Think before you review–a cautionary tale about online business reviews
Not that long ago, in a place not that far away, a Dallas jury awarded a wedding photographer over $1 million in damages after finding that a bride and a groom made multiple disparaging and defamatory statements about her and her business.
With 24-7 access to social media and websites that allow consumers to post online business reviews, individuals who have a bad experience may be quick to post about it. Online reviews are certainly helpful to consumers and businesses too. However, these reviews can have unintended consequences, especially when they are used to vent frustrations or retaliate against a business. Reviewers who do not chose their words carefully, may find themselves defending a defamation and business disparagement lawsuit and possibly owing money to the target of their bad review.
Defamation is the act of injuring a person’s reputation by making a false statement to a third person. Usually, the statement must cause the person being defamed some pecuniary injury; but, in cases where the statement is obviously harmful, damagesmay be assumed. Business disparagement is similar to defamation but applies exclusively to a product or a business rather than a person’s reputation. Under both claims, the false statement must expressly or impliedly assert facts that are objectively verifiable and must be construed based on how a person of ordinary intelligence would interpret it (e.g., satire is likely not actionable). Opinions are actionable if the statement can be categorized as a fact–“in my opinion, Jones is a liar” implies knowledge of facts that Jones lied. Not all unflattering statements are defamatory, and there are laws to protect citizens exercising their free speech rights from retaliatory lawsuits that seek to intimidate or silence them on matters of public concern.
Businesses often have more resources to dedicate to litigation than their customers, so the Texas Legislatureenacted Anti-SLAPP legislation to prevent complaining consumers from getting buried in bogus defamation suits they cannot afford to defend. These laws carry harsh penalties for those who bring non-meritorious defamation or disparagement lawsuits by givingdefendants an avenue to have such cases dismissed in their infancy if the plaintiff cannot show that he will be able to prove his case (e.g., hecannot show that the statement is false or objectively verifiable). If a defamation case is dismissed under Anti-SLAPP, the plaintiff must pay the defendant’s attorneys’ fees and is subject to sanctions, usually monetary. Anti-SLAPP legislationwas not enacted to protect defamatory speech though. To avoid crossing the line, be completely honest and avoid false inflammatory statements when posting reviews. If my truck breaks down while I’m driving home from mechanic X’s shop because he unknowing installed a new but defective transmission, there is a significant difference in saying “just after leaving mechanic X with a new transmission that set me back $3,500, that transmission failed causing my truck to breakdown on the side of the road” and one that says “X installs junk yard parts and charges for new ones. He scams his customers and is clearly incompetent at his trade.” The first statement is true and defensible. The second is not.
Other examples of defamatory or disparaging statements that have survived dismissal or resulted in a verdict for the plaintiff include:
- False implication that employee lacked fidelity and honesty in dealing with employer;
- Statement that a broker was going to lose his license due to professional misconduct;
- False accusations that a physician was incompetent, dishonest, worked while intoxicated, and was of low moral character;
- Calling a dog breeder a puppy miller; and
- Allegationthat federal authorities were investigating a certain company and accusing that company of paying illegal kickbacks to physicians for writing prescriptions.
You may see a lot of statements like these and wonder why there aren’t more defamation suits. In my experience, these disputes often get resolved through cease and desist/demand letters. Business owners don’t want to draw additional attention to the statement (especially if it does not cause significant harm or is removed) or deal with the hassle and expense of a lawsuit, and some have concerns about Anti-SLAPP laws. The statute of limitation period for defamation is one year and two years for business disparagement from the time the statement is published. So, a would-be plaintiff has time to evaluate the effects of a false statement, consult with an attorney, and decide how to proceed. Both customers and businesses should carefully consider the possible legal consequences when it comes to online reviews.
This article does not address all factors to consider in evaluating disparagement and defamation cases and is not being offered as legal advice.