Dow Jones vs Gutnick – and the law’s an ass

Blogging from the back of the taxi, I’m just reminded to blog about the intriguing case I alerted to last night. I am lecturing at QUT for about seven weeks starting in about September on IT Governance. The first half is being presented by Bill Singleton, a senior associate with Allens Arthur Robertson, and he is basically presenting the law to them as it relates to ensuring the good governance of IT.

I attended last night to be introduced to the class, and I stayed for the lecture. One of the interesting cases was to me the Dow Jones v Gutnick case. From what I understood, Dow Jones implied in their newsletter that Gutnick was involved in insider trading. This did not sit well with Mr Gutnick who, even though the newsletter was written in New York and uploaded to the net to a server in New York, sued them in Victoria for defamation.

My first reaction was that the suit would fail for lack of jurisdiction – Victoria is not New York after all.

Apparently Gutnick won on the basis that the defamation occurs where the download took place – Victoria. And the kicker is that, because of the bilateral agreements with the US, Gutnick then had an enforceable court order that he could pursue in the States.

When I mentioned this to my lawyer wife (I’m certainly no lawyer) her reaction was ‘So? That makes sense, otherwise you’d forum shop.’

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My view is that it’s rather bad – you write something, put it on the net, and any jurisdiction where there is a bilateral agreement – or where you want to do business – could result in an enforceable court order.

I mean, what if you innocently break the law in another jurisdiction? China, for example? Admittedly this was a defamation case, but even so it scares and annoys me a little.

I suspect there may be implications for corporate bloggers there.

I may misunderstand, after all I was in a lecture late at night. However to me it seems a classic case of, once again, the law getting in the way of progress.

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