Stockhouse board posters sued.

[cwericb]

I have always been surprised at some of the outrageous statements posted on the Stockhouse board. Now, in no way am I comparing this board to Shockhouse, but most of us are tempted to vent at times so I thought that the following would make interesting reading.

 

St. Elias Mines Ltd. to Sue for Defamation

 

Vancouver, B.C. September 20, 2010

St. Elias Mines Ltd. () ("St. Elias" or the "Company") announces that the Company, its President, Lori McClenahan, and management of St. Elias are suing certain anonymous online bulletin board posters for defamation. The anonymous posters placed a series of defamatory comments on a Stockhouse bullboard against the Company, its President and management and, as of today, are continuing to post false and defamatory comments. Further details regarding the defamation lawsuits will follow once filings are made with the Supreme Court of British Columbia.

 

"The Company has grounds to file defamation lawsuits with the courts against the posters to seek general and aggravated damages as well as punitive damages. There is a need to deter irresponsible, self-interested, malicious postings and the courts have, in the past looked down upon libellous material found in online postings" stated President, Lori McClenahan. "Statements transmitted and published over Stockhouse's website about particular companies are accessible by millions of individuals, shareholders and potential investors, and the extent of the damage could be considerable", the President continued.

 

Prior Lawsuits Against Internet Posters

 

Stockhouse posters have faced legal action over forum postings many times in the past. One well-known case is the lawsuit where Barrick Gold Corp. was awarded $125,000 by the Ontario Superior Court of Justice after the company was libelled on internet chat lines.

 

In a more recent case, a handful of inflammatory online postings about Farallon Mining Ltd. ("Farallon") have led to the biggest internet defamation award ever handed out in Canada. The Supreme Court of British Columbia awarded $425,000 in damages for defamatory comments made by an a online poster. On March 30, 2010, an online poster had to pay a total of $425,000 in damages for comments he made at Stockhouse's website. The targets of the posters online ire were Farallon, Farallon's Chairman and Farallon's management company. Madam Justice C.A. Wedge awarded Farallon and Farallon's management company $75,000 each in general damages and $25,000 each in punitive damages. Farallon's Chairman was awarded $125,000 in general damages, $75,000 in aggravated damages and $25,000 in punitive damages. In addition to being the biggest internet defamation award in Canadian history, it is the largest defamation award rendered against a single person in Canada.

[T-bone1]

wow, that is a little chilling. Is anyone aware of the nature of these posts? I would hope they were clearly libelous and false, and not merely criticism.

[cwericb]

I don't know the specifics, but I have seen the words "crooks", "thieves", etc used frequently. (However in some cases the words were probably deserved.) But it is a good reminder to be a little careful as to how one phrases his comments. There is a right way and a wrong way to call a crook a crook.

[Guest broxburnboy]

The libel laws in Canada and the United States differ a lot. You'll notice that the companies in question are Canadian ones and the jurisdiction of the judge is Canadian provincial. What is acceptable in public discourse in the USA is not in Canada.

Canadian law recognizes that freedom of speech does not protect libelous attacks on others (which infringes on their freedoms).

Award amounts depend on the ability of the defamee to prove loss caused by the libel. Politicians in Canada are frequently both the subject and object of libel actions..

 

The enforcement of the libel laws tends to keep public discourse in the Canadian media  more polite, and seemingly less heated.

[Guest longinvestor]

This is the new information asymmetry paradigm in the age of the internet!

 

FFH had it's share of message board attacks(Yahoo) as many on this board know from the 2003-2006 timeframe. I don't know whether my losses as a holder were made up by the buying opportunities that came along with the depressed stock price. But it sure was not a good time for Prem and FFH management to go through all that! I remember Prem had to issue press releases at the height of the attacks. We know Prem is reclusive and had never done anything like that. Well there is a lawsuit still ongoing, personally I would like plenty of sunshine on the subject of media manipulation by scam artistes. I hope the case becomes a landmark one!

 

While individual investors should make their own independant analysis and make investment decisions, the fact that the world is moving towards getting all information online makes for some easy prey given the openness of the internet. I am willing to wager that the shadowy world of hedge funds using shortselling as their primary vehicle rely on the openness of the internet and use this to the hilt. Ironically folks like Chanos argue for no disclosures of their short positions while the internet is free for dissemination of any and all info, right or wrong. Shortselling thrives on rumors. Information asymmetry is nothing new but the internet has made it acute. How much of this has contributed to the stock bubbles of the past 15 years? Not small I'd say. Buffet reminds us that the 1920's was not much different in that radio was apparently becoming popular and people touting stocks got a new voice. And folks who had no business being in stocks ended up there!

[cwericb]

Funny that you should mention the law suit as I had been contemplating posting a question asking if anyone had any news. I must be at least a year since I have heard any news at all. Does anyone know of any recent developments or where it stands now?