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Friday, 10/28/2005 6:47:19 PM

Friday, October 28, 2005 6:47:19 PM

Post# of 203
CXN in Forbes....and it ain't pretty:

"Gregory Halpern knows how to hype. Shares of his publicly held company, Circle Group Holdings, quadrupled in price early last year amid reports that its new fat substitute, Z-Trim, was being tested by Nestlé. As the stock spurted from $2 to $8.50, Halpern's 35% stake in the company he founded rose to $90 million. He put out 56 press releases last year."


Gregory Halpern at Circle Group, in Mundelein, Ill., used this approach against his nemesis, Nick Tracy, a.k.a. Timothy Miles. After the first attack Halpern contacted the blogger's lawyer but got nowhere. He demanded a correction, only to get mocked:Miles posted on his blog an audio file of a perturbed message Halpern had left on his voice mail.

Halpern had better luck, however, when he allied with Gayle Essary, who runs the FinancialWire online news service and had tangled with Miles, too. Halpern dug up details on Miles (his photo and Oregon driver's license; his links to a litany of questionable companies; his claim to be an ordained minister; his Web site that describes a mysterious crystal that contains a message from God) and fed them to Essary. Essary did 15 articles on Miles without citing Halpern as a source, and when Halpern heard from people asking about Miles' allegations against Circle Group, he referred them to FinancialWire, saying it had "exposed this guy a long time ago."

Halpern also used a new law, the Digital MillenniumCopyright Act, which requires hosts to take down copyrighted material used without permission. He confronted Miles' service provider and threatened to sue for copyright infringement and libel; the ISP pulled the plug. But emerged days later at a second service. In three months Halpern pursued Miles through nine ISPs, finally giving up and filing a libel suit in state circuit court in Cook County, Ill. in June 2004. He accuses the blogger of orchestrating a short-seller scheme to send Circle stock plunging. Miles insists he never sold short or acted on behalf of short-sellers.

Miles, who says he misrepresented himself as Nick Tracy because "I wanted to be discreet," has abandoned and moved from Oregon to Slovenia. He claims he is outside the Illinois court's jurisdiction. The judge disagrees. Miles says he plans to appeal. He has set up a new site,, and insists he is a bona fide investigative journalist: "I tell the truth, and it's never pretty." This drives Halpern nuts:"It's amazing that an anonymous guy can put out a report full of lies and then be so self-righteous."

After anonymous attacks spread to Yahoo, Halpern moved in court to force Yahoo to reveal who was behind the sniping. In September a state judge in Illinois ordered Yahoo to reveal the names. A lawyer for the secret posters is trying to settle without turning over their names, Halpern says. Yahoo declines to comment on the case, but Halpern argues that Yahoo and other carriers should step up: "They make money selling ads on these message boards, and the controversial material generates the most traffic. So they're benefiting from this garbage. I think they should take responsibility for it."

Halpern has had less luck getting anyone inCongress to listen to his plaint. He says that may change if a few politicians get a taste of what he has gone through. "Wait until the next election rolls around and these bloggers start smearing people who are up for reelection,"Halpern says. "Maybe then things will start to happen."