LONDON — Harrods has been given the go-ahead by the High Court here to proceed with a libel action against Dow Jones for an article published in The Wall Street Journal on April 5.

On March 31, Harrods issued a joke statement suggesting that its chief, Mohamed Al Fayed, was planning an initial public offering for the Knightsbridge store. It was titled “Al Fayed Reveals Plan to ‘Float’ Harrods” and the contact press person was named as Loof Lirpa – or April Fool spelled backwards. April Fool’s jokes are a longstanding tradition in the U.K., where national newspapers and television stations generally will include at least one joke story to celebrate the day.

On April 1, the Journal wrote an item for its World Watch column based on the Harrods release, and followed it up a day later with a correction.

On April 5, the newspaper referred to the Harrods item in its Deals & Deal Makers column. The headline was “The Enron of Britain?” The story said, “If Harrods…ever goes public, investors would be wise to question its every disclosure.”

Dow Jones maintains the Journal was taking a tongue-in-cheek tone, and making its own joke about Harrods’ bogus statement.

Over the past year, Dow Jones has been seeking to have Al Fayed’s libel action stayed on the grounds that the case should be brought in the U.S. and not the U.K. The substantial circulation of the paper, Dow Jones argued, takes place in the U.S., even though it is accessible to U.K. readers via the Internet.

U.S. libel laws are generally much stricter than those in the U.K., requiring plaintiffs to prove a newspaper or magazine published a particular article with actual malice. U.K. courts generally apply a looser set of proofs, which is why many celebrities sue for libel in British courts.

However, in the Al Fayed case, the High Court judge ruled that his court did indeed have jurisdiction over the article despite the fact that it had originally been published in the U.S. He has also suggested that the two parties reach an amicable settlement.

“Judge Eady’s decision is an important result for all companies and individuals in Britain who are defamed by overseas publications which can be read on the Internet here,” said Harrods in a statement. “Harrods is pleased that it will be able to pursue its action, and will continue to ensure that its name and reputation are fully defended.”Dow Jones must file a defense to the Harrods claim within the next four weeks.

A spokeswoman for Dow Jones said, “We’re disappointed that the judge reached this decision in this case which has been going on for a year. We believe this illustrates why the court should take a serious look at this kind of forum shopping by libel plaintiffs.”

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