Defamation / Reputation
Johnson v. Steele
Closed Contracts Expression
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Nakanune is an independent online news platform. It re-published several articles alleging that KazKommertsbank, a large Kazakh bank, committed corrupt and unlawful acts. It also published an article based on a letter that alleged similar corrupt activities. The bank sued Nakanune and the courts of first instance and appeal found that the publication caused harm to the bank’s business reputation because it published false information.
Nakanune.kz is an independent news outlet in Kazakhstan created in response to bans and closures of independent publications. On October 15, 2014, Nakanune published an article titled New Pas in Kazkom’s Marlezonk Ballet (Новые па в марлезонском балете «Казкома»). The article was based on a letter from one of the news outlet’s readers about violations in construction projects financed by Kazkom using Almaty city’s public funds. The letter alleged that the broad violations were ignored by Almaty City Hall because of corruption. The letter also listed bribes that the bank paid to the Almaty City Hall. Lastly, the published letter cited instances when the bank unlawfully transferred funds from Kazakhstan and unlawfully withdrew large sums of money.
The letter’s author asked Nakanune to publish the letter and ask the Almaty City government to respond to the letter. The news outlet did not investigate the validity of the claims made in the letter, and re-published it, asking the Almaty City government to respond to the letter.
Six months after the article was published, KazKom sued Nakanune for harm to its business reputation, and requested the deletion of the article and compensation for fiscal losses resulting from the harm to its business reputation.
The basis for the suit was Kazakhstan’s Law on The Mass Media, art. 21, para.2, which prohibits journalists from dissemination of false information.
The appellate court defined business reputation as an established public positive assessment of business credentials of a company.
The appellate court then defined damaging statements as ones that defame without supporting evidence, or that harm the dignity and honor of a citizen or organization in the eye of the public or in the eyes of private citizens from the perspective of lawfulness and public moral principles.
Then, the appellate court ruled on whether the publication was through mass media. The court explained that mass media include periodic publications in print, audio, video or internet platforms, and ruled that Nakanune fell into the criteria and was thus a mass media, therefore the article was a mass media publication.
The appellate court stated that under the Kazakh Criminal Code, all are considered innocent until found guilty by a court of law. Since Nakanune did not provide proof that a court found the bank guilty of the alleged corruption, its allegations of such corruption constituted false statements.
The court then stated that Nakanune’s article was based on a letter and that Nakanune, as its lawyers themselves stated, did not investigate the validity of the claims made in the letter, and simply republished it, thus the information published was not verified. Based on this, the court ruled that Nakanune intentionally republished information that was not validated and false.
On the issue of damages, the court stated that Kazakh Civil Law, art. 141, para. 4, allows fiscal compensation for harm to business reputation. The court then stated that KazKommertsBank is one of the largest banks in Kazakhstan and harm to its business reputation is also felt by its clients. Thus, the court believed that requested TENGE 20 million (roughly $100,000) compensation was fair.
Decision Direction indicates whether the decision expands or contracts expression based on an analysis of the case.
The decision contracts expression because the court’s ruling limits debate on possible corruption of large public entities. Specifically, the court’s application of the principle that all are innocent until proven guilty, in ruling that since there’s no judicial proof of the bank committing corruption, thus it must be innocent, limits the possibility of publicly discussing even rumors of unlawful acts. The ruling and subsequent fine also has a significant chilling effect on the media, for both the publisher and the author.
Global Perspective demonstrates how the court’s decision was influenced by standards from one or many regions.
Case significance refers to how influential the case is and how its significance changes over time.
The decision is from a court of appeals, which has precedential value over courts of first instance.
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