May 082010
 May 8, 2010  Posted by  Court, Featured News, Online

The Associated Press had a story earlier this week that I just came across on a court decision out of New Hampshire.  In a nutshell, the case involved a watchdog site, Implode-Explode Heavy Industries, Inc. (Implode), that uploaded a confidential document about a mortgage company, Mortgage Specialists, Inc., and an anonymous comment made on the site accusing the mortgage company’s owner of fraud. The background of the case, as summarized in the court’s decision:

In August 2008, Implode published an article that detailed administrative actions taken by the New Hampshire Banking Department against Mortgage Specialists. In this article, Implode posted a link to a document that purported to represent Mortgage Specialists’ 2007 loan figures (Loan Chart). In response to the article, an anonymous website visitor with the username “Brianbattersby” posted two comments regarding Mortgage Specialists and its president.

After Mortgage Specialists became aware of the article and postings, it petitioned for injunctive relief, alleging that publication of the Loan Chart was unlawful because it violated RSA 383:10-b (2006) (mandating confidentiality of all investigative reports and examinations by the New Hampshire Banking Department) and that Brianbattersby’s postings were false and defamatory. Mortgage Specialists requested that Implode immediately remove the Loan Chart and postings from its website. Mortgage Specialists further demanded that Implode disclose both the identity of Brianbattersby and the source of the Loan Chart.

The trial court had granted the relief sought by Mortgage Specialists, but the New Hampshire Supreme Court held that a watchdog web site is a news organization and remanded the case back to the lower court on the issue of whether the site — as a news organization — should have been ordered to reveal the source of a leaked document posted on the site.   With respect to the web site being a news organization, the court held:

The fact that Implode operates a website makes it no less a member of the press. In light of the trial court’s implicit findings, we conclude that Implode’s website serves an informative function and contributes to the flow of information to the public. Thus, Implode is a reporter for purposes of the newsgathering privilege.

With respect to whether the site should have been ordered to reveal the identity of an anonymous commenter, the court took this opportunity to endorse the Dendrite standard adopted in other courts and states:

We conclude that the Dendrite test is the appropriate standard by which to strike the balance between a defamation plaintiff’s right to protect its reputation and a defendant’s right to exercise free speech anonymously. Accordingly, we join those courts which endorse the Dendrite test.

The case is The Mortgage Specialists, Inc. v. Implode-Explode Heavy Industries, Inc.. .

Read more on First Amendment Center.

Public domain photo from Wikimedia Commons.

Update: A reader kindly sent in a link to an article by Public Citizen on this case. Public Citizen had filed an amicus brief (pdf) in this case.

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