Online Posts About Company Lead to $5 Million Defamation Verdict

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Internet Posts on Stock Forum and Letter to State Agency Found to be False and Jury Awards Compensatory Damages; Punitive Damages to be Pursued

This will present a precedent for small market companies to fight back

Securus Law Group, P.A. today announced, and court records reveal that a Hillsborough County Jury rendered a verdict on April 5th in favor of Seafarer Exploration Corp for $5,080,000 in damages to the company and shareholders due to online posts made from November 2009 to December 2010 in an online stock discussion forum by a Vero Beach Florida man. From Court records the court and jury found that the posts made about Seafarer, a treasure exploration and recovery Company based in Tampa, were false, which the jury according to the verdict found, had led to a decrease in market price, delay in Company business and to investor holdings. According to the court records the jury also found that a letter sent by the poster to a state agency was false causing a 15 month delay in receiving a permit renewal for its dive operations off the Florida coast.

Securus Managing Partner and lead trial attorney, Craig A. Huffman had argued in the complaint and ensuing filings that part of the case involved online posts which were made on investorshub.com, under a discussion forum about Seafarer Exploration. In the lawsuit complaint and seperate filings in the court record, the posts were made by Sean Murphy of Vero Beach Florida, a former consultant diver for the Company who was fired in November 2009 for conduct unrelated to the lawsuit. Soon after according to the complaint, Murphy, using the on screen name of “Floridatreasurecapt,” posted hundreds of entries about Seafarer, its management, directors, and projects, alleging that the company was guilty of fraud, was under different investigations by state and federal agencies, and that management was “ripping off” shareholders. The jury, after two days of evidence, sided with Seafarer according to the jury's verdict.

Court documents showed Seafarer alleged during the trial that Murphy also sent a letter in January 2010 to the State Bureau of Archaeological Research where he alleged that Seafarer had forged paperwork with his Murphy’s name on it and had taken artifacts from the dive site improperly.

A review of the jury verdict showed they did not believe Murphy’s letter or similar postings were true. Court records showed the jury reached its conclusion after numerous witnesses and evidence were presented at trial. Murphy had in his pleadings of record defended the case early on that he was the one who was going to take Seafarer to task. In the end he tried to make out that the Court proceedings were “vindictive” and his rights were violated. In some of his responses to the Court Murphy stated he absented himself from the trial after stating it was pointless to present a defense.

“Mr. Murphy is going to be an example of what should happen to people who sit behind screen names and negatively, falsely, impinge the lives of people and of good companies. We are not done with him yet,” stated Huffman. “This will set a precedent for small market companies to fight back,” Huffman continued.

According to documents of record in the case the jury found Murphy liable for the delay in Seafarer getting its permit renewed from the State, as well as finding him liable for loss in the market value of the Company. The damage award, according to the verdict, was for compensatory damages only. In pleadings Seafarer has left open the opportunity to pursue Murphy for punitive damages in a separate proceeding before the Court.

“We and our client are weighing the approach to take toward punitive damages in this case, to punish Murphy for his acts, and to dissuade others from doing this,” stated co-counsel, David Chalela.

About Securus Law Group, P.A.
Securus Law Group represents public companies and select investors in corporate and regulatory matters.

The case was tried in the Circuit Court in and for Hillsborough County, Florida; case number 10-CA-004674.

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Craig Huffman
Securus Law Group
(888) 914-4144
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