The Electronic Frontier Foundation (EFF) has filed an amicus brief in support of BehindMLM.

The brief is part of ongoing litigation initiated by GSB Gold Standard Corporation.

EFF is a

member supported, nonprofit organization that works to protect civil liberties and human rights in the digital world

Commenting on GSB’s New York Supreme Court petition, which is currently under appeal, EFF’s Brendan Gilligan wrote in a March 12th article;

Like speech itself, the First Amendment right to anonymity fosters and advances public debate and self-realization.

Anonymity allows speakers to communicate their ideas without being defined by their identity.

Anonymity protects speakers who express critical or unpopular views from harassment, intimidation, or being silenced.

And, because powerful individuals or entities’ efforts to punish one speaker through unmasking may well lead others to remain silent, protecting anonymity for one speaker can promote free expression for many others.

Too often, however, corporate or human persons try to abuse the judicial process to unmask anonymous speakers.

Thus, courts should apply robust evidentiary and procedural standards before compelling the disclosure of an anonymous speaker’s identity.

In the New York Supreme Court case, GSB has thus far failed to provide any supporting evidence in relation to their claims.

GSB, GSPartners and Heit meanwhile have been the subject of over a dozen regulatory fraud warnings.

  1. Texas described GSPartners as “various fraudulent investment schemes that are threatening immediate and irreparable harm”
  2. Washington described GSPartners’ MLM business as “fraudulent activity”
  3. Alabama claims GSPartners was “evading Alabama laws and making guarantees that are unrealistic”
  4. California described GSPartners as a “fraudulent crypto investment scheme”
  5. Kentucky asserted GSPartners “acted as an unregistered issuer of unregistered securities through its publicly available websites”
  6. Wisconsin described GSPartners as a “global fraud scheme”
  7. Arkansas claimed GSPartners is “perpetrating numerous fraudulent investment schemes that are threatening immediate and irreparable harm to investors”
  8. New Hampshire accused GSPartners of “fraud and deception”
  9. Arizona determined GSPartners’ threat to “public welfare requires immediate action” and
  10. Florida’s undercover investigation into GSPartners revealed “unlawful activities
  11. Mississippi described GSPartners’ Ponzi scheme as the “offering and selling fraudulent (of) certificates tied to digital assets”
  12. Georgia fined GSPartners, Josip Heit and Michael Dalcoe $500,000 for securities fraud
  13. Massachusetts’ Attorney General’s Office counted GSPartners in a list of “crypto scams”

An ongoing federal investigation into GSPartners and Heit is also underway.

Outside of the US, six Canadian provinces have issued GSPartners fraud warnings (British Columbia,  Ontario, Alberta (G999  GSTrade and GSPartners), Quebec and Saskatchewan), along with South Africa, Australia and New Zealand.

After the Canadian fraud warnings, an attempt to rebrand GSPartners as Swiss Valorem Bank was initiated in May 2023. For reasons that haven’t been made public, the rebranding was quickly dropped.

GSPartners itself collapsed in December 2023. An attempt to reboot as GSPro flopped, prompting a suspected third reboot attempt as Billionico.

In their filed amicus brief, EFF states BehindMLM’s appeal “touches on an issue central to EFF’s work: protecting online expression, including the right to speak anonymously”.

This case presents an opportunity to ensure that New York courts follow the lead of federal and state courts around the nation that have adopted balancing tests to help protect online speakers from improper efforts to pierce their anonymity.

The right to speak anonymously is deeply embedded in the political and expressive history of this country.

Allowing individuals to express their opinions, unmoored from their identity, encourages participation in the public sphere by those who might otherwise be discouraged from doing so.

Accordingly, while anonymous speakers do not enjoy an absolute right to anonymity, the First Amendment requires courts to ensure that litigants do not misuse the legal discovery process based on pretextual claims.

It further requires courts balance the interests of the party seeking unmasking against the concrete harms—to the speaker and others—that can result.

BehindMLM has previously raised concerns about Heit’s ties to organized crime in Europe.

As a nonprofit legal services organization, EFF has been involved, as counsel or amicus, in numerous cases where plaintiffs appeared to have manufactured legal claims as a pretext to unmask less powerful anonymous speakers.

Absent rigorous court review, anonymous speakers who are unable to obtain counsel may be less successful in defending their First Amendment rights.

More recently, EFF has been involved in cases where litigants sought to misuse the Digital Millennium Copyright Act’s (“DMCA”) hair-trigger subpoena provision to unmask critics.

This above background demonstrates the importance of developing and applying robust procedural and substantive protections for individuals targeted by legal process seeking to unmask them.

BehindMLM’s brief discusses these requirements in full. EFF endorses those arguments and urges the Court to adopt the test she articulates.

EFF goes on to urge the New York Supreme Court to adopt “two substantive steps of the anonymity test”.

First, the requirement that litigants seeking to unmask anonymous speakers meet a substantial evidentiary burden to demonstrate the legal sufficiency of their claims ensures that the litigation is not a pretext to retaliate against the speaker.

Some courts require plaintiffs to establish a prima facie case, supported by evidence, that the anonymous speaker’s statements in fact rise to the level of civil or criminal liability.

Resolving this appeal does not require this Court to decide which standard is appropriate for this step, however, as GSB Gold Standard, Inc. cannot meet either.

If, as here, a party cannot meet their evidentiary burden, the analysis should end, and the court should quash the subpoena.

Second, even if a litigant meets their evidentiary burden, they are not automatically entitled to unmask the speaker.

As numerous courts recognize, litigants must also establish that the balance of competing interests weighs in favor of unmasking the anonymous speakers.

The trial court’s order denying BehindMLM’s motion to quash GSB’s subpoena should be reversed because GSB has failed to establish that it has meritorious claims against BehindMLM.

As BehindMLM’s briefing explains, BehindMLM faces serious threats of extralegal retaliation if their identity is revealed, and unmasking BehindMLM could chill others from commenting on cryptocurrency, an issue of significant public concern.

Conversely, GSB has not established that it must unmask BehindMLM to obtain meaningful relief.

The sole relief GSB seeks is BehindMLM’s identity, which it claims it “relevant to GSB’s potential claims for defamation and defamation per se.” Respondent’s Opp. at 7 (emphasis added).

Given BehindBLM’s [sic] countervailing concerns, GSB’s potential need falls far short of the justifiable, legitimate litigation need that courts require.

The New York Supreme Court accepted EFF’s amicus brief on March 11th.


Update 14th April 2024 – EFF’s amicus brief filing was approved on April 11th.