies with a rider for defamation claims. It is common for such policies to provide defense and indemnity payments, anywhere in the world. In an uncertain world, nothing will take the place of good insurance.

Prepare to Fight the Foreign Judgment

Finally, prepare to fight. Despite the Hague Convention and matters of comity, most countries will still allow a resident to challenge a judgment rendered by a foreign court.  This should provide U.S. citizens with some comfort since most U.S. courts are reluctant to enforce a foreign libel judgment that would not violate the law if the act had been committed here. See, e.g., Yahoo, Inc. v. La Ligue Contre Le Racisme Et L’Antisemitisme (ND Cal. 2001) 169 F.Supp.2d 1181;  Desai v. Hersh (N.D. Ill.1989) 719 F.Supp. 670 aff’d (7th Cir. 1992) 954 F.2d 1408; DeRoburt v. Gannett Company, Inc. (D.Hawaii 1980) 507 F.Supp. 880.  

Similarly, other countries are often reluctant to enforce judgments rendered by U.S. courts as they question the validity of U.S. jurisdiction, excessive jury verdicts and punitive damages awards. However, U.S. efforts are underway to increase the enforceability of U.S. judgments abroad. See e.g., Jeffrey Kovar, comments before the Subcommittee on Courts and Intellectual Property of the Committee on the Judiciary of the House of Representatives made on June 29, 2000. Although such challenges are time-consuming and expensive, they may be the last resort in preventing enforcement of an adverse judgment rendered in a foreign jurisdiction.

Online publications have always been at risk of defamation claims. What Dow Jones and the other cases tell us is that the number of foreign claims is on the rise. But, by planning and implementing strategy in advance, one would hope these risks would be minimized without harm to content or chilling a reporter’s judgment.    

Michael S. Overing teaches Internet Law at the USC Annenberg School for Communication. He is a practicing attorney in Los Angeles County, California. He frequently assists individuals and businesses with Internet and media-related legal issues.