Slammed in chat rooms, brokerage files lawsuit
Thomson Kernaghan
Katherine Macklem
Financial Post
Yahoo! Inc., operator of one of the world's most popular Web sites, is being sued for libel by Thomson Kernaghan & Co. Ltd., a privately held Canadian investment dealer.
The lawsuit claims Yahoo! and a string of other defendants were "reckless, malicious, vicious, callous, reprehensible, shocking, oppressive and high-handed."
The suit is one of the first filed in Canada against Yahoo! It is significant because it delves into the largely uncharted territory of Internet libel and the responsibility of both the individuals who write defamatory messages and the operators that provide the forums, such as chat rooms, for discussions.
Silicon Investor Inc., which operates financial bulletin boards, is also named in the suit, as are a handful of individuals known only by the pen names they sign to postings on the World Wide Web, such as "Black John," "Tech," and "Danimal 2002."
Thomson Kernaghan says a press release and other messages posted on the Web were malicious and portray both it and Mark Valentine, a second plaintiff in the suit and a Thomson Kernaghan vice-president and director, as acting illegally.
The case, filed in Ontario Court, general division, is the latest in a volley of lawsuits involving Thomson Kernaghan and Mr. Valentine regarding controversial investments made by the firm.
Most of the other lawsuits aim in the opposite direction, with Thomson Kernaghan as the target, and claim the brokerage and Mr. Valentine have illegally manipulated stock prices.
It is these allegations of manipulation that triggered the libel suit, which singles out a press release posted on the Web (and also disseminated by newswire services) by Texas-based Restaurant Teams International Inc.
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Two of Restaurant Teams' principals and its stock promoter are also named in the Thomson Kernaghan suit.
The libel suit claims a total of $5-million and asks the court for "the imposition of punitive, aggravated and exemplary damages against the defendants."
The brokers will ask Yahoo! and Silicon Investor to disclose the true identities and addresses of people who have posted messages that it deems offensive.
To date, only a handful of libel suits have been launched concerning material posted on the Internet.
People falsely believe they can hide behind anonymous messages, said Michael Geist, a law professor at the University of Ottawa who specializes in Internet law. They need to have a better sense of what happens when they post messages, he said.
"Just as there are limitations on the right to free speech, there are on the right to anonymity," Mr. Geist said.
Spokespeople for both Yahoo! and Silicon Investor said they do not comment on lawsuits. In the past, Yahoo! and other chat-room operators have complied with court orders to provide information on their users' identities.
In addition to the Restaurant Teams lawsuit, Thomson Kernaghan has been named by about a half-dozen companies in other lawsuits accusing it and the funds it manages of short-selling stock after investing in convertible debentures in the companies. In an interview in November, Lee Simpson, Thomson Kernaghan's chief executive, denied any wrongdoing.
Full story:
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- Jeff |
