Libel, Slander, and Defamation: How to Protect Your Reputation in a Digital Economy

by | BiggerPockets.com

Bad reviews hurt a business. If you own the business, they hurt your soul. Nonetheless, platforms like Yelp are the gatekeepers to quality now. You have to accept that not everyone is going to like what you are doing and that any old jerk can leave a scathing review that could damage your credibility. But never fear—even in the seemingly lawless world of the internet, there is law to protect you. The good news is that you can protect your business against untruthful, inflammatory remarks.

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When Negative Reviews Transform Into Defamation

There’s definitely a hard line in the sand regarding defamation. Cross that line, and a negative reviewer could indeed be engaging in defamation. There have actually been hundreds of lawsuits over negative reviews posted in online forums, but few people take action.

The first amendment only protects the truth. No one has the right to tell lies about you or your business. If a negative review in any public platform is negative AND untruthful, you can sue for damages. That situation is the very definition of libel.

A Quick Note From the Legalese Translator: Libel is something that occurs when an individual knowingly makes false statements about you in writing. Someone who does the exact some thing verbally is committing a similar crime, but we call that slander. The difference between the two is simple: were the false statements printed or spoken?
The Quick and Dirty is this:  

  • Printed = libel
  • Verbal = slander.

This content brought to you by The Legalese Translator.

Now, you are going to have to prove that a negative comment was untrue if you are going to silence it. If a customer says that they were served an ice cold steak, you’re going to have a hard time proving the remark untrue. I suppose maybe the customer’s steak could have flown off the plate and smacked a neighboring diner in the eye, which would give you some evidence of its temperature. If they have burn scars, you may well have a shot.

This is an insane example, but it demonstrates a case where a business is actually damaged by a negative review that can, at least in theory, be proven untrue. This is grounds for a defamation lawsuit.

All About Defamation

There are two types of defamation. We mentioned libel. Libel is the act of defaming someone by telling lies about him or her in print—literally, on paper, which can include publication in a news outlet or other online forum. This includes online reviews. The second type of defamation is slander, which is spoken defamation. See that handy chart above if you need to reference back to this topic. Just for fun, we’re going to give you some examples.

Related: How to Keep an Amazing Reputation in the Real Estate Business

You see a lot of slander during political campaigns. Remember “Lock Her Up?” with Hillary Clinton or the myriad of statements about Donald Trump’s health? They could all be total fabrications. Even if true, the critics were unlikely to have evidence of their claims. You’d think such powerful people would be willing to sue to keep such commentary out of the media and public eye.

But defamation is tricky business.

In order to win a defamation lawsuit you must prove the following:

  1. That a statement was made
  2. That it was published for others to see (comments, reviews, etc.)
  3. That the statement caused you injury (emotional distress, loss of business, etc.)
  4. That the statement was false.

That is a tall order, because each of those elements above must be proven fact. Items (b) and (c) are especially difficult to prove without cold, hard, tangible evidence.

Awards in a defamation lawsuits generally require the offending party to remove false statements. Damages might be awarded for lost profits or injury, which as mentioned are very difficult to prove, especially if we’re talking “emotional distress.”

Defamation Suits: Is This The Hill You Want to Die On?

You really need to pick your battles carefully. You can spend a lot of money silencing negative reviews that may not actually be costing you anything. It’s also difficult to prove that the offending party is lying. Judgments are rare without overwhelming evidence, so odds are you could spend more money engaged in the suit than actually doing things that could improve your business.

How Business Owners Can Manage Negative Reviews Without Setting Foot in Court

My personal advice to business owners who are on the receiving end of negative or untruthful reviews is that you respond to it once. That’s a hard rule: Don’t beg, plead, or offer free stuff to the hostile party. Once, and only once, is the golden rule. Why? It’s enough to show that you are a business owner who cares. It allows anyone who reads the review to hear your side. Reach out to the customer directly if it’s possible and figure out if you can resolve their issue. Maybe you can get a negative review taken down just by showing a potential client that you want to do better by them. That’s how you win over people whom you disappointed, and we all have off days. And for bonus points: other readers will see you engaging with your customer base. This builds credibility with potential customers.

Related: Should There Be a Better Review System in Place for Landlords?

Now, if you’ve taken these steps and you are unable to resolve a negative and untrue comment or review that is causing your business injury, you can file a lawsuit against the perpetrator.

Just remember that lawsuits are a long and costly process. Don’t drag yourself into a fight if there aren’t sticks or stones involved. We meant it: ask yourself, is this the hill you want to die on? Do you want to go toes to the mat for (typically) not much reward? If the injury is real and the comment is false, take legal action. Just be sure you’re in a fight over something that matters.

If you’ve had issues with defamation, libel, slander, or any of the concepts we’ve talked about above, please share your experience in the comments section.

The same goes for questions: I love answering your questions, so put them below and I’ll do my best to address everyone.

Thanks for reading, and I hope you have a better grasp of reputation management now.

About Author

Scott Smith

Scott Smith helps clients nationally and internationally from his office in Austin, Texas. With over 5 years experience in the litigation, Scott works on proactively building defense in anticipation of future lawsuits for real estate investors. Scott is one of the few attorneys in the nation that structures companies for maximum protection with minimum taxes.

What You Want the Text to Say

7 Comments

    • Scott Smith

      Yes indeed! Or if you’re going to do it yourself, keep your own conduct impeccable. But even if you do, someone somewhere may still find a reason to get nasty on the internet. Maybe because of an honest mistake, or maybe they just don’t like the cut of your jib or the shirt you wore that day. But that’s why I wrote this. You raise a great point though: hiring good people for your real estate dream team is vital! As is vetting them. Thanks for your feedback, Chris.

  1. Mark Ferguson

    I hired an SEO company to work on my site. They overcharged me, admitted it, but refused to refund me. When I started the chargeback process they proceeded to launch a negative campaign against me on YouTube, my blog, Facebook, and other websites. The reviews are crazy and not related to my business at all in most cases. Completely bogus and easy to prove. They are from fake Facebook and YouTube accounts. And the owner of the company is in Cambodia. They even created a website calling me a racist with a made up story. I have been trying to find a good lawyer to sue the crap out of them.

    • Scott Smith

      I’m sorry to hear about that experience you had Mark. Maybe one of my writers can give you some tips on how to get better help with SEO. She’s here on BP– @Mary Browder Any ideas for Mark?

      The ones that are totally bogus should be easy to report to the social media platforms. If it’s interfering with your life to that extent, then yes, maybe it is time to at least consult with an attorney. However, with them being in Cambodia, that lawyer might find they don’t have anything worth suing for. I’ll see what I can do to get you some damage control ideas, and hope you found something helpful in this article. Again, sucks that you’ve had to deal with this level of harassment, but bogus accounts should be easy to report. Especially if the person made them JUST to make the bad review, etc.

  2. Mandy Walker

    I have a friend who threatens to sue all the time over comments. This is a bad idea, right? Your article has some way better ones at least.

    Lol at the legalese translator. That’s so funny! It looks like that’s a real person not just a character. Can I borrow him/her to read my contracts?

    • Scott Smith

      Hi Mandy,

      In general threatening to sue someone is not a bright idea. It’s kind of a “go” or get off the pot situation. A threat to sue actually gives the other side time to prepare, or worse, sue you first. The element of surprise is important in many scenarios. However, in cases like this, where you have diplomatic alternatives, it’s usually best to try those first. If you’re going to sue someone, don’t give them the opportunity to hide assets or anything you could collect on judgment. Shut your mouth and just do it. I’m sure you wouldn’t do such a silly thing, but perhaps you could let your friend know that his threats aren’t accomplishing much. Heck, send him a copy of this article!

      There is indeed a real-life legalese translator! I’ll let her know about your kind words, and she may just connect with you here on BP. Thanks for your kind comments as always Mandy. I really appreciate your regular contributions to these discussions! It doesn’t say on your profile, but are you just interested in the law or considering a career, something else?

  3. Andrew Syrios

    One note if you have a property management company for your or others rentals it that most of these companies have terrible online ratings. The best thing you can do is ask tenants when renewing a lease if they’ll give you a rating. Happy people rarely give ratings unless you ask them. If they’re renewing, you are likely to get a good review.

    Also, politely respond to each negative response. If the comment is angry and you are polite and logical, people will usually side with the polite and logical people. Furthermore, if those ratings are drowned out by positive ratings, potential tenants will just see these bad posts as an aberration.

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