LCC vs. ML-Implode Lawsuit Over

Exclusive: for immediate release.

Bay Area-based pay option ARM lender Loan Center of California (LCC) and Aaron Krowne/Krowne Concepts Inc. ( Mortgage Lender Implode-O-Meter ) have settled the lawsuit which was filed by LCC on May 7, 2007, in LCC's home county of Solano, CA.

The suit stemmed from a report from a former LCC employee, that was posted anonymously on ml-implode.com for about a day in mid-April, 2007. The report alleged that LCC was suffering from financial difficulties and had engaged in improprieties. LCC disputed the content of the report and sued Krowne and ml-implode for libel, claiming that LCC was damaged by the post itself as well as by the implication that the company had "imploded".

ML-Implode refused to divulge the identity of the former LCC employee who had provided the information on the principle that the anonymity of news information sources is sacrosanct.

By the terms of the settlement, LCC has dismissed its claims against ML-Implode, without any admission of liability or any monetary payments.

The suit was formally dismissed by the court on December 24, 2007.

Supplementary Resources

• LCC Lawsuit Fundraising page
• First LCC lawsuit press release
• Second LCC lawsuit press release
• Donate right now to support us against similar threats in the future.

Epilogue

We thank our supporters in the mortgage lending community for rallying forth to keep us running. Without the approximately $25,000 donated by the public, we probably wouldn't have survived (the total direct costs of the suit were about $40,000---and keep in mind we never entered litigation). We really couldn't have done it without you, and so it really is your site. Our sincere thanks goes out to the good people of the mortgage lending and banking community for "adopting" us and giving us the opportunity to contribute to greater transparency and public dialog in such an important area.

We feel that the outcome of this suit represents only a partial victory for bloggers and internet-based public forums in general. The judge in our suit did agree that the site was indeed fundamentally focused on an important topic of public discourse. However, almost incomprehensibly to us, he did not dismiss the suit in line with the letter and intent of the CDA (section 230) and California's "anti-SLAPP" law. We strongly believe this was a grave mistake.

As is made clear by the costs we faced in the suit, providing a forum for whistleblowing and debate on critical contemporary issues remains a risky and expensive proposition. It is virtually "death upon challenge" for any individual or small-scale operation. It is thus unclear to us why anyone would ever get involved in such an enterprise if they truly understood the peril they were placing themselves in. We certainly would not have, if we knew then what we know now.

At a time when the internet's promise of lower communication barriers for average citizens is becoming a reality, the legal system remains the greatest threat to the public's receiving the benefit of this gift. Now, more than ever, we need to provide mechanisms which enable regular people to organize and fight back against entrenched corporate and government interests which have deeply corrupted our economy and society. This starts with, and relies centrally upon grassroots communication. So-called anti-SLAPP laws, such as California's law that we attempted to invoke, seem to be more of a fig leaf put out by these interests rather than a genuine attempt at reform. Sadly, this seems to be the state of affairs across the country, and the entire country is worse-off for it.

So we ask for your continued support in fighting this fight---because we cannot accept that outcome as a permanent one.

—apk