Toronto Exchange Takes Aim At Message Board Participant (WSJ 6/12/98)
By JASON ANDERS
THE WALL STREET JOURNAL INTERACTIVE EDITION
There's never a shortage of mudslinging on on-line message boards. But
the Toronto Stock Exchange says it has had enough of one of its most
vocal on-line critics. It has threatened him with a lawsuit -- and warned the Web site he frequents that it considers his posts libelous.
Porter Davis, an options trader in Toronto,hasn't posted any more messages on the Silicon Investor site (www.techstocks.com)
since receiving a letter on June 2 from attorneys for the exchange ordering him to stop publishing "defamatory material" about the exchange, and its management.
"They win. I quit. Sorry folks. ... I can't jeopardize my family's future in a fight with the TSE," Mr. Davis wrote in his last post.
Since then, Mr. Davis, an 18-year veteran of options trading and managing partner of Professional Trading Partners in Toronto, has become something of a superhero on Silicon Investor. In recent days, hundreds of
messages have been posted bashing the Toronto Stock Exchange and
accusing it of bullying Mr. Davis. Many message board participants have
renewed their criticism of the exchange, and have openly challenged the
exchange to sue them. Some have talked of setting up a legal defense fund
for Mr. Davis.
Mr. Davis, a floor trader, has been a vocal
critic of the exchange and its management for
more than a year, posting frequently in the
"Canadian Options" message board on Silicon
Investor. He strongly opposed the exchange's plan to automate options
trading. Mr. Davis has called the exchange the "Valu-Jet of stock
exchanges," and compared it to the Titanic. He also has been critical of
exchange President Rowland Fleming, and suggested he should be fired.
It's not clear which of Mr. Davis's posts offends the exchange. An
exchange spokeswoman says the exchange can't point out specific
messages that prompted the letter because that would "be propagating the
defamations further [and] continuing the process." The dispute between the
exchange and Mr. Davis was first reported in the Financial Post.
"This is the first time in the 150-year history of the exchange that we have
considered such action," Pam Agnew, an exchange spokeswoman, says of
the letter sent to Mr. Davis. "The attacks of over a year in duration -- on
almost a daily basis -- which prompted action by the exchange were
considered libelous, threatening and defamatory, and beyond the limits of
acceptable behavior and legal bounds."
Mr. Davis declines to comment, citing advice of his attorney.
The exchange's attorneys also sent a letter to Silicon Investor warning that
it considered the posts defamatory and libelous. But a spokeswoman for
Silicon Investor said the letter didn't make reference to any particular
posts, and didn't request any particular action. "We wrote back asking
them to provide us with specific violations. ... What they sent us was too
general," says Jill McKinney, Silicon Investor's Webmaster.
Ms. McKinney says Silicon Investor gets a lot of complaints from
companies and people who have been criticized on its boards, but says
this is the first time a stock exchange has ever complained. She says
Silicon Investor does remove posts that violate its terms of use -- which
prohibit the posting of libelous material -- but says it wasn't immediately
clear that Mr. Davis had done that.
Ms. McKinney says Silicon Investor tries to protect its users' freedom of
speech, and only removes posts "when absolutely necessary." She says the
site hasn't removed any of Mr. Davis's posts.
Recent laws protecting on-line sites could make it difficult to win a libel
case against Silicon Investor, says Floyd Abrams, a partner in the New
York law firm Cahill Gordon & Reindel.
"It's clear that an on-line service is immune from libel suits for what it
carries," says Mr. Abrams. Those services are protected by the
Communications Decency Act of 1996, he says. In April, America Online
used that law to successfully defend a defamation lawsuit brought by
White House adviser Sidney Blumenthal and his wife, Jacqueline, over a
report by on-line gossip columnist Matt Drudge published on that service.
Before the communications act, conflicting court rulings made it unclear
how responsible, if at all, on-line services were for content posted by their
users. In one prominent case, Prodigy was judged responsible for user
posts because it admitted that it screened messages for profanity and other
questionable content, thereby making it more than just a conduit.
But aside from the liability, Mr. Abrams says the exchange would first
have to establish that Canada has jurisdiction over Silicon Investor by
showing it does considerable business in Canada. The Web site, which has
been based in Overland Park, Kan., but is moving to Seattle, was recently
acquired by Go2Net.
"It seems to me [Silicon Investor] has a considerable defense against a
Canadian court having jurisdiction over them," Mr. Abrams says.
Libel suits are easier to win in Canada than in the U.S., Mr. Abrams says,
because Canadians don't have the same freedom of speech protections
afforded to Americans by the First Amendment. "A plaintiff in the U.S. has
to prove what was said about him was false. In Canada, as in England, the
[defendant] has to prove what he said was true," he says.
Despite the recent letter, the exchange doesn't want to stop Mr. Davis
from posting "constructive" messages in the future, says Ms. Agnew. In
fact, she says, Mr. Davis has done more than anyone to educate people
about derivatives products, and she hopes that continues.
"We applaud him," she says. "He's one of the greatest assets the industry
has. Our only concern is where things are defamatory or libelous." |
