Friday, December 21, 2007

Libel Tourism: N.Y. Court rules in Ehrenfeld case: It won't hear the case.. now.

The N.Y. Appeals Court has ruled in the Ehrenfeld case. There are many disturbing aspects to this case, as my colleague Michael Broyde and I wrote in our New York Times oped.

[Some background: In her book Ehrenfeld charged Saudi billionaire Mahfouz with funding terrorism. She did not publish the book in the UK. Nonetheless, Mahfouz's lawyers bought the book over Amazon UK and then went to the UK court and sued her for libel. The case coined the term "Libel Tourism." She did not contest the Saudi billionaire's charges against her and therefore lost by default. ]

She tried to counter sue Mahfouz in the United States. She argued that, the fact that Mahfouz might try to collect what he won in the UK judgment against her, gave the N.Y. court jurisdiction and it should prevent that from happening.

The N.Y. Appeals Court ruled that New York courts have no jurisdiction to hear her counter suit because he has not yet tried to collect the funds awarded him by the UK court.

Ehrenfeld's lawyers had argued that just the threat that Mahfouz would try to collect the money gave American courts jurisdiction.

What the N.Y. court said was that she can't sue now. The court seems to be saying that, should, however, Mahfouz come banging on her door to collect the money, she can then go to the N.Y. court and ask them to hear the case.

Since the ruling was announced yesterday I have received a number of despondent emails. They have expressed the sentiment that this is an awful defeat for Ehrenfeld, as well as all others who would expose Saudi funding of terrorism and try to expose extremism.

I too wish the ruling had gone otherwise but lawyers had warned me that the court would probably rule this way.

Part of the problem is that Ehrenfeld, by choosing not to contest Mahfouz's assault on her in the UK court, has a judgment against her.

I am convinced -- I may be wrong -- that Mahfouz won't come after Ehrenfeld for the money. To do so he might look like a vicious man trying to strip an American researcher and writer of her livelihood. Moreover, if she then goes to the American courts and counter sues, he might lose.

However, if he leaves things as they are now it is a win/win for him.
* He won by default in the UK court
* He has a judgment against Ehrenfeld [even though she never published in the UK]
* He leaves her hanging, not knowing if he is coming to collect "his" money while he avoids looking like an ogre.
* Above all, he avoids the risk that she will counter sue and win in an American court.

I know that Ehrenfeld did not contest these charges in the UK on principle. [It is absurd that a book that was not published in the UK can be the cause of a libel suit there.] However, because of the nature of UK libel laws, it let Mahfouz have his win [even if by default]

This made him the winner. And that is how he will probably choose to remain.

1 comment:


A possible answer to this happening again is a Publishers small print legal notice inserted in all books published in the USA which states:

The Sale of this book shall be governed by and construed in accordance with the Laws of the State of New York, both the publisher, seller, deliverer and buyer/s, agree that they shall submit to the exclusive Jurisdiction of the United States District Court of New York, or any other NY State Court, for the purposes of all legal proceedings, including libel, arising out of the publishing, distribution, sale and purchase of this book. The purchasers agree that they jointly and severally irrevocably waive the right to conduct legal proceedings arising out of the sale and purchase of this book in any other legal Jurisdiction, other than in the State of New York, USA. [Etc]

I'm certain this suggestion contains 101 ripostes from those more knowledgeable on Law.