DRUG WAR ON THE WEB

'Narco News' Ready For Libel Suit In New York

Last month, when Citigroup bought Banamex, the second largest bank in
Mexico, the deal was praised as good for the Mexican people and good
for the banks. Citigroup vice chairman Robert Rubin told the press
that the deal was the result of an overture from Banamex chairman
Roberto Hernandez Ramirez, who is worth $1.3 billion and has been
promised a seat on the Citigroup board. On May 18, The New York Times
faithfully regurgitated Hernandez's rags-to-riches success story.

But the fruit vendor turned billionaire has a dark side. According to
statements made in 2000 by Al Giordano, publisher of the Mexican-based
NarcoNews.com, Hernandez has also been called a money launderer and
a drug dealer. Giordano says he has reviewed published photos and
testimony suggesting that Hernandez has shared his Yucatan
beachfront with the boats and planes of the cocaine trade.

Hernandez has denied the allegations since they were first reported
in 1997 by the Mexican newspaper Por Esto! Last summer, after failing
in his efforts to get Por Esto! prosecuted in Mexico, the banker
decided to sue his critics in New York. He hired Akin Gump Strauss
Hauer & Feld, a firm that has represented alleged money launderers in
the past, to file a libel suit on behalf of Banamex. His lawyer calls
the portrayal of Hernandez and Banamex as drug traffickers "utterly
false," and claims that Giordano's comments "injured Banamex's
business reputation"oa conclusion which seems especially odd now that
Banamex has been snapped up by Citigroup for $12.5 billion.

Wherever he found his money, Hernandez has enough of it to sue Narco
News for yearsoor at least until the Web site shuts down. But it would
be a mistake to underestimate my friend Giordano, a respected reporter
and activist who plans to defend himself against the libel charges.

In what is shaping up to be the summer's most entertaining media
trial, Giordano will appear in New York State Supreme Court on July
20, where he plans to throw curve balls during the first round of oral
arguments in the case.

In his motion to dismiss, Giordano chronicles his lifelong commitment
to free speech and claims that every one of his supposedly libelous
statements is what the courts call an opinion, because in each case he
cited the facts on which his opinion was based.

Via e-mail, Giordano wrote that the opinion defense has solid
precedents, including a case in which an umpire sued Yankees owner
George Steinbrenner for mocking his calls as "ludicrous" and
incompetent. Because Steinbrenner referred to specifics to back up his
opinion, his statement was found to be not defamatory. Giordano says,
"We razzed the umpire in this case, the government, which leaves
certain white-collar traffickers alone."

Attorney Thomas Lesser, who represents Narco News, also filed a motion
to dismiss, arguing that the court cannot allow Banamex to sue the Web
site in New York for content uploaded in Mexico. According to Lesser,
that would be tantamount to giving any libel plaintiff permission to
sue any Web site anywhere in the worldoa precedent that would
seriously threaten free speech.

In its response, Akin Gump calls Lesser's argument a "straw man" and
paints Giordano as having superhuman powers to raise money and affect
public opinion. The plaintiff also claims jurisdiction in New York
because Giordano has business contacts and does fundraising here.

It's too early to call a winner, but as of this week, Giordano will
stop posting new reports on his Web site. When he arrives in New York,
he intends to dispense with the technicalities and turn the spotlight
on the drug trade, which is the heart of the case. "We may be
out-hollered and out-dollared," he quips, "but we're not
outsmarted."

Unlike Hernandez, who Giordano says is "hiding behind his bank," the
journalist will step up to the plate. "Just showing my face," he says,
"will speak volumes about which side of this dispute is telling the
truth." Given his passionate opposition to the drug war, Giordano
should have plenty of fans cheering from the bleachers.