Malaysiakini today filed its defence at the Kuala Lumpur High Court against a defamation suit by Sarawak Chief Minister Abdul Taib Mahmud regarding an allegation of multi-million ringgit timber kickbacks.

In its 42-page statement, the online media organisation and its editor-in-chief, Steven Gan, described Taib's law suit as an abuse of the court process.

According to the statement prepared by Azzat & Izzat - the legal firm representing malaysiakini - Taib's law suit was calculated to stifle criticism and dissent in the Sarawak State Assembly by depriving its members from discussing the issue.

On May 15 - the day Taib filed the writ of summons - Sarawak State Assembly speaker Awang Asfia Awang Nassar ruled that no question or debate on the matter would be allowed as it would be deemed subjudice since the chief minister has stated his intention to initiate legal proceedings.

The controversy over the alleged timber kickbacks started following a report by Japanese news agency Kyodo News, which was published by the Japan Times on March 29, 2007.

It reported that nine members of a Japanese shipping cartel transporting Sarawak logs to Japan had allegedly paid a Hong Kong agency RM32 million, what the shipping lines claimed were tax-deductible genuine expenses, but which the tax authorities in Japan disallow.

The report added that Regent Star, described as a paper company in Hong Kong, was closely linked to Taib and his family.

The issue was also reported by numerous news organisations in Japan and elsewhere. Malaysiakini reported the matter a week later, and followed this up with its own special issue on the matter, RM32 mil kickbacks - tip of the iceberg.

Allegations denied

Taib, 71, who has been in power in Sarawak for 26 years, denied the allegation in a special statement in the last State Legislative Assembly meeting and vowed to take legal action against various parties involved.

Apart from malaysiakini and two Kuching-based opposition politicians, Taib has also filed a writ of summons against Utusan Malaysia, but it is not clear whether this has been served to the Umno-owned daily.

The two opposition leaders - former PKR state chief Wan Zainal Wan Sanusi and the party's Stampin branch chief See Chee How - were sued for distributing leaflets in the streets of Kuching containing articles from malaysiakini and Japan Times.

According to the statement of defence, malaysiakini "did no more than any other reputable news organisation which operates with professional journalistic integrity would have done in similar circumstances in reporting a news story which has such public importance".

The online news daily also pointed out that Taib had not initiated any legal action against the Japanese newspapers that carried similar content in its news report.

Malaysiakini also stated its intention to contest Taib's claim that he "is a reputable politician".

The statement of defence gave details of the business interests involving members of Taib's family, including conglomerate Cahaya Mata Sarawak (CMS).

CMS is headed by Taib's son Sulaiman Abdul Rahman and brother Mahmud Abu Bekir Taib, and a sizable stake of the company is owned by the chief minister's wife, Leila Taib

The company is one of the major conglomerates in Malaysia with revenue of RM6.2 billion and profit before tax of RM519 million for the financial year ending at Dec 31, 2006.

Key points in defence

In his law suit, Taib had argued that the reports in malaysiakini were aimed to increase subscribers and advertisers to the website.

On the contrary, the statement of defence said that malaysiakini was "risking a reduction in the number of advertisers ... due to the oppressive political climate in Malaysia where news reports against the ruling Barisan Nasional government are discouraged."

Other key points raised in the statement of defence include:

  • Taib's performance, character and business dealings is a serious matter of legitimate public interest as he remains a serving politician and the chief minister of Sarawak.

  • The timber trade is a lucrative source of revenue for Malaysia and contributes a great deal to the economy of Sarawak in particular and Malaysia generally, in addition to being of great legitimate public interest to all those concerned with the protection and preservation of equatorial rainforests and the impact logging has on the Earth's environment.

  • Taib has been at various times during his political career been accused of improper financial dealings in relation to the grant of logging concessions in Sarawak.

With the filing of malaysiakini's defence, Taib has two weeks to file a reply before the case goes to a judge for a date to be set for hearings.


SPECIAL REPORT: Tip of the iceberg