UPDATE: Ms. Cox replied to via email to a request for comment. When asked whether she would appeal the ruling she said, “I do Plan to Appeal. Thats all I can Say on that.”

When Obsidian Finance Group, an Oregon-based investment firm, sued blogger Crystal Cox for defamation, she believed that the law would protect her. Cox argued that her work constituted journalism, and that she was therefore protected by an Oregon law that protects journalists from being required to divulge sources. U.S. District Court judge Marco Hernandez disagreed, and ordered Cox to pay $2.5 million in damages to Obsidian Finance.

Cox runs a small armada of blogs, most dealing with an array of legal and financial issues (a pair of sites devoted to natural health remedies being the exceptions). On several of those blogs – most notably Obsidian Finance Sucks – she has taken issue with the behavior of Obsidian Finance and Kevin Padrick, co-founder of the company. In one post in particular, posted late last year, she accused Padrick of fraud, of dishonesty with Obsidian’s shareholders, and the abuse of his position as the company’s chapter 11 trustee for personal gain.

The post acknowledges that Cox had already received a cease-and-desist from Padrick’s attorney. In response to Cox’s refusal to comply, Obsidian sued for defamation. Cox, who represented herself in court, argued that she was a journalist, and that the information in her post had come from a confidential source, insulating both her and the source from liability. Judge Hernandez wrote in his ruling that internet blogs are not covered by the statute in question, which defines media of communication as “any newspaper, magazine or other periodical, book, pamphlet, news service, wire service, news or feature syndicate, broadcast station or network, or cable television system.” He further argues, citing state statute, that the protections of Oregon’s journalism shield law do not apply in civil defamation suits, meaning that even if he accepted Cox’s argument that being a blogger made her a journalist, she would not be protected by the shield law in this instance.

After the ruling, Cox posted a flurry of updates to her Obsidian Finance blog. In the posts she argues against the judge’s ruling and cites the publicity the case has garnered as a victory for her.