US Report: AOL dismissed in Drudge case

In a ruling with potentially far reaching effects for Internet service providers, America Online has been dismissed from a high-profile $30m (£17.90m) defamation lawsuit against the online service and Web gossip columnist, Matt Drudge.

U.S. District Court Judge, Paul Friedman ruled that AOL and other ISPs can't be held liable for potentially libellous material disseminated by them but created by a third party, throwing out a suit brought by Sidney Blumenthal, a senior aide to President Clinton and his wife, Jacqueline Jordan Blumenthal.

The ruling said Congress exempted ISPs from lawsuits such as this one when it passed Clinton's sweeping telecommunications industry reforms in 1996.

Blumenthal sued AOL and Drudge over the controversial writer's Aug. 10, 1997 column accusing Blumenthal of beating his wife - a column available on Drudge's Web site and to AOL's then-9-million subscribers. Drudge issued a retraction and an apology the next day.

While the ruling is undoubtedly sending ripples of relief through the ISP industry, it could be appealed first to the District of Columbia U.S. Circuit Court of Appeals, and then perhaps to the Supreme Court. The ruling also let stand Blumenthal's companion lawsuit against Drudge.

Friedman ripped into Drudge in the ruling, calling him "simply a purveyor of gossip" who isn't eligible to the libel protections available to journalists.

The Blumenthals' lawyer said in a statement that the couple was heartened by the judge's criticisms of Drudge, but said they will appeal the decision dismissing AOL as a defendant.

AOL general counsel George Vradenburg said in a statement that the ruling was consistent with previous court decisions on ISP liability