Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Pastimes : Investment Chat Board Lawsuits -- Ignore unavailable to you. Want to Upgrade?

To: Jeffrey S. Mitchell who wrote (1174)	3/1/2001 3:26:04 AM
From: EL KABONG!!!	Read Replies (1) \| Respond to of 12465

interactive.wsj.com March 1, 2001 U.S. Judge Dismisses Case Alleging Online Defamation By STACY FORSTER WSJ.COM In a ruling hailed by free-speech advocates, a federal judge in California determined that two defendants who were sued for online defamation had the right to freely express their opinions about a publicly traded company. U.S. District Judge David O. Carter last week dismissed a lawsuit by Global TeleMedia International Inc., a software-development company in Newport Beach, Calif. The company filed suit without knowing the identities of the defendants, who used screen names when they posted on the Raging Bull investing-discussion site. Listed in the suit as "John Does," the defendants' identities were disclosed during the discovery period. They are Barry King, whose online moniker was "Bdaman609," and Ron Reader, known as "Electrick_Man." In dismissing the lawsuit, filed in California's Central District in Los Angeles, the judge said Global TeleMedia was fair game for public discussion about its performance because it is a publicly traded company with thousands of shareholders and a following on Internet message boards. The company trades on the OTC Bulletin Board under the symbol GLTI. "The point is that [Global TeleMedia] is not a matter of public interest merely because of media attention or sensation, but rather because it has had over 18,000 public investors and is the topic of literally thousands of Internet postings," his ruling said. The judge also determined that the plaintiff's arguments didn't meet the required standards for defamation, which includes the dissemination of false information. He deemed the defendants' comments to be opinion, not fact, and therefore not subject to the plaintiffs' claims of defamation. Some observers of Internet-communications law said the judge's opinion represents an important weapon for people who are sued for their postings on Web message boards. But the company, which maintains that the postings were untrue and defamatory, may appeal. And attorneys who work with plaintiffs in these types of cases aren't convinced the decision will survive above the appellate level. "We look at the chat room as no less than the front page of a newspaper, and if someone had paid for an advertisement [similar to the postings] on the front page, that's an actionable offense," said Jonathon Bentley-Stevens, president and chief executive of Global TeleMedia. Company officials who bristle at comments on Internet message boards are increasingly turning to the courts to unmask their critics' identities. Blake Bell, an attorney at Simpson Thacher & Bartlett in New York, tracks such cases and says about 120 have been filed so far, with numbers growing. Mr. Bentley-Stevens said the company is reviewing its options and will soon decide whether to appeal or try another approach in its lawsuit. Judge Carter cited provisions in California's so-called SLAPP law, which stands for Strategic Litigation Against Public Participation. These laws vary from state to state, and California's is among the most liberal. Under this law, the plaintiffs must first show that the objectionable information doesn't relate to an issue requiring public participation. Plaintiffs must also demonstrate they have a likelihood of succeeding with their case at trial; if they can't, the case is eligible for early dismissal. Megan Gray, a Los Angeles attorney representing Mr. Reader, one of the defendants, said the judgment is believed to be among the first to hold that Internet message board discussions about stocks are in the public interest. "This was a really early evaluation about whether or not this is a lawsuit that was filed to punish protected speech or whether it should proceed to trial," Ms. Gray said. Free-speech advocates are cheering this development, saying it upholds individuals' rights to participate in public debate without fear of being silenced by frivolous lawsuits. "It will make companies very careful in ensuring that the suits they bring have merit," Mr. Bell said. But cyber-law watchers say this case is different because the judge's decision acknowledged the different norms that operate in online stock chats, which often include hyperbole and name calling, says Lyrissa C. Barnett Lidsky, a law professor at the University of Florida. "Anyone who has been on the message boards knows, but often you run into judges who aren't very sophisticated about technology, and they have a great deal of fear about cyberspace," Ms. Lidsky said. Judge Carter cited examples of the postings, which included allegations that officials were going to abscond with investors' money and for being slow to deliver on business promises. In one instance, Mr. King posted a message that said Global TeleMedia officials were "headed for the calmer waters of the Caribbean (sic) where your money will be safe from federal authorities." But the judge said that the tenor and tone of the messages was often tongue-in-cheek, and the average reader wouldn't confuse these posters' opinions with facts about the company. "Given the tone and context of the message, a reasonable reader would not take this to be anything more than a disappointed investor who is making sarcastic cracks about the company," Judge Carter said. But Global TeleMedia's Mr. Bentley-Stevens says the postings in question are not opinions but comments made with malicious intent. "They were saying specific things about absconding with funds or alleging criminal acts by management," Mr. Bentley-Stevens said. "We feel that is not an opinion and those people are attempting to manipulate the market for their own means ... That's hardly an opinion. That's something that designed to scare unsophisticated investors into selling their shares." Bruce Fischman, an attorney with the Miami law firm of Fischman, Harvey & Dutton, said a higher level of court than the one in California will ultimately set a precedent in these cases. Mr. Fischman is representing J. Eric Hvide, the former chairman and chief executive of Hvide Marine Inc. who is suing a group of message board posters who sought to preserve their anonymity. "The appellate courts are not going to treat defamation any differently on the Internet than they will off the Internet," he said. Write to Stacy Forster at stacy.forster@wsj.com. KJC

To: Jeffrey S. Mitchell who wrote (1174)	3/15/2001 12:35:53 PM
From: Jeffrey S. Mitchell	Read Replies (1) \| Respond to of 12465

Re: 3/9/01 - [HEPH] Defendants gpalcus and dickie13_62301's special motion to strike is GRANTED The following is a TENTATIVE, ruling for 3/9/01, Department 62, the Honorable Kevin A. Enright presiding. Case Number GIC759462 1. Defendants gpalcus and dickie13_62301's special motion to strike is GRANTED. CCP 425.16 (b) (1) states "A cause of action against a person arising from any act of that person in furtherance of the person's right of petition or free speech under the United States or California Constitution in connection with a public issue shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim." An act in furtherance of a person's right of free speech in connection with a public issue includes "any written or oral statement or writing made in a place open to the public or a public forum in connection with an issue of public interest." (CCP 425.16(e)(3).) There can be no dispute that Yahoo!'s message boards are public fora. The message board pertaining to plaintiff's company alone has received nearly 17,000 postings. The complaint itself acknowledges messages can be posted and read by millions of people. Defendants' postings concerned a matter of public interest. Matters of public interest "may also include activities that involve private persons and entities, especially when a large, powerful organization may impact the lives of many individuals." (Church of Scientology v. Wollersheim 42 Cal.App.4th 628, 650. See also DuPont Merck Pharm. Co. v. Superior Court (2000) 78 Cal. App. 4th 562, 576-a "public interest" based on the number of persons allegedly affected and the seriousness of the medical conditions treated by the plaintiff drug manufacturer.) The mere fact that Yahoo!'s message board for plaintiff contains over 17,000 postings suggests there is a good deal of public interest in plaintiff's financial viability. Plaintiff has issued a number of press releases, thereby calling attention to itself. (Defts' Exhibit D.) By issuing press releases to the general public the plaintiff itself must believe the public is interested in its activities. In addition, plaintiff is a publicly traded company and is required to make public filings. (Defts' Exhibit C.) Having established this action arises out of defendants' free speech in connection with a public issue, the focus shifts to whether plaintiff has made a prima facie showing of facts which would, if proved at trial, support a judgment in plaintiff's favor. (Church of Scientology v. Wollersheim 42 Cal.App.4th 628, 647.) Plaintiff has not made such a showing. "In determining whether statements are of a defamatory nature, and therefore actionable, a court is to place itself in the situation of the hearer or reader, and determine the sense or meaning of the language of the complaint for libelous publication according to its natural and popular construction. That is to say, the publication is to be measured not so much by its effect when subjected to the critical analysis of a mind trained in the law, but by the natural and probable effect upon the mind of the average reader." (Morningstar Inc. v. Superior Court (1994) 23 Cal.App.4th 676, 688 (citations omitted).) Defendants' comments as set forth in their separate statement cannot be deemed defamatory. It should be apparent that these are comments that might be echoed during a raucous annual shareholders' meeting. Plaintiff selectively focuses on words such as "fraud" and "incompetence" yet minimizes the context of the messages. The comments are clearly extravagant statements or figures of speech not intended to be taken literally. Although prefacing a statement with "in my opinion" or similar words does not protect an otherwise defamatory statement, here phrases such as "that's my personal rant" indicate the comments are not to be taken as fact when viewed in connection with the obviously hyperbolic speech preceding it. Further, defendants have presented evidence that their comments did not adversely affect the stock price. (Defts' Exhibit E.) This evidence has not been rebutted. For the above reasons, the court orders the complaint be stricken as to defendants gpalcus and dickie13_62301 and judgment be entered accordingly. 2. In light of the ruling granting the motion to strike, defendants' motion to quash the subpoena on Yahoo!, Inc. is granted as to defendants gpalcus and dickie13_62301. 3. Paul Alan Levy's motion for admission as counsel pro hac vice is granted on the following conditions. Counsel is to provide a declaration to this court by March 15 that he has notified the California State Bar and paid them $50.00 (See CRC 983.) This ruling is a tentative ruling pursuant to California Rule of Court 324. All law and motion matters are set for hearing on the above date at 10:30 a.m. and 1:30 p.m. Unless modified or vacated by oral argument, the tentative ruling will become the final order of the Court. [See California Rule of Court 324] The Court, in its discretion, will only permit oral argument on certain motions. If the Court will not hear oral argument on a noticed motion, the tentative ruling will designate "NO ORAL ARGUMENT". Tentatives with the "NO ORAL ARGUMENT" designation will become the order of the Court on the hearing date for which the motion was calendared. Otherwise, parties appearing for oral argument must appear on the date and at the time noticed for the hearing. Failure to appear will be deemed waiver of oral argument. Unless otherwise ordered, no further order is to be prepared after the hearing. The prevailing party is to prepare and serve notice of this ruling pursuant to CCP 1019.5. Tentative Rulings may also be obtained by accessing the San Diego Superior Court Website at sandiego.courts.ca.gov or by calling (619) 531-3690 after 3:30 pm on the preceding day. messages.yahoo.com messages.yahoo.com ===== Exercizing Speech on HEPH... by: gpalcus (M/EXONERATED) 03/11/01 12:36 am EST Msg: 17829 of 17903 Judge Enright's tenative decision affirms that musings by any of us on YAHOO! about HEPH are protected by State and Federal Law. I may speak. You may speak. And... if it chose, HEPH could speak and respond on this and other public fora. Here, we ALL may engauge in the resulting discourse. Our continuing discussions will not be colored by the fear of legal retribution by the Company. Likewise, the Company could engauge in our electronic conversation and shape it with a voice ONLY EQUAL to any of ours. I do not believe that any of us has ever expected anything more. The Company has prosecuted a costly attempt to exercize a controlling voice, greater than ours, that has been fairly adjudicated and adjusted by the courts. At least here, in the eyes of the law, we are of equal weight and voice. Can't we take this moment as an appropriate time to refocus our discussion; distilling our observations and concerns to their essential points. My questions and criticisms have remained much the same during the span of my posting. In the next posts, I resubmit for our discussion the very essential points that have perplexed me about this investment. In the last go-round, the resulting discourse compelled HEPH to sue. This time, I cordially invite Hollis Eden to PARTICIPATE not LITIGATE! messages.yahoo.com ===== Angelawatch et al.... by: gpalcus (M/EXONERATED) 03/12/01 02:19 am EST Msg: 17842 of 17903 Friday's ruling applies at this point to both dickie_13 and myself only. That is not to say that when it becomes final early in this week that Judge Enright may broaden its scope. I DO NOT KNOW THIS TO BE POSSIBLE. Certainly, whatever defense you mount should cite our case ruling. Please know that we have been formulating a defense since early January. Our legal team has been at work almost since we were informed by YAHOO! of HEPH's discovery subpoena. For those 'et als' as yet without a defense in place, the following explains what we have done. It may be helpful. We attempted (by a motion to quash) to block HEPH from obtaining private records from YAHOO! that could identify us beyond our screen names. This was done not so much to 'hide' as it was to protect against a clearly unwarranted invasion of our privacy. Even though the Subpoena became moot (HEPH subsequently found out who all/most of us are) the court DID rule that HEPH's subpoena to YAHOO! should be quashed (i.e. not honored by YAHOO!) From what we have gathered, YAHOO! surrendered private information on all who did not challenge the subpoena. How HEPH obtained the private information of dickie_13 and myself, I can only surmise. The second, and perhaps more powerful motion on which we prevailed was against HEPH's attempted SLAPP of (at least the two of) us. SLAPP is Strategic Litigation Against Public Participation. It is what HEPH has done to all of us - brought the aggravation, humiliation and cost of a frivolous lawsuit to bear on us as a response to our legally protected criticism. The insidious idea is that the burden of defending onself against even weak charges will wear a critic down until he/she takes a deal and goes away. The California Courts (where all of our cases will be adjudicated) especially frowns upon such attempted SLAPP. The result of the ruling on this motion will obligate HEPH to pay not only for all court costs, but also for our legal representation to fight it. It also does not preclude us from countering for damages. FOR THOSE OF YOU CONTEMPLATING THE HEPH OFFER - TO STOP POSTING ON THIS BOARD AFTER ISSUING AN APOLOGY TO THE COMPANY... consider what Friday's ruling may mean for your defense. Under an Anti-SLAPP ruling, your defense may be paid for, by HEPH... Judge Enright's ruling is, at this point tenative. It was issued Thursday evening; after reviewing the original complaint, our motions, HEPH's responses and our rebuttals. All of this was submitted in writing within proscribed time frames prior to oral arguments; which took place on Friday. The judge's tenative ruling was handed down even before the oral arguments were entertained. ( I would guess that this was because our cause was so fundamental and their allegations so flimsy ) The final ruling should be rendered early in the week. Again! The ruling IS NOT blanket. It applies to dickie_13 and gpalcus only at this time. BUT, the court will entertain Judge Enright's ruling as precedent in your defense(s). The rest is up to you - however you wish to persue it. Posted as a reply to: Msg 17839 by angelawatch messages.yahoo.com ===== damages/Foolishstocks... by: gpalcus (M/EXONERATED) 03/14/01 10:01 am EST Msg: 17877 of 17903 .. I had never been sued before, Foolishstocks. I had never been the object of Corporate SLAPP? And certainly, I have never had to assess damages before. I guess you could say that I have been fortunate... Until the recent witchhunt! Personally, I do not know that I will seek damages. I continue to explore that option. That I have been affected by this case (damaged, as it were)is undeniable. That the other 'et als' have been damaged by the Company's action? Undeniable. How does one assess damages? Lawyers have various formula, but I am not a lawyer. I suppose I could intuitively measure what has been directly and indirectly affected by this disturbance and assign some value to it. Some say that I should consider the major disruptions that this frivolous case has imposed upon my life. (Of course, you were not SLAPP'ed , so you could not know that it has.) Others say that I should sell my HEPH Holdings now and assess my paper loss as a starting point for damages... Still others castigate me because they feel that this case has equally damaged dear old HEPH....(reminds me of the story of the boy who murders his parents then when caught, pleads for the court's mercy, as he is an orphan...) I fully understand that any damage award would ultimately undermine the value of my HEPH stock (and yours)... And hence, I fully understand the perhaps biased non 'et al' concern. Yet proportionately, who holds the largest chunk of the cheese?... The people who initiated the illegal SLAPP. They would (and should) feel the biggest pinch, It may not seem fair, but we wouldn't have had to consider these issues if the big cheese(s) had played by the rules. If I were to petition for damages, what would be the criteria? Actual Cost? Opportunity cost? Aggravation? Loss of work and income? The time spent researching, preparing, and coming to understand the dynamics and ramifications of this case - Unrecoverable time that I did not share with my wife and kids since the beginning of the year. Tell me... ? Now multiply that by at least eleven... (when the last 'et al' is declared an 'et didn't') Posted as a reply to: Msg 17854 by Foolishstocks messages.yahoo.com