CHICAGO (CBS.MW) -- In a case with implications for investigative journalism in

the Internet age, a Canadian mining company has successfully used British libel

law to shut down part of a U.S.-based Web site.

The case, which pits Barrick Gold, Barrick Goldstrike Mines and their chairman,

Peter Munk, against Guardian Newspapers Ltd., was settled Tuesday with Barrick

and Munk winning an apology and monetary damages from the Guardian -- as well as

the deletion of a story from a U.S.-based Web site.

At issue was a piece written by American Greg Palast, a freelance reporter,

regular columnist for the Guardian's Sunday Observer and occasional contributor

to the BBC's flagship nightly television news program.

"The Best Democracy Money Can Buy," which appeared on Nov. 26 of last year,

focused on large corporate and individual donations to the Republican Party and

the presidential campaign of George W. Bush.

In it, Palast wrote about a 8,000 contribution made by Barrick to the GOP;

allegations about Munk's having helped Iran-contra figure and Saudi arms dealer

Adnan Khashoggi win a pardon from then-President George H.W. Bush; Barrick's

1992 takeover of U.S. government property estimated to contain billion in

gold for ,000; and George H.W. Bush's job on Barrick's payroll in which the

ex-president supposedly interceded with two Third World dictators on the

company's behalf.

The part that upset Barrick the most, however, was Palast's reference to

allegations made by Amnesty International and reports by Tanzanian newspapers

that a company subsidiary in the East African nation carried out the

"extrajudicial killings" of 50 independent miners by burying them alive when

they refused to vacate a company concession.

Barrick flatly denies any culpability in the Tanzania murders (and in fact did

not own the subsidiary at the time of the alleged massacre) and maintains that

it was in total accordance with all applicable U.S. laws regarding both its

campaign contributions and takeover of the Nevada property.

Suit filed in London

The company sued for libel in plaintiff-friendly Great Britain earlier this

year, charging that the article caused it and Munk "great embarrassment and

distress" and that their reputations were "extremely seriously damaged" as a

result. The company asked for monetary damages and an injunction to prevent any

further dissemination of the article by the Guardian, "its directors, employees,

agents or otherwise ..."

In settlement papers in the High Court of Justice in London, the Guardian stated

that there was no "intention to make any allegations of corruption or illegality

in relationship between President Bush" and Barrick; that Barrick was not

involved in the alleged deaths of miners in Tanzania; and that Barrick acted in

accordance with U.S. law in the Nevada mine takeover and in its political

contributions.

The Guardian also offered "sincere apologies ... for any offence caused"; agreed

to pay "a substantial sum" in damages and legal fees; and said it has deleted

the article from its own electronic archives.

Barrick said in the filing it is satisfied that the "vindication of their

reputation ... has been achieved" and that it will not pursue the litigation

further.

Spokesman Vince Borg reiterated that the newspaper "has acknowledged [the story]

was libelous" and said that the company will donate the damages to a "worthy

cause."

Palast, who repeatedly offered to correct or clarify the story if Barrick could

prove its falsity, maintains an electronic archive of his work on his U.S.-based

Web site, http://www.GregPalast.com. As a result of the settlement, he has

essentially been forced to delete all references to Barrick in his online story,

since keeping it up could expose the Guardian to additional aggravated damages.

"I am not at war with Barrick," Palast told CBS.MarketWatch.com. "I just would

like the truth to come out. But I can't risk my paper's treasury with U.S.

publication.

"What is sad is the use of British libel laws to ride on the electrons across

the Atlantic to shut down a U.S. electronic publication," he added.

U.S. expert weighs in

It is also troubling to some U.S. First Amendment experts.

Floyd Abrams is a partner at Cahill Gordon & Reindel and an attorney who won the

Pentagon papers case for The New York Times. The celebrated press-freedom

attorney pointed out that U.S. publications routinely delete or alter stories in

foreign editions for fear of running afoul of local libel laws.

"U.S. law provides many more additional protections than exist or ever existed

in the United Kingdom," he said. Unlike in the United States, where plaintiffs

typically have to show not only that a story is false but that it was published

with the knowledge that it was false, in England "the person who brings the suit

doesn't have to prove anything" and the burden of proof is on the defendant.

While U.S. courts have in the past refused to enforce British libel judgments,

the U.S. impact of the settlement "is certainly something to keep an eye on, and

it should worry people," Abrams added.

Another major difference between U.S. and British law is that "truth is not an

absolute defense" in the United Kingdom, said Sandy Davidson, a professor of

communications law in the University of Missouri's journalism and law schools.

In other words, a story can be correct in all of its facts, but if a court finds

it to be defamatory, the defendant can be held liable.

Davidson noted that foreign entities in the past have had some success at

getting U.S. Internet service providers to voluntarily shut down U.S.-based Web

sites.

But, she added, any "court-mandated shutdown would run directly into problems of

transnational jurisdiction" and the question "of what kind of power a U.K. court

might or might not have over a U.S. citizen."

Story still available

Palast's original story has been widely reproduced both in the United States and

overseas. The full, uncut version remains online on numerous U.S. Web sites

including www.onlinejournal.com. If Barrick wants to get it pulled from those

sites, it will have to do so through far-less-sympathetic U.S. courts.

As far as Online Journal is concerned, the piece isn't going anywhere.

"Unless it will cost Greg his livelihood, you may assume the article will stay,"

said editor/publisher Bev Conover. "As tattered as it has become, this is still

America and we still do have First Amendment rights. Someone has to stand up to

the bullies."

Borg said the issue of whether Barrick will go after media outlets continuing to

run Palast's story "or any other libelous statements" is "a speculative

question; we haven't decided that at this time."

And as to why the company sued only in Britain, Borg said, "the article was

filed there, the Observer [the Guardian-owned Sunday paper in which Palast's

work was published] is based there, and that was where the jurisdiction was

determined to be. It doesn't come down to a question of libel law in one

jurisdiction, it comes down to a question of truth or libel."

In terms of market cap, Barrick is the world's most valuable gold-mining

company. It trades in Toronto, New York, London, Paris and Switzerland. The

company will jump from No. 4 to No. 2 in production levels if its recently

announced acquisition of Homestake Mining (HM: news, chart, profile) goes

through, as expected, in the fourth quarter of this year.

On Wednesday, Barrick shares closed down 13 cents to .76.

Online at:

http://cbs.marketwatch.com/news/story.asp?siteID=mktw&guid=%7BEB28FEB3%2DF4F6%2D4E47%2DB7CB%2DFAB4B1FC84F9%7D

Award-winning investigative reporter Greg Palast writes, Inside Corporate

America, fortnightly in the Observer (London), Sunday paper of Britain's

Guardian.

At http://www.GregPalast.com you can read and subscribe to Greg Palast's

columns.

"Best democracy money can buy"

Gregory Palast examines the sources of the 0m that boosted Bush's bid for the White House

 

Sunday, November 26, 2000

Last week, I mailed my overseas ballot for the US presidency -- and you can wipe that smug little grin off your face. I won't put up with condescending comments about America's democratic rituals from a nation with an unelected House of Lords occupied by genetic fossils and, soon, Chris Woodhead.

In fact, you could think of the billion spent in the US campaign in positive, New Labour terms. Call it 'the efficient privatisation of the democracy' -- though an outright auction for the presidency would be more efficient still.

If the guy who lost the vote, George W Bush, nevertheless wins the White House, he'll have surfed in on a crushing wave of nearly half a billion dollars (7 million), my calculation of the suffocating plurality of cash from corporate America, a good 25 per cent more than Al Gore's take.

George W could not have amassed this pile if his surname were Jones or Smith. The key to Dubya's money empire is Daddy Bush's post-White House work which, incidentally, raised the family's net worth by several hundred per cent.

Take two packets of payments to the Republican Party, totalling 8,000, from an outfit called Barrick Goldstrike. That's quite a patriotic contribution from a Canadian company. They can afford it. In 1992, in the final hours of the Bush presidency, Barrick took control of US government-owned property containing an estimated bn in gold. For the whole shooting match, Barrick paid the US Treasury only ,000.

Barrick made deft use of an 1872 gold rush law meant to allow pan-and-bucket prospectors to gain title to their tiny claims. In 1992, Clinton's newly elected administration was ready to prevent Barrick's stunning grab. But Barrick is a lucky outfit. Bush's Interior Department expedited procedures to ram through Barrick's claim stake before Clinton's inauguration.

Ex-Pres George Bush was lucky, too. When the electorate booted him from the White House, he landed softly - on the Barrick Goldstrike payroll, where he comfortably nested until last year.

Who is Barrick? Its founder, Peter Munk, made his name in Canada in the 1950s as the figure in an infamous insider stock-trading scandal. Munk headed a small speaker manufacturer that went belly-up, just after he sold his stock. This is not quite the expected pedigree for an international minerals mogul.

If we look in the shadows behind Munk we can see the more accomplished player who provided the capital to set up Barrick - Saudi arms dealer Adnan Khashoggi.

During Bush's presidency, Khashoggi was identified as conduit in the Iran-Contra conspiracy. He had already run into trouble with US lawmen when, in 1986, he was arrested and charged -- but not convicted -- of fraud. He was bailed out of the New York prison by Munk, who provided the m bond. Bush performed an even bigger favour for Khashoggi: as his last act in office, the president pardoned Khashoggi's alleged co-conspirators, key members of Bush's own cabinet. As a result, no case could be made against Khashoggi.

In 1996, a geologist prospecting in Indonesia, Mike de Guzman, announced his discovery of the world's richest gold field. Munk rapidly deployed his president. Bush, on behalf of Barrick, contacted officials of the former dictator Suharto who were in control of mining concessions. Thereafter, De Guzman's company was told it would have to turn over 68 per cent of its claim to Barrick.

Barrick didn't have long to gloat. Jim-Bob Moffett, the tough, old, Louisiana swamp dog who heads Freeport-McMoRan Mining, had a private meeting with his old benefactor Suharto. At the end of the meeting, Jim-Bob and the dictator stood on the steps of the presidential palace to announce that Freeport-McMoRan would replace Barrick. (Ironically, Barrick lucked it again. The gold find was a hoax. After Jim-Bob learnt he'd been suckered, his company invited geologist De Guzman to talk it over. Sadly, on way to the meeting, De Guzman fell out of a helicopter.)

While Mr Munk's president did not pay the cost of his rental in Indonesia, Bush could redeem himself in Africa. In 1996, as genocide in Rwanda fomented civil war in Zaire, Barrick smelt opportunity. We have learnt that, at that time, Bush spoke with his old golfing buddy, Mobutu Sese Seko (then dictator of Zaire) about diamond concessions.

I don't know what ex-CIA director Bush told the panicked dictator, but we do know that Mobutu granted Barrick exclusive rights to mine gold in north-west Zaire.

Maybe Bush talked about Barrick's mining experience in neighbouring Tanzania where, according to Amnesty International, Barrick's subsidiary carried out 'extra-judicial killings'. Amnesty reports that 50 independent miners who refused to move off the Barrick unit's concession were buried alive in the pits by company bulldozers. Barrick denies the allegations.

Beyond Barrick, Daddy Bush has many other friends who filled up his sonny-boy's campaign kitty while Bush performed certain lucrative favours for them. In 1998, Bush père created a storm in Argentina when he lobbied his close political ally President Carlos Menem to grant a gambling licence to Mirage Casino corporation.

Bush wrote that he had no personal interest in the deal. That's true. But Bush fils did not do badly. After the casino flap, Mirage dropped 9,000 into the Republican Party war chest.

The ex-president and famed Desert Strormtrooper-in-Chief, also wrote to the oil minister of Kuwait on behalf of Chevron Oil Corporation. Bush says honestly that he, 'had no stake in the Chevron operation'.

Following this selfless use of his influence, the oil company put 7,000 into Republican Party coffers. Most of that loot, reports the Center for Responsive Politics, came in the form of 'soft money' That's the squishy stuff corporations use to ooze around US law which, you may be surprised to learn, prohibits any donations to presidential campaigns in the general election.

Not all of the elder Bush's work is voluntary. His single talk to the board of Global Crossing, the telecoms start-up, earned him m in stock. The company also kicked in another million for his kid's run.

And while the Bush family steadfastly believes that ex-felons should not have the right to vote for president, they have no objection to ex-cons putting presidents on their payroll. In 1996, despite pleas of US church leaders, Daddy Bush gave several speeches (he charges 0,000 per talk) sponsored by organisations run by Rev Sun Myung Moon, cult leader, tax cheat -- and formerly, the guest of the US federal prison system.

There are so many more tales of the Bush family daisy chain of favours, friendship and campaign funding. None of it is illegal -- which I find troubling. But I don't want to seem ungrateful. After all, the Bushes helped make America the best democracy money can buy.

Blackout in Florida

Vice-President Al Gore would have strolled to victory in Florida if the state hadn't kicked 12,000 citizens off the voters' registers five month ago as former felons.

In fact, only a fraction were ex-cons. Most were simply guilty of being African-American. While 8,000 of those disenfranchised went through the legal rigmarole of getting on to the voting list, the rest -- enough to have won the state for Gore - did not.

A top-placed election official (not a Democrat) told me that the government had conducted a quiet review and found -- surprise! -- that the listing included far more African-Americans than would statistically have been expected, even accounting for the grievous gap between the conviction rates of blacks and whites in the US.

The source of this poisonous blacklist: Database Technologies, a division of ChoicePoint, and hired by Governor Jeb Bush's frothingly partisan Secretary of State, Katherine Harris. My thanks to investigator Solomon Hughes for informing me that DBT is a division of ChoicePoint. Under fire for mis-use of personal data in state computers, ChoicePoint founder Rick Rozar made a strategic six-figure soft cash donation to the Republican Party.



Investigative reporter Gregory Palast writes 'Inside Corporate America' in the Observer, the Sunday paper of the Guardian of London, where this first appeared.

Contact gregory.palast@guardian.co.uk for comments or reprints.

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