1999: A press release issued over Business Wire announced the creation of a new company called Webnode. This company, according to the release, had been granted a government contract to regulate ownership of 'nodes' on the 'Next Generation Internet.' Each of these nodes (there were said to be over 50 million of them) represented a route that data could travel. The company was licensed to sell each node for $100. Nodes would increase in value depending on how much traffic they routed, and owners would also receive usage fees based on the amount of data that flowed across their section of the internet. Therefore, bidding for the nodes was expected to become quite intense. Offers to buy shares in Webnode soon began pouring in, but they all had to be turned down since the company was just a prank. There really was a Next Generation Internet, but there were no nodes on it. Business Wire didn't find the prank amusing and filed suit against its perpetrators for fraud, breach of contract, defamation, and conspiracy.
Comments
Listed in chronological order. Newest comments at the end.

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Some people have no sence of humor!
Posted by Susan  on  Thu Apr 01, 2004  at  12:15 PM

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...and some people have no CENTS of spelling.
Posted by fat mike  in  LA  on  Fri Apr 02, 2004  at  01:17 AM

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I am sure you both meant "sense"
Posted by M256  on  Sat May 08, 2004  at  09:07 AM

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It's all fun and games 'till someone loses face...or dollars...
Posted by Paul  on  Thu May 13, 2004  at  12:14 PM

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Nerdy april fool joke
Posted by Script  on  Tue May 18, 2004  at  07:34 PM

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Nah, I think you all means scents
Posted by Ian  in  UK  on  Sun Nov 28, 2004  at  07:58 PM

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ooh.. that's a big embarassing, isn't it mike?
Posted by will  on  Fri Apr 01, 2005  at  02:15 AM

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smileys

I could not find how the lawsuit ended. Do you know?
Posted by gunner  on  Sat Apr 02, 2005  at  06:09 PM

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Message-Board Pranksters Settle Business Wire Suit - part 1.

December 7, 1999


By JASON ANDERS
THE WALL STREET JOURNAL INTERACTIVE EDITION


Three message-board users have settled a closely watched lawsuit brought against them by Business Wire over an April Fools' prank.

Business Wire, a wire service that distributes press releases for a fee, received $27,500 and an agreement from the three to remove portions of a Web site that the company disputed. Janice Shell, Jeffrey Mitchell and William Ulrich, all well-known members of the Silicon Investor stock-chat site (http://www.techstocks.com), say they believe they could have won the case but couldn't afford to continue to fight it.

Business Wire sued the group after it paid the wire service to distribute a phony press release as part of a prank earlier this year. The three set up a Web site on April 1 for a fake company called Webnode (http://www.webnode.com) that purported to be auctioning off pieces of the Internet. Scores of message-board users expressed interest in investing in the company before the group revealed the prank later that day. The three say they created the hoax to educate investors about fraud on the Internet, and how easy it is for investors to be taken in.

The payment to Business Wire was covered by Mr. Mitchell's homeowner's insurance policy. The terms of the settlement are public, and both sides are free to discuss the case -- something relatively unusual in settlements.

"I'm very glad it's over. We all are," says Ms. Shell, an art historian who lives in Milan. "We were rather naive about how the law works. I certainly wouldn't call this justice."

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Business Wire says it considers the settlement a victory. "I'm happy with the result. We got what we wanted," says Lorry I. Lokey, president of the San Francisco wire service. "There's no way we're going to have our future jeopardized by this type of operation. We're not going to sit still and take these kinds of insults."

Business Wire filed the Webnode lawsuit in April in U.S. District Court in San Francisco, alleging that the prank constituted fraud and infringement of Business Wire's trademark. The suit also alleged breach of contract, defamation and conspiracy, and said the three used the service to "publicize a phony investment opportunity."
Posted by Josef Svejk  on  Tue Sep 19, 2006  at  11:57 AM

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Message-Board Pranksters Settle Business Wire Suit - part 2.

Since then the suit has been a popular topic on Silicon Investor, where the three defendants are well-known for going after companies they believe are frauds. Most of the chatter about the suit has widely criticized Business Wire, and characterized the skirmish as a David vs. Goliath matchup. Message-board users donated some $28,000 to a "Webnode legal defense fund," Mr. Mitchell says. He says some of that money will be returned to donors after legal bills are tallied.

Most posters weighing in on the settlement have viewed it as a victory for the "Webnode three."

Business Wire's Lawsuit Rattles Message Boards (April 28)

Business Wire has maintained that it had to protect its image, which it said was being tarnished by the pranksters. Indeed, the three have been vocal in their criticism of the way Business Wire has handled the case, and have lampooned the company on a portion of the Webnode site dedicated to the court case. One "retraction" posted on the Webnode site, since removed as part of the settlement agreement, apologized for infringing on Business Wire's trademark and promised never to mention the name again. The one-page retraction mentioned Business Wire 44 times.

And the three say that while they've agreed not to repeat the same prank, they insisted during settlement discussions that they remain free to discuss the case -- and to continue to criticize Business Wire.

"I really do believe that this case was about silencing a critic who happened to be pointing out some very true facts," says Mr. Ulrich, who works as a Web designer in San Rafael, Calif. "Anybody can put out a press release [on Business Wire] and say pretty much anything they want. Online investors don't always understand that, and they need to take these things with a grain of salt."

Mr. Ulrich says he is troubled by the number of companies who use services like Business Wire to distribute false or misleading information to investors. He points to the recent case of Uniprime Capital Acceptance, a Las Vegas owner of automobile dealerships who saw its stock price soar on the OTC Bulletin Board after a release announcing one of its units had developed treatment for AIDS.
Posted by Josef Svejk  in  deleted  on  Tue Sep 19, 2006  at  11:58 AM

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Message-Board Pranksters Settle Business Wire Suit - part 3.

Securities regulators swooped in immediately and halted trading of the stock. Regulators also brought fraud charges against Alfred Flores, head of the Uniprime division that had allegedly developed the treatment. In one release, Mr. Flores claimed he operated his own immunology-research laboratory for the past 15 years. But regulators say between November 1983 and September 1992, Mr. Flores was actually serving a prison sentence for first-degree murder in Colorado. Both Mr. Flores and the company have denied the allegations, and the case is pending.

Business Wire's Mr. Lokey says he's not familiar with the Uniprime case, but says the wire service carefully screens press releases before they're distributed. "We don't just sit still. I can tell you that anyone in the future that moves a false story on our wire is going to get sued and we're going to win it," says Mr. Lokey. "We probably do as well or better a job of weeding out this stuff than The Wall Street Journal does," he says.

The three message-board users claimed Business Wire's suit was a "Slapp," or strategic lawsuit against public participation. California has an anti-Slapp statute designed to protect people from lawsuits that try to limit free speech. But since Business Wire filed its case in federal, not state, court, the three said it would have been a difficult and costly legal process to seek to have the anti-Slapp statute applied.

All told, Mr. Mitchell says he and the others involved in the case generated about $90,000 in legal fees fighting the lawsuit. The bulk of the legal expenses have been covered by his insurance company, he says.

This wasn't the first April Fools' prank the group has pulled. In 1998 it set up another fake company, FBN Associates, that supposedly had developed a number of miraculous fixes for the Y2K computer problem, and had even received a blessing from the pope. Scores of would-be investors flooded message boards looking for information about how to buy stock in the company before the gag was revealed.


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Write to Jason Anders at .(JavaScript must be enabled to view this email address).
Posted by Josef Svejk  on  Tue Sep 19, 2006  at  11:59 AM

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What's left of webnode.com can be found here:

http://web.archive.org/web/20020802161128/www.webnode.com/index1.html
Posted by Josef Svejk  in  deleted  on  Tue Sep 19, 2006  at  12:04 PM

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Hoax nothing as soon as the government gets off its but with this thing I’ll be laughing all the way to the bank.
Posted by Rugs  on  Sun Apr 01, 2007  at  03:49 PM

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There was a US government research project called "Internet 2", basically very fast network connections being used to see what life was like if you had very fast network connections; nothing particularly worth the hype. Like any other network, Internet 2 had nodes; in normal usage, node is simply a term for a computer attached to a network...
Posted by akb427  on  Sat Jan 05, 2008  at  02:27 AM

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