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Appeals Court Ruling in Favor of Rabbi Could Affect Internet Sites Worldwide

December 12, 2002
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In a decision that could have far-reaching effects regarding freedom of speech over the Internet, a court here has ruled that a defamation lawsuit brought by an Australian rabbi will not be heard in the United States.

Last year, the online version of Barron’s Magazine published a report claiming that Australian rabbi and mining magnate Joseph Gutnick was a major client of Nahum Goldberg, an Orthodox Jew currently serving a seven-year prison sentence for money laundering and tax evasion. Goldberg had been found guilty of defrauding the Australian government out of more than $24 million.

Along with being a multimillionaire from mining and other commercial activities, Gutnick leads a congregation in Melbourne, Australia, is a major Likud supporter and a well-known figure in Israel.

While Gutnick wanted the case heard in Melbourne, Dow Jones, which publishes Barron’s, wanted to have the case heard in the United States.

Last year, Gutnick’s lawyers successfully argued that since the material was downloaded in the Australian state of Victoria, it should be deemed to have been published there — and, consequently, the case should be heard there.

But the lawyer for Dow Jones appealed that decision in Australia’s High Court in Canberra, arguing that the case should be heard in New Jersey because that was where the material was uploaded to the Internet.

The High Court allowed 18 media companies — including CNN, Reuters, Yahoo and Amazon — to submit arguments in the case, effectively allowing them to back the Dow Jones appeal.

But now, in a unanimous decision, the High Court has dismissed the appeal, finding that the point of publication is where the material was downloaded.

It also noted that a claim for damages could only be made if the person claiming them had a reputation in the place of publication.

Following the court’s ruling, Gutnick told JTA: “I have had nothing to do with Nahum Goldberg for 10 years, and I have not spoken with him for at least four years.

“I am delighted that I can now clear my name in my own territory and stand tall with my family and my congregation.”

In response to a claim that Dow Jones has no assets in Australia, Gutnick added: “It would be a disgrace if an organization of that size failed to pay costs awarded against them.”

Gutnick’s case against Dow Jones is expected to be heard in Melbourne’s Supreme Court next year.

Meanwhile, a spokesman for the Internet Industry Association called the High Court’s decision “a great disappointment for the online industry. The global community now has to be extremely careful about what is published on the Internet. This will have a dampening effect.”

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