Last week, Fairfax journo Mike Carlton resigned after firing up against critics of his article about Israeli attacks on Gaza.

News was quick to pick up on the story, giving it a two page spread in the Daily Telegraph.  The punch line was a bizarrely photoshopped picture with Carlton's face super-imposed on a bombing victim and wearing a Palestinian head-dress. The body was actually that of a Boston Bombing victim. Oops.

Leaving aside the obvious questions of journalistic integrity and disgusting tackiness, there’s an interesting legal issue here about defamation by photoshop. After a string of steamy cases about unauthorised publication of people’s private parts, we know that a photograph can be defamatory.  The question is whether it will cause people to think less of you. Words can hurt, and so can an image.

This one is particularly interesting. Clearly the Telegraph was intending to say something awful about Carlton; we think they attempted to portray him as a Palestinian sympathiser who had reaped the whirlwind of his own provocations (that is, he blew himself up).

In defamation, there's a difference between intent and effect. Malice can be relevant, but it doesn't determine whether you've been defamed. That's in the eyes of the audience.

So, is it defamatory to imply that someone is a Palestinian?  Eek. Controversial. We say no. Is it defamatory to imply that he's a terrorist, because all Palestinians are terrorists? And there's the sting – News was playing on the prejudices of bigots, but you're not going to win a defamation case by alleging that bigots will think less of you if they see you in a Palestinian head-dress.

So, while Carlton may have a good case, it'll be built on more subtle imputations than the obvious ones that News clearly intended to convey. In the end, their use of the photoshopped image was meant to hurt Carlton. That doesn’t make it defamatory. It just makes News look like a pack of race-baiting rednecks.