declined two opportunities to respond to allegations made against them by either telephone or fax.

A list of questions was faxed to one of their US lawyers, Mr. Morris Goldings, of Boston-based law firm Mahoney, Hawkes & Goldings.

Mr. Goldings faxed a letter back to The Royal Gazette inviting the investigating journalist to his Boston office to discuss the matter.

"The specific questions which are contained in your fax justify responses which can most effectively be done through a face-to-face meeting with you,'' wrote Mr. Goldings.

"At such a meeting, documents can be provided which will demonstrate the falsity of certain allegations and of the innuendos contained therein.'' He added: "If you are interested in a fair and journalistic treatment of such matters as you believe it appropriate to publish, I expect that you will accept my invitation.

"If you decline to do so and publish defamatory statements, you and your employer will be held responsible.'' When informed by telephone that a journalist would not be flying to Boston, Mr. Goldings again declined to answer any of our questions.

In his letter, Mr. Goldings stated he has been retained as "special counsel with respect to the defamation, malicious interference and related claims which our clients, Gilbert Beinhocker, Gregory Plunkett, and entities associated with them, may have against you (the journalist) and The Royal Gazette .

"These claims arise out of conduct which you have undertaken and apparently continue to undertake which constitutes the publication of libelous and slanderous matter of or concerning my clients,'' it states.

"To the extent that such publication has already occurred through oral and written statements to individuals, damage may have already been done which no amount of correction or retraction will fully repair.

"To the extent that you or The Royal Gazette undertake further publication, and in particular newspaper publication of defamation, you should be on notice that this firm is authorised to pursue these matters in the courts of all appropriate jurisdictions for full and, where available, punitive damages.

"If you choose to publish, I request that you publish this letter in its entirety at the same time as publication of any article.

"Please be advised, however, that such publication will not in any way be deemed to immunise you or your employer from such legal process as I determine appropriate.''