Christopher Harborne v. Dow Jones & Company, Inc. d/b/a The Wall Street Journal

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

CHRISTOPHER HARBORNE, AML )
GLOBAL LTD. (BVI), AML GLOBAL )
LTD. (HK), AML GLOBAL (HK) LTD.,)
and AML GLOBAL PAYMENTS LLC, )
) C.A. No. N24C-02-292 KMM
Plaintiffs, )
)
v. )
)
DOW JONES & COMPANY, INC. d/b/a )
THE WALL STREET JOURNAL, )
)
Defendant. )

Submitted: October 11, 2024
Decided: December 23, 2024

MEMORANDUM OPINION AND ORDER

Plaintiffs’ Motion to Convert – DENIED.
Defendant’s Motion to Dismiss – DENIED.

Brian E. Farnan, Esquire, Michael J. Farnan, Esquire, Farnan LLP, 919 N. Market
Street, 12th Floor, Wilmington, Delaware, Elizabeth M. Locke, Esquire, (argued)
Jered T. Ede, Esquire, Clare Locke LLP, 10 Prince Street, Alexandria, Virginia,
attorneys for plaintiffs.

Daniel M. Kirshenbaum, Esquire, Young Conaway Stargatt & Taylor, LLP 1000
North King Street, Wilmington, Delaware, Katherine M. Bolger, Esquire, (argued),
Abigail Everdell, Esquire, Davis Wright Tremaine LLP, 1251 Avenue of the
Americas, 21st Floor, New York, New York, attorneys for defendant.

Miller, J.
I. INTRODUCTION

Christopher Harborne (“Harborne”) is an international businessman, owning

and investing in several successful businesses. He was an early investor in

cryptocurrency, and became an active trader on the Bitfinex cryptocurrency

exchange. While Harborne owned 12% of Bitfinex and its sister company Tether,

he was not involved with either company, except as a minority stakeholder.

The Wall Street Journal (“Journal”) published an article in 2023 about

Bitfinex’s and Tether’s difficulties maintaining access to the global banking system

in light of fraud and money laundering allegations. The article detailed how these

companies used falsified documents, “shadowy intermediaries,” and shell

companies to open bank accounts around the world, including at Signature Bank.

Signature Bank ultimately closed the accounts and later attempts by Tether and

Bitfinex to open new accounts were rejected, due to the allegations against them.

The article then turned to Harborne, reporting that after Tether and Bitfinex

were turned down by Signature Bank, the bank was “then introduced” to Harborne

and his company AML Global. The article stated that Harborne opened an account

for his company at Signature Bank, but the application did not say that he owned

12% of each of Bitfinex and Tether under the name Chakrit Sakunkrit. The article

also stated that the Sakunkrit name appeared on Signature Bank’s list of those the

bank felt “were trying to evade anti-money laundering controls.” The article

1
described Signature Bank executives questioning the source of funds into AML

Global’s account. The bank then “soon closed” the account.

Harborne and his companies brought this action asserting defamation against

the Journal’s publisher, Dow Jones & Company, Inc. (“Dow Jones”).1 Plaintiffs

allege that the gist of the article was that Harborne and his companies engaged in

Bitfinex’s and Tether’s scheme to defraud banks. Plaintiffs claim that the gist was

false – Harborne never opened an account for Bitfinex or Tether, nor did he engage

in a scheme to defraud banks. But because of the article, Harborne and his company

were injured as the market perceived the article to accuse him of such behavior.

Dow Jones moved to dismiss under Rule 12(b)(6), attacking the complaint’s

allegations of falsity and actual malice. Construing the complaint and drawing all

reasonable inferences in plaintiffs’ favor, the Court finds that the complaint

adequately pleads falsity and actual malice. The Motion to Dismiss is DENIED.

II. FACTUAL BACKGROUND 2

A. Harborne and his companies

1. Harborne’s businesses

Harborne is a businessman and technology investor. He holds dual citizenship

in Great Britian and Thailand, where he has lived and worked for over 20 years. 3

1
D.I. 1 (Complaint), p. 1, n. 1.
2
The facts are derived from the allegations in the complaint.
3
D.I. 1, ¶ 9.

2
When he became a naturalized Thai citizen, Harborne was required to adopt a Thai

name.4 He chose Chakrit Sakunkrit. He uses his Thai name for legal purposes in

Thailand and uses his birth-name outside Thailand. 5

Harborne owns several companies, employing over 600 people around the

world, including plaintiffs AML Global Ltd. (BVI), AML Global Ltd. (HK), AML

Global (HK) Ltd. (collectively “AML Global”), and AML Global Payments LLC

(“AML Global Payments”). AML Global is an international jet fuel broker that

works with oil companies, aviation fuel traders, intro-plane agents, and specialist

aviation fuel suppliers. 6 Harborne built a successful business. AML Global has been

awarded $39 million in U.S. Department of Defense contracts. Through AML

Global,7 Harborne expanded into the aerospace and financial payments sectors.

AML Global Payments handles incoming and outgoing payments for AML Global’s

operations.8

2. Harborne invests in cryptocurrency.

Harborne was an early investor in Bitcoin and other cryptocurrencies. 9 Tether,

which trades on the Tether exchange, is the most widely traded cryptocurrency.

Because it is a stablecoin tied to the U.S. dollar, it is more predictable than other

4
Id.
5
Id., ¶ 33.
6
Id., ¶ 21.
7
Id., ¶ 23.
8
Id.
9
Id., ¶ 22.

3
types of cryptocurrencies.10 Investing in cryptocurrencies, including tether, is a

recognized strategy to hedge against the volatility of foreign currencies. 11

Bitfinex is a cryptocurrency exchange platform that trades units such as

Bitcoin.12 Although he did not own any Bitcoin, Harborne was an active trader on

the Bitfinex platform. In 2016, Bitfinex suffered a hack through which Bitcoins

were stolen. 13 As a result, Bitfinex issued “BFX” crypto tokens to traders, including

Harborne.14 Harborne saw the tokens as a risky, yet potentially high-reward

investment, so he purchased BFX tokens on the secondary markets.15 Eventually,

Bitfinex converted the BFX tokens to equity, and Harborne became a “minority

shareholder of Bitfinex with a roughly 12% ownership stake in the exchange.” 16

Harborne never held a management or executive position with Bitfinex. 17

B. AML Global Payments opens an account at Signature Bank.

In 2018, Signature Bank began accepting “crypto exchanges and stablecoin

issuers as clients,” making the bank one of the “‘preeminent player[s] in that

space.’”18 In November 2018, AML Global Payments contacted Signature Bank

10
Id., ¶ 27.
11
Id., ¶ 29.
12
Id., ¶ 28.
13
Id.
14
Id. The tokens were essentially a “digital IOU” that could be cashed in if the lost tokens were
recovered.
15
Id., ¶ 29.
16
Id., ¶ 29.
17
Id.
18
Id., ¶ 32.

4
about opening an account. It followed the bank’s standard application process: the

bank sent its due diligence package and AML Global Payments responded to the

inquiries. 19 AML Global Payments disclosed that the account would be used to

transact trades on Kraken, an exchange similar to Bitfinex, and that Harborne also

uses the Sakunkrit name (and explaining why).20 After Signature Bank reviewed

and approved AML Global Payments’ application documents, it formally applied for

an account in January 2019, which the bank then opened. 21

Shortly after opening the account, AML Global Payments funded it with a

$10,050,000 wire transfer from Kraken, which “served as the sole source of funding

for the account.” 22 Between February and May 2019, additional funds were

deposited in the account from Kraken and transfers out of the account were made to

AML Global Payment’s accounts at other banks. The Signature Bank account was

never used for Tether or Bitfinex.23

On May 8, 2019, Signature Bank sent AML Global Payments an account

closure notice. The bank wrote:

Subject to no material change occurring with respect to the
account(s) prior to the above-stated date [], as a courtesy to you

19
Id., ¶ 33.
20
Id. (“Christopher Harborne has been a long-term resident of Thailand (20+ years) and acquired
Thai nationality in 2011 by naturalization, which requires adoption of a Thai Language name. He
is required to use the Thai name for legal purposes in Thailand but is not required to abandon his
original birth name which he continues to use outside Thailand.”).
21
Id., ¶ 35.
22
Id.
23
Id.

5
and in an effort to permit you enough time to establish another
relationship, the Bank will permit transactions on this account
until May 22nd 2019. ... This should afford you sufficient time to
make other arrangements to handle your banking needs. 24

C. The Journal publishes the February Article.

On February 2, 2023, the Journal published an article by Ben Foldy (“Foldy”),

Ada Hui, and Peter Rudegeair, titled “The Unusual Crew Behind Tether, Crypto’s

Pre-Eminent Stablecoin” (the “February Article”). 25 This article reported on Tether

and profiled its founders and certain executives, describing them as “an unusual

bunch with scant experience.”26 Even though Harborne was not an executive of

Tether or Bitfinex, the article described how Harborne came to own a “roughly 10-

12% stake in both Bitfinex and Tether.”27 The article reported that “AML Global”

24
Id., ¶ 37.
25
Id., ¶ 39; https://www.wsj.com/articles/tether-ownership-and-company-weaknesses-revealed-
in-documents-11675363340.
26
D.I. 1, ¶ 40.
27
Id., ¶ 41. The Journal contends that Harborne is a “principal” of Bitfinex based on the company’s
registration with the Securities Commission of the Bahamas, which identifies Harborne as such.
Harborne alleges that the registration requires disclosure of owners of 10% or more of the voting
securities, but that he had no control over the entity. He was nothing more than a minority owner.
Id., p. 22, n. 25.

6
was an independent aircraft refueling agent, which had received approximately $39

million in contracts with the U.S. Department of Defense. 28

D. The Journal publishes the March Article.

On March 3, 2023, the Journal published an article by Foldy and Ada Hui,

titled “Crypto Companies Behind Tether Used Falsified Documents and Shell

Companies to Get Bank Accounts” (the “March Article”). The March Article began

by noting that those behind “the most widely traded cryptocurrency were struggling

to maintain their access to the global banking system,” so their backers “turned to

shadowy intermediaries, falsified documents and shell companies” to gain access to

bank accounts. 29 The article went on to describe a major tether trader who was

“trying to ‘circumvent the banking system by providing fake sales invoices and

contracts for each deposit and withdraw.’” 30 An owner of Tether recommended

abandoning this strategy because he “‘would not want to argue any [of these

practices] in a potential fraud/money laundering case.’” 31

Not having access to the global banking system was an “existential threat” to

Tether and Bitfinex, the March Article continued. According to a “cache of emails

and documents” reviewed by the Journal, Tether and Bitfinex used other companies

28
Id., ¶ 42. Other than insulting Harborne’s character, plaintiffs do not take issue with this article.
29
Id., Ex. A.
30
Id., ¶ 71.
31
Id., Ex. A.

7
and individuals (some of which had ties to a “designated terrorist organization”) to

open accounts for them. As a result of this scheme, authorities seized “hundreds of

millions of dollars of … assets.”32

The March Article reported that Tether’s need to maintain access to bank

accounts grew urgent in 2017, when Wells Fargo “stopped processing transactions

from several Taiwanese accounts that Tether was using.” 33 To calm users, Tether’s

chief strategy officer said on a call a few weeks later, that Tether and Bitfinex

“always found a solution” to the banking issue and that “‘[t]here’s been lots of sort

of cat-and-mouse tricks that everyone in the industry has to avail themselves of.’”34

The March Article went on to describe instances where bank accounts were opened

for the companies by established business executives who used fictitious company

names, and that one such account was allegedly used to launder money for a Hamas

organization.35 The Department of Justice seized more than $1 million from another

Bitfinex account that was being used by a black-market money transmitting

business.

The March Article also reported on other questionable Bitfinex transactions,

including the transfer of more than $1 billion to a “Panama-based payment

32
Id.
33
Id.
34
Id.
35
Id., Ex. A.

8
processor,” that was known for using shell companies to open bank accounts, despite

no written agreement between the entities. By October 2018, U.S. and European

authorities uncovered the scheme and “$850 million of [Tether’s and Bitfinex’s]

funds were seized.” Bitfinex had to borrow funds from Tether to “cover the hole in

its balance sheet.”36

Tether and Bitfinex were able to open nine bank accounts in Asia over nine

days in October 2018, the article continued. Customers were urged to keep these

new banking relationships quiet because revealing the information “‘could damage

not just yourself and Bitfinex, but the entire digital token ecosystem.’”37

In 2018, Tether and Bitfinex also opened accounts at Signature Bank, the

Journal reported, which the bank promptly closed. Signature Bank rejected the

companies’ attempt to open another account later in 2018. The March Article then

turned its attention to Harborne, reporting:

Signature bankers were then introduced to a company called AML
Global, an aviation fuel broker that was looking to open an account.

The account would be controlled by Christopher Harborne, according
to the application, which said it would be used to trade cryptocurrency
primarily on a well-known exchange called Kraken for the purposes of
hedging currency exposure. Mr. Harborne is a major backer of Brexit
and the U.K.’s Conservative Party and owns AML Global.

The application didn’t say that Mr. Harborne owned roughly 12% of
both Tether and Bitfinex under another name, Chakrit Sakunkrit. The

36
Id.
37
Id.

9
Sakunkrit name had earlier been added to a list of names the bank felt
were trying to evade anti-money-laundering controls when the
companies’ earlier accounts were closed, but Mr. Harborne’s hadn’t.

Compliance executives questioned why an account that was supposed
to be trading on Kraken was getting huge inflows from what appeared
to them as Bitfinex. “Bitfinex was not mentioned anywhere in the
paperwork that was provided,” one Signature executive wrote,
according to the documents. “If they are buying/selling with Kraken,
why is the money only coming in from Bitfinex?”

The account for AML was provisionally opened but soon closed after
the bank realized the account was connected to Bitfinex, according to
people familiar with the matter. Mr. Harborne didn’t reply to a request
for comment. 38

E. The media reacts to the March Article.

Within days of the article being published, a prominent opinion columnist at

Bloomberg posted an article describing the March Article as accusing “AML”39 of

“lying to act as a front for a crypto exchange.”40

Another website’s report said, that had Harborne disclosed his “second

identity” (Sakunkrit), Signature Bank “likely would have … rejected” it because

Sakunkrit’s name had previously been added to “‘a list of names the bank felt were

38
Id., Ex. A (the “Last Five Paragraphs”).
39
At times, the complaint and the briefs refer to “AML” without identifying a specific entity. The
Court adopts this nomenclature unless the name of the specific AML entity is relevant.
40
D.I. 1, ¶ 110.

10
trying to evade anti-money-laundering controls.’”41 Similar articles appeared on

other websites, as well as social media sites. 42

F. Harborne demands a retraction.

After months of attempting to mitigate the damage from the March Article,

Harborne sent a letter to the Journal on December 13, 2023, “outlining the numerous

falsehoods” in the article, offering to meet to answer any questions, and demanding

a retraction. 43 The Journal rejected Harborne’s offer, and “attempted to defend the

[March] Article by ... claiming that it did not accuse Mr. Harborne and AML of any

wrongdoing.”44 The Journal further responded that it did not “state or imply” that

Harborne and his companies were “shadowy intermediar[ies] or shell compan[ies]”

or that AML falsified documents or used the Signature Bank account for the “benefit

of Tether or Bitfinex.” 45

On January 17, 2024, Harborne sent another demand for a retraction. 46 A few

weeks later, Harborne met with Foldy, other Journal employees, and its counsel.47

41
Id., ¶ 111.
42
Id., ¶¶ 112-15.
43
Id., ¶ 104.
44
Id., ¶ 106.
45
Id.
46
Id., ¶ 116.
47
Id., ¶ 120.

11
Harborne presented documents that showed the allegations in the March Article were

“categorically and demonstrably false.” 48

Only after the threat of litigation did the Journal removed the Last Five

Paragraphs of the March Article and republished it on February 21, 2024, with the

following editor’s note:

A previous version of this article included a section regarding
Christopher Harborne and AML Global, which applied for an account
at Signature Bank. The section has been removed to avoid any potential
implication that AML’s attempt to open an account there was in any way
a part of an effort by Bitfinex or Tether to mislead banks, or that
Harborne or AML withheld or falsified information during the
application process.49

The Journal did not, however, publish the new version as widely as it

published the original article.50 Additionally, the Journal’s Factiva site continued to

carry the original version of the article. 51

48
Id.
49
Id., ¶ 124.
50
Id., ¶¶ 125-26.
51
Id., ¶ 130.

12
Harborne contacted the Journal on February 25, 2024, expressing

dissatisfaction with the editor’s note. Shortly thereafter, he filed the complaint.52

G. The complaint

The complaint asserts three counts: Count I – Defamation (Harborne); Count

II – Defamation by Implication (Harborne); and Count III – Defamation by

Implication (the AML Global entities and AML Global Payments).

In Count I, Harborne alleges that the statement in the March Article that: “The

Sakunkrit name had earlier been added to a list of names the bank felt were trying to

evade anti-money-laundering controls when the companies’ earlier accounts were

closed”53 is defamatory. Harborne asserts that a reader would understand this

statement to mean that he attempted to evade anti-money-laundering controls.54

52
Id.
53
Id., ¶ 155.
54
Id., ¶ 157.

13
Harborne alleges the March Article was false because he never attempted to

evade anti-money-laundering controls and his name was never on such a list.55 To

support his claim of falsity, Harborne also alleges:

• Signature Bank allowing the account to remain open for weeks after the

closure notice is inconsistent with it suspecting Harborne of committing

fraud or money-laundering.56

• The March Article misidentified “AML Global” as an “aviation fuel

broker” when the Journal knew the jet fuel entities never applied for an

account at Signature Bank; AML Global Payments submitted the

application.57

• Contrary to the March Article’s inference, Harborne did disclose his

Thai name.

• Contrary to the article’s inference that Harborne failed to disclose his

ownership interest in Bitfinex and Tether,58 the application did not ask

55
Id., ¶ 158.
56
Id., ¶¶ 36-38, 67.
57
Id., ¶ 78.
58
Id., ¶ 81.

14
about Harborne’s ownership interests nor did the bank request

additional information, despite Harborne’s offer to provide it. 59

• The March Article reported that the Signature Bank account was closed

when bank employees realized it was being used for “huge inflows from

what appeared to them to be Bitfinex.” But, as the Journal knew, the

account was used only for Kraken. 60

• Contrary to the March Article’s implication, AML Global Payments

was not a “shadowy intermediary” for Tether and Bitfinex, which the

Journal later acknowledged.61

• The Journal knew Harborne was not an executive of Bitfinex or Tether

and that he did not control either company; he simply held a minority

stake in each.62 Yet, the article implied he was an executive who tried

to open accounts for the companies.

• The March Article also implied that AML was a “shell” used to

facilitate Tether’s and Bitfinex’s “illicit attempts to gain access to the

59
Id., ¶ 82.
60
Id., ¶ 84.
61
Id., ¶ 86.
62
Id., ¶ 87.

15
global banking system.” 63 AML is not a shell, nor was it used for illicit

purposes.

Finally, Harborne alleges that the Journal acted with actual malice, as follows:

• The Journal failed to follow journalistic ethical rules,64 which maintain

that subjects of reports should be afforded a meaningful opportunity to

respond to a story before it is published. Further, Dow Jones’ own

Code of Conduct, and the Journal’s Newsroom Standards & Ethics

rules, recognize the impact an article may have on others’ lives and

therefore require “assessing the credibility of our sources and

providing an opportunity for full and fair comments before a piece is

published.”65

• Contrary to these policies and standards, Foldy did not provide

Harborne a fair opportunity to respond. Just two days before the March

Article was published, Foldy sent an email to Harborne’s AML

account, requesting a comment on the article. Based on Foldy’s email

to this account prior to the February Article, which “didn’t send,” Foldy

knew the AML account was not a viable way to reach Harborne. The

63
Id., ¶¶ 88-89.
64
Such as The Society for Professional Journalists, and the Columbia Journalism Review, among
others. D.I. 1, ¶ 45.
65
Id.

16
Journal could have used the multiple phone numbers and email

addresses listed on AML’s website to contact Harborne.66 The Journal

chose not to because it “intentionally tried to avoid contacting”

Harborne.67

• While Foldy was intentionally avoiding actual comment from

Harborne, Rob Barry (“Barry”), a contributor to the March Article, was

investigating Harborne’s background. Barry and Foldy communicated

with Harborne’s former business associate, Tim Bennett (“Bennett”),

to inquire about Harborne’s businesses and sources of wealth. After

Foldy sent Bennett a sketch of the forthcoming March Article, Bennett

responded:

unless you are suggesting fraud or malpractice ... then it’s
not much of a story as he is simply yet another ‘rich guy’.
... So far I see a story taking shape about a mysterious
wealthy political benefactor, but I don’t see any ‘hooks’
that will draw in your readership or indeed any
investigatory/regulatory authorities. 68

• Barry and Bennett continued to communicate, ending with Bennett

telling Barry: “It seems to be your mission to try to ferret out something

66
Id., ¶¶ 52, 55-55.
67
Id., ¶ 56. This inference is bolstered, Harborne asserts, by a somewhat cryptic email subject line,
stating only “request for comment” and no indication that it was from a news reporter or time
sensitive. Id., ¶ 57-58.
68
Id., ¶ 65.

17
that would make an otherwise mundane ‘riches to massive riches’ story

saleable. ... But to me the [Harborne] saga is fairly uninteresting.” 69

• The Journal knew it was conveying a derogatory meaning when it

implied that AML was a “shell” company because the Journal had

previously published articles warning readers of the dangers of shell

companies, and their use for nefarious purposes. 70

• The Journal knew there was no basis to suggest that AML was under

investigation.71

• The Journal knew Harborne’s Thai name had been disclosed to

Signature Bank, and that the account application did not request

information about Harborne’s investments. 72 The Journal privately

admitted that Harborne’s Thai name was disclosed, AML was not a

shell, the Signature Bank account was not used for Tether or Bitfinex,

and yet, the Journal published the article because it fit with the Journal’s

preconceived false narrative. 73

In Counts II and III, Harborne and the AML plaintiffs, respectively, assert

defamation by implication. The factual allegations for these counts are the same as

69
Id., ¶ 66.
70
Id., ¶¶ 89-93.
71
Id., ¶ 96.
72
Id., ¶¶ 97-99.
73
Id., ¶¶ 101-02.

18
those asserted in Count I: the statements in the March Article are defamatory, false,

and made with actual malice. The defamatory statements “are of and concerning”

Harborne and the AML entities, and thus they are defamatory by implication.

III. PROCEDURAL HISTORY

Dow Jones moved to dismiss the complaint, under Rule 12(b)(6). With its

opening brief,74 Dow Jones submitted the Transmittal Affidavit of Kevin C. Gilligan

(the “Affidavit”). Exhibit 2 to the Affidavit purports to be “a true and correct copy

of documents, bank records, and emails, referenced in Defendant Dow Jones &

Company, Inc.’s Opening Brief in Support of its Motion to Dismiss Plaintiffs’

Complaint as the ‘Signature Documents.’” Exhibit 2 consists of 266 pages of

various documents (or portions thereof), some of which are redacted. Dow Jones

asserts that these documents are incorporated by reference into the complaint, and

therefore, the Court may consider them under Rule 12(b)(6).

Prior to filing their answering brief, plaintiffs filed a motion to convert Dow

Jones’ motion to a motion for summary judgment and requested that it be denied as

premature. Plaintiffs assert that Exhibit 2 contains unauthenticated, “never-seen-

before” documents, which are not incorporated into the complaint.

At a status conference with the parties on the motion to convert, the Court

asked for supplemental briefing. After reviewing the supplemental briefs, the Court

74
D.I. 17.

19
advised the parties that the motion to dismiss and motion to convert would be heard

at the same time.

The parties fully briefed the motion to dismiss and the Court held oral

argument on September 17, 2024. 75

IV. STANDARD OF REVIEW

The parties have not presented a fully-developed choice-of-law analysis. But

because they briefed the motion to dismiss under New York law, for purposes of the

motion to dismiss the Court will apply New York substantive law. The Court will

apply Delaware procedural law.76

Under Superior Court Civil Rule 12(b)(6), the Court accepts as true all well

pleaded factual allegations and draws all reasonable inferences in favor of the non-

moving party. The liberal construction afforded to a claimant does not, however,

“extend to ‘conclusory allegations that lack specific supporting factual

75
The parties filed additional supplemental submissions on October 9 and 11, 2024, addressing a
recently issued Delaware defamation opinion. D.I. 61; D.I. 62. The recent Superior Court opinion
denied a motion to dismiss a defamation claim. But because that case was decided under California
law, it has no application here.
76
US Dominion, Inc. v. Fox News Network, LLC, 2021 WL 5984265, at *18 (Del. Super. Dec. 16,
2021) (as a general matter, the law of the forum governs procedural matters).

20
allegations.’” 77 Dismissal will be denied if there is a reasonably conceivable set of

circumstances of recovery on the claim. 78

“A complaint that gives fair notice ‘shifts to the [opposing party] the burden

to determine the details of the cause of action by way of discovery for the purpose

of raising legal defenses.’” 79 Therefore, to avoid dismissal under Delaware’s notice

pleading standard, a party “need not plead evidence,” but at a minimum, must “allege

facts that, if true, state a claim upon which relief can be granted.” 80

V. DISCUSSION

A. The parties’ contentions

Dow Jones argues that the complaint must be dismissed because it fails to

sufficiently plead the March Article was false. Dow Jones makes two arguments in

support of this position: (1) the complaint pleads conclusory allegations,

unsupported by facts; and (2) the documents in Exhibit 2 show that the allegations

77
Surf’s Up Legacy Partners, LLC v. Virgin Fest, LLC, 2021 WL 117036, at *6 (Del. Super. Jan.
13, 2021) (citation omitted).
78
Cent. Mortg. Co. v. Morgan Stanley Mortg. Cap. Holdings LLC, 27 A.3d 531, 535, 536-37, n.13
(Del. 2011) (the “‘conceivability’ standard is more akin to ‘possibility,’ while the federal
‘plausibility’ standard falls somewhere beyond mere ‘possibility’ but short of ‘probability.’”).
79
VLIW Tech., LLC v. Hewlett-Packard Co., 840 A.2d 606, 611 (Del. 2003).
80
Id.

21
are not well-pled because the documents contradict the complaint’s conclusory

allegations.

Dow Jones also asserts that the complaint fails to sufficiently plead actual

malice, again relying on the documents in Exhibit 2, in part, to support its argument.

Plaintiffs argue that the complaint contains sufficient factual allegations that

the March Article was false and that it was published with actual malice. Plaintiffs

further argue that the Court cannot consider the documents in Exhibit 2 on a motion

to dismiss. If the Court considers the documents, plaintiffs contend that the Court

must convert the motion to dismiss to a motion for summary judgment.

Before addressing whether the complaint states a claim, the Court must

determine whether the Exhibit 2 documents are incorporated by reference. If Exhibit

2 is not incorporated, the Court must then decide whether to convert the motion to

dismiss to a motion for summary judgment.

B. Incorporation by reference

Dow Jones contends that plaintiffs allege 29 times in the complaint that the

documents in the Journal’s possession show that the article contained false

statements.81 According to Dow Jones, these very documents, which are contained

81
See, e.g., D.I. 1, ¶ 1 (asserting the article was false “even though the Journal and its reporters
knew and possessed documentation that conclusively showed that those accusations are false.”; ¶
4 (“the very bank account documents that the Journal and its reporters reviewed and reported on
confirmed the falsity of the Journal’s accusations.”); ¶ 54 (“based on the Journal’s own reporting,
it possessed AML’s Signature Bank application…”); ¶ 56 (“Between AML’s website and the
Signature Bank application, the Journal knew of 13 ways in which they could contact Mr.

22
in Exhibit 2, contradict plaintiffs’ allegations. Dow Jones argues plaintiffs cannot

make allegations based on the documents upon which the Journal relied and then not

incorporate them into the complaint. Dow Jones maintains that if the Court does not

incorporate the Exhibit 2 documents, then the allegations that refer to documents the

Journal possessed, must be stricken.82

Plaintiffs counter that incorporating the Exhibit 2 documents is improper

because the documents are unauthenticated, redacted, 83 and plaintiffs have never

seen some of these documents, which are being offered for the truth of the matter

asserted. Plaintiffs assert that references in the complaint to documents in the

Journal’s possession are referring to plaintiffs’ own documents, such as the bank

application and account statements.84 Plaintiffs further argue that it would be

improper for the Court to interpret these documents at this stage of the proceedings.

1. Incorporation by reference

On a motion to dismiss, the general rule is that the “universe of facts” is those

that are pled in the complaint. 85 When a party submits matters outside the complaint,

a court may consider those documents, but the court then will typically convert the

Harborne and AML …”); ¶ 89 (“the Journal knew [the statements] were false based on its own
prior reporting and the very documents on which it purported to report…”) (emphasis added in
each).
82
D.I. 38, p. 1.
83
Dow Jones states that the redactions were made only to conceal its confidential source.
Affidavit, ¶ 5.
84
D.I. 39, pp. 3-4.
85
Doe 30’s Mother v. Bradley, 58 A.3d 429, 443 (Del. Super. 2012).

23
motion to a summary judgment motion.86 A court may consider outside matters

without converting the motion to one for summary judgment in limited

circumstances: “(i) where an extrinsic document is integral to a plaintiff’s claim and

is incorporated into the complaint by reference, and (ii) where the document is not

being relied upon for the truth of its contents.”87

Whether a document is integral to a claim is largely a “facts-and-

circumstances inquiry.” Generally, a document is integral if it is the source for the

facts as pleaded in the complaint.88 Even if a document is integral, it may not be

considered unless it is “clear on the record that no dispute exists regarding the

authenticity or accuracy of the document. … It must also be clear that there exists

no material disputed issues of fact regarding the relevance of the document.”89

Courts will incorporate documents by reference for “carefully limited

purposes.”90 The court will do so to address situations such as when the complaint

quotes from or relies on “only selected and misleading” portions of the document.

For example, a court may consider a proxy statement upon which a complaint’s

86
Id.
87
Id., at 444.
88
Murray v. Mason, 244 A.3d 187, 192-93 (Del. Super. 2020).
89
Faulkner v. Beer, 463 F.3d 130, 134 (2d Cir. 2006); Perrigo Co. v. Int’l Vitamin Corp., 2018 WL
4290387, at *2 (D. Del. Sept. 17, 2018) (same). Delaware courts follow federal courts in
determining whether matters outside the complaint will cause a motion to dismiss to be converted
to a motion for summary judgment. Doe 30’s Mother, 58 A.3d at 444. See also, Two Farms, Inc.
v. Davis, Bowden & Friedel, Inc., 2018 WL 2714796, at *2 (Del. Super. June 4, 2018) (“Court may
consider undisputedly authentic documents…”).
90
In re Santa Fe Pac. Corp. S’holder Litig., 669 A.2d 59, 69 (Del. 1995).

24
disclosure claim is based for the limited purpose of considering what was

disclosed. 91 But, the proxy statement cannot be considered to establish facts in

assessing the merits of the complaint’s breach of fiduciary duty claims.92

2. Analysis

The Exhibit 2 documents have not been authenticated, as Dow Jones

concedes.93 Exhibit 2 contains some portions of AML Global Payments’ Signature

Bank application, some bank communications with Harborne’s representatives,

some internal Signature Bank communications, and bank statements that appear to

relate to AML Global Payments’ account at a different bank. The Affidavit does not

authenticate the documents, nor could it. The record does not establish how the

documents were compiled, who compiled them, or what judgment was applied in

selecting these particular documents. These are factual issues that cannot be

determined on a motion to dismiss.

Further, the Exhibit 2 documents are being offered for the truth of the matter

asserted. For example, the March Article states that Signature Bank added

Sakunkrit’s name to a “list of names the bank felt were trying to evade anti-money-

91
Id.
92
Id. (finding lower court improperly considered the substance of the proxy statement to evaluate
the complaint’s substantive claims). Further examples include considering the contract at issue in
a breach of contract case or the alleged defamatory article in a defamation case. Id.
93
D. I. 46 (Dow Jones advising the Court that Exhibit 2 was “what we have” and that Dow Jones
was not offering them “because they’re authentic.”); Dow Jones Reply Brief in Support of Motion
to Dismiss, (D.I. 56), p. 6 (arguing that “authentication [is] irrelevant because it is not at issue.”).

25
laundering controls.”94 Dow Jones points to an email in Exhibit 2 with a subject line

of “Hotlist additions” 95 to establish that the article was accurate; Sakunkrit’s name

was on the Hotlist. But there is nothing in the email to indicate that the bank

suspected the people/entities on the list of trying to evade the anti-money-laundering

controls, as Dow Jones asserts.

Because there is a real dispute over the authenticity and relevance of the

Exhibit 2 documents, the Court finds that Exhibit 2 is not incorporated into the

complaint.

Next, the Court must determine whether to consider all the allegations in the

complaint or, as Dow Jones urges, strike the 29 allegations that refer to the

documents the Journal possessed when writing the March Article. Dow Jones argues

that these allegations should be stricken because plaintiffs are now admitting that

they were asserted “without factual support;”96 that is, plaintiffs had no good faith

basis to allege what the Journal relied on, in violation of Rule 11. 97

At this stage of the proceedings, the Court is required to construe the

allegations in the complaint in plaintiffs’ favor.98 Reviewing the complaint through

94
D.I. 1, Ex. A.
95
D.I. 18, Ex. 2, p. 4.
96
D.I. 32, p. 2 (emphasis in original).
97
There is no pending motion to strike or a properly raised Rule 11 violation. Therefore, the Court
construes this argument as requesting the Court find that these 29 allegations are not well-pled for
purposes of Dow Jones’ Rule 12(b)(6) motion.
98
Ramunno v. Cawley, 705 A.2d 1029, 1036 (Del. 1998).

26
this lens, the Court interprets the 29 allegations to be referring to documents of which

plaintiffs were aware, such as the Signature Bank application and plaintiffs’ own

bank records (as well as their own behavior),99 and not the specific documents in

Exhibit 2. Thus, the Court will consider all of the allegations in the complaint.

Finally, with Exhibit 2 not being incorporated into the complaint, the Court

must determine whether to consider the motion to dismiss without reference to

Exhibit 2 or consider Exhibit 2 and convert it to a motion for summary judgment.

The Court will not convert the motion to dismiss. Converting the motion would

allow the complaint to go untested under Rule 12(b)(6). Dow Jones’ motion to

dismiss is not based solely on the Exhibit 2 documents and it has a right under the

rule to test the complaint. So, the Court will evaluate the motion to dismiss to the

extent it does not rely on Exhibit 2 documents. The Motion to Convert is DENIED.

C. Defamation

1. Elements of defamation

“‘Defamation is the making of a false statement which tends to expose the

plaintiff to public contempt, ridicule, aversion or disgrace, or induce an evil opinion

99
D.I. 39, p. 4.

27
of him in the minds of right-thinking persons, and to deprive him of their friendly

intercourse in society.’” 100

To state a claim for defamation under New York law, a plaintiff must allege:

“(i) a false statement; (ii) publication; (iii) fault; and (iv) one of four per se injuries,

including, … (a) an accusation of a serious crime or (b) business harm [and] the

alleged defamation must be ‘of or concerning the plaintiff.’”101

Dow Jones’ motion attacks the complaint’s allegations of falsity and fault

(here, actual malice). 102

2. Does the complaint adequately plead the March Article is false?

Dow Jones focuses on the article’s statement that Harborne’s Thai name was

on a list of bank-suspected money-launders. Dow Jones asserts that the complaint

fails to allege facts to show that this statement was false. First, the article does not

accuse Harborne of evasive behavior but merely reports that the bank felt he was

trying to evade such controls. Second, Harborne’s denial that his name was on the

100
Zuckerbrot v. Lande, 167 N.Y.S.3d 313, 330 (N.Y. Sup. 2022) (quoting Stepanov v. Dow Jones
& Co., Inc., 987 N.Y.S.2d 37 (1st Dept. 2014)).
101
US Dominion, 2021 WL 5984265, at *21 (applying New York law) (internal citation omitted);
Chicherchia v. Cleary, 616 N.Y.S.2d 647, 648 (N.Y. App. Div. 1994) (internal citation omitted).
102
Dow Jones argues that plaintiffs must plead actual malice under New York’s Strategic
Litigations Against Public Participation. N.Y. Civ. Rights Law § 76-a, (“Anti-SLAPP law”).
Plaintiffs assert that the Anti-SLAPP law does not apply here, but concede that they must allege
actual malice because they are seeking punitive damages. Even if the statute applied, plaintiffs
assert that they have satisfied the actual malice pleading requirement. Accordingly, without
deciding whether the Anti-SLAPP law applies, the Court will apply an actual malice standard of
fault.

28
list is insufficient. Third, Harborne’s allegation that the bank did not inform him he

was on any such list and that AML was able to open an account are speculative

allegations, especially because Signature Bank closed the account shortly after it was

opened, with no explanation.

Finally, Dow Jones argues that the “gist” of the statement is that Harborne was

on the list because of his connections to Bitfinex (which had engaged in questionable

banking behavior), not that Harborne had engaged in any wrongdoing.

Plaintiffs counter that when the statements about Harborne are taken in

context of the entire article, the allegations in the complaint make it reasonably

conceivable that the money-laundering statement is false.103 The “gist” of the article

was that Harborne was a part of the larger scheme of “shadowy intermediaries” to

commit bank fraud. Even if Dow Jones’ interpretation of the gist of the article was

reasonable, plaintiffs argue that at this stage of the litigation the Court must accept

plaintiffs’ inferences over Dow Jones’.

i. Falsity pleading standard

“To satisfy the falsity element of a defamation claim, [a] plaintiff must allege

that the complained of statement is ‘substantially false.’ Thus, ‘[if] an alleged

defamatory statement is ‘substantially true,’ a claim of libel is legally insufficient

103
Plaintiffs’ Answering Brief in Opposition to Motion to Dismiss, (D.I. 55), p. 19.

29
and should be dismissed.”104 “[A] statement is substantially true if the statement

would have a different effect on the mind of the reader from which the pleaded truth

would have produced.” 105 “‘When the truth is so near to the facts as published that

fine and shaded distinctions must be drawn and words pressed out of their ordinary

usage to sustain a charge of libel, no legal harm has been done.’” 106

A statement is substantially true if the “gist” or “sting” of the article is true.107

The Court must consider the whole article and “‘its effect upon the ordinary

reader.’”108

ii. Analysis

The title of the March Article previews its theme: Companies Connected to

Tether Used False Documents and Shell Companies to Obtain Bank Accounts. The

article referred to “shell companies” and “shadowy intermediaries” that were used

to fraudulently open the accounts. It also discussed investigations into Tether and

Bitfinex transactions and other fraud in the cryptocurrency market (referencing Sam

Bankman-Fried being charged with fraud). After recounting that Tether’s and

104
Tannerite Sports, LLC v. NBCUniversal News Grp., 864 F.3d 236, 242 (2d Cir. 2017) (quoting
Franklin v. Daily Holdings, Inc., 21 N.Y.S.3d 6, 12 (1st Dep’t 2015)).
105
Id. at 242 (quoting Biro v. Condé Nast, 883 F. Supp.2d 441, 458 (S.D.N.Y. 2012)); Zuckerbrot
v. Lande, 167 N.Y.S.3d 313, 333 (N.Y. Sup. 2022) (“‘[c]ourts typically compare the complained
of language with the alleged truth to determine whether the truth would have a different effect on
the mind of the average reader.’”) (internal citation omitted).
106
Id. at 243 (quoting Fleckenstein v. Friedman, 266 N.Y. 19, 23 (1934)).
107
Obi v. Amoa, 63 N.Y.S.3d 208, 216 (N.Y. Sup. 2017); Ramunno v. Cawley, 705 A.2d 1029, 1035
(Del. 1998).
108
Tannerite Sports, 864 F.3d at 243 (quoting Silsdorf v. Levine, 463 N.Y.S.2d 822 (1983)).

30
Bitfinex’s accounts were closed and their later efforts to open an account at Signature

Bank were “rejected,” the article stated that the bankers “were then introduced to”109

AML about opening an account. Reading the March Article as a whole, as the Court

must, the “gist” is that Harborne and his company were part of this larger scheme to

defraud banks. The article insinuates that Harborne intentionally hid from the bank

his Thai name and his ownership interest in Tether and Bitfinex. The complaint

alleges facts that the gist is not true.

The complaint alleges that Harborne followed Standard Bank’s application

process, provided the bank with all the information requested, including voluntarily

disclosing his Thai name, and offered to provide more information if needed.

Further, the Signature Bank account was used only for the stated purpose — to trade

Kraken. And, the bank did not act in a manner consistent with a concern about bank

fraud; it opened the account and allowed Harborne to continue to use it for a month

after issuing the account closure notice.110 Accepting Dow Jones’ argument (that

109
D.I. 1, ¶ 77 (emphasis added).
110
Dow Jones relies on Aboutaam v. Dow Jones & Co., 2019 WL 1359772 (N.Y. Sup. Mar. 26,
2019) and Cabello-Rondón v. Dow Jones & Co., 2017 WL 3531551 (S.D.N.Y. Aug. 16, 2017) to
support its argument that mere denial of the allegations is insufficient to plead falsity. In
Aboutaam, the plaintiff did not challenge the article’s statement that the family’s company was
under international investigations, but only challenged the statement that the company was under
investigation by U.S. Immigration and Customs Enforcement. The complaint alleged the article
was false because it did not include a statement that the owners of the company “disclaimed any
knowledge” of the investigations. This allegation did not provide facts that there were no such
investigations and therefore, the mere denial was insufficient. In Cabello-Rondón, the plaintiff
challenged the statement that he was the “biggest target” or a “leading target” of an investigation
but did not challenge that he in fact was the subject of an investigation. The plaintiff pled no facts
to show the article was false but instead relied on a “conclusory and convoluted statement” in the

31
Signature Bank closing the account without explanation only a few months after it

was opened shows it was concerned about fraud), would require construing the

allegations in Dow Jones’ favor, which the Court cannot do on a motion to dismiss.

Plaintiffs also alleges facts that AML was not a shell and that Harborne was

not an executive of Bitfinex or Tether.

Finally, Dow Jones’ assertion that the gist of the statement that Harborne’s

Thai name was put on the bank’s list was simply due to Harborne’s connections to

Bitfinex (and not because of any alleged wrongdoing), is not a reasonable reading

of the March Article. The article expressly said that the Sakunkrit name was put on

the list due to concerns over money-laundering.

The Court finds that the effect of the March Article on the ordinary reader

would be that Harborne and his companies were involved in the fraudulent schemes.

The complaint alleges facts sufficient to plead that the article was false.

3. Does the complaint adequately plead actual malice?

Dow Jones contends that the complaint’s actual malice allegations are

insufficient as a matter of law: the complaint does not identify the alleged unreliable

source the Journal relied on; its theory of shoehorning Harborne into a preconceived

complaint. These cases are distinguishable. First, they subject the complaints to a higher pleading
standard. Aboutaam (requiring defamation to be pled with particularity) and Cabello-Rondón
(applying plausibility standard). Second, unlike these cases, plaintiffs here allege more than a bare
statement that the article was false.

32
narrative about Bitfinex is belied by the fact that he is one of Bitfinex’s largest

stockholders; the March Article never called AML a “shell company;” pointing to

Bennett, who provided no substantive comment on Harborne except to call him “yet

another ‘rich guy,’” is insufficient; an alleged lack of investigation is insufficient to

find actual malice; and the refusal to retract cannot establish actual malice because

the relevant time period is at publication, not after.

Plaintiffs counter that they have alleged direct evidence of actual malice: the

Journal intentionally omitted that Harborne did not hide his Thai name from

Signature Bank; and the Journal knew AML Global was not a shell, as established

by the February Article.

Plaintiffs also assert that they have alleged circumstantial evidence of actual

malice: the Journal purposefully avoided the truth because it did not use any of the

other 13 available methods to contact Harborne for comment, and it ignored

Bennett’s comments that the story’s tact had no traction; the Journal relied on an

anonymous source without further investigation; the Journal “fit” Harborne into its

preconceived false narrative that Harborne was part of Bitfinex’s and Tether’s

unlawful schemes; the Journal refused to retract the March Article from all its sites

and failed to publicly publish that it did not intend to insinuate that Harborne had

done anything wrong; and the Journal violated journalistic standards, evidenced by,

33
among other things, the Journal’s admission that the March Article “did not meet”

its own “editorial standards.”

i. Actual malice pleading standard

Actual malice is the most demanding fault standard. 111 It does not mean ill

will or animosity. 112 Rather, a plaintiff must show that the defendant published the

false information about the plaintiff “‘with knowledge that it was false or with

reckless disregard of whether it was false or not.’”113 To demonstrate “reckless

disregard,” a plaintiff must establish that the defendant “entertained serious doubts

as to the truth of [the] publication or ... had a high degree of awareness [of its]

falsity.”114 The meaning of “reckless disregard” is not “readily captured in ‘one

infallible definition,’” 115 but “through the course of a case-by-case adjudication,”

courts have given context to this “otherwise elusive constitutional standard[].” 116

Caselaw teaches that reliance on an anonymous source or an unreliable source,

alone, “does not support an inference of actual malice.”117 Similarly, the failure to

investigate a statement’s truth, alone, does not support an inference of actual malice,

111
US Dominion, 2021 WL 5984265, at *28.
112
Cabello-Rondon v. Dow Jones & Co., Inc., 720 Fed.Appx. 87, 88 (S.D.N.Y. 2018).
113
US Dominion, 2021 WL 5984265, at *28 (citing Sweeney v. Prisoners’ Legal Servs. of N.Y.,
Inc., 647 N.E.2d 101, 104 (N.Y. 1995) (quoting N.Y. Times Co. v. Sullivan, 376 U.S. 254, 280
(1964))) (cleaned up).
114
Id.; Cabello-Rondon, 720 Fed.Appx. at 88 (quoting Church of Scientology Int’l v. Behar, 238
F.3d 168, 174 (2d Cir. 2001)).
115
Harte-Hanks Comm., Inc. v. Connaughton, 491 U.S. 657, 686 (1989) (citation omitted).
116
Id.
117
Cabello-Rondon, 720 Fed.Appx., at 89.

34
“even if a prudent person would have investigated before publishing the

statement.”118 But reliance on an anonymous or unreliable source without further

investigation may support an inference of actual malice.119

Further, a publisher cannot “‘purposefully avoid[ ]’ the truth and then claim

ignorance. If the plaintiff offers ‘some direct evidence’ that the statement ‘was

probably false,’ the court can infer that the defendant ‘inten[ded] to avoid the

truth.’”120

“The hurdles to … pleading actual malice, though significant given the First

Amendment interests at stake, are by no means insurmountable.”121 “‘Although

actual malice is subjective, a court typically will infer actual malice from objective

facts,’ understanding that a defendant in a defamation action will rarely admit that

he published the relevant statements with actual malice.”122 Such circumstantial

evidence of actual malice may include a departure from journalistic standards,123 a

preconceived false narrative, 124 and a refusal to retract.125

118
US Dominion, 2021 WL 5984265, at *21 (citing Sweeney, 647 N.E.2d, at 104 (quoting N.Y.
Times Co., 376 U.S., at 280)) (cleaned up).
119
Cabello-Rondon, 720 Fed.Appx., at 89.
120
US Dominion, 2021 WL 5984265, at *21.
121
Biro v. Condé Nast, 807 F.3d 541, 545 (2d Cir. 2015) (citation omitted).
122
Id.
123
US Dominion, Inc. v. Fox News Network, LLC, 293 A.3d 1002, 1043 (Del. Super. 2023) (“US
Dominion II”) (citing Harte-Hanks Comm., 491 U.S., at 689 (1989)).
124
Id.
125
Id.

35
ii. Analysis

Plaintiffs argue that they cannot be faulted for failing to provide factual

allegations challenging the veracity of the Journal’s source (because the Journal

refused to provide any information about the source) and therefore, they should be

entitled to proceed to discovery on this issue. This argument fails for several reasons.

First, the source is not anonymous; it is confidential – the Journal knows the identity

of the source. Second, it is inconsistent with “actual malice” being a subjective

test.126 That plaintiffs do not know the identity of the source does nothing to show

that the authors “in fact entertained serious doubts as to the truth of the

publication.”127 Finally, even if the source was anonymous, that fact alone is

insufficient. Reliance on an anonymous source may be evidence of actual malice

“when there are obvious reasons to doubt the veracity of the informant or the

accuracy of his reports.” 128 Plaintiffs offer no factual support for the notion that the

authors of the March Article had reason to doubt their source’s information.

Similarly, plaintiffs’ theory that the Journal purposely avoided the truth is

insufficient. The Journal’s reporter admitted that his February email to Harborne’s

126
McFarlane v. Sheridan Square Press, Inc., 91 F.3d 1501, 1508 (D.C. Cir. 1996 ) (“The actual
malice standard is subjective…” and therefore, “the inference of actual malice must necessarily be
drawn solely upon the basis of the information that was available to and considered by the
defendant prior to publication.”).
127
St. Amant v. Thompson, 390 U.S. 727, 731 (1968).
128
Id. See also, Curtis Pub. Co. v. Butts, 388 U.S. 130, 157 (1967) (publisher had reason to question
veracity of its source, who was on probation for bad check writing charges, but published the story
without substantial independent support).

36
AML account “didn’t send,”129 but Harborne does not allege that he never received

the March 1 email. Moreover, failing to obtain a comment from the subject of an

article is not evidence of actual malice. 130 There is no obligation for a reporter to try

to find or use multiple means to contact a subject, and plaintiffs cite no authority for

such a proposition.131

While it is a close call, plaintiffs’ remaining allegations, taken together,

adequately plead actual malice.

Direct evidence: Plaintiffs allege that the March Article insinuated that

Harborne hid his Thai name from Signature Bank, but the Journal possessed

Signature Bank documents that showed that the Thai name was disclosed. Also, the

Journal knew from previous reporting that AML was a jet fuel company with

significant contracts, not a shell. Dow Jones responds that the March Article never

called AML a “shell” company. But a fair reading at this stage is that the article

suggested that AML was a shell.

129
As Dow Jones points out, the February email “didn’t send”, which suggests the email never left
the sender’s outbox. It does not suggest that there was any defect in the email address or that the
email was otherwise undeliverable.
130
McFarlane v. Sheridan Square Press, Inc., 91 F.3d 1501, 1510-11 (D.C. Cir. 1996) (quoting
Edwards v. National Audubon Society, Inc., 556 F.2d 113, 121 (2d Cir. 1977)) (the reporter could
reasonably expect the subject of the story to deny the allegations and “[S]uch denial are so
commonplace in the world of polemical charge and countercharge that, in themselves, they hardly
alert the conscientious reporter to the likelihood of error.”).
131
Plaintiffs also argue that the Journal’s failure to obtain a comment from Harborne violates its
own journalistic standard. But the standards cited by plaintiffs do not suggest that the multiple
contact avenues must be utilized.

37
Preconceived narrative: The throughline of the March Article was Bitfinex’s

and Tether’s scheme to defraud banks. The Journal sought to further that narrative

by implicating Harborne. The reporters contacted Bennett, but did not follow

through after Bennett indicated that his information would not be helpful to the story

the Journal wanted to tell.

Despite no Bitfinex transactions in AML Global Payment’s Signature Bank

account, the March Article included a quote from “[c]ompliance executives”

suggesting that Bitfinex transactions had been flowing through the account.

To “fit” Harborne into Bitfinex’s scheme, the article stated that “Harborne is

one of Bitfinex’s largest shareholders,” despite the fact that he had no control over

the company and never held any positions with the company.

Refusal to retract: While the Journal removed the Last Five Paragraphs of the

article from its online version, its other sites still carry the full article.132

Departure from Journalistic standards: The Journal admitted that the March

Article was not up to its editorial standards.

VI. CONCLUSION

Reading the March Article as a whole, the gist of the story is that Harborne

and his company were part of a broader scheme by Bitfinex and Tether to defraud

132
US Dominion II, 293 A.3d, at 1043 (where a refusal to retract may be considered as
circumstantial evidence of actual malice).

38
Signature Bank. Accepting plaintiffs’ well pled allegations as true, the complaint

adequately alleges the March Article was false.

It remains to be seen whether plaintiffs will be able to carry their burden at

trial to prove that the authors acted with actual malice. But plaintiffs are not required

to plead evidence at this stage of the case. The complaint adequately pleads actual

malice.

Accordingly, the Motion to Dismiss is DENIED.

IT IS SO ORDERED.

/s/Kathleen M. Miller
Kathleen M. Miller, Judge

39