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NEW YORK (Reuters) - The Virginia Supreme Court ruled against America Online in its efforts to protect the identity of one of its 35 million subscribers by asking the court to quash a subpoena calling for the member's name in an issue that goes to the heart of the anonymity of the Internet.
The ruling against the world's largest Internet service provider, based in Dulles, Virginia, was the latest in the evolution of privacy laws as they pertain to the Internet and identities of Web surfers, privacy experts said.
"The law is very unsettled and still being written. Any decision by the highest court of any state -- particularly the one where AOL resides -- is significant," said David Sobel, general counsel at Electronic Privacy Information Center.
The Virginia Supreme Court sided with a lower California court's ruling that supported Nam Tai Electronics Inc.'s NTAI.O request to subpoena the identity of an AOL user as part of a complaint that alleged libel, trade libel and violations of California's unfair business practice statutes.
The electronics company alleged in its complaint, filed in January 2001 in California Superior Court, that 51 unknown individuals, including an AOL subscriber, posted "false, defamatory and otherwise unlawful messages" about the company's stock on an Internet message board.
"The case is important to the extent that AOL was attempting to ask the Virginia Supreme Court to adopt a rule of law for Internet speech that was different than the law as it exists for the bricks and mortar world," Jon Talotta, associate at Kirkpatrick & Lockhart, which represents Nam Tai, told Reuters.
"This ruling makes this a traditional defamation case," added Robert Feyder, litigation partner at the law firm.
In April 2001, AOL filed a motion to quash Nam Tai's subpoena. arguing it should not be required to reveal subscriber information because it would "infringe on the well-established First Amendment right to speak anonymously."
AOL, the Internet arm of media giant AOL Time Warner Inc. AOL.N , also argued Nam Tai could not meet the heightened scrutiny required to overcome that right but the lower California court denied AOL's motion.
Companies, including AOL, have turned over subscriber's names under different circumstances, an AOL spokesman said.
However, AOL argued that Nam Tai's complain did not merit setting aside First Amendment rights, but the lower California court denied AOL's motion to quash the subpoena.
"Clearly, we are disappointed in the ruling. AOL feels that there are important critical First Amendment issues at stake in this case and we are in the process of considering our legal actions," AOL spokesman Nicholas Graham told Reuters.
The online giant has 10 days to ask the Virginia Supreme Court to reconsider its decision or turn over the name. If AOL goes back to the court in Virginia and it still rules against AOL, the company could then appeal to the U.S. Supreme Court.
Privacy experts called the ruling significant but said more litigation involving online privacy issues would likely unfold before a determination is made about what a company needs to prove before winning such cases.
"It is disappointing because a whole host of courts around the country have been appropriately concerned about the First Amendment right to anonymity," said John Morris, staff counsel at the Center for Democracy and Technology.
However, he said, the decision may not have as much importance in the end because the Virginia Supreme Court ultimately decided that the First Amendment issues surrounding this case must be resolved in the California courts where Nam Tai filed its original complaint, Morris added
The ruling against the world's largest Internet service provider, based in Dulles, Virginia, was the latest in the evolution of privacy laws as they pertain to the Internet and identities of Web surfers, privacy experts said.
"The law is very unsettled and still being written. Any decision by the highest court of any state -- particularly the one where AOL resides -- is significant," said David Sobel, general counsel at Electronic Privacy Information Center.
The Virginia Supreme Court sided with a lower California court's ruling that supported Nam Tai Electronics Inc.'s NTAI.O request to subpoena the identity of an AOL user as part of a complaint that alleged libel, trade libel and violations of California's unfair business practice statutes.
The electronics company alleged in its complaint, filed in January 2001 in California Superior Court, that 51 unknown individuals, including an AOL subscriber, posted "false, defamatory and otherwise unlawful messages" about the company's stock on an Internet message board.
"The case is important to the extent that AOL was attempting to ask the Virginia Supreme Court to adopt a rule of law for Internet speech that was different than the law as it exists for the bricks and mortar world," Jon Talotta, associate at Kirkpatrick & Lockhart, which represents Nam Tai, told Reuters.
"This ruling makes this a traditional defamation case," added Robert Feyder, litigation partner at the law firm.
In April 2001, AOL filed a motion to quash Nam Tai's subpoena. arguing it should not be required to reveal subscriber information because it would "infringe on the well-established First Amendment right to speak anonymously."
AOL, the Internet arm of media giant AOL Time Warner Inc. AOL.N , also argued Nam Tai could not meet the heightened scrutiny required to overcome that right but the lower California court denied AOL's motion.
Companies, including AOL, have turned over subscriber's names under different circumstances, an AOL spokesman said.
However, AOL argued that Nam Tai's complain did not merit setting aside First Amendment rights, but the lower California court denied AOL's motion to quash the subpoena.
"Clearly, we are disappointed in the ruling. AOL feels that there are important critical First Amendment issues at stake in this case and we are in the process of considering our legal actions," AOL spokesman Nicholas Graham told Reuters.
The online giant has 10 days to ask the Virginia Supreme Court to reconsider its decision or turn over the name. If AOL goes back to the court in Virginia and it still rules against AOL, the company could then appeal to the U.S. Supreme Court.
Privacy experts called the ruling significant but said more litigation involving online privacy issues would likely unfold before a determination is made about what a company needs to prove before winning such cases.
"It is disappointing because a whole host of courts around the country have been appropriately concerned about the First Amendment right to anonymity," said John Morris, staff counsel at the Center for Democracy and Technology.
However, he said, the decision may not have as much importance in the end because the Virginia Supreme Court ultimately decided that the First Amendment issues surrounding this case must be resolved in the California courts where Nam Tai filed its original complaint, Morris added