Will blockquoting soon become illegal?

Just read about this rather scary libel court case over at EFF.

Last week the Electronic Frontier Foundation (EFF) and the American Civil Liberties Union of Northern California (ACLU) filed a friend-of-the-court brief in a case that could undermine a federal statute protecting the free speech of bloggers, Internet service providers, and other individuals who use the Internet to post content written by others. The case in question is a libel suit filed against women's health advocate Ilena Rosenthal after she posted a controversial opinion piece on a Usenet news group. The piece was written not by Rosenthal, but by Tim Bolen, a critic of plaintiff Terry Polevoy...

Lawyers for the plaintiffs argue that Rosenthal is liable because posting the comments makes her a "developer" of the information in question, and she therefore becomes the legal equivalent of its creator for the purposes of the lawsuit. If the court finds in favor of the plaintiffs, the implications for free speech online are far-reaching. Bloggers could be held liable when they quote other people's writing, and website owners could be held liable for what people say in message boards on their sites.

So if somebody says something false, anyone who quoted it could be held liable? Nevermind what happens to blogs, what happens to newspapers at that point?