The Changing Face of Defamation

The idea of providing compensation for damage to ones' reputation is long rooted in our legal system. Reputations are considered difficult to repair, and both legal and equitable relief is available to remedy the damage and deter others from similar behavior. Traditionally, defamation defendants were media publishers, companies, or broadcasters. For the average person, the threat of defamation suit was nothing more than an intimidation by an irritated neighbor or disgruntled co-worker.

Common law recognized that different communications could cause different levels of harm. "Libel" was traditionally classified as a written message, and "slander" as one that was spoken. Damages were greater for libel as the harmful significance had greater mobility and longer life. When broadcast technology made it possible to "speak" a defamatory message that was heard by millions this common law distinction was diluted. The distinction, however, made it rare that individuals speaking in a small crowd would ever face a defamation lawsuit for their remarks. The cost was too high, not to mention the First Amendment protections built into state's defamation laws that make proving a prima facia case impractical.

Credibility was often an issue. A man who pens a defamatory article and photocopies it for distribution on a street corner in effect is distributing his credibility along with the message, the same as a politician speaking at a rally is judged objectively by the listeners. This can cast down on the truth of the message and minimize the actual harm suffered by the person whose reputation is attacked.

The trend in the coming years may, however, be a large increase in the number of defamation cases, and an increase in the damage awards. With people having the ability to distribute messages to millions via the Internet, individuals can now speak with the power of a large media outlet. Message boards, web sites, and chat rooms, allow remarks to be made from the comfort of home. There is an incentive for even greater falsehoods on the Internet because many speakers use false names, operating with a general sense of anonymity. With little ability for the listener to judge the credibility of the speaker, messages on the Internet are believed. Stock prices of publicly traded companies have been sent into a tailspin from teenage pranksters penning false company reports. Common people now have the power to inflict extreme and lasting damage to reputations without leaving their home. Businesses especially are scared. So scared, they are now likely to bring defamation claims merely to deter future occurrences. These factors are changing the landscape of defamation law.

Juries too are responding with big verdicts clearly recognizing the harm. In one of the first Internet cases to go trial, a jury in Santa Clara, California awarded $425,000 in damages to a company after they sued two disgruntled workers who posted defamatory messages on over 100 message boards, and on their personal web site. The company, Varian Medical Systems, felt the criticisms went beyond protected speech. The defendants continued their tirade during the trial, posting scathing summaries about the daily events. The Judge reminded jurors daily not to view the defendant's web site.

What is unique about this case is that the defendants were individuals, not a company or newspaper. Had the defendants distributed their messages using handbills while standing at the entrance to their former employer, the company may have allowed the activity for a while, and then sought injunctive relief. Instead, they chose to litigate the defamation case against two defendants of such little means they were forced to use their retirement accounts to fund their defense.

Expect this trend to continue. Large companies and reputation-concerned individuals will aggressively pursue defamation claims against people who would traditionally have been dismissed as lacking any integrity. Defamation law must also respond. Currently, the only legislative response applies to service providers, granting them significant immunity from on-line defamation liability. The question is whether civil penalties alone will be sufficient to deter Internet users from their actions. Likely not. Until people realize how large their financial responsibility may be, and until such prosecutions become widespread, they will continue to make comments freely and carelessly, and in some cases, maliciously.

It is often said that you can't un-ring a bell. In a practical sense, the same is true for defamatory remarks. One's reputation, once disturbed, is very difficult to repair. Businesses should incorporate into their employee policies strong prohibition about discussing company business on the Internet. They should also aggressively police the Internet for defamatory remarks that their customer's may be reading, and prosecute those offenders.