Why you can too easily publish and be damned

Demon Internet faces a legal bill of up to £500,000 after its decision last week to settle a long-running libel case about malicious messages posted on its newsgroup servers.

Demon's decision to settle rather than risk losing in court has raised fears that freedom of speech on the Internet could be curtailed.

In an out-of-court settlement, physicist Dr Laurence Godfrey will be paid damages and costs by Demon, one of the UK's biggest Internet service providers (ISPs).

Godfrey claimed he had asked Demon to remove from its servers defamatory postings, which had been forged so as to appear to be from him.

Demon refused to remove the material, described by Godfrey's lawyers as "squalid, obscene and defamatory", from the soc.culture.thai newsgroup.

The ISP must pay £15,000 damages plus legal costs, estimated at £230,000. Including its own costs, Demon's bill is likely to approach £500,000.

The case hinged on whether or not Demon could be treated as the publisher of material on one of its hosted newsgroups.

Demon's parent company, Thus, said in a statement: '(We) remain convinced that the law has not kept pace with the development of the internet and will work with our colleagues in the industry to lobby for modernisation of the law.

"Thus will press the government for recognition that ISPs should not be liable for the millions of items carried on the internet every day."

The case has had a knock-on effect already: ISP Netbenefit has closed down a site run by a gay current affairs magazine, after complaints about the material posted on it.

"We're not in a position to monitor sites and decide what is or isn't defamatory," said Alison Sparshatt, managing director of Netbenefit. "The legal position isn't clear enough for us to take responsibility."

Dai Davis, head of the IT Group at law firm Nabarro Nathanson, said service providers are not treated any differently from retailers. "If ISPs have effective control of people using the system, then they have no special defence," he said.

Davis warned that because no formal ruling was made, the case does not set a legal precedent. He added that Demon would not have been able to advance a defence of innocent dissemination.

Other legal experts added that planned European law could become important to the issue."'Under the European Union's draft ecommerce directive, if an ISP doesn't know about libellous content, it will not be liable. If it does know, it can be liable," said Mike Pullen, a partner at solicitors Dibb Lupton Alsop.

Sparshatt said that in the US, ISPs are treated as carriers, like telecommunications companies, and as such are not responsible for content transmitted on them.

The case creates a dilemma for ISPs because if they screen submissions or suspend websites, which in any case is technically difficult, they could damage internet-based businesses.

Reporting by vnunet.com