For years, U.S. writers and publishers have faced the threat of “libel tourism” – suits by foreigners, who take advantage of England’s plaintiff-friendly libel laws to get large judgments and injunctions against authors and publishers of writings they don’t like.
For example, in 2003, Rachel Ehrenfeld published Funding Evil: How Terrorism Is Financed and How to Stop It in the U.S. In Funding Evil, Ehrenfeld claimed that Bin Mahfouz, a Saudi Arabian banker, provided financial backing for terrorist organizations. The book was not marketed or published in England, and a mere 23 copies reached England via Internet sales. Nevertheless, Bin Mahfouz was able to sue Ehrenfeld for defamation in the English courts, which found that these few sales were sufficient to confer personal jurisdiction over Ehrenfeld. When Ehrenfeld failed to make an appearance to defend the suit, the English court entered a default judgment against her, ordering her to pay a large fine, to apologize and retract her statements and to pay Mahfouz’s legal fees, and enjoining her from further publication of Funding Evil in England. (Fn1)
After Mahfouz attempted to enforce his judgment against her in New York, Ehrenfeld filed an action in federal court for a declaratory judgment that Bin Mahfouz’s judgment was not enforceable in the U.S. based on First Amendment protections. Ehrenfeld claimed that as a result of the English judgment awarded Bin Mahfouz, publishers had rejected other articles she had written about Saudi companies, possibly fearing that publication of Ehrenfeld’s work would make them the targets of defamation suits as well. However, the District Court dismissed Ehrenfeld’s case, finding that New York’s limited long-arm statute did not give the Court jurisdiction over Bin Mahfouz. (Fn2) This let Mahfouz continue his efforts to enforce his judgment against her.
The Ehrenfeld case illustrates an increasingly common problem in the Internet age. Courts in foreign countries that lack First Amendment speech and press freedoms are increasing willing to assert jurisdiction over defendants in defamation suits based on tiny levels of distribution or viewership of content. For example, in 2007, American actress Cameron Diaz was reportedly able to sue the National Enquirer in London over an article that was only published in the U.S. version of the Enquirer and had received 279 hits from U.K. addresses on the Enquirer’s website. (Fn3) The Washington Times also recently faced a defamation suit in London, even though no hard copies of the Times are sold in the U.K., based on forty-odd hits on its website. (Fn4)
In an effort to ameliorate this problem, Congress has just passed and the President signed the SPEECH Act (to be codified at 28 U.S.C. §§ 4101-05). The SPEECH Act provides shields for U.S. authors and publishers by preventing a person who obtains a defamation judgment in a foreign court from enforcing that judgment in the U.S., unless that person makes two showings concerning that judgment.
First, the plaintiff must show that that the defamation law applied by the foreign court provided as much protection for freedom of speech and the press as the U.S. Constitution and applicable State laws -- or that the defendant would have been found liable under U.S. laws anyway. (Fn5) The SPEECH Act further provides that a plaintiff cannot enforce its defamation judgment, unless the judgment is consistent with the Communications Decency Act (47 U.S.C. § 230). (Fn6) The Communications Decency Act provides website operators with immunity from most types of suits for publishing material provided by third parties.
Second, the plaintiff must show that the foreign court’s exercise of jurisdiction over the defendant comported with U.S. Due Process requirements.(Fn7) This could prevent enforcement in the U.S. of defamation suits regarding publications that were not expressly aimed at the jurisdiction in which the suit was brought – i.e., true libel tourism.
The SPEECH Act also provides swords for U.S. publishers and authors. First, the Act provides that a defendant who successfully defends an attempt by a plaintiff to enforce a foreign judgment can recover its attorneys fees and costs. A successful foreign defamation plaintiff does not garner an additional attorneys fee award. (Fn8)
Second, the SPEECH Act also codifies a defamation defendant’s right to bring a suit for in federal courts for a declaration that the foreign judgment is “repugnant to the Constitution or laws of the United States.” (Fn9) Some courts around the United States have already been willing to grant such judgments, however, others have refused to grant them. (Fn10) Such a declaratory judgment would prevent a plaintiff with a foreign judgment from engaging in further enforcement actions in the U.S. On the other hand, it would not prevent the plaintiff from continuing to enforce its judgment against the defendant or the defendant’s assets in foreign courts.
Third, the Speech Act also helps cure some of the jurisdictional problems faced by plaintiffs such as Ehrenfeld by providing for nationwide service of process for actions for declaratory relief against foreign defamation plaintiffs. (Fn11) This would permit a defamation defendant for file suit in her home state of New York, even if the foreign defamation plaintiff never set foot in the State, but had a vacation home in, say, Florida.
What the SPEECH Act does not do is permit a U.S. defendant to stop the prosecution or enforcement of a defamation lawsuit in foreign lands – such as by providing a right to sue for damages or to get an injunction. Congress considered, but ultimately rejected such proposals for many reasons, including that they would be largely unenforceable and that they would not show due respect for national sovereignty.
This means that, while the SPEECH Act protects U.S. authors, publishers and interactive websites within U.S. shores, it will not stop libel tourism. Authors, publishers and website operators can still expect to see defamation suits emanating from places like London or Singapore, which can be fully enforced on them if they travel to or have assets or operations in foreign lands.