Brief summary: Demon Internet are an ISP who host Usenet articles. Godfrey felt that one such article libeled him, and sued Demon as the publisher. Demon tried to use the defence of innocent dissemination. The judge held that, once they had been informed of the libel, they were no longer "innocent", and so were indeed liable.
For more details, search on the words in the title, or see, eg: http://www.cyber-rights.org/reports/demon.htm.
The bad news is that once someone does complain, you can't just say, "but I didn't write it". You either have to remove the offending material, or be prepared to fight for it.
Isn't it true that in Great Britain, if you are sued for libel, the onus is on you (the defendant) to prove every sentence? Thus, as this is very expensive (often impossible), most libel cases are settled out of court. --
Worse, as truth isn't always a defence. But in this case Demon's defence wasn't that it was true, but that they didn't write it. -- DaveHarris
The UseNet article in question was a forgery which would appear to most people to come from Godfrey. (A well-done UseNet forgery is difficult to detect.) In my view, there is an important difference between defending a right to say "Clifford Adams is bad" (even anonymously), and publishing a message like "I am bad", apparently signed by the same "Clifford Adams". Many sites that strongly defend free speech would remove a forged article.
Locally, for any sites I host, I am likely to remove disputed content if threatened with legal action. Most legally questionable writing would be removed anyway (because it doesn't fit within a site's mission or the local community standards).
Personally, I'm a bit more concerned about copyrights. Fortunately, one of the rational parts of the US "DigitalMillenniumCopyrightAct?" (DMCA) is its limitation of liability. See [1] for an overview of the DMCA, which summarizes the relevant part as:
See [2] for a sample DMCA notice, and note the restrictions including: