A man mistakenly identified as a business associate of disgraced former Labor powerbroker Eddie Obeid in the bestselling anti-corruption expose He Who Must Be Obeid has won a significant battle in his defamation case against the publisher.
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Random House pulled all copies from bookstore shelves and publicly apologised to Christopher Brown, the son of former federal tourism minister John Brown, after the authors, Kate McClymont and Linton Besser, confused him with an Obeid business partner of the same name.
While Random House accepts the book is defamatory of Mr Brown, it disputes that the book is capable of conveying a number of specific imputations Mr Brown claims in his defamation case against it in the NSW Supreme Court.
On Thursday, Justice Lucy McCallum ruled all the imputations were capable of arising.
Random House admits the book implies Mr Brown failed to pay a large debt he owed to the ANZ bank and that the bank sued and obtained judgment against him.
But it denied the imputation that Mr Brown "knowingly associates with and engages in business activities with Eddie Obeid who is Australia's most corrupt politician".
It further denied the imputation that Mr Brown "used his association with the notoriously corrupt Eddie Obeid to advance his business and financial affairs" and that he was director of a company which employed a prominent member of the Mafia, Franco Labozzetta.
The case of mistaken identity centres on events that took place between March and May 1992. The authors allege a man named Christopher Brown had been a party to a travel business that had gone bust with unpaid debts of almost $100,000.
The book also detailed the affairs of Scobde Pty Ltd, a company associated with Mr Obeid that was trying to build a ski lodge in Perisher on land leased from the National Parks and Wildlife Service. Mr Brown, a director of Scobde, is said to have negotiated for $62,000 in rent arrears to be paid to NPWS in instalments.
The book identifies the man as "the son of former federal tourism minister John Brown". But the man actually involved was born in Colchester, England, in 1947 - 19 years before Mr Brown was born in Parramatta - and has a different middle name.
Lawyers for Random House argued the book is not capable of conveying an imputation that in 2014, 22 years after the events described, Mr Brown still associates with Mr Obeid in business. Richard Potter, for Random House, also said there is nothing in the book to say Mr Brown had any personal knowledge of Mr Obeid's corrupt dealings.
In fact, the book says recent revelations about Mr Obeid's corrupt conduct came as a shock to many people including his close associates, Mr Potter said.
However, Justice McCallum disagreed, saying the "whole tenor of the book ... is that it reveals secrets of the past" and a reader could think Mr Brown associated with Mr Obeid knowing he was corrupt despite Mr Obeid's public reputation being intact at the time.
Justice McCallum also allowed Mr Brown's lawyers to plead a more serious imputation that Mr Brown knew that Scobde had employed Mr Labozzetta to "heavy" the NPWS to obtain an increase in the amount of accommodation at the Perisher ski resort.
"The book gives a detailed description of the involvement of Chris Brown and others in property developments in which Eddie Obeid was involved," Justice McCallum said.
"The plain insinuation, in my view, is that those deals entailed corrupt details. What else is the point of including them in 'the untold story' of Eddie Obeid?"
The case will return to court on December 5 for directions.
