Splendid isolation? Australia as a destination for 'libel tourism'.

• Author: Rolph, David

Abstract

'Libel tourism' has been a source of tension between the United States and the United Kingdom. Ti highlights the difference not only between these countries' defamation laws but also their conflict of laws rules. Legislation to combat the real or perceived problem of 'libel tourism' has been proposed or enacted in the United States and the United Kingdom. This article analyses the phenomenon of 'libel tourism' and seeks to define the concept and to ascertain its incidence. It examines the Ehrenfeld v Bin Mabfouz litigation and the legislative reforms it provoked. It then considers the prospect that Australia will prove an attractive destination for 'libel tourism'.

I Introduction

The phenomenon of 'libel tourism', or 'libel terrorism', as it has been more tendentiously called, has generated considerable attention in the United States and the United Kingdom. The contention that English courts have exercised jurisdiction over defamation proceedings which have a marginal connection with the United Kingdom and which impinge upon United States citizens' constitutionally protected right to freedom of expression under the First Amendment has elicited a strong response from legislators, judges and academics in the United States and the United Kingdom. The culmination of the American legislative response was the passage of the SPEECH Aa in 2010, (1) although a number of state legislatures enacted specific provisions dealing with foreign defamation judgments. The issue of 'libel tourism' has also figured prominently in the recent libel law reform process in the United Kingdom, although English courts arguably had already begun to take a more rigorous approach to the exercise of jurisdiction over defamation cases with an international dimension to them.

'Libel tourism' and the American and English responses to it highlight the differences not only between the levels of legal protection afforded to freedom of expression in these countries, but also between their conflict of laws rules. These differences also exist between American and Australian law. Indeed, the tensions are arguably starker, given that Australia has no bill of rights and consequently has not had to reconsider the balance between the right to reputation and freedom of expression in its defamation law, as the United Kingdom has done, following the introduction of the Human Rights Act 1998 (UK). Moreover, Australian courts and legislatures have not attempted to impose more rigorous threshold tests of jurisdiction on prospective 'libel tourists', again unlike the United Kingdom. Therefore, it is instructive to analyse the phenomenon of 'libel tourism' and the United States response to it from an Australian perspective.

This article first explores the concept of 'libel tourism' and its incidence in the United Kingdom and Australia. What is meant by 'libel tourism' and how frequent it is are contentious issues. The article identifies the important differences between American and Anglo-Australian defamation law and conflict of laws, which give rise to the problem of 'libel tourism'. It examines the case which was the impetus for the American legislative response to 'libel tourism', Ehrenfeld v Bin Mahfouz. It then traces those legislative developments, as well as the attempts by the United Kingdom to address concerns about 'libel tourism'. Finally, the article considers the prospects of 'libel tourism' occurring in Australia, using the recent case of Evony LLC v Everiss as a case study. It suggests that, while the relative geographical isolation of Australia might be a disincentive to 'libel tourism', such a disincentive might be overcome, given the globalised and networked nature of communication technologies and the advantages offered to plaintiffs by Australia's defamation laws and its conflict of laws rules.

II 'Libel Tourism': Its Definition and Incidence

A significant difficulty with analysing the phenomenon of 'libel tourism' is the definition of the concept itself. The lack of clarity has been noted by law reformers and academics. (2) A neutral meaning of 'libel tourism' was provided by the Libel Working Group, established by the United Kingdom Ministry of justice, which defined the term as 'a proceeding in which a non-resident sues another non-resident in the forum'. (3) Other definitions identify the type of non-resident litigant involved in 'libel tourism', giving some content to the concept. Thus, 'libel tourism' can be viewed as a form of forum shopping, in which well-resourced, usually high-profile plaintiffs--such as American celebrities, Saudi businessmen and Russian oligarchs--sue for defamation in a place which has little connection to the publication itself and to the parties. (4)

Another definition of 'libel tourism' has gained currency, which differs from these meanings in important respects. In Ehrenfeld v Bin Mahfouz, Ehrenfeld herself defined 'libel. tourism' as 'the use of libel judgments procured in jurisdictions with claimant-friendly libel laws--and little or no connection to the author or purported libelous material--to chill free speech in the United States'. (5) Some American legal scholars also define 'libel tourism' in this way. (6) The difficulty with this definition is that it focuses on the effect of foreign defamation litigation on United States defendants and their right to freedom of speech without considering the identity of the plaintiffs and their relationship to the fora in which they sue. Some plaintiffs who sue United States publications could be Labelled 'libel tourists' without those plaintiffs ever leaving home. For example, applying this definition, Joseph Gutnick, the plaintiff in the High Court of Australia's landmark decision on jurisdiction over internet defamation, (7) could be perceived as a 'libel tourist'; he sued in a jurisdiction with 'claimant-friendly libel laws' (relative to the United States); he sued a magazine which had little connection to the forum; and he sued in respect of an article written by an author who equally had little connection to the forum. Yet Gutnick never left home--he was a resident of Victoria, suing in the Supreme Court of Victoria for damage to his reputation solely within Victoria, which was the principal, but not the sole, place in which he conducted business. (8)

Partlett and McDonald suggest that there has been insufficient attention given to important distinctions between proceedings which might be classified as 'libel tourism'. They identify three categories of claim which are usually treated as 'libel tourism': first, where a foreign plaintiff sues a defendant in the forum in which the defendant resides or conducts business; second, where a plaintiff sues a foreign defendant in the forum in which the plaintiff resides or conducts business; and third, where a plaintiff sues a defendant in a forum in which neither party resides or conducts business but in which publication has occurred. (9) It is the latter two categories which are most readily recognised as 'libel tourism', yet arguably they raise distinct concerns, with the third category being more egregious than the second. The conflation of these two categories in most analyses of 'libel tourism' indicates the centrality of American anxieties about encroachments upon First Amendment rights in this debate.

In addition to the definitional difficulties, there is disagreement as to whether 'libel tourism' is a serious problem in the United Kingdom and elsewhere. (10) There are, in fact, few cases of 'libel tourism' which proceed to final judgment. More proceedings are commenced but are discontinued or settled. However, as the Joint Committee on the Draft Defamation Bill accepted, merely looking at the decided cases is likely to provide an incomplete understanding as to the true extent of 'libel tourism'. The threat of defamation litigation by prospective 'libel tourists' and the resulting 'chilling effect' on freedom of expression needs to be taken into consideration. (11) Even if 'libel tourism' is not in fact a significant problem, in terms of the number of actual or threatened defamation cases, the widespread perception that a Western liberal democracy is inimical to, or insufficiently protective of, freedom of expression might be sufficient to warrant law reform. (12) Addressing 'libel tourism' then might be an instance in which law reform needs to proceed not in response to an empirically demonstrated problem but on the basis of principle.

English courts have indeed attracted an eclectic range of defamation litigants. They include American celebrities, such as Cameron Diaz, Justin Timberlake and Kate Hudson. They include Russian oligarchs, such as Boris Berezovsky and Grigori Loutchansky. (13) They include Saudi businessmen, such as Khalid bin Mahfouz. (14) Further, more exotic examples include defamation proceedings brought by boxing promoter, Don King, against British boxer and New York resident, Lennox Lewis, as well as a Nevada promotion company and a New York attorney; (15) renowned film director, Roman Polanski's defamation proceedings against Vanity Fair magazine; (16) the Beatles' hanger-on, 'Magic Alex' Mardas' defamation proceedings against The New York Times and The International Herald Tribune; (17) an Icelandic businessman against an Icelandic academic; (18) and former New Zealand cricket captain, Chris Cairns' defamation proceedings against Indian cricket administrator, Lalit Modi arising out of a tweet. (19) Australia has also managed to attract some high-profile 'libel tourists'. For instance, film stars Jim Carrey and Penelope Cruz have sued for defamation in Australia, although their proceedings were ultimately settled or discontinued. (20) These are only some of the many libel proceedings that generated concern about 'libel tourism'. (21)

III Differences between American and Anglo-Australian Defamation Law and Conflict of Laws

'Libel tourism' has become a potent...