In what is considered a groundbreaking ruling, Australia's High Court has found publishers who distribute media content over the Internet from outside Australia are liable for defamation action under Australia law.
The High Court's decision is in response to an appeal by US based Dow Jones & Company Inc, publishers of the Wall Street Journal, to prevent businessman Joseph Gutnick's defamation action against it from being held in his home state of Victoria.
Gutnick initially launched a defamation action in the Supreme Court of Victoria against Dow Jones, claiming damages from an article it published online in October 2000. He claimed that as the material was distributed online, and thus available to readers in Victoria, it should be subject to that state's laws.
Dow Jones responded that because the online material was located on its Web servers in its offices in the US, it should be classified as being been published there. Therefore, any action taken against such material could only be launched in a US court, the group stated.
In its final judgement, the court said the most important issue so far as defamation is concerned is the place in which such defamation occurs.
"Statements made on the Internet are neither more nor less Â‘localised' than statements made in any other media or by other processes. Newspapers have always been circulated in many places. The reach of radio and television is limited only by the capacity of the technology to transmit and hear or view them, which already, and for many years, has extended beyond any one country," the court said.
"In any event, a ‘publisher', whether on the Internet or otherwise, will be likely to sustain only nominal, or no damages at all for publication of defamatory matter in a jurisdiction in which a person defamed neither lives, has any interests, nor in which he or she has no reputation to vindicate."
The court's decision also noted the dangers of creating publishing ‘havens'.
In particular, the court criticised Dow Jones' argument that publication should be held to occur at the one place where the matter is either provided or first published, pointing out that such a decision could not "withstand any reasonable test of certainty and fairness".
"If it were accepted, publishers would be free to manipulate the uploading and location of data so as to insulate themselves from liability in Australia, or elsewhere: for example, by using a Web server in a Â‘defamation free jurisdiction' or, one in which the defamation laws are tilted decidedly towards defendants. Why would publishers, owing duties to their shareholders, to maximise profits, do otherwise?
"The place of ‘uploading' to a Web server may have little or no relationship with the place where the matter is investigated, compiled or edited."