Guide to Defamation

Defamation is used to broadly describe when someone makes a statement(s) that causes (or is expected to cause) serious damage to someone or something’s reputation.

These statements could be made in permanent form, such as published written statements or photographs (known as libel) or in temporary form, such as spoken statements or gestures (known as slander).

What’s ‘serious’?

To be counted as ‘serious’, the statement would need to have been made about something or someone that doesn’t already have a bad reputation, and the statement wasn’t quickly taken back or apologised for by the person making the statement.

What counts as ‘serious harm’?

For the statement to be legally recognised as causing ‘serious harm’ to a business (and therefore defamatory), significant financial loss will need to have been caused (or be expected to be caused) by the statement.

Be measured in your approach and take good advice

While this may sound relatively straightforward, accusations of defamation are often controversial, expensive to bring and many do not ultimately succeed – and regardless of the outcome, they can cause a lot of damage to a business in the meantime.

They are often played out on a very public and prolonged basis too – a fact that can be far more damaging to reputation than less inflammatory, more sustained and non-combative action to rebut or disprove what has been said.

Your immediate priority should be to avoid fanning any flames.

The last thing you will want to achieve, after all, is a very public spat where far more people end up noticing or knowing anything damaging that’s been said about you, and for those additional people to enter into the commentary, giving it even more airtime and potentially a lot more credibility than if it had been handled differently.

Defamation situations often go hand in hand with PR advice.

It is always worth taking advice from legal experts and those who can assist you with taking the broader, smart commercial steps to negate anything damaging that is said against you.

Those commercial steps might well include bolstering the testimonials on your website and that you share on your social media feeds, having well-respected industry influencers publish positive commentary on what you’re doing, announcements of good causes or positive developments that deflect from an unhelpful statement that has been said.

They might even include apologising, admitting a problem, confirming it’s been fixed, and something even better is now happening, or even doing nothing for a short period of time.

What’s right for one situation may not be right for another, so taking advice immediately if you find yourself on the receiving end of a defamatory statement (or accused of having made one), is critical.

Time is always of the essence when it comes to defamation, and you will need a good strategy; one that potentially extends to reassuring your staff and briefing them with the right knowledge, guidance and consistent messages.

What to do if someone has been defamatory towards your business (before any court action is initiated)

Below are the steps that we recommend.

It’s advisable to fact-find in collaboration with a legal expert so that any advisory materials produced during your fact-finding exercise have the benefit of legal privilege (protection from disclosure to the court or your accuser) if you ultimately cannot avoid going to court.

So, if you think this is a situation where you’re facing serious harm to your business, and your instinct is that it is likely to be controversial or that the statement-maker may not be easily appeased, make sure that right from the start, you require all persons involved in supporting this fact-finding exercise not to create any new documents, correspondence (including emails and texts) or notes, unless these are done at the request of, and addressed directly to, a legal adviser.

1. Rapidly fact find

This fact-finding will need to examine the nature of the statements made against you, what the experts advise and, regardless of any emotional reaction that you’re tempted to take:

Who has made the statement and their relationship to you or to others that are important to you

For example, is it a customer, significant business partner, shareholder, or employee, that has made the statement(s)?

A more distant relationship to you and/or those that matter to you may merit a very different potentially and less intensive approach by you – especially if the statement is made maliciously and is intended to goad you into publicly defensive statements or into saying something that you’d later regret.

Those who are close to you might be appeased, negotiated with, or even persuaded to withdraw the statement made, without the need for you to take aggressive action against them.

Also, look at whether they or others have said some similar before.

What you believe the motivations of the statement-maker might be

For example, what do they hope to achieve by making defamatory statement(s) about you?

Is it to force you into doing something that they want?

And how might they be appeased?

Is appeasing them rapidly something that you might be prepared to consider – and could you come to some accord that might include a confidentiality commitment on their part? and

Whether this is a seriously harmful statement

If it is genuinely serious, you should quantify this harm as best you can.

The greater the harm, the more urgent and justifiable your action (and the costs of any such action) will be in countering it.

Part of this assessment will need to look at where the statement has been made and what can be anticipated next in terms of how far it might spread, how long it’s likely to stick around and how credible is it’s source; a customer, shareholder or employee saying something defamatory about you might potentially be taken more seriously and prove far more incendiary than a statement about you by a rival, for example.

2. Do not publicly engage without having taken expert advice

For example, if someone has stated something about you in the press or on social media, don’t respond until you have considered your position very carefully.

And do not allow yourself to be bullied or goaded into a reaction before you are prepared.

Panicked or knee-jerk responses can undermine your negotiating position, as well as your reputation and credibility, faster than anything in these situations.

Claimants (like you) in defamation situations are publicly judged as much, if not more, by how they respond, as they are by what is initially stated about them.

If you must say anything at all, saying ‘no comment’ or ‘we’re taking this very seriously and urgently looking into this’ is generally better than denial (which can subsequently undermine your credibility if aspects of the statement prove true), or angry responses, (which can be interpreted and speculated on in all sorts of unhelpful ways.

3. Do not privately engage with the statement-maker except on advice

In some cases, you might not be able to avoid this, for example, if the statement has been made by an employee who is still at work.

Expert employment law advice should also be taken here since you’ll probably want to isolate the employee and instigate disciplinary procedures, but depending on the nature of the statements made, you will need to tread with care to avoid giving the employee a potential employment claim against you.

Asking the employee to wait in a meeting room until you have taken this advice may be a wise approach while you seek that advice.

Avoid doing anything knee-jerk and remain calm and professional at all times.

Conversations with the employee should ideally take place with another colleague present to witness what is said and attest to the way that you handle the conversation.

If someone else makes the statement, however, you may have a little more time to take advice.

Early-stage communications can be critical in influencing how the situation will progress, so your strategy here will be really key.

4. Make sure everyone essential knows the advised strategy and is equipped to action it

Part of any defamation claim strategy is to cover who needs to know what about the position your business has been advised to take and how you need them to behave.

You may need to act fast and anticipate any vulnerabilities or individuals who may be specifically targeted or under pressure due to what’s happened.

For example, if a trading relationship is affected and may need to be suspended, your account managers and sales team will need to be aware of this and provided with the right communications messages and instructions, so they are prepared and can reinforce, not inadvertently undermine your position.

5. It’s not true that legal action is inevitable

There may be other worthwhile ways to resolve the situation, even where damaging public statements have been made.

For example, mediation might still be an option, especially where withdrawing the damaging statement and/or an apology can be agreed upon.

Taking legal action

Legal action is your last resort – and it’s really appropriate only where you know you’re in the right and have strong prospects of proving this.

Be very confident that you have considered and ruled out all other options before you start on this as the minute you initiate legal action, you expose your business to the significant risk of public scrutiny and speculation.

And you’ll need to be prepared for this, as it will likely involve a big effort by many people within and associated with, your business – who will, for example, need to be briefed, to be convinced of your position, equipped with the messages that you’d want them to deliver if they are approached or targeted themselves, etc.

You’ll be calling in a lot of goodwill and trust and you may be asking some individuals to handle situations of pressure for which they may not previously have been trained or have experienced.

Going ahead with legal action

Technically, for most situations, you’ll need to make your claim within 1 year of the defamatory statement being made.

Whilst most businesses will want to start the formal process within a matter of hours or days of becoming aware of the defamatory statement, the legal time limit starts running from when the statement was made, even if you didn’t find out until some time later.

Depending on the advice that you have received, and the seriousness of the defamatory statements made, you may pursue one of two principal courses of action at this stage:

1. An application for an interim injunction (emergency court order) to stop any further statements or follow-ups from being made – or to stop a threatened statement from being made (if it has not yet been published, only threatened).

or

2. A standard claim of defamation, the main steps for which are broadly described below.

Making a non-injunctive claim of defamation

First, send a letter of claim to the person you know, or have good reason to believe, has made the defamatory statement (the defendant).

The letter of claim should include:

1. Your name
2. Where the statement was made (e.g. the name of a publication or website, for example). Be as specific as possible
3. Details of the statement (e.g. a transcript, or an exact copy of the statement’s wording)
4. An explanation as to why you consider that the statement is untrue, backed up with any evidence you have
5. How you expect the matter to be resolved (e.g. financial compensation, a retracting statement)
6. If possible, evidence of how your business is clearly identifiable in the statement made and the effect the statement has had

The defendant must respond to your letter as soon as possible.

When they do reply, they must include:

1. Whether they consider your claim to be true, or untrue, or if they need more information to decide
2. If they consider that your claim is true, they must inform you of what they’re willing to offer as compensation for making the statement
3. If their position is that your claim is untrue, they’ll need to explain why, backing up their reasoning with facts, if possible
4. If they need more information to decide, they must detail exactly what information that would be and why they need it

If your letter of claim doesn’t resolve the matter, you can consider alternative dispute resolution (ADR).

This is where you both try to find a resolution without initiating legal proceedings and going to court (litigation).

For example, one ADR option would be to hire a mediator – this is an unbiased third party who will work with both you and the defendant to help you reach a resolution that is fair to you both.

If ADR doesn’t help, then you may want to opt for litigation, taking into account all the factors that we’ve already highlighted above.

In court, the defendant (who made the defamatory statements about you), may use 4 main defences:

1. Truth (i.e. if the defendant can prove that the statement they made was true)
2. Honest opinion (i.e. if the defendant can show that the statement was their own honest opinion gained from facts that were already available)
3. Public interest (i.e. if the defendant can show that the statement was made in the interests of sharing with the public)
4. Privilege (this can take a few different forms, but broadly speaking protects defendants when it’s in the public interest to allow them to speak freely without concern of a lawsuit being made against them; for example, statements made in court, when giving job references, or when making reports to appropriate legal authorities)

If the court rules in your favour – in addition to any compensation owed to you – you could also be able to have an injunction put in place, which will prevent the defendant from making any further defamatory statements.