The High Court judge who prompted sharp intakes of breath from newspaper editors when he awarded Max Mosley damages last week has now drawn sighs of relief from website owners, by blocking a web forum libel case that could have suffocated the flame wars that often rouse debate.
While the privacy-infringing report of Mosley's orgy cost The News of the World £60,000 and yesterday provoked further libel litigation, Nigel Smith, an unemployed shareholder activist, was told on Friday he is barred from pursuing tens of thousands of pounds from his online critics for "mere vulgar abuse". In his judgment, current top libel beak Mr Justice Eady acknowledged that forum users don't necessarily believe what they write, let alone think about it.
The court imposed a civil restraint order on Smith that bars him from suing posters at ADVFN, a leading investment forum. He had issued 37 sets of libel proceedings against individual users and ADVFN itself.
On Monday, Smith vowed to appeal against the order, claiming the court did not have the right to impose the order and that his human rights were violated by Mr Justice Eady. "He's made me a second class citizen," Smith told The Register, "It's one rule for the rich - Mosley - and one rule for the poor - me."
The case stems from Smith's involvement in a campaign to recover shareholders' investments from the alleged Langbar pump-and-dump fraud that rocked the Alternative Investment Market in 2005. Langbar's activities are currently being investigated by the Serious Fraud Office (more info on the company's website here).
A firestorm was sparked on ADVFN in April last year when Smith, under the username "Anomalous", labelled fellow Langbar thread poster "Wiganer" a "fraudster". Smith alleged that Wiganer was falsely claiming Langbar compensation. Other members leapt to Wiganer's defence and slammed Smith for getting his facts wrong, branding him a "bully", "vindictive", "completely mad" and a "hypocrite".
Believing the statements against him were defamatory and actionable, Smith obtained a court order known as a Norwich Pharmacal that required ADVFN to disclose the IP addresses of the posters. News of the legal offensive spread on the ADVFN boards at the end of April 2007, attracting further criticism.
Commenting on the situation, ADVFN member Russell Watkins critcised Smith. Along with other who weighed into the debate, his name was added to Smith's Pharmacal order. Fearing a cripplingly expensive legal battle, Watkins settled out of court for £5,000 plus £1,000 costs. Following Friday's judgment, he says he now regrets that decision.
Fellow defendant, Michael Tuppen, who did not settle his case and gave evidence to Justice Eady in person, had written on ADVFN: "Anomolus and people like him (Godfrey vs Demon springs to mind) eventually destroy the internet with absurd actions like this. My wipers scraped better things from my car windscreen tonight than this dickhead Anomulus."
Our original report on the Godfrey vs Demon case in 2000 is here. The landmark decision established that forum providers can be liable for defamatory statements they host.