Competing Stone Sellers Face Jury on Defamation

PHILADELPHIA (CN) - A jury should decide whether a marble company defamed a competitor with an anonymous smear campaign, a federal judge ruled.

Colonial Marble & Granite says it received a deluge of negative online reviews in the summer of 2009 from purported customers using Google and Citysearch.

The reviews, which numbered in the hundreds, allegedly included scathing accusations that included calling Colonial a "total scam" and "a very dishonest company."

But Colonial says the posts weren't coming from customers at all; they were coming from a competing business named AAA Hellenic Marble.

Subpoenas to various websites indicate that some of the "reviews" came from Hellenic's office computers or Hellenic executive Nicholas Alexiadas, according to a July 2010 complaint against Hellenic and its employees.

After Hellenic proffered a statement from then-employee Richard Moser in which he took sole responsibility for some of the posts, Colonial added Moser as a defendant.

Moser said in deposition that he lived in Alexiadas' home for part of 2009 and had access to the Internet there, according to records. He claimed to have authored the posts because he was angry that Colonial allegedly did not fully compensate him for work he did in the summer of 2008.

Colonial wants a jury to sort out liability since Moser has only taken responsibility for some of the posts, while disavowing authorship of others.

U.S. Magistrate Lynne Sitarski refused Monday to dismiss the case against AAA Hellenic, Alexiadas and Moser at summary judgment.

There is a factual dispute about whether Colonial suffered lost business or actual damages because the posts, Sitarski found.

While Colonial presented evidence that it lost customers as a result of the posts, she noted that Hellenic has contested the admissibility of that evidence.

Sitarski declined to rule on admissibility Monday, finding that it's another issue for the jury to decide.

She also declined to grant summary judgment for Hellenic on its defamation counterclaim. The company has alleged that Colonial wrongly accused Alexiadas in a press release of creating "dozens of fake consumer profiles on several consumer websites, which he used to disparage Colonial on countless occasions over several months."

Trial is set for April 9.

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