Multivision's Nazerali begins defamation trial
2015-04-13 20:38 ET - Street Wire
by Stockwatch Business Reporter
The trial of Vancouver stock promoter Altaf Nazerali versus publishers of allegedly defamatory material began today in the Supreme Court of British Columbia. Mr. Nazerali's lawsuit claims that the material falsely accused him of being an arms dealer and a terrorist, among other things.
The statements at the centre of the suit were published on the website deepcapture.com, operated by Deep Capture LLC, one of the defendants. Other defendants include Mark Mitchell, who allegedly wrote the statements; Patrick Byrne, who publishes the website and is also the chief executive officer of on-line retailer Overstock.com Inc.; and Judd Bagley, an employee of both Overstock and Deep Capture LLC. Overstock and High Plains Investments LLC, a company affiliated with deepcapture.com, are also defendants.
The trial comes 3-1/2 years after Mr. Nazerali, represented by Vancouver lawyer Dan Burnett of Owen Bird Law Corp., filed a suit against Mr. Byrne, Mr. Mitchell and Deep Capture LLC. The suit complained about 21 "chapters" that appeared on deepcapture.com in 2011. These chapters, said the suit, linked Mr. Nazerali with Mafia members, associates of Osama bin Laden and Muammar Gadaffi, and other unsavoury characters. In 2013, Mr. Nazerali filed a second defamation lawsuit, bringing new defendants into the mix. The claims were consolidated in 2014.
Burnett's opening
At the trial, Mr. Burnett began his opening statement by describing Mr. Nazerali as an entrepreneur whose business relationships and community reputation are vital to him. In 2011, Mr. Nazerali became the object of a series of statements made by Mr. Mitchell on deepcapture.com, a website that (in Mr. Burnett's words) "utterly savages" its targets.
The statements were contained in 21 chapters, from which Mr. Burnett quoted at length. One statement asserted that Mr. Nazerali, the Mafia and Irving Kott (an infamous 1970s stock promoter) were "all doing business together." Another had Mr. Nazerali and the chief of Saudi intelligence "running scams" together. Still others linked Mr. Nazerali to jihadists, arms dealers, "narco-traffickers," a "pack of market manipulators" and the "favourite financier" of Osama bin Laden.
These are "just about the most outrageous defamatory statements one could make," said Mr. Burnett.
Not only did the defendants -- Mr. Mitchell in particular -- fail to contact Mr. Nazerali about whether their statements were true, said Mr. Burnett, they responded inappropriately when Mr. Nazerali contacted them about their "numerous extreme errors." They should have realized their mistake and apologized, but instead they chose "bravado" and continued their on-line postings, "taunting" Mr. Nazerali, said Mr. Burnett.
Another aggravating factor, in Mr. Burnett's view, is that after Mr. Nazerali commenced legal action, the defendants filed responses accusing him of fraud and more. Mr. Burnett condemned this "terrible revictimizing" and concluded his opening statement with the charge that the defendants did not treat Mr. Nazerali as a human being.
Mitchell's discovery
After his opening statement, Mr. Burnett called his first witness: Mr. Mitchell, or rather Mr. Mitchell's discovery interview from 2012. Mr. Burnett quoted extensively from the interview transcript.
During discovery, as quoted by Mr. Burnett, Mr. Mitchell took responsibility for writing the 21 chapters in question. He said he and Mr. Byrne, the editor, had "very little discussion" about Mr. Nazerali. Mr. Byrne never asked for the basis of the chapters or sought details about the steps taken to verify the information, said Mr. Mitchell. Rather, Mr. Byrne did a "quick read" of the chapters before they were posted on-line.
Mr. Burnett then read parts of the transcript related to Mr. Mitchell's lack of attempts to contact Mr. Nazerali. Mr. Mitchell claimed that because he was constrained by his (self-imposed) writing deadline, he did not take steps to contact Mr. Nazerali, although he would have in an "ideal" situation. Asked to clarify "ideal," Mr. Mitchell said journalists contact people because they are good sources. In response to a question about contacting people for other reasons, namely verification, Mr. Mitchell said this is the "usual protocol" but does not often happen in journalism. He was then asked if he had ever been trained in journalism. The answer was, "Not academically, no."
Another reason Mr. Mitchell gave for not contacting Mr. Nazerali was his impression that Mr. Nazerali was "elusive," read Mr. Burnett. Mr. Mitchell said he did not know where Mr. Nazerali was or how to get in touch with him. He was asked whether he tried to look up such information. The answer, again, was no.
Mr. Burnett moved on to the parts of the transcript dealing with a phone call from Mr. Nazerali to Mr. Mitchell, in which Mr. Nazerali denied claims made in the chapters. (Mr. Mitchell would go on to confirm, in response to questions, that the first direct communication between him and Mr. Nazerali -- whether as a phone call or as an e-mail in September, 2011 -- was the result of Mr. Nazerali contacting him, not the other way around.) Mr. Mitchell said he did not reinvestigate his claims after Mr. Nazerali contacted him because he "took [his] prior reporting to be accurate" and trusted his confidential sources. He was then asked whether his sources were "shady." Indeed they were, replied Mr. Mitchell, which is exactly "how [he] knew they had first-hand access to the information."
North Vancouver libel specialist Roger McConchie represents all the defendants except for Overstock, which is represented by Vancouver lawyer Stephen Schachter of Nathanson, Schachter & Thompson LLP.
While Mr. Nazerali has had roles with many public companies, his only current role is as the president of Multivision Communications Corp., a thinly traded TSX Venture Exchange listing.
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