Has 2Clix backed-down from Whirlpool lawsuit?

Stan Beer
Wednesday, 19 September 2007 18:59

Opinion and Analysis

In a rather curious media release, online watchdog Electronic Frontiers Australia (EFA) has welcomed a "decision" by Queensland based accounting software vendor 2Clix to withdraw its lawsuit against online telecoms forum Whirlpool for allowing a series of allegedly malicious postings against 2Clix on its site. The only problem is that there has been no official confirmation from 2Clix that the lawsuit has been halted.

In August, 2Clix filed a $150,000 suit against against Simon Wright, the founder of Whirlpool claiming "injurious falsehood" because of two forum streams that displayed critical comments about the company's software from anonymous posters. 2Clix claimed that the publication of that criticism caused a "severe downturn in monthly sales" of approximately $150,000 per month.

The 2Clix lawsuit caused a stir among online civil libertarians and some web publishers who viewed it as an attack on freedom of speech in cyberspace. One such group, EFA, issued a strong condemnation last week of the 2Clix lawsuit as details of the action came to light.

However, this week it appears to be all smiles from EFA as it claimed in a release that an employee of 2Clix had contacted Whirlpool to say that the the lawsuit had been abandoned.

Despite this claim, EFA admits in the very same statement that Whirlpool has been unable to confirm with 2Clix or its legal representatives that the case has been dropped. Nor has any paperwork been filed with the courts to curtail the suit, according to EFA.

On the surface, it does indeed seem strange that news pertaining to the changed status of a legal action would be conveyed to the defendant by an employee of the plaintiff rather than a legal representative or at least a high ranking executive. Then again, just about everything in this case seems strange, including the lodgement of a lawsuit against the founder of a forum in which the plaintiff had been an active participant.

"Lawsuits are a short-sighted and self-destructive way of dealing with criticism," said EFA Chairperson Dale Clapperton in a statement.  "As McDonalds and many other companies have learned, suing your critics will cause much more damage and bad publicity than the criticism itself ever would."

True enough, but until such time as 2Clix officially withdraws its action against Whirlpool or makes an official statement to that effect it seems a trifle premature to declare the case over and done with.