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SI - Site Forums : The History of Silicon Investor

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To: Graystone who wrote (1235)9/6/2018 12:46:31 PM
From: Jeffrey S. Mitchell3 Recommendations

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Actually, it was my homeowner's policy, from Safeco. Back then, personal liability coverage was one of those small upcharges insurance companies made a killing on. Then the Internet became a thing. Clearly, insurance companies back then didn't anticipate all the lawsuits from people freaking out over seeing bad stuff about them "in writing" with a lifespan of "forever".

Back then, only California had an anti-SLAPP statute. It was created specifically to protect people speaking out against politicians in the newspaper-- politicians who would then sue these critics to shut them up and discredit them. I figured why not apply that analogy to the Internet? The attorney I called who was pioneering these suits agreed to see if that could fly. I paid him myself and with donations from people here on SI. SI Brad gave $20K btw. Back then he wanted to be anonymous; I assume he'd be OK with it now. I don't have a list any more, so thanks again to everyone who also contributed.

Anyhow, as you know, attorneys are quite expensive and are good at running through money. When the bills started piling up, someone on SI suggested I check my homeowner's policy, which had never occurred to me. Lo and behold, there was coverage. But now I had to use their lawyers.

Business Wire's lawyers also decided to throw in a Lanham Act violation, i.e. misuse of copyright. Had we forged a press release, OK, that would make sense. Rather, I paid $500 using my own name (i.e. legally) to issue the PR. But the entire reason they brought this bogus claim was so they could argue that because this was a Federal, not State, charge, the case should be in a district, not state, court, hence the anti-SLAPP procedure would not apply. We of course argued this was "case-laundering"-- that if this ruse worked, everyone would do it, thus invalidating CA specific law in general.

My attorney agreed, and said Safeco was obligated to pay him if I were prepared to litigate this for another year or two to prove as such. I was. Of course. However long it took. Then, a short while later, I got another call about settling. It turns out that BW had already spent well over $1M on their own attorney fees, not to mention was getting (rightfully) beat up in the media. It also doesn't look good to be suing your customers.

I'll digress a bit here and say I have a very strong feeling that the reason BW brought the suit to begin with is because certain people here on SI who, shall we say, "disliked" us, contacted BW to tell them we all actually were criminals. I say this because I had my uncle, an attorney, be my first representative to deal with BW. He was like "are you guys doing stock manipulation or something?" I was like, wait, what? Apparently that's what "people" were telling the BW lawyers.

But getting back to the story-- Safeco was projecting their own legal fees would also be astronomical. Insurance companies are in the business of cutting their losses and moving on, not trying to win lawsuits. Keep in mind that we are not a "loser pays" society, so this is all about money to them, not justice. BW was hoping to recoup "something" just to say they did, and Safeco was willing to pay "something" to avoid having to pay a substantial amount instead. I, being a businessman, understood that, and of course said... "tough sh!t". No way was I going to have one of those "the parties have settled... amount undisclosed" press releases which I was prohibited from ever talking about.

Of course this didn't sit well with either party, but this was my/our right. I/we would only settle if 1) BW put in writing that all charges had been dropped "with prejudice" (could never be brought again), 2) The settlement remained unsealed (was public), and 3) None of us had to sign a non-disclosure or any form prohibiting us from talking about the case, then OK. And that's what happened.

So, there you have it, the first case (I know of) of someone getting sued for "Fake News"!

- Jeff
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