Kiwiblog

The Herald reports:

Nelson MP Nick Smith says he is “delighted” a $15 million defamation lawsuit against him has been settled out of court.

“It’s been a very draining five years. The settlement involved some payment but was less than the legal costs would have been for the scheduled six week hearing,” Dr Smith said outside court. …

Counsel for the parties appeared in the High Court today to announce an agreement had been reached, but the terms were confidential.

Dr Smith said that no public money was involved in the settlement.

Having a $15 million lawsuit hang over you would be no easy thing. Most defamation suits will punish but not destroy you. This suit would have, if successful, bankrupted Nick. No money, no house to live in, no job.

So it must be a great relief to have it settled. I don’t know the terms of the settlement of course but even the fact there has been one is significant because my understanding is Smith and Wakeling had been prepared to settle years ago, but the Plaintiff insisted on a day in court. However a recent case in appellate courts made the burden of proof harder for the plaintiff, so this may have helped encourage a settlement.

The Nelson Mail report:

Nelson MP and Government minister Nick Smith faces trial later this year in a significant defamation case.

A six-week hearing in the High Court at Auckland is scheduled to start on June 8, but Dr Smith hopes it can be resolved out of court before then.

Timber preservatives producer Osmose New Zealand began legal action in December 2005 against timber preservation scientist Robin Wakeling and Dr Smith over statements they made in July 2005 about one of its timber treatments.

The company is seeking nearly $15 million in damages.

The legal costs to date alone has been massive for Nick, let alone what the trial will cost, and if Osmose are sucessful, any damages.

Dr Wakeling published an article critical of the Building Industry Authority (BIA), now the Department of Building and Housing, for approving the use of the treatment in timber framing of houses in 2004.

Dr Smith issued a press release later the same day critical of the then-Government and BIA, along with a copy of Dr Wakeling’s article. He was interviewed on the issue on radio and television.

Osmose’s statement of claim pleaded 11 causes of action. Five were directed at Dr Wakeling – two in defamation, two for injurious falsehood and one for breach of the Fair Trading Act.

The other six were against Dr Smith for defamation and injurious falsehood but did not include an alleged breach of the FTA.

Dr Smith said yesterday the legal action had become more complex with six other parties added to the action.

“That takes a little bit of the pressure off in that there are more people to fund the defence,” he said.

The legal costs of the various parties would be well over $500,000, he said.

Ouch.

The SST reports on how an American multinational timber company, Osmose,  is suing Nick Smith and a local scientist for $15 million each. Nick has already had $300,000 in legal costs and it is likely his bills will reach $500,000.  It is worth remembering this is costs to be met from after tax income. On an MPs salary, take home pay is only around $71,000 a year, so the cost is more than the entire take home pay for seven years.

The company of course has the right to take legal action if it thinks comments made were defamatory and hurt their business.  They have to prove actual lost income to succeed (so I understand). But if as reported, the company is refusing any offer to settle, you wonder if the motivation is to destroy Nick and Dr Wakeling rather than have the record set straight and receive compensation.

Nick has been sued before – ironically for the first time by the Exclusive Brethren. But all the other cases have been won or settled.