An online slanging match over a 9/11 conspiracy book that quickly degenerated into a vitriolic war of words is now the subject of a $42.5-million defamation case.

The case could be a landmark case as it may set a precedent around the responsibilities of website owners to police the comments published by readers.

Greg Smith, a small Sydney film producer specialising in conspiracy theories, claims he is now millions of dollars out of pocket after he was defamed on the forums of Australian community website zGeek.com.

Smith had been contracted by a group of Eastern European investors to produce a film called Merchant Of Death, a documentary about the life and times of alleged Russian arms dealer Viktor Bout, who is being held in Thailand waiting for the outcome of an extradition request from the US.

But the film deal was axed after the overseas party that contracted Smith to make the film allegedly stumbled across the comments on the zGeek forum and decided Smith's reputation was too damaged to continue.