A Melbourne nightclub owner shouldn't get a payout for being defamed by a former Victorian police officer, lawyers for the state argue.
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Inflation nightclub director Martha Tsamis is seeking between $200,000 and $350,000 after suing the State of Victoria over comments about drugs and underage patrons made in 2014 by former superintendent Brett Guerin to the Herald Sun and 3AW.
A jury found in favour of Ms Tsamis. They determined it was not substantially true that she allowed entry to minors, ran Inflation in a manner conducive to drug trafficking, drunkenness and violence, and which jeopardised patrons' health.
But the jury accepted the state's truth defence linked to the imputations that Ms Tsamis operated Inflation as a "honeypot" for drug dealers, in a way that allowed drugs to be sold or consumed, and which resulted in overdoses at or around Inflation.
Acting for the state, Paul Hayes QC told Victoria's Supreme Court on Monday that Ms Tsamis' most serious claims were not deemed defamatory because they are true and therefore she should not be awarded damages.
"Letting minors into a licensed premises pales in significance," he said.
"Drunkenness in a nightclub ... your average Australian reader, your honour, wouldn't be too disturbed by that."
But if Justice John Dixon disagreed and decided to award Ms Tsamis compensation, it should be no more than $10,000, Mr Hayes said.
The woman's lawyer, Timothy Sowden, argued his client's reputation had been damaged by remarks found to be defamatory.
Inflation had been made out to be the "wild west," Mr Sowden said, leaving Ms Tsamis feeling devastated, distraught and betrayed.
Justice Dixon has reserved his decision on damages.
Australian Associated Press