Local Internet users are being warned about making defamatory statements via the Internet.

Manager of Appleby, Spurling & Kempe's Litigation Department, Kelvin Hasting-Smith, has warned that comments posted on Internet message boards could lead to libel law suits.

Two local jewellers, Colombian Emeralds and Crissons, are embroiled in an Internet libel suit after a message was posted on the Internet in an investors' site on Yahoo! which allegedly attacked the reputation and character of one of the jewellery providers.

Mr. Hastings-Smith urged people and business employees to be very careful about the messages they sent over their computers.

He noted that the UK had seen a number of cases concerning slanderous material over the past five years, with many being settled out of court, while the US was divided over the issue.

Someone defamed in material on the Internet could also seek damages from the Internet service provider (ISP), he noted.

This came after a decision was made in the US by the New Jersey Superior Court in Bergen County against three defendants charged with defaming Biomatrix Inc, and its chief executive.

The three defendants, one of which was a former employee of Biomatrix, alleged that the chief executive was a "Nazi SS Doctor'' and the company's product, which treats arthritis, caused a woman to "cough up blood and scream in agony before she died''.

It is the first ruling to find an Internet posting liable.

"Perhaps the Biomatrix case will be the one that will actually focus Internet users' minds on what is, and what is not, acceptable,'' said Mr.

Hastings-Smith.

"Increasingly, I am receiving inquiries from persons who believe they have been defamed not only in Internet chat room sites, but also in e-mail communications.'' He noted that the ISP would be considered the publisher of the document in such cases.

He said comments made over the Internet should be reviewed and carefully thought out before they were posted.

"Comments like these could destroy people, and related to financial aspects, stocks could drop hurting the company,'' he said. "I wonder if they had proof of their claims.'' He stressed: "We often hear the expression `think before you press the send button' but how many of us actually do? "If users in this part of the world were in any doubt that they were immune to prosecution in the civil courts from defamation, it is time for them to think again. The die has been very firmly cast in the US and while such a decision is not binding on Bermuda courts, it is nevertheless likely to have persuasive authority as the first decision if its kind.

"When there are personal attacks, some of them are outrageous,'' he said.

"Let's put the brakes on this.'' And while public figures may be adapt to this kind of treatment, the everyday person is not. To them it is unfair, said Mr. Hastings-Smith.

"This decision really underlines a point I have been making for some time, which is that employers must put in place better safeguards to avoid exposure of this sort. Unless employees have proper Internet polices in place or sensible e-mail procedures they could be at risk.'' For local companies and other businesses whose employees have access to the Internet, Mr. Hasting-Smith added: "Remember that defamatory statements appearing electronically cause liability not only for the author, but for the publisher and each subsequent publisher of the defaming words.

"There may also be a liability for any employer whose equipment had been used by an employee to post the message.''