MEXICAN BANKER SUES 'NARCO NEWS'

Drug War Goes on Trial

It's a libel action with all the elements of a political thriller.
Two left-wing publishers use the Internet to accuse a powerful
Mexican banker of pushing cocaine from his Caribbean beachfront and
the banker hires Vernon Jordan's law firm to sue for libel in New
York. Turning the tables, the defendants hire top First Amendment
lawyers and prepare to put the drug war on trial in the media capital
of the world.

Sound too good to be true? So says the alleged drug dealer, Roberto
Hernandez Ramirez, a former stockbroker who bought Banco Nacional de
Mexico (Banamex) from the Mexican government in 1991. The Banamex
lawsuit denies all the allegations, right down to the money
laundering and the bribes, and says the drug "smear" has hurt the
bank's ability to do business.

"Banamex is one of the oldest, most respected, and largest banking
institutions in Mexico, and the bank's chairman, Roberto Hernandez,
is a man of the highest moral character," says Thomas McLish, a
lawyer with Akin Gump Strauss Hauer & Feld, a powerful lobbying and
law firm in the nation's capital. "The portrayal of Banamex and
Hernandez being involved in narcotics trafficking is utterly false
and [the defendants] know it to be false."

"Everything I have printed I know to be true and I have documented
with the facts," says Al Giordano, publisher of The Narco News
Bulletin, a Web site that covers the drug war in Latin America
(www.narconews.com). My friend Giordano, a former political reporter
for the Boston Phoenix, has never been sued for libel before; indeed,
he's usually the one making the accusations. This past October, an AP
correspondent resigned after Narco News caught the reporter lobbying
the Bolivian government on behalf of a private company.

The other defendant is Mario Renato Menendez Rodriguez, editor and
publisher of Por Esto!, a daily newspaper with a paid circulation of
about 70,000 on the Yucatan peninsula. Menendez says he has
eyewitness testimony, documents, and photos to back up his
allegations that Hernandez has turned miles of once-pristine
beachfront into an outpost for the drug trade. The publisher is
outraged by what he calls the banker's attempt "to destroy me
economically, politically, and professionally."

It's not the first time Hernandez has tried to silence Menendez. In
1997, after Por Esto! first denounced Hernandez as a
"narco-trafficker," the banker asked the Mexican government to file a
criminal libel action against the publisher. But that action was
dismissed in September 1999 by a judge who wrote that "all the
accusations . . . were based on the facts." Hernandez pressed charges
again in Mexico this year, and the case was thrown out for the second
time on October 26, 2000, the day Menendez learned he was being sued
in New York.

The plot thickened in November, when Menendez retained Martin Garbus,
the legendary First Amendment lawyer who represented Lenny Bruce on
obscenity charges in 1964. Garbus thinks Menendez will prevail. "I
represent a newspaper and a journalist accused, and from what I
understand they have a good defense of the libel claim," says Garbus,
who finds it "very significant" that the libel claims were thrown out
in Mexico.

Akin Gump's McLish says the new suit is different because it "relates
to knowingly false statements made in the U.S." The complaint cites
statements published by Narco News, comments made by Menendez and
Giordano when they traveled to New York last March, and interviews
they gave to WBAI and the Voice. (Exhibit A in the suit is the Press
Clips column of February 23-29, 2000, in which Menendez declared
Hernandez a "narco-trafficker." The Voice is not a defendant in the
suit.)

The inflammatory charges came home to roost on August 9, when Akin
Gump filed its libel action in New York. In a totally unconnected
incident, shots were fired into the Por Esto! offices in Merida at
the end of August. After making inquiries, Menendez found out the
government was planning to arrest him for libel on September 8, the
day he was set to launch a new printing press in Cancun. That day,
Menendez says, the Mexican attorney general's office called a judge
three times asking for the arrest warrant. He also claims that armed
police were on the street and a government plane was waiting at the
airport to take him to a high-security prison outside Mexico City.

Menendez is used to this kind of pressure. In 1968, the government
put him in jail for reporting on and publishing photos of the student
massacre in Mexico City, in his now defunct magazine Por Que? He
believes the banker planned to have him locked up before announcing
the lawsuit in the U.S. But on September 8, the judge refused to
issue the arrest warrant.

In the meantime, Giordano has been playing a cat-and-mouse game with
lawyers in the U.S. Because Giordano does not publish his address,
Akin Gump has been unable to serve him, mailing notices to defunct
post office boxes and sending reps to Mexico in search of a gringo
with a mustache. Two weeks ago, as the deadline loomed, Akin Gump
asked Giordano to acknowledge the charges by e-mail. He did not
respond.

According to Giordano, Akin Gump then launched a "cyber-attack" on
Narco News, sending e-mails that took up more than 10 megabytes of
storage space and caused his list server to shut down. Last week,
Giordano says, Akin Gump went so far as to send a threatening letter
to Voxel.net, his Internet service provider.

McLish denies threatening legal action against Voxel (which as a Web
host is not liable for defamatory content). "The suggestion that Akin
Gump is engaged in cyber-war is nonsense, and Mr. Giordano knows it,"
fumes the lawyer. "He should just come out of hiding and accept
service of the complaint."

Giordano has sought advice from Thomas Lesser, a Massachusetts lawyer
who put the CIA on trial in 1987, in the course of defending Abbie
Hoffman and Amy Carter on a campus protest charge. Lesser calls the
Banamex suit a "heavy-handed attempt to silence criticism." No one on
the defense team understands why Akin Gump brought this suit in New
York, where the allegations are likely to attract more publicity.
Says Garbus, "They're shooting themselves in the foot."

But Giordano sees the case as a golden opportunity to exercise his
skills as a pro se defender, if he so chooses. "I'm looking forward
to deposing Hernandez," he says. "In the long run, this will be an
educational process for the public that will reveal information about
the atrocity of the drug war and how it's being waged by the U.S.
government and its friends in Latin America."

One more twist: The judge assigned to the case is Harold Baer, who
was pilloried in 1996 when he threw out a car search in Washington
Heights even though it had turned up 80 pounds of heroin and cocaine.
If the case proceeds, it could reach Baer's courthouse in Manhattan
by this time next year. Tom Lesser predicts,"it's going to be a long,
interesting trial."