||Neutral Citation Number:  EWHC 1797 (QB)
||Case Numbers: HQ07X03107, HQ07X01546, HQ07X01547, HQ07X01599, HQ07X01732, HQ07X02617, HQ07X02619 – HQ07X02621, HQ07X02925, HQ07X03076, HQ07X03106, HQ08X00135, HQ08X00826, HQ08X00923, HQ08X01190 – HQ08X01199, HQ08X01201 – HQ08X01203, HQ08X01262, HQ08X01263, HQ08X01322, HQ08X01564 – HQ08X01568, HQ08X01584
B e f o r e :
THE HONOURABLE MR JUSTICE EADY
|| NIGEL SMITH
||- and -
||ADVFN Plc and others
Aidan Eardley (instructed by Edwin Coe) for the Claimant
Richard Parkes QC (instructed by Field Fisher Waterhouse LLP) for ADVFN Plc
Andrew Katsapaou, Charles Love, Wynne Pearce and Michael Tuppen appeared in person
Hearing date: 9 June 2008
HTML VERSION OF JUDGMENT
Crown Copyright ©
see also: Approved Supplemental Judgment
Mr Justice Eady :
The subject-matter of the 9 June hearing
- I refer to my ruling when this litigation was adjourned on 12 May 2008, and will not repeat the background which I there attempted to summarise:  EWHC 1250 (QB).
- At the hearing on 9 June Mr Smith had the advantage of being represented by Mr Eardley, who developed the case for lifting the stay imposed by the Master on 25 April and proposed a number of directions for the most convenient way of progressing all the cases so far issued and outstanding. ADVFN Plc was represented by Mr Parkes QC and a number of defendants appeared and made submissions in person. Others had written to me beforehand setting out their individual concerns.
- While Mr Parkes submitted that the stay should remain in place for the time being, at least until some outstanding costs orders (totalling about £25,000) were complied with, he nonetheless recognised that there was a prima facie case against ADVFN in libel. That claim raises one issue which is unique to the company, namely the pleaded defence under s.1 of the Defamation Act 1996, which Mr Eardley suggested was apt for preliminary disposal. Mr Parkes reserved his position for the time being as to whether his client might wish to take any other pre-emptive argument (for example, based on qualified privilege or abuse of process).
- Meanwhile, the Defendants who appeared in person and those who made submissions to me in writing seek to maintain the stay in place and, in some cases, there has been a suggestion that the individual claim should be struck out as having no realistic prospect of success (either because at least one defence is bound to succeed or because the litigation in its context may be regarded as an abuse of process). No formal applications were made for this purpose and the Claimant did not therefore have a chance fully to address the point.
- One of the matters which the Master referred to me for consideration was whether or not the circumstances would justify the making of a civil restraint order against Mr Smith. Some of the litigants in person also canvassed this possibility. Before I could make an extended order I would need to be satisfied that he has persistently issued proceedings or applications that can be categorised as totally without merit.
- There is no doubt that a significant number of Defendants are troubled by the prospect of long drawn out and expensive litigation which they cannot afford and in respect of which they may have no realistic prospect of recovering costs even in the event of ultimate success. As I mentioned in my earlier ruling, Mr Smith is exempt from paying court fees and may reasonably be presumed to have no significant funds with which to meet any costs order. That fear is naturally confirmed by his apparent inability, so far, to pay the costs already outstanding in favour of ADVFN.
- The Defendants who appeared before me were Mr Wynne Pearce (HQ08X01194), Mr Charles Love (HQ07X03076), Mr Andrew Katsapaou (HQ08X01569) and Mr Michael Tuppen (HQ08X00135). They made their submissions with economy and restraint and helped me to put matters in context.
The Claimant's inability to fund the litigation
- I turn first to ADVFN. It is now well recognised that the court's ability to order costs to be paid as the case progresses has brought a salutary discipline to litigation, which helps to prevent things getting out of hand and tends to focus minds on priorities and proportionality. That is especially so with those who are free from the usual discipline imposed by the requirement to pay court fees when issuing proceedings or applications.
- It is obviously a relevant question to ask whether someone who had to pay court fees would have thought it proportionate to any legitimate gain to issue 37 sets of proceedings (with apparently more to come). If there is a genuine desire for vindication over any significant defamatory allegation, it is reasonable to suppose that this objective could generally be achieved by a more targeted strategy. Inevitably, one is left with the impression that Mr Smith and his solicitors are determined, as I described it on 12 May, to pick off the potential defendants one by one and to make it clear to them that it would be cheaper to apologise and pay up at an early stage. It may be, therefore, that his fees exempt status is being used as a tactical weapon. What is more, one of the common complaints from the litigants in person is that this impression is confirmed by the failure to comply with the defamation protocol by spelling out the exact nature of the complaint before issuing proceedings.
- It may be true that a significant number of actions were started in March of this year in order to avoid a limitation defence, with more flesh to be put on the bones later, but that does not explain why nothing was done before that date. Norwich Pharmacal applications had been made in April 2007, but no steps were thereafter taken. No explanation has been given for this delay. Obviously in the absence of any explanation the question arises whether there is indeed a genuine need for vindication or compensation.
- I am asked to scrutinise these cases with particular care having regard to the principles addressed by the Court of Appeal in Dow Jones Inc v Jameel (Yousef)  QB 946 (cited in my earlier ruling) and to ask whether they actually represent, in each case, a genuine attempt to vindicate Mr Smith's reputation and whether there is any legitimate or tangible advantage to be gained which outweighs the considerable demands which would be made upon public and private resources. (As Mr Tuppen pointed out, the public purse has already been effectively subsidising the strategy through the fees exemption.)
- For the moment, at least, I see no reason why ADVFN should continue to be vexed with this litigation until Mr Smith complies with the outstanding costs orders. They cannot simply be ignored.
The nature of bulletin boards
- It is necessary to have well in mind the nature of bulletin board communications, which are a relatively recent development. This is central to a proper consideration of all the matters now before the court.
- This has been explained in the material before me and is, in any event, nowadays a matter of general knowledge. Particular characteristics which I should have in mind are that they are read by relatively few people, most of whom will share an interest in the subject-matter; they are rather like contributions to a casual conversation (the analogy sometimes being drawn with people chatting in a bar) which people simply note before moving on; they are often uninhibited, casual and ill thought out; those who participate know this and expect a certain amount of repartee or "give and take".
- The participants in these exchanges were mostly using pseudonyms (or "avatars"), so that their identities will often not be known to others. This is no doubt a disinhibiting factor affecting what people are prepared to say in this special environment.
- When considered in the context of defamation law, therefore, communications of this kind are much more akin to slanders (this cause of action being nowadays relatively rare) than to the usual, more permanent kind of communications found in libel actions. People do not often take a "thread" and go through it as a whole like a newspaper article. They tend to read the remarks, make their own contributions if they feel inclined, and think no more about it.
- It is this analogy with slander which led me in my ruling of 12 May to refer to "mere vulgar abuse", which used to be discussed quite often in the heyday of slander actions. It is not so much a defence that is unique to slander as an aspect of interpreting the meaning of words. From the context of casual conversations, one can often tell that a remark is not to be taken literally or seriously and is rather to be construed merely as abuse. That is less common in the case of more permanent written communication, although it is by no means unknown. But in the case of a bulletin board thread it is often obvious to casual observers that people are just saying the first thing that comes into their heads and reacting in the heat of the moment. The remarks are often not intended, or to be taken, as serious. A number of examples will emerge in the course of my judgment.
The Defendants who appeared in person
- Several of the Defendants have made the point that Mr Smith would be well aware of all this and that he has shown himself to be unrestrained in "dishing it out". Indeed, some of the remarks of which he now complains were themselves prompted by the way he was behaving towards others. In particular, he had been very critical of someone known as "Wiganer". This led in turn to criticisms of his behaviour. This was mainly on the basis that there was in his case plenty of "give" but no willingness to "take".
- This emerges, by way of example, from some of Mr Love's postings. On 21 April 2007 he said, "I posted on this thread for the first time a couple of days ago to support those who were being threatened and bullied by you Mr Smith". On 22 April he added, "I have no intention of apologising to you for voicing my opinions and my support of those who you have most outrageously bullied with threats and demands for money".
- The same day he asked, "Who started the slandering? Smith, that's who. He called Wiganer a fraudster and then others he called liars when in fact he was completely wrong in his reasonings concerning the conditions for claiming [i.e. compensation of shareholders for Langbar losses]".
- Also, Mr Smith rather alarmed someone using the name "Dr Jekyll" who was prepared to apologise when he was threatened with libel proceedings: it was this that led Mr Wynne Pearce, for example, to offer the remarks over which he has been sued. He said on 19 April 2007 (of Dr Jekyll): "I do not believe any of his posts have been defamatory and Nigel Smith has behaved in an appalling manner. NS has discredited himself by his own actions".
- On the same day, Mr Love said "I do not believe any of his posts have been defamatory and Nigel Smith has discredited himself by his own actions". The next day he described Mr Smith as a "b[ulletin] b[oard] bully".
- Many would be surprised to see any of this made the stuff of libel proceedings – the object of which is to restore reputation. Most people would know what was being referred to in these exchanges and make up their own minds about Mr Smith's behaviour. One might well ask, in the language adopted by the Court of Appeal in Jameel, whether "the game is worth the candle". If litigation is being used to exert pressure on people to pay money (whether for charity or otherwise) or to apologise without any regard to the overall merits, solely with a view to avoiding spending money without hope of recovery, then the court needs to ensure that its processes are not being abused.
- In a number of these cases, it is obvious to me that there would be strong defences of qualified privilege or fair comment and, in some cases, arguments running along the lines of "mere vulgar abuse". No such issues, as I have said, are formally before me at the moment, since no-one has issued an application for summary judgment or to strike out any part of a pleading on any of those grounds; nevertheless, such factors weigh heavily in the exercise of the court's discretion and case management powers and, specifically, since I am now asked to continue the stay imposed by the Master. The court has a wide discretion to impose or maintain a stay, which is now embodied in CPR 3.1(2)(f). The only reason for lifting a stay, of course, is to allow a genuine claim to progress towards trial in order to achieve some legitimate advantage: that is to say, vindication or compensation.
- Mr Wynne Pearce is a retired solicitor who responded to Dr Jekyll's call for help when he was asked for money by Mr Smith. Of course, he was not acting in a formal solicitor-client relationship, but he was trying to help (gratuitously) in the light of his professional experience. Even though he was not himself a Langbar shareholder, therefore, there would be a powerful argument that he had a legitimate reason to step in and try to inject some common sense. He was trying to encourage Dr Jekyll not simply to pay up out of stress and anxiety. That would provide a powerful argument to the effect that there was a legitimate common and corresponding interest such as to give rise to a privileged occasion. Furthermore, in using the word "appalling" he was clearly expressing a personal opinion (by no means unique to himself) about Mr Smith's modus operandi and how it was affecting people.
- There would thus be a good argument in Mr Wynne Pearce's case to the effect that there was a defence of fair comment on a matter of public interest. In an early posting, on 10 February 2007 (time-barred before the issue of proceedings), Mr Wynne Pearce had also referred to "the Nigel [Smith] School of Irrational Thought and Vexatious Litigation". That is clearly a comment in the same vein about what was happening on the bulletin board.
- Rather laboriously, in his particulars of claim against Mr Love, Mr Smith attempts to define "appalling" by reference to "someone who acted in a manner that causes dismay, horror or revulsion to others". Yet the remarks on the bulletin board by these multiple defendants were not simply made in a vacuum. Any reader would know the context and recognise the conduct on Mr Smith's part which was being characterised as "appalling" and be able to form his or own view of it. This means that Mr Smith's reputation in the eyes of such a person is likely to depend primarily on what he himself has done, and is known to have done, rather than on what others are saying about it.
- Mr Michael Tuppen told me that when he wrote the words to which Mr Smith took offence in his case, he was at first unaware of Mr Smith's identity. He only knew him at that stage by one of his dozens of "avatars" – in this case "Anomalous". On 23 April 2007, he wrote "Assuming I am not being taken in by a complete load of bollocks! then: Anomalous behaviour is unacceptable good luck to all victims!!!".
- Mr Tuppen went on to quote an American judge who had apparently said, in a similar context, that " … plaintiffs harmed by a blog have an instant remedy available: blogging themselves". Next day, Mr Tuppen added that "You cannot defame someone with an insult". He went on to observe:
"Anomolus and people like him (Godfrey vs Demon springs to mind) eventually destroy the internet with absurd actions like this. My wipers scraped better things from my car windscreen tonight than this dickhead Anomulus."
This is an example of what I mentioned earlier in the context of "mere vulgar abuse". (The case reference was of course to Godfrey v Demon Internet Ltd  QB 201.) One would not wish to encourage "vulgar abuse"; on the other hand, it is not necessarily appropriate for it to be taking up the scarce resources of the civil courts.
- Mr Tuppen then complained that the courts had too readily granted Norwich Pharmacal relief in Mr Smith's case and thought it irresponsible for ADVFN to reveal the identities of subscribers (although, of course, it was subject to court orders). He was obviously concerned at "the release of private home locations". ADVFN could be, for all they knew, putting lives at risk. He asked, rhetorically "Who is anomalous, is he a schizophrenic mass murderer?" It is thus clear that he was not alleging that Mr Smith (whose identity he claimed at that stage not to know) was in fact a mass murderer. He was merely pointing out the general risks attaching to the release of personal details.
- Mr Tuppen then went on to refer to one of Mr Smith's demands for money (made on 19 April 2007) and advised that people should not pay up. He said:
"I believe that as others have said Anomalous and others are conspiring to extort money from individuals they have threatened. DO NOT PAY ANYTHING to the solicitors named on 19/04/2007 @ 12:37 [Edwin Coe] … DO NOT PAY ANYTHING TO ANYONE WITHOUT TALKING TO THE POLICE/LAWYERS Take good care."
- The next day (25 April 2007), Mr Tuppen said:
"I do not like people demanding money with threats from people who can possibly ill afford the sums asked for. I have therefore contacted the police naming Nigel Smith – together with his home address as a possible crook demanding money under duress."
Mr Tuppen confirmed, in so far as it may be relevant, that he had indeed drawn the matter to police attention.
- This is by no means an uncommon theme. Mr Smith would no doubt argue that there is a fundamental difference between seeking genuinely to vindicate yourself and, on the other hand, "demanding money with threats". That is of course true, but sometimes the distinction becomes difficult to detect. All depends on the particular circumstances and how the demands are expressed. An adverse impression may more easily be conveyed in this context, as I said earlier, where no attempt is made to comply with the defamation protocol. Mr Tuppen was effectively saying that it was a matter worthy of investigation whether the line had been crossed. He was not purporting to give a legal opinion on the matter. That is why he referred it to the police for further investigation.
- Mr Katsapaou (using his avatar "Katsy") also joined in on 23 April 2007 with reference to "blackmail", but again very much in the context of Mr Smith's demands for money which all readers would have known about. It was not a general allegation of criminality. He poignantly added, "Surely the courts must see sense and throw this straight out with Anom picking up the tab". A few minutes later he asked, "Anom can't you see the distress you're causing". He too was sued for his pains. It is said by Mr Smith that the relevant words bore the defamatory meanings that he was blackmailing people into giving money to charity, that he had isolated himself from any respect and was causing distress.
- Mr Katsapaou was a shareholder in Langbar who had suffered loss and had a legitimate interest in the subject-matter being discussed on this bulletin board. There would be arguable defences of qualified privilege and fair comment and, at least so far as causing distress is concerned, possibly justification as well.
- In theory, after the expenditure of considerable sums of money, the stage might be reached where long pleadings have been served raising defences very similar to one another. Again, in theory, there might be 20 to 30 replies alleging malice. But this might be thought to be unreal and abusive of the court's process. It is difficult to prove malice and only rarely do claimants succeed in doing so. The principles are clear; it is necessary to go beyond bare assertion and to plead facts which are more consistent with malice than with its absence: Somerville v Hawkins (1851) 10 CB 583; Telnikoff v Matusevitch  QB 102, 120; Alexander v Arts Council of Wales  1 WLR 1840.
- It would surely be a waste of time and money to hear so many applications to strike out when the answer is all too predictable. It is obvious to any casual observer that these Defendants were quite sincere in their beliefs about Mr Smith and his activities. They seem to have felt quite strongly about it. The idea that any of these people was acting in bad faith, and making claims which he knew to be false, is not realistic. The question I have to ask, therefore, is whether it can be right to allow all these time-consuming and potentially costly steps to be taken when the outcome is plainly predictable to anyone with any knowledge of defamation; what is more, in circumstances in which a great many people will be left out of pocket. In the modern climate, and in the light of the overriding objective of the CPR, I cannot believe it is right to let this happen.
- Since these cases seem to me to have no realistic prospect of success, I think it is right to keep the stay in place.
The written representations I received
- Those who made submissions only in writing were Mr Andrew Hanham (HQ08X01263), Mr S McCormick (HQ07X02617/HQ08X01567), Mr Alistair McIntyre (HQ08X01193), Mr John O'Brien (HQ08X01192) and Mr Kevin Smith (not actually a defendant himself). I also received what were in effect character references for Mr Smith from people who had appreciated his services in the past.
- Mr Hanham lives in Prague. His postings were dated 21 and 23 April 2007. Although there was a Norwich Pharmacal order made on 24 April, as a result of which his details were disclosed, he was first contacted over a year later by letter dated 30 April 2008. He is one of those in respect of whom proceedings were launched at the end of March, without any prior attempt to comply with the protocol.
- When the solicitors wrote to him they failed to mention either that the claim form had been issued or that, five days earlier, the Master had ordered a stay. A reply was demanded within seven days together with "a reasonable offer of damages". I requested an explanation for this surprising behaviour in my ruling of 12 May. I eventually received a letter from Edwin Coe explaining that there had been a lack of communication within the firm and that the relatively junior employee handling the case had not had passed on to him the information about the stay. I naturally accept that explanation, but it has to be said that in this and other cases a most unfortunate impression was created to the effect that a litigant, assisted by a firm of solicitors, was demanding money and threatening proceedings "if necessary" while concealing the fact that they had already been issued and stayed.
- Because Mr Hanham had moved in the meantime from Jersey to Prague, he did not receive the letter until 19 May (after the expiry of the rather Draconian deadline). He replied five days later and called for an explanation of the irregularities I have mentioned. He did not receive the courtesy of a reply.
- Mr Hanham's posts were in a similar vein to the others I have mentioned. He made a number of points. He acknowledged that Mr Smith felt aggrieved by some of the comments made by shareholders on the website, but added that "he has invited these comments". His own remarks had been "provocative". Mr Hanham pointed out that "Those strong words have been used by people who have lost substantial amounts of money and feel that Anom [Mr Smith] is not acting in the best interests of shareholders". This is surely, within this particular thread, a classic case of qualified privilege and fair comment. He also observed, "He has split the shareholders into two groups and has now embarked on a crusade to silence the rightfull (sic) criticism he is receiving from the majority [Scheme of Arrangement] shareholders …. Anom is attempting to control a public forum for his own use".
- He went on two days later to make comments about a lack of communication to shareholders and expressed the opinion that some shareholders had only two options; that is to say, to go for the scheme of arrangement or opt out. It is unclear why, if this was genuinely perceived to be damaging to Mr Smith's reputation, no steps were taken until the limitation period was about to run out. Why, in particular (as Mr Hanham commented in his letter of 21 May 2008), was he not notified "in writing at the earliest opportunity" (as the protocol requires)?
- I received a letter from Mr McCormick dated 3 June 2008. He strongly believes he has done nothing wrong and made a similar complaint as to how difficult it had proved to extract any information from Edwin Coe:
"Despite several attempts at contacting his solicitor at Edwin Coe, unfortunately I have had no reply from them whatsoever therefore I have no knowledge at all of the exact contents of my alleged one defamatory post [on 24 April 2007]."
- This is a most unsatisfactory state of affairs. Not only, yet again, did Mr Smith and his legal advisers fail to comply with the defamation protocol, but they failed even to identify what he is alleged to have said – over a year later. It is possible that the solicitors, being engaged on a conditional fee agreement, were trying to keep down costs by not exerting themselves beyond the bare minimum. If so, that is a philosophy which does not serve the interests of justice or of fairness to these multiple defendants.
- Given his limited state of knowledge, Mr McCormick confined himself to drawing certain matters to my attention from the thread itself and from Mr Smith's witness statement. He said that some of the "Anomalous" postings had "made extremely unpleasant reading" and that he thought his "pay up or else" postings were intimidatory. He drew attention to one of these dating from 19 April 2007, which included the following unpleasant passage addressed to "Cardiff John" (in fact Mr O'Brien):
" … since you did not make any attempt to clear your defamation before the deadline set yesterday, I demand that you make reparations in the form of GBP £10,000. I do not need to remind you that your legal costs would be far greater in court, or that you have offended more than once."
- Mr McCormick also referred to a passage in the witness statement in which Mr Smith claimed to have been the victim of a "hate campaign" or "cyber-bullying". Mr McCormick said that he was no part of any such campaign and did not at the relevant time know who "Anomalous" was. It was "nothing more than a username on a bulletin board".
- Mr Smith has been able to throw light on the nature of his complaint against Mr McCormick and the words are identified in the particulars of claim. The essence of Mr McCormick's observations on 24 April 2007 was to the effect that he had come across a thread and noted the distress which had been caused to one of the shareholders whom Mr Smith had threatened with litigation.
- Mr McCormick made a number of pithy and down-to-earth observations such as, for example, "As if LGB shareholders getting fleeced wasn't bad enough we then get crap like this". He continued:
"Bulletin board posters taking other posters to court coz he called me names.
It's absolutely pathetic and Anomolous should be totally ashamed of himself here. GROW UP. If I had a pound for every time I'd been called a w*nker or something far worse than I would be a rich bloke yet I've never run to the law once.
Life's too short for crap like this. You get one shot at life and to waste it in this manner is just that, a WASTE.
Whatever happens tomorrow in that court, Anomolous has already lost the respect of many many people here on ADVFN."
This might be thought to echo the sentiments expressed by Lord Phillips MR in Jameel at  and 
- In the particulars of claim Mr Smith pleads the following natural and ordinary meanings, namely that he:
"(a) should be ashamed of himself,
(b) should grow up,
(c) was wasting his life
(d) has lost the respect of 'many many people' on ADVFN".
- I also received written submissions dated 5 June 2008 from Mr Alistair McIntyre (HQ08X01193). He operated under the pseudonym of "fatnacker". He is being sued in respect of posts between 18 and 28 April 2007 and also in respect of an isolated item on 26 January 2008. He may be thought to have invited this, to some extent, when he commented to Mr Smith on 21 April 2007, " … your bully boy tactics don't worry me so do your worst".
- I will not set out all the words complained of, in this instance, but the flavour can be understood from the meanings pleaded in the particulars of claim. These included the following:
i) that the claimant has a poor grasp on reality;
ii) that the claimant was using medication;
iii) that he did not have a good reputation to protect;
iv) that he had failed court cases;
v) that he was a founder member of a minority group of investors that were seeking to recompense themselves to the detriment of others;
vi) that he was guilty of a crime which was unspecified;
vii) that he was guilt of extortion under false pretences;
viii) that he was guilty of extortion with menaces;
ix) that he was a bankrupt;
x) that he is bullying;
xi) that he is manipulating;
xii) that he is making threatening demands for money;
xiii) that he had committed a "jail-able offense" (sic);
xiv) that he had insulted and defamed the defendant;
xv) that he had used "bully boy tactics";
xvi) that he had demonised himself;
xvii) that the campaign against the claimant was a spectacular success;
xviii) that he did a "face saving deal with ADVFN";
xix) that he had orchestrated "the whole thing" (i.e. defamations of himself);
xx) that he was not truly defending shareholders but the "oposite" (sic).
The impression is given that the formulation of this complaint inflates the significance of Mr McIntyre's comments out of all proportion to their context.
- Mr McIntyre pointed out that he was a subscriber to ADVFN's financial information site and also a shareholder in Langbar. He explained some of the background to me, including Mr Smith's behaviour towards "Wiganer" in calling him a "fraudster". It was Mr Smith's case that this person had been making a fraudulent claim for compensation when he had suffered no loss. The matter had been before the Chancery Division and, in this context, Mr Smith said to one shareholder, "I can see from post 53446 that you don't understand the law with respect to Fraud. You needn't concern yourself though, as Justice Pumfrey (a Senior High Court Judge) had difficulty with the concept as well". Mr McIntyre also drew attention to the supposed "hate campaign or cyber-bullying", and commented that the only "campaign" was that waged by Mr Smith himself.
- He also referred to a matter which was discussed during the court hearing on 9 June; that is to say, the fact that Mr Smith was using many usernames on the ADVFN website which closely resembled those used by some of the other libel defendants. He added, "I am struggling to understand why the defendant would do this other than to antagonise the defendants".
- Mr McIntyre concluded his submissions in this way:
"The defendant it seems has gone out of his way to be aggressive and confrontational. I have only known of him as a result of the langbar fraud but others I understand have over the years been unfortunate enough to be on the receiving end of his unwelcome attention. his manner is abrupt, forthright and insulting and he claims the right to insult and cause distress with impunity, as a shareholder in langbar I have a right to decide for myself who I put my trust in as regards any recovery process, the freedom I claimed was met with a barrage of insults and ridicule from the defendant who amongst other things labeled me as 'a malcontent, an arsehole, a liar, and one to stupid for conversation', in light of this I belive the statements complained of by the claimant caused him no loss either to his reputation or to his finances, the claimant has no difficulty financially in making these claims as I belive he is exempt of the court costs indeed he has been quoted as saying 'win or loose it wont cost him a penny'.
I would bring to the courts attention that it was only after the stay order of 25th april 2008 that I received a communication from the claimants solicitor dated 30th april 2008 asking me to make an offer of reparation this is a clear breach of the stay order of the 25th. I did however reply to this letter acknowledging receipt and denying any liability the claimant nor his solicitor have as yet not replied to any of my communications to date and have drip fed any documents they are required to supply to me so that I can make a full and fair submission to the court in fact I have only today (the 4th june 2008) received from them a complete set of the documentation required,
All things considered I hope I have supplied the court with enough relavant information to keep in place and further extend the order of the 25th April 2008 should this not be the case I would ask for an adjournment so that I am afforded enough time to make a more detailed submission."
Mr McIntyre helpfully attached copies of the relevant posts made by Mr Smith.
- One can immediately detect from the complaint against Mr McIntyre familiar and common themes.
- I received written submissions from Mr O'Brien both before the hearing on 12 May and before that of 9 June. He was unable to attend because of work commitments.
- He is sued in respect of comments made on the bulletin board between 17 and 18 April 2007. He had used the pseudonym "Cardiffjohn36". He had referred to Mr Smith as "a scrounger" and as being "bankrupt". On 18 April 2007 he added this:
"funny when he gets himself in the shite and completely loses the plot – one of nigel smith's [apparently not a bankrupt] many alias threatens over 10 people with legal action.
everyone of his vile bullshiting vindictive posts yes even his death threats can be traced!
act like a man anom admit your 'loss' rants over the last few days were wrong [not one person has agreed with you] apologise over your many racist remarks last week and
- Mr Smith complained of the meanings that he was a scrounger and a bankrupt and also of the allegations that he made threats and posts which were vindictive. Not surprisingly, he also complained at the suggestion that he had made death threats and that he was a racist.
- Mr O'Brien made a number of apologies on the bulletin board, but then caused further offence to Mr Smith by saying on 19 April 2007, "I still don't like your tactics and will carry on the petition to get you banned … for totally going against the spirit of advfn – free open debate [Anonymous]". Then, as I have recorded above, Mr Smith wrote (among a great deal more), "I demand that you make reparations in the form of GBP £10,000. I do not need to remind you that your legal costs would be far greater in court, or that you have offended more than once". This was unpleasant and Mr Smith can hardly be surprised that people interpreted this as a threatening demand for money (and, incidentally, for a sum out of all proportion to any possible injury to reputation).
- There are many more exchanges in a similar vein, which there is no need to repeat.
- I turn, finally, to the submissions I received from Mr Kevin Smith dated 3 June 2008. He is not a defendant, but described himself as "a witness to these events" and enclosed a number of items he thought might be of relevance. These included posts which he said were attributable to Mr Smith over a long period of time and suggested that they were "wholly inappropriate for someone who says he has aspirations for setting up a registered charity for investors". He may well be right but at this stage, at least, I think it right to put these to one side and not take them into account in considering the issues before me.
The case put forward in the Claimant's witness statements
- I turn to the submissions made by the Claimant in his witness statement of 29 April seeking to set aside the Master's stay order. He pointed out that seven of the claims listed in the schedule to the Master's order were, in effect, already concluded since they had been for the purpose only of seeking Norwich Pharmacal relief. Furthermore, three of the claims, as I recorded in my ruling of 12 May, were settled out of court and are thus no longer active.
- Most of the claims in the schedule had not gone past the stage of being issued for limitation purposes. Mr Smith was waiting to serve them on the parties until such time as the pre-action protocol had been complied with (admittedly somewhat late in the day). That leaves five actions which are currently pending and subject to case management orders. They have all been assigned to Master Fontaine.
- He pointed out that, following a further Norwich Pharmacal order made by Sir Charles Gray on 23 April 2008, a further 23 claims are "due to be issued in the next three months". That would bring the total to 60.
- My attention was drawn to the decision of Lightman J in Mitsui Ltd v Nexen Petroleum UK Ltd  EWHC 625 (Ch), where three conditions were identified for the grant of Norwich Pharmacal relief. In particular, he argues that because Norwich Pharmacal relief has already been granted, I should proceed on the basis that the majority of the posts have been considered to be defamatory or arguably defamatory. It is right, on the other hand, to bear in mind that Norwich Pharmacal relief is granted on an ex parte basis and that it would not give rise to an issue estoppel between Mr Smith and any of the defendants in the proceedings already issued. For the purposes of case management, and seeking to achieve the objectives underlying the overriding objective of the CPR, it is right to keep them monitored and especially to have regard to the fact that each claim needs to be considered, not only on its own merits, but also in the context of the welter of litigation of which it forms only a part. The mere fact that he was granted Norwich Pharmacal relief does not divest me of that responsibility.
- Twice in the witness statement (at paragraphs 4 and 32) Mr Smith refers to his work for the shareholders' action group as being pro bono. Some surprise was expressed, therefore, at the hearing on 9 June by those defendants present when Mr Smith, in order to show that he had some prospect of meeting the costs orders made in the ADVFN case, mentioned that he was due to receive something of the order of £100,000 by way of an ex gratia payment for his work in recovering some of the lost monies (apparently equivalent to 5%). In the light of this new information, some of the defendants chose to make further written submissions on the subject. So too did Mr Smith himself in a further statement. He rejected any suggestion that his claims to have carried out the work pro bono were in any way misleading. It seems to me that there is no need to investigate this new controversy any further, for present purposes, and I put it to one side in reaching my conclusions. It may well have to be addressed at some stage, but I am certainly not in a position to decide that he deliberately misled either the court or those for whom he acted.
- Another issue raised on 9 June I shall also leave out of account. One of the Defendants appearing in person had printed off on 7 June this year a page from Mr Smith's website in which it was quite expressly claimed, inaccurately, that his company was a charity (implying a registered charity). This was taken down shortly afterwards but was raised as another possible example of dishonesty. Mr Smith suggested in the written material he subsequently submitted that this had only been a draft.
- Despite the suspicions to which these developments gave rise, it seems to me that neither the "pro bono" issue nor that of the "charity" could be resolved without full disclosure and cross-examination. Nor did Mr Eardley have the opportunity on 9 June to take full instructions. That is why I leave both aside for the purposes of resolving the present application.
The submissions made by Mr Eardley
- Mr Eardley had only been instructed shortly before the hearing of 9 June and therefore had no opportunity to submit a skeleton argument. His oral submissions were nonetheless carefully and cogently presented. He argued that there was no need to keep the stay in place for any of the actions. The Master must (he said) have been under a misunderstanding because he did not realise that some of the actions were spent (i.e. those which sought only Norwich Pharmacal relief and the three which had been settled in October 2007); nor was he apparently aware that a number were already under way and in the course of case management by Master Fontaine.
- Mr Eardley addressed the concerns so far raised about the litigation and, in each instance, proposed what he commended as the appropriate practical solution.
- First, there was the potential risk of over-compensation (to which I had referred on 12 May). It was clearly necessary for any award of damages to be made in the context of all the claims (including those settled last year). It would not be right to compensate for either injury to reputation or for hurt feelings as though any individual's publication(s) had been the sole cause. The way to deal with the problem, according to Mr Eardley, was to arrange for the claims in due course to be heard together by the same tribunal. Whether it was appropriate actually to order consolidation was a matter that could be addressed at a later stage.
- A further factor was the protection afforded to defendants by s.12 of the Defamation Act 1952. The tribunal in question would, in due course, have to bear in mind, when making an award in any given case, any other award for similar allegations made, or about to be made, against any other defendant. Any risk of over-compensation would thus be significantly reduced.
- The second problem addressed by Mr Eardley was the possibility of different courts coming to different or inconsistent conclusions. This was another matter I had highlighted on 12 May specifically in the context of Mr Smith's earlier strategy of "divide and rule"; that is to say, picking off the defendants separately. That too could be addressed by listing any cases which survived to trial to be heard together.
- Thirdly, there was the relationship between the many claims made against individuals and the action against ADVFN itself. Apart from its unique defence under s.1 of the Defamation Act 1996, to which I have already referred, it is necessary also to remember that there is a degree of overlap in subject-matter between some of the cases. Mr Eardley's analysis showed that in the ADVFN action there were 19 posts complained of as allegedly defamatory, of which 11 were also complained of in actions brought against individual defendants. Issues would thus potentially arise of joint responsibility and a need to consider to what extent defences might or might not overlap and also, so far as damages are concerned, the issue of the lowest common denominator (as discussed by Lord Hailsham in Cassell v Broome  AC 1027).
- Mr Eardley argued that if the s.1 defence failed, on a preliminary hearing, then the claims against ADVFN could be heard alongside those relating to the individuals responsible.
- Fourthly, he addressed the concerns about the draining of public resources over such a multiplicity of claims. He argued that it was premature to consider this because, despite the long delay before the proceedings were issued at the end of March this year, Mr Smith had still not decided how many of them should be pursued. He was hoping to "whittle them down". But this rather illustrates his client's casual profligacy when it comes to issuing claims.
- Mr Eardley then turned to the proceedings which are "active", in the sense that they are currently being case-managed by Master Fontaine. I have already considered those involving ADVFN, Mr Tuppen and Mr Love. The others on which Mr Eardley made submissions were those relating to Mr William Kane (HQ07X02619), Mr Christopher Byrne (HQ07X03106) and Mr Roderick MacDonald (HQ07X02620).
- Mr Kane is currently resident in Cyprus and I was told by Mr Tuppen, who seems to be in touch with him, that he is suffering from stress. Complaint is made against him in respect of a posting on 21 April 2007 addressed to "Freddie". It seems that Mr Kane had also taken offence at Mr Smith's post to cardiffjohn, which I have quoted above, as it seemed to him (as it obviously did to a number of other people) "threatening".
- What he had said was simply this:
"I already did that when I reported his post to cardiffjohn which I regarded as threatening to obtain money, they agreed with me and said they'd already pulled his post.
If advfn regarded the post as containing threats with the intent to obtain money, then surely they should have informed the police as that is a criminal act."
- This seems to me clearly to mean that Mr Kane had reported Mr Smith to ADVFN, who had removed the "threatening" post to Mr O'Brien. He seems to be taking the point that if ADVFN had removed the post, they should, for consistency, have informed the police. It does nor necessarily follow, of course, because the fact that ADVFN removed the post is explicable on the basis that the company decided to be "on the safe side". Nevertheless, if "they agreed with me" reflects the fact that there was a conversation (apparently with someone called "debaleb") in which ADVFN regarded the post to cardiffjohn as being a threat to obtain money, it would be entirely reasonable to report it to the police (as indeed did Mr Tuppen). Mr Kane is not asserting that Mr Smith committed "a criminal act". He is not a lawyer and appears merely to be suggesting that it would have been consistent with the suspicion of ADVFN for the company to report it to the police as a possible or suspected crime.
- Mr Smith in his particulars of claim has apparently construed Mr Kane's observation as an assertion, on his part, that he is guilty of a criminal act. He pleads at paragraph 11 of the particulars of claim:
"The definition of criminal is (noun) a person charged with and convicted of a crime, a person who commits crimes for a living, (adjective) of, involving, or guilty of crime."
In the next paragraph he goes on to plead:
"It is manifestly true that seeking reparations for defamatory statements is not a criminal act. The defendant made a statement that he knew or should have known to be untrue and that this was actual malice. The claimant is therefore seeking aggravated damages for this malice."
- This is simply nonsense. There is no chance that Mr Kane would be held to be malicious. What is more, it is by no means "manifestly true" in all cases that the seeking of reparations for defamatory statements could not be a criminal act. As I have already commented earlier, it very much depends on the way in which the demand is made.
- In this case there is a defence in which Mr Kane asks that the claim be struck out as an abuse of process. He pleads that he was the holder of 3,500 shares in Langbar, which currently had no worth and dealings in which had been suspended. He also pleads that he had been a member of the ADVFN website for at least seven years (and had never had any of his posts removed or been reported to the ADVFN abuse team – unlike Mr Smith).
- As to the meaning that would be attributed to the post, Mr Kane points out that the post fell into two sections. The first part was simply copied from a post by "debaleb" and was the basis upon which he made his own comment. In other words, he was repeating the fact that "debaleb" had apparently been told by ADVFN that they agreed with him/her that the post to cardiffjohn was "threatening". Mr Kane then goes on, in the second part of his post, to make what he describes, correctly, as "a conditional statement". The nub of his defence is contained in the following passage:
"It makes no assertion or allegation, nor does it refer to any individual. It invites comment about ADVFN's actions as the defendant did not believe that ADVFN would have made such a statement [i.e. that Mr Smith's post to cardiffjohn was 'threatening']."
He was, in other words, expressing scepticism as to whether ADVFN would have expressed such a view, on the one hand, and then failed to report it to the police on the other.
- Those who are used to bulletin board communications, as the relevant readers of this post would be, would appreciate that Mr Kane was quoting "debaleb" and making a comment in relation to that.
- Mr Kane also denied working in concert with anyone else. He added that he "… has been caused real hurt and anguish by the action of the claimant to the detriment of [his] health and wellbeing far beyond any conceived hurt felt by the claimant over any post made by the defendant".
- Mr Eardley simply submits that this is a matter which should be left over to trial for the fact-finding tribunal to make a decision on meaning and also, possibly, on the pleaded allegation of malice. He points out that, so far, qualified privilege has not been pleaded and that it would, even if raised, be a fact-sensitive matter, the merits of which would require to be assessed in the light of the evidence at trial.
- Next Mr Eardley turned to the claim against Mr MacDonald. I am told that a strike-out application on Mr MacDonald's part was heard by Master Fontaine on 1 October 2007 and actually dismissed. The case needs, therefore, to be addressed in the light of that outcome.
- The proceedings were issued on 31 July 2007 and Mr Smith complains of a number of posts attributed to Mr MacDonald.
- On 21 April 2007 he had posted the following:
"If these actions do proceed, nearly all will be dismissed as unceremoniously as Nigel's last effort. How long did that take to be dismissed out of hand – 5 minutes, was it?"
Mr Smith says that this is defamatory because it suggests that he commences cases that are vexatious and without merit, with the result that they are dismissed by the court out of hand. He also complains of a passage in the same post in which Mr MacDonald had said:
"The untrue allegations of bankruptcy are a little different, but even they must be put in context. This is a man who has publicly solicited for money and accepted it."
That statement is said to be defamatory because it suggests that Mr Smith has solicited for money and accepted it "in an improper fashion". Again there is an allegation of malice. He suggests that Mr MacDonald took part in a "collective attack" and a "malicious group attack".
- There is an amended defence dated 8 April 2008. The main points raised seem to be as follows:
(1) The "last effort" refers to a case of Mr Smith being struck out without proceeding to trial on the basis that there were no reasonable grounds for bringing the claim and no reasonable prospect of success (i.e. presumably a plea of justification).
(2) He combines a defence of "mere vulgar abuse" and fair comment in paragraph 16 in these terms:
"The defendant believed and believes that the defamation remedy exists to restore serious injury to reputation and is not available for vulgar abuse that could be taken seriously or for fair comment based on truth. Most of the alleged defamations consisted of vulgar and childish abuse of a kind routinely found on bulletin boards, while others were entirely unexceptionable".
(3) Mr MacDonald alleges justification also in relation to the "soliciting" allegation. He relies on the proposition that Mr Smith, after establishing the Langbar action group, had been explaining on the bulletin board how much work he was doing (not even himself being a shareholder) and the costs that he was incurring, which he had difficulty in meeting because he was unemployed. Therefore shareholders began to help him financially by chipping in amounts of £10 a time. He argues that this amounts to solicitation for money and that Mr Smith accepted the sums proffered. (He did not pass the judgment that this was done "improperly".)
(4) He also seeks to justify other allegations to the effect that "Nigel learns absolutely nothing" because he refused to accept the ruling of Lindsay J in the Langbar litigation on a point of law as to whether shareholders could be said, in certain circumstances, to have suffered a loss. Mr MacDonald wishes to make the allegation that Mr Smith has continued to press his own interpretation of the law despite the Judge's ruling (he apparently having suggested that Lindsay J did not understand the point).
(5) He wishes also to defend the description of Mr Smith as a "destructive twerp" as either fair comment or mere vulgar abuse.
(6) Mr MacDonald also denies being part of a group or a participant in a concerted effort.
- Mr Eardley submits in the light of the Master's order of 1 October 2007 that I cannot revisit the question of whether the claim has a reasonable prospect of success. As a matter of principle, that would appear to be clearly right. Nevertheless, I shall need ultimately to assess the significance of this particular action in the context of all the others.
- I turn next to Mr Byrne. He was unwise enough on 18 September 2006 to suggest of Mr Smith that:
"He is a strange character and I wonder what a psychologist would make of the man. He seems to show symptoms of schizophrenia with a megalomaniacal obsession with litigation … "
Rather laboriously, Mr Smith pleads that the passage as a whole conveys the meaning that he suffers from:
a) schizophrenia, a number of psychotic disorders characterised by progressive deterioration of the personality and
b) megalomania, a mental illness characterised by delusions of grandeur, power or wealth.
He also raises a number of subsidiary meanings to the effect that he was:
c) playing the part of a person that he aspired to be but could never achieve
d) seeking employment from a firm of solicitors
e) making frivolous legal claims
f) seeking public acclaim
g) a small or insignificant person bringing legal actions against the world
h) deluding himself and others.
- On 19 September 2006 Mr Byrne observed, "Thanks Dan for showing NS as the dishonest opportunist he is". Somewhat optimistically, Mr Byrne pleads that this is not defamatory.
- On 12 October 2006 there was another rather offensive posting which Mr Smith suggests conveys the meaning that, in order to join his action group, people are required to "perform sexual favours or acts upon the claimant". Mr Byrne argues that no right-minded person could possibly infer "that to join the RA you actually had to perform oral sex on the claimant". He says it is mere vulgar abuse that would not have been taken seriously.
- On 20 October 2006 Mr Byrne suggested that Mr Smith " … did a wonderful job at the beginning before he went nuts and started acting against shareholders". Mr Smith pleads that this means that he had "mental problems". Mr Byrne's response is to deny that the term "nuts" is defamatory:
"It would be inconceivable that a right-minded person could take this form of abuse to actually infer that the claimant suffered from mental torment."
- On 27 April 2007 Mr Byrne posted the comment that " … it would appear that a poster called anonamous has sued several people for calling him names. He seems like a right cunt". No defamatory meaning is attached to this and Mr Byrne denies that it is defamatory. He argues that it is "the vulgar abuse that can regularly be encountered on the ADVFN bulletin board". One has to ask whether this is the sort of material that should find its way for resolution into the High Court.
- Mr Smith then lists ten other assorted postings by Mr Byrne at various times, but attributes no defamatory meaning to them. In those circumstances there is probably no need to consider them further.
- As to Mr Love and Mr Tuppen, whose actions I have already considered, Mr Eardley simply argued that these were matters which were not fit for summary disposal and rather that they should be allowed to proceed to trial for the fact-finding tribunal to form a conclusion on the issues of justification and fair comment raised.
- I was grateful to Mr Eardley for his careful submissions, which brought a certain amount of order out of what at first appeared to be chaos. If one approaches these cases individually along conventional lines, those submissions appear very persuasive. Occasionally, however, it becomes necessary to stand back and take a practical approach in the light of the letter and spirit of the CPR. Are there really genuine issues which require to be resolved or is it the case, on the other hand, that this litigation when viewed as a whole, and in its proper context, is such as to bring the administration of justice into disrepute? Is there really any legitimate or tangible advantage to be gained? I cannot formally come to a conclusion on either abuse of process or the merits of any actual or prospective defences, since there is no application before me. It does seem to me, however, that I am fully entitled to take into account the nature of the issues as they appear at the moment and that I am entitled to protect the interests of the public purse and of the many defendants involved in the light of those clear impressions. Indeed, I have an obligation to ensure that the court's process is being used compatibly with the overriding objective. The court is today required to be more proactive in such matters, especially when dealing with a number of people who cannot afford legal advice to protect their best interests.
- Against that background, I have come to the conclusion that it would not be right at this stage to lift any of the stays ordered by the Master on 25 April. I fully accept, of course, that in the case of the "active" cases currently being case-managed by Master Fontaine it is not for me to intervene in the individual cases or to go behind any decisions which have already been made. On the other hand, they do need to be seen in the context of the litigation as a whole. Not least, I have to bear in mind the undoubted need for these cases, if they are ever to be heard, to be heard together so as to avoid inconsistencies and over-compensation. They need to progress, if at all, in harness. Since I am proposing to maintain the stay in relation to those cases which have not yet been served, it would seem consistent for these reasons to maintain the stay also in the cases which have hitherto been active.
- It is already clear that it is Mr Smith's intention to issue further proceedings following the Norwich Pharmacal relief he recently obtained in April 2008 from Sir Charles Gray. It seems that there is the prospect of over 20 further libel actions. This makes it particularly appropriate for me to consider the matter referred to me by the Master on 25 April as to whether or not there is a case for a civil restraint order.
- In view of the scale of Mr Smith's libel claims, I can properly come to the conclusion that the requirement of "persistence" has been fulfilled.
- The question on which I need to focus next is whether there has been persistence with regard to claims that can properly be characterised as "totally without merit". If so, I could come to the corresponding conclusion that his present application to lift the stays would to that extent also be totally without merit. I have rehearsed above a number of examples where claims have been made in respect of postings which are so obviously, in their context, either mere vulgar abuse or fair comment (sometimes both). There are also examples of a converse and corresponding interest in the subject-matter, for various reasons, such as to give rise to occasions of qualified privilege.
- I referred to common themes in the postings, such as that of "bullying" other users and making "threatening demands" for money. That is classic fair comment territory and, in the light of the modern authorities, it is inconceivable that a jury would find any of those who expressed such a view "malicious" – let alone all of them. Opinions may be expressed in exaggerated and strident terms; the only requirement is that they be honestly held. It is fanciful to suppose that any of these people did not believe what they were saying. Even if they reached their conclusions in haste, or on incomplete information, or irrationally, the defence would still avail them. It would be wasteful to let proceedings go forward merely on the footing of a series of formulaic assertions to the effect that the individual concerned did not honestly believe what he was saying. There is accordingly no realistic prospect of any such claims achieving the only legitimate goal of vindicating reputation.
- I would not suggest for a moment that blogging cannot ever form the basis of a legitimate libel claim. I am focusing only on these particular circumstances. It does seem to me appropriate to characterise these claims as totally without merit. I will therefore make an extended civil restraint order, which means that Mr Smith cannot launch any further libel proceedings arising out of the Langbar matter based upon bulletin board blogs without obtaining my written permission. Meanwhile, the stays in respect of the individual claims will remain in place.
Approved Supplemental Judgment
Mr Justice Eady :
Following the handing down of the judgment on 25 July 2008, it was pointed out to me on Mr Smith's behalf that I had discouraged counsel at the hearing on 9 June from developing his submissions on the issue of whether or not it was appropriate to grant a civil restraint order. At that stage, it seems that I had formed the view that the necessary conditions had not been fulfilled. This had obviously slipped my mind by the time I came to write that part of the judgment. Before the order was perfected, it was possible to delete the references to a civil restraint order. Unfortunately, since the error was not pointed out in the 48 hours prior to handing down, it is not possible now to make amendments to the judgment.
The purpose of this short supplemental judgment is, therefore, simply to make it clear that no civil restraint order was in fact made. That is because it would not be right to make such an order without giving Mr Smith's counsel the opportunity to make such representations as he wishes. This does not, of course, affect the continuation of the stay. Any new proceedings will be referred to Master Whitaker automatically on his return and be subject to the same regime; that is to say, it will be necessary to demonstrate that they should be allowed to proceed separately from those actions already the subject of a stay.
At some convenient stage, next term, I will be able to consider such further submissions as Mr Eardley may wish to make on the grant or otherwise of a civil restraint order.