Baidu.Com Seeks to End Suit by Chinese American Writers

Baidu Inc., (BIDU) owner of China’s most popular search engine, asked a U.S. court to dismiss a lawsuit by Chinese-Americans who said the Internet company “censored” their articles on the pro-democracy movement in China.

Baidu, in its first legal motion in response to a May 2011 lawsuit by eight residents of New York City, said the case should be dismissed because the complaint wasn’t properly served on the Beijing-based Internet company, according to a filing yesterday in Manhattan federal court.

The People’s Republic of China, another defendant in the case, hasn’t responded to the lawsuit. Baidu’s lawyers said in the court filing that the Chinese government also wasn’t properly served under international law, citing a letter from the Chinese Ministry of Justice.

“The Hague Convention is the exclusive means of serving judicial documents” on the Chinese government, Baidu’s lawyers said in their motion to dismiss. Referring to the plaintiffs’ delivery of the complaint to Baidu and the People’s Republic through FedEx Corp. (FDX) mailings, the lawyers said, “The Hague Convention does not authorize service by FedEx.”

The writers claimed that Baidu.com, “in conjunction with and as an agent and enforcer of the People’s Republic of China, purposely designed its search engine algorithm to exclude” pro- democracy topics. They said Baidu and China violated free speech provisions of U.S. and New York State law.

Damages Request

The plaintiffs filed a request in July for a default judgment against Baidu.com because it hadn’t responded to the suit. They are seeking $16 million in damages plus interest.

Stephen Preziosi, a lawyer for the plaintiffs, said in a telephone interview today that it was the motion for a default judgment that prompted Baidu’s response.

“All of a sudden Baidu is very concerned and hired a lawyer in New York to claim I didn’t serve them properly,” said Preziosi, who runs his own law firm. “This is just more rhetoric, to try to avoid being sued in New York, when they do so much business in New York.”

Quinn Emanuel Urquhart & Sullivan LLP is representing Baidu.

Baidu’s American depositary receipts trade on the Nasdaq Stock Market. They fell 43 cents to $112.34.

The case is Zhang v. Baidu.com Inc., 11-cv-3388, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Don Jeffrey in New York at djeffrey1@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net