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Aussie Court Backs Suit Over Net Article

Australia's highest court Tuesday granted a businessman the right to sue a U.S. publication in Australia over an article published online in the U.S. and distributed over the Internet.

The case is considered a landmark ruling and could set a precedent for global media companies publishing content in their home countries, while being subject to foreign laws for posting the material for access on the Internet.

The court unanimously dismissed an appeal by Dow Jones & Co., saying the suit brought by Australian mining magnate Joseph Gutnick, was subject to Australian law. Dow Jones argued that the Internet version of an article from Dow Jones' Barron's magazine, should be heard in the United States, because Dow Jones Web servers are located in New Jersey. Gutnick's attorneys were successful in getting the case tried in Victoria, Australia, where some readers saw the story.

"The court was asked to determine where the article was published. It has made no findings on the merits of the defamation action itself," the Australian court said in a statement.

The article originally appeared in an October 2000 online version of Dow Jones-owned Barron's magazine claiming Gutnick was involved in stock scams, money laundering and fraud. Gutnick claimed the piece personally defamed him.

Dow Jones said in a statement that it would continue to defend itself in the case brought by Gutnick. Several other major media companies made legal submissions as part of the case against Dow Jones in Australia, including AOL Time Warner, Amazon.com, the Associated Press, Bloomberg, News Corp., Reuters and Yahoo.

The reason so many major international media companies are taking interest in this case is because it marks the first time a country's highest court defined where Internet publication takes place in a libel case.

Dow Jones argued the ruling opens publishers of content on the Internet to defamation suits in countries where the material is downloaded, and could lead to a variety of new suits around the world, which may restrict freedom of speech.

In a statement, Dow Jones said it "expressed disappointment" over the decision and said "publication was not where the material was downloaded by individual readers around the world." Dow Jones said it was published on the company's "web servers."

Dow Jones in its statement did say it was encouraged by court's ruling recognizing the "novel, complex and global" issues of Internet publishing.