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Hedge Fund Felon Gilabert Ups Harassment Campaign Against Implode; Highlights Omnipresent “SLAPP” Free Speech Threat

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by Aaron Krowne
Founder, The Implode-o-Meter

Our dedicated readers might recall that a couple weeks ago, the Implode-o-Meter (at its Hedge Funds site, http://hf-implode.com/) received a lawsuit threat by a convicted hedge fund Ponzi fraudster, Keith Gilabert.

Gilabert’s “SLAPP” style threat may be the most frivolous such threat in history — not only was Gilabert convicted, but he actually confessed and pled guilty to the crime (lightening the pockets of his investors by about $7 million, or half of his fund’s total nominal assets) prior to 2007. Further, he was complaining about our simple, two-paragraph synopsis of the ordeal (concerning Gilabert’s “GLT Venture Fund”), contributed by author Ann Logue, which was itself derived from government (SEC and DoJ) filings and statements, as well as other, more extensive mainstream articles (themselves based chiefly on the same government releases).

Gilabert’s threat was, thus, an obvious attempt to whitewash the record of his confessed crime from our site, which happens to rank very prominently online (for the very same reason Gilabert wanted the article removed: we are a well-known outlet for truth in the economic arena). This is the essence of “SLAPP” (which stands for “Strategic Litigation Against Public Participation”) — a lawsuit filing (or simply threat of same) which has as its intent to bully the target into silence (or worse, extort money from them), even though the filer knows they could never win a lawsuit on the merits.

Gilabert delivered his threat in the form of a two-page legal “nastygram”, written by himself. It was all quite shoddy. Unfortunately, due to the Implode-o-Meter’s past history of dealing with similar SLAPP suits (two of which still drag on, despite an outright win in one of them in the New Hampshire Supreme Court), we had to pull the Gilabert article due to lack of funds to mount an even basic defense to yet another suit.

You can read about Gilabert and his SLAPP threat on the HF-Implode page which used to hold the original article, where we have instead posted Gilabert’s letter and replied to it.

Logue stands by her original writeup, and has re-posted it to her own site, along with a rather damning response to Gilabert (a sample: Logue sharply points out that the statute of limitations for a libel suit passed more than three years go; a fact which, while making any suit legally baseless out-of-the-gate, cannot “stop” Gilabert from filing if he chooses!)

The we took yet more of our limited time to write this additional post, however, is because Gilabert was not content to stop at our removal of the article and its replacement with a response. Obviously upset that we didn’t simply acquiesce to full silence, Gilabert has spent the past few weeks harassing the Implode-o-Meter and trying to get us “in trouble,” extra-legally.

In the first such example, he complained to our hosting company that his “privacy was being violated” by us posting his own letter. While there was low risk this would actually harm us (because we have a small, “boutique” hosting company), we still had to go on the defensive and explain to them why the threat was frivolous and we should be allowed to keep the page posted.

In the second case, Gilabert submitted a complaint to Google. The reasoning for that one isn’t as clear, since Google has no actual authority over us (except that we carry Google Ads, and that in theory, they could drop us from their seach index, causing VERY material harm to us). Also, a former co-owner of the Implode-o-Meter now works at Google. Luckily, the complaint was forwarded to him personally, and then from him to us, so we could explain through a trusted channel how it was entirely frivolous.

Ironically, it was Gilabert himself who levelled the charge of “tortious interference” in his nastygram (with what business, we aren’t sure. We know that ours is definitely online publishing, and he has already interfered with it, and is clearly attempting to do more).

Why is this harassment?  Because Gilabert knows our email address: that’s where he sent the electronic copy of his initial nastygram.  And he’s received direct responses from us from it (and I know he’s read them).    If these were legitimate privacy complaints, he could have taken them to us directly.  Instead, he clearly wanted to harm us.

Nevertheless, we responded to Gilabert’s indirect harassment/interference attempts by graciously blacking out his signature and street address in the re-posted nastygram. We aren’t trying to threaten Gilabert’s personal safety; rather, we are simply exercising our Constitutional right to make known the idiocy and malice of what he is doing.

And why do that? Because people need to know how little free speech there is out there in practice, even in America, the land of the Pentagon Papers Supreme Court ruling. Any sufficiently-funded individual or company can relatively-easily dispense of any online criticism or whistleblowing by filing a SLAPP suit (or simply threatening to do so).  Often, in our experience, these suits have as a secondary goal the discovery of the identity of an anonymous whistleblower.   The average individual or small media company cannot possibly economically survive even one such threat, given the astronomical cost of litigation these days. We’ve stood as firm as possible against three of them (that have been filed — multiples of that in threats that did not result in follow-up in court).

There are a lot of good civil rights and free speech organizations out there, but unfortunately they do not have the resources to provide pro-bono defense except for a tiny percentage of such cases. Personally I know of many SLAPPs that resulted in the speech being silenced, and you’ve never heard of them.  Because that’s the inherent nature of the problem — it’s much bigger than the few reported cases where somehow the defendant has or gets the resources to fight back in court.  That is, SLAPP threats usually work.

The upshot is, free speech only exists for Big Media, which has the funds to defend its own right to publish. But even in that case, budgets are so tight, that a sufficiently-active finger-pointing investigative journalist is likely to find themself unemployed before too long.

We need a federal “anti-SLAPP” law to make it harder to file these suits (which would provide early dismissal, with fees awarded to the defendant), especially since most of these suits end up in federal court by virtue of being online. That, however, would likely only be the beginning, since a judge can always fail to apply the law properly (and the bench seems to defer to well-funded interests arbitrarily a distressing percentage of the time), necessitating an expensive litigation and/or appeal process. If we are to reclaim any meaningful right of free speech in this country, it may be necessary to move to an automatic “loser pays” model, possibly with punitive damages if the suit is clearly frivolous (so that plaintiffs actually stand to lose something by filing, without the defendant needing to counter-sue for damages — which requires lots more money up-front). The UK has reportedly moved to this model, with much success (though their definition of libel leaves much to be desired).

At any rate, something must be done.  We reckon the pall cast on free speech by SLAPPs, especially against whistleblowing and investigative reporting, is a major factor in the financial crisis and depression we are dealing with today.


Background on additional SLAPP threats The Implode-o-Meter has faced

You can also read about many of the above cases at the Citizen Media Law Project, The Reporter’s Committee For Free Press, at Public Citizen, and Harvard’s Berkman Center (many links to specific reports/amici about our cases from these sources are available on our Media Links page).

Selected additional well-known whistleblowing/investigative reporting by The Implode-o-Meter

There Are 4 Responses So Far. »

  1. SLAPP him back, Nastygram him back.
    Sue for damages to your good name,
    He did defame you at Google,
    almost to bad it went to former owner/partner.
    It’s a two way street.

  2. You can’t change facts, you can only change your reaction to them. If the goal was to get the story to sink in the search rankings, it’s not working.

  3. Mr Gilabert is attempting to reinvent himself as someone who did not commit those crimes. Your apply light and disinfectant to the story is hurting his ability to continue the lie. Creepy in the 1990s and still creepy today.

  4. […] a year’s hiatus, Implode readers are privileged to be entertained by further drama in the saga of Keith Gilabert vs. Implode.  (The impatient may grab the anti-SLAPP motion filed against Gilabert and skip the remainder of […]

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