Ex-Blue Sky director Elaine Stead awarded $280k in Joe Aston defamation case
The AFR’s Joe Aston found to have engaged in a ‘form of bullying’ as ex-Blue Sky director Elaine Stead awarded $280,000.
Former Blue Sky director Elaine Stead has been awarded $280,000 in damages in her defamation case against Financial Review columnist Joe Aston, who she argued, had made her out to be “reckless’’ and “stupid’’.
In a lengthy judgment delivered on Wednesday morning, Justice Michael Lee awarded Dr Stead $280,000 in ordinary and aggravated damages against Aston and his employer Nine Entertainment Co. relating to two columns and a tweet penned by Aston in 2019.
In a statement released on Wednesday afternoon, Nine said it was “disappointed by the court’s decision”, and the amount of damages was dwarfed by legal fees racked up by both sides in the case, “which exceed $2 million’’.
“Expensive and disproportionate defamation cases like this have a chilling effect on freedom of speech,’’ Nine said in a statement.
“The proposed reforms to the Defamation Act should go some way toward correcting the imbalance. The Court has granted leave to appeal.”
Dr Stead also released a statement, saying she was “very pleased” with the decision.
“I hope the judgment brings an end to more than two years of personal embarrassment, anxiety and distress.”
“I am grateful that the judicial process has helped me to repair the damage to my professional
reputation and right the personal harm that the articles have caused me, although I will never be able to completely undo all the damage done.”
The cap for ordinary damages under Australian law is $421,000 while aggravated damages can be assessed in much greater sums above this, with regard to a number of factors.
Justice Lee said in his judgment there was scope under Australian law for the robust expression of opinions.
“In essence this case is about whether this line the law draws was crossed,’’ he says in his judgment.
Justice Lee said Dr Stead argued that Aston had “pole vaulted” the line the law draws in regard to defamation.
In wrapping up his one-hour delivery, Justice Lee referred back to an earlier statement he had made, that perhaps the matter would not have found its way to his chambers, had Aston not expressed himself with such “vitriol’’.
He said while there was a “rational basis” for a critical examination of Dr Stead’s activities on social media, which were the subject of Aston’s columns, he found that Aston “did single her out for focus and engaged in a sustained campaign of offensive mockery which amounted, in my view, to a form of bullying’’.
But the judge did accept that Aston genuinely held the belief that Dr Stead was “stupid”.
“Mr Aston believed Dr Stead was both denying the reality of the real reason for the collapse of Blue Sky and had demonstrated obtuseness, indeed stupidity, by engaging in discordant social media posts,’’ the judgment states.
“Indeed, without making findings going beyond what is necessary to determine this case, it might be said there was a rational basis for Mr Aston to be highly critical of aspects of the performance of the officers of Blue Sky including Dr Stead; it was not irrational to think it was strange and dissonant for a former director and senior executive of a public company that had performed in the way Blue Sky had performed to engage in social media in the terms she did.’’
But the judge said there was an “asymmetry of power”, with Aston “the one with the column inches” and “one might ask, what was she supposed to do?’’
“She was being serially mocked ... as being, in effect, a gaping moron.’’
This was in relation to a reference Aston had made, referring to Dr Stead as “Brick Tamland’’, a character from the movie Anchorman.
“To describe Dr Stead’s experience as likely to be ‘unpleasant’ might be thought to be an exercise in considerable understatement,’’ the judgment says.
“The targeted campaign of offensive mockery of Dr Stead was unjustified and improper and meant the manner in which Fairfax and Mr Aston committed the tort of publishing the defamatory matters, caused damage and was conduct sufficiently oppressive to warrant some compensatory sum to be awarded for aggravated damages.
“It is difficult to identify comparables, but in considering the appropriate and rational relationship between harm and amount, I have had regard to the general tenor of awards (including those where a person’s professional standing is affected) as part of the process of synthesis of the relevant matters to which I have referred.
“Weighing up all the factors, I have concluded that the appropriate award of ordinary and aggravated compensatory damages is $280,000.’’
The judge said the Dr Stead “presented as a witness of the truth’’, except for her assertions that she was surprised that her activities on social media would be the subject of media attention.
He said Aston was a generally “candid and impressive’’ witness.
The matter will return to court next week for arguments as to costs and interest.
‘TRUTH DEFENCE ABANDONED’
The trial, held over several days in December, captivated Australia’s business community, at times attracting more than 100 viewers on its live stream.
Dr Stead, a former executive director with the now-collapsed ASX-listed fund manager Blue Sky, and a former manager of the South Australian Government’s venture capital fund, had alleged Aston defamed her in two Rear Window columns published in February and October 2019, as well as on social media.
Aston’s columns, Dr Stead claimed, made her look “reckless” and “stupid”, and, the court heard, ignored her “remarkable’’ reputation and track record of success in the venture capital industry.
Dr Stead claimed Aston made her out to look “cretinously stupid’’, and her lawyer Sue Chrysanthou QC told the court “Mr Aston targeted my client because she is a woman’’.
Aston’s columns referred to Dr Stead as a “prodigious destroyer of capital’’ who invested in “peanut start-ups’’, references which Dr Stead argued made her look “cretinously stupid”.
She had also been characterised as a “pyromaniac” of other people’s capital.
Dr Stead, while working at Blue Sky, was a director and part of the team overseeing investments in companies such as the now-defunct bespoke shoe company Shoes of Prey and online wine retailer Vinomofo.
Blue Sky collapsed in 2019 after short seller Glaucus Research published a report the previous year alleging serious concerns with its business model including that it overvalued assets under management and had misrepresented the performance of its investments.
Ms Chrysanthou argued in her closing statement that the court should consider awarding aggravated damages in the matter, because of Aston’s “escalation” of his claims against Dr Stead while giving evidence.
The barrister at the time declined to specify an amount for a damages claim but said that without a finding of aggravation Dr Stead was seeking damages “right at the top of the range” and with aggravation the sum would be “well above that”.
Ms Chrysanthou said the columnist had escalated his claims “repeatedly” and was in many instances unresponsive to questions put to him.
The maximum defamation payout under Australian law, without aggravation, is $421,000.
Aston’s legal team abandoned a truth defence before the trial, and were relying on “honest opinion” as a defence.
Aston told the court he did indeed believe Dr Stead was “stupid” – a view formed after he examined some of the decisions she made while at Blue Sky.
He used as an example the investment in Shoes of Prey, whose business “looked really dumb”, he said.
Aston said the business plan included a “Cinderella strategy” to only make shoes for people with really small, really large, or quite unusual feet.
“It was stupid,” he said.
Aston also singled out “stupid social media posts” on the day Blue Sky went into a trading halt, in which Dr Stead said she “needed a hug”.
Under questioning, he admitted that he couldn’t really know what this referred to, although he didn’t think it meant her dog had died.
“I knew that most of Elaine’s business had gone to shit,” he said.
In a tweet to promote one of his articles, Aston called Dr Stead a “pyromaniac” but said that he obviously didn’t mean that she literally went around setting fire to people’s money.
He agreed that he had also referred to Dr Stead as a “feminist cretin” in a column that also mentioned writer Clementine Ford. Asked why he’d made the link, he agreed that he believed both were feminists, both were stupid and he believed that both were asking their supporters for money.
Aston told the court part of his role was to target, with humour, “hypocrisy, cant, self-importance … extending right through to wrongdoing”.
Ms Chrysanthou said Mr Aston’s defence had tendered no expert evidence that Dr Stead’s track record was poor. Instead there was a “feeble attempt’’ to list a number of companies which didn’t perform well, she said.
Ms Chrysanthou said investors such as Atlassian co-founder Mike Cannon-Brookes had also invested in Shoes of Prey – the company referred to as a “peanut start-up”, and that at the time of that investment by Blue Sky, it was performing well and had good prospects.
Dr Stead made successful investments in companies such as Hatchtech and Pet Circle, Ms Chrysanthou said, and won back to back Australian Venture Capital Association (AVCAL) awards in 2016 and 2017 for those investments.
Dr Stead was also not the sole decision maker in Blue Sky’s investment decisions, the court heard, with an investment committee needing to make an unanimous decision to invest.
Dr Stead at one stage had suicidal thoughts and took a month off work to get psychological help after her mental health was “obliterated”, the court heard early in the trial.
Ms Chrysanthou at one stage challenged Aston on whether he believed Dr Stead who has a PhD, is stupid, and if so how he came to that conclusion.
“Stupid is as stupid does,” he told the court. “Someone who repeatedly does stupid things is by definition stupid.”
He referred to what he described as the “banality” of Stead’s social media posts, which led to a discussion of Aston’s own social media postings.
Mr Aston also agreed that he sometimes targets individuals, often over months or years, and that he occasionally goes out of his way “to take people down, using the Rear Window column”.
He often uses mockery, he said.
For example, he agreed under questioning, he had at one point referred to Dr Stead as Brick Tamland, the dimwitted “gaping moron” from Anchorman.
“And Anchorman II?” Justice Lee inquired.
“Yes, I apologise for that omission,’’ Mr Aston said.
Mr Aston said Dr Stead had changed her profile picture to that character “so she seemed to be running with the joke as well’’.
Mr Aston said he was not intending to insult Dr Stead.
“I did that to be amusing,” Mr Aston said.
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