At first, that's what she got: Smith did the floors in a few weeks in July 1999. But soon their relationship soured, leading first to a small-claims lawsuit over payment for the repairs, and ultimately to a multimillion dollar federal lawsuit that involves charges of Nazi war looting -- and raises fundamental questions about Internet libel law.

In an act that has legal repercussions today, Smith (who could not be reached for comment for this story, despite extensive efforts to reach him by phone and e-mail) apparently fired off an e-mail to Ton Cremers, the solo operator of the Museum Security Network, a Netherlands-based non-profit that tracks news of art theft, looting and forgery. Cremers' e-mail newsletter reaches about 1,000 readers worldwide -- a small but hardcore group of museum security professionals, curators, art historians, art dealers, art collectors, lawyers, law enforcement officials and journalists.

In the e-mail, dated Sept. 8, 1999, Smith identified himself as a building contractor in Asheville, and Batzel as his client. The e-mail then linked Batzel to the Nazis. "[Batzel] bragged to me about being the grand daughter of 'one of Adolph Hitler's right-hand men.' At the time I was concentrating on performing my tasks, but upon reflection, I believe she said she was the descendant of Heinrich Himmler," it alleged, adding, "Ellen Batzel has hundreds of older European paintings hanging on her walls, all with heavy carved wooden frames. She told me she inherited them. I believe these paintings were looted during WWII and are the rightful legacy of the Jewish people."

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The e-mail included Batzel's address and Smith's phone number, information that Cremers left intact when he distributed the e-mail to Museum Security Network subscribers on Sept. 9.

Several readers, outraged by the posting, shot off critical e-mails to Cremers. He promptly published them, beginning on Sept. 11 with a posting from Christopher Atkins, a media licensing coordinator at the Museum of Fine Arts in Boston:

"Mr. Smith is completely out of line for suggesting that some woman with old paintings in her home has amassed a collection of paintings from Nazi war booty. His claims, evidence and assumptions were ridiculous, and he was very disrespectful of this woman's privacy in offering this woman's address." Atkins concluded by admonishing Cremers: "I think it was wrong for you to take this man's story seriously. Please respond."

Cremers replied in the same newsletter (and soon struck Batzel's address from the archived version of the e-mail). "I do share your opinion about the quite odd contents of this message," he wrote. "However, I am convinced that most of our subscribers have enough common sense to see the difference between sane and insane... In this case I have not chosen to behave as a censor. I hate to do that anyway. I must admit that my decision to forward Mr. Smith's message may have been wrong. What is worse: forwarding messages with strange contents or censor[ing] messages?"

Another Museum Security Network reader, Earl Merkel, warned Cremers that he could be sued for libel. Merkel criticized Cremers for jeopardizing the credibility of the forum "by blithely passing along what are, without dispute, unsubstantiated rumors. You may also risk legal consequences, if your act of 'publishing' this woman's name and address causes her damage. By no definition is she a 'public figure' who can usually be libeled with impunity as long as no 'malice' can be proven. At the very least, you owe this woman an apology; at worst, you may end up owing her much of what you personally own."

Merkel's warning was prophetic. Though Batzel says she and Smith eventually settled their dispute over the home repairs (she says she gave Smith $250, a ladder and some halogen lamps), the e-mail's allegations have led to a multimillion-dollar lawsuit. Batzel, who now lives in Los Angeles, is suing both Smith and Cremers in federal court for $10 million in defamation, invasion of privacy and intentional infliction of emotional distress. And while the suit against Smith is relatively conventional, the one against Cremers -- which could reach court by the end of this year -- tests the cutting edge of Internet legislation.

Should a Web site based in the Netherlands be subject to the laws of every country in which it has readers? Should the landmark 1996 Telecommunications Act, which protects Internet Service Providers like AOL from libel in the case of third-party postings, also cover an e-mail newsletter that publishes unedited letters and press clippings? And what future is there for a one-man publishing operation that may have just enough resources to make editorial judgments, and errors of judgment, but too few for legal safeguards like fact-checking?

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