Slabbed New Media wins historic case under the US SPEECH Act.
US District Court rejects claims of US Citizens that forum shopped a defamation case to a foreign country in an act known as libel tourism. Record $425,000 Nova Scotia defamation judgment is “Repugnant to the Constitution” of the United States under the SPEECH Act.
Bay St Louis, Mississsippi December 20, 2012: U.S. Federal court rules against Canadian libel tourists – $425,000 judgment unenforceable:
United States District Court Judge Louis Guirola ruled yesterday saying that Louisiana native Vaughn Perret and his life partner Charles Leary had not met the U.S. standard of proof for their claims against Mississippi investigative journalist and blogger Doug Handshoe in a Nova Scotia court issuing a summary judgment December 19, 2012 for Handshoe and denied the claim by Perret, Leary and Trout Point Lodge, a Nova Scotia luxury resort property linked to a major political corruption scandal in New Orleans.
The pair had won a large defamation judgment in Nova Scotia against Handshoe and his highly-acclaimed political blog, Slabbed, and filed suit in Mississippi in an attempt to enforce that judgment. Handshoe did not defend the suit in Nova Scotia, and a default judgment was entered against him.
“It was an obvious case of libel tourism from the start and I was not going to dignify it with a response,” Handshoe contended, referring to what Judge Guirola described in his decision as “…the practice of “circumventing [U.S. Consitution] First Amendment protections”… “by filing lawsuits in foreign jurisdictions that lack similar protections.”
Leary and Perret told the Mississippi court that Canadian law afforded Handshoe “as much free speech protection as he would have received in a state or federal district court of the United States,” but Judge Guirola disagreed. He opined that, according to the SPEECH Act (Securing the Protection of our Enduring and Established Constitutional Heritage – 28 U.S.C. 4101), “ the judgment of the Canadian court is unenforceable in the United States because (1) Canadian law provides less stringent protections for freedom of speech than United States laws and (2) Handshoe would not have been found liable for defamation in a domestic court.”
The case involves assertions that Handshoe and others have made that Trout Point, Leary and Perret are connected to the ongoing corruption scandal involving disgraced former Jefferson Parish president Aaron Broussard, who is accused of using his Nova Scotia properties adjacent to Trout Point Lodge to commit a variety of frauds.
Broussard, his former wife – and partner in some of the Nova Scotia business enterprises – and other Parish officials have pleaded guilty to several counts of fraud and other charges surrounding the scandal.
After the default judgment was issued in Yarmouth, Nova Scotia by Nova Scotia Supreme Court Justice Susan Hood, she entered a judgment in which she awarded Trout Point Lodge general damages in the amount of $75,000, and Perret and Leary each $100,000 in general damages, $50,000 in aggravated damages, and $25,000 in punitive damages. None of those damages were upheld by the U. S. District Court
Judge Guirola also took strong issue with an injunction against Handshoe by the Nova Scotia court, which would effectively put him out of business. He said that an order issued in the area of First Amendment rights must “be precise and narrowly tailored to achieve a pin-pointed objective.”
“This broadly worded injunction…” said the judge, “would not be issued in a domestic court.”
Handshoe has continued to publish Slabbed, which is highly regarded in the Southern US for its uncompromising reporting on corruption in the region in the wake of Hurricane Katrina.
“I believed from the get-go that I had a right, maybe even a duty, to publish news about corruption affecting millions of citizens in my state and region and hundreds of millions of tax dollars,” said Handshoe, who is also a Certified Public Accountant.
The decision added that “verbal tumult, discord, and even offensive utterance” are “necessary side effects of … the process of open debate,” and noted that “one of the prerogatives of American citizenship is the right to criticize public men and measures–and that means not only informed and responsible criticism but the freedom to speak foolishly and without moderation.”
Handshoe prevailed in his argument that, under the SPEECH Act, the judgment of the Canadian court is unenforceable in the United States. The court found that Trout Point, Leary, and Perret failed to meet even one of the requirements under the burden imposed by the SPEECH Act.
Judge Guirola found that Leary and Perret did not demonstrate that “either (A) that the Supreme Court of Nova Scotia provided the level of protection for freedom of speech in this case as an American court, or (B) that Handshoe would have been found liable for defamation in a court in this state.”
Under well-established First Amendment principles of American law, speech is protected, and it is the plaintiff’s burden to prove falsity in a defamation action.
Judge Guirola found that the Nova Scotia court failed to conduct a minimal “inquiry into the truth of Handshoe’s assertions.”
Judge Guirola said that, to enforce the judgment of the Supreme Court of Nova Scotia would contradict the letter and purpose of the SPEECH Act.
“We had every confidence that, once it heard the facts of the case, “said Handshoe’s lawyer Bobby Truitt, “the court would render a fair decision which would reject this outrageous instance of libel tourism.”
In the past month, Leary and Perret have launched a second defamation suit in Nova Scotia, against Handshoe, Slabbed and the owners of the popular WordPress internet web host, naming as co-conspirators Handshoe’s attorney, Bobby Truitt and Randall Smith, a prominent New Orleans attorney, who represents a firm claiming to be harmed by the corruption scandal at the heart of the Broussard allegations.
A recent amended complaint in the suit filed by Smith on behalf of Concrete Busters named Leary and Perret’s Kempt Wilderness Trout Point Lodge, Ltd and Cerro Coyote, a luxury vacation property they owned in Costa Rica, as “shell corporations” and co-conspirators against the concrete firm. Named also as shell corporations in that suit are Broussard-owned or managed Kempt Wilderness Services and Nova Scotia Enterprises, LLC.
The publisher of Nova Scotia-based online news site, SouthCoastToday.ca was also named as co-conspirator in the most recent Trout Point suit, with Leary and Perret claiming that the publisher was an agent of Handshoe and that he “tag-teamed” with Smith and Handshoe against them.
The pair of Trout Point owners have attempted to coerce him to divulge privileged journalistic source materials and requested that Justice Hood bar him from reporting on an open court hearing in the defamation suit.
“Despite the paranoid assertions and crazy conspiracy theories trotted out in this suit, this is absolutely a case of harassment,” says Handshoe. “If Mr. Perret and Leary think they can continue to intimidate me and other reporters into not publishing the truth about corruption where we find it – even if it stretches into the wilderness of Nova Scotia – they have a big surprise coming.”
The issue of legal fees and court costs has not been settled, but the language of the SPEECH Act suggests that Leary and Perret will be held liable for Handshoe’s costs in defending the failed suit.
Handshoe expects to seek an injunction soon in the Southern District against Perret, Leary and Trout Point regarding what he contends is their continued harassment of him and his internet hosts.
See Judge Guirola’s decision:
See Notice of Action for most recent Trout Point Lodge suit against Handshoe, Slabbed and Automattic (WordPress): http://www.slabbed.org/wp-content/uploads//2012/12/TPL-v-DKH-Part-2.pdf
See amended statement of claim filed by Concrete Busters: http://www.slabbed.org/wp-content/uploads//2012/11/Concrete-Busters-v-Heebe-et-al-Doc-1.pdf