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Isn't this article libelous?

Defamation Law Discussion Forum

Isn't this article libelous?

Postby pascoe69 » Thu Apr 07, 2011 6:30 am

http://www.forbes.com/free_forbes/2010/0426/investing-pink-sheets-fraud-stock-scam-madoff-spot-pump-dump.html?partner=yahoomag
The writer did no research and said he "randomly" selected Itronics to mention in his article because they had an association many years ago with a marketing company that had a pump and dump on it's client list.
The day after this article was released, Itronics stock plummetted on heavy volume because of this article inferring it's apump and dump which it definitely is not. I've been a shareholder for several years and it's the furthest stock from a P&D imaginable.
Isn't this article libelous toward Itronics?
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Isn't this article libelous?

Postby cruz50 » Thu Apr 07, 2011 6:42 am

No the article is not libelous. Nothing it states about Itronics is untrue. It states that Cervelle Group, an investor relations and financial consulting group, had a business relationship with My Vintage Baby and also had a business relationship with Itronics. This is true. It states that Itronics stock rose and crashed. I don't know about the rising part because NASDAQ only goes back 10 years but the past 10 years shows the stock did crash so that statement is true as well. It states that Cervelle Group was often paid in shares which is also true.

The inference from that section of the article is that if a company that was subject to pump and dump market manipulation used the same investor relations firm as another company that suffered a stock price crash, then it is likely that the other company was subject to pump and dump market manipulation as well. That is the opinion of the author. While it is a poorly formed opinion that displays a deficit in understanding the nature of OTB companies in general and constitutes poor journalism, opinions do not constitute defamation.

Itronics has been trading for less than a penny for over 2 years and at the prices it has been trading for the past month the heavy volume you are citing represents less than $50,000 in trades, the drop in trade value since the high of day before the article was published as of today is only 20% and only 1/200 of a cent per share. I wouldn't worry about the long term impact of this article on Itronics.
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Isn't this article libelous?

Postby ayize » Thu Apr 07, 2011 6:43 am

In my limited opinion it is.

I can't believe the slander I see on this forum.
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Isn't this article libelous?

Postby berwin » Thu Apr 07, 2011 6:55 am

Well as there was a financial loss created by this article there is a definite possiblity of there being a case to answer.

However the case has to prove that the article contains something the write knows is wrong or which they didn't research with due dilligence.

Now Itronics is mentioned in passing and no responsibility is attributed to Itronics. If what said was correct, then there is no case to answer.

Sorry, these things happen. If Itronics engages in a good damage control and media management strategy the stocks will resurge, and if they are artificially low now then they should surge rapidly inceasing their value beyong the previous high because investors like investing in something on the rise.

So you could be a winner in the end.

PS: do you buy stocks to sell or buy for the dividends and long term investment? If it is the latter then you won't have to worry too much about a temporary drop. The main effect of a temporary drop is that the company is now currently vulnerable to takeover. Also some projects may be put on hold because of reduced ability to raise needed capital.
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