Front Page Trash

Defamation (Libel and Slander) On The Internet and Elsewhere

by David L. Ganz

Column 4 – May 20, 1999

Law and Coins David L. Ganz

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Phone: (212) 517 5500 Fax: (212) 772 2720

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Suppose that you’re surfing the Internet when someone asks about your recommendation for buying coins from a particular dealer, or about the general reputation of the person. Or, to posit another real life example, let’s say that you’re in a chat group on America Online when someone asks whether or not it’s true that a specific person stole large cents from the collection of the American Numismatic Society.

These are not pretend questions. These and other similar instances occur everyday. Before the Internet, there were comments made at coin clubs, on dealer-to-dealer teletype, and elsewhere. Regardless, the issues are the same.

What do you answer, if at all, to these questions – and what are the potential consequences of an informal conversation in which you make a serious claim against another person, even if they are a fellow collector?

This is the case on the Internet or if a letter is published in a club publication. It’s also true when you offer a derogatory reference or statement about another person to a third party.

There’s an easy answer to the question, but judging from the chat on line today, it seems clear that either there is popular disagreement with the answer, or those who chat simply have a devil-may-care attitude that could prove costly.

The reason for this is, a false statement that is damaging is defamatory, a branch of law known as a tort, and that which is defamatory can give rise to substantial damages. When stated orally, it is known as slander; when in writing, libel.

This tort first surfaced about the year 1275, just 60 years after the Magna Carta was signed and sealed at Runnymeade by Britain’s King John. Initially, it was no doubt intended to protect the barons and feudal lords from the statements or claims invoked by the serfs.

In the intervening 725 years, it has become a mechanism by which individuals can protect themselves against the gossips of society, and those who “publish” a libel, or a slander, thereby disseminating it.

Publishing does not mean having a printer set it in type and then offset it into the distribution channel of commerce. The essence of the legal cause of action is an untrue statement that is uttered orally (slander) or in writing (libel) that is damaging to another.

There are exceptions, and there are provisos. But a false statement recklessly made may be subject to substantial economic punishment.

Today, defamation may be defined as the making of a false statement, which tends to adversely affect one’s reputation, thereby exposing one to public hatred, contempt or ridicule.

# There are five basic elements which must be proven in order to establish a prima facie case of defamation (without taking into account any defenses): defamatory language orally uttered or printed (published) by the defendant;
# the statement made concerns the plaintiff, and not some other person or entity;
# a publication by the defendant has taken place to a third person;
# that as a result of the “publication”, injury has been caused to the reputation of the plaintiff;
# in some instances, malice need also be shown for there to be recovery.

Publication also does not mean printing it in a newspaper or magazine. It can be as simple an act as writing it in a private letter intended to be seen by only one other person, and actually seen by that person. (If seen by more than one person, it proceeds to the issue of more damages).

Certainly, it can be as simple an act as publishing on an Internet bulletin board that someone is a “crook”, or that they “stole”, or that they were somehow dishonest and performed their business tasks improperly.

Damages must always be proven, but if it comes in the form of a loss of business reputation, or wrongfully accusing a person of a crime, and the statement is false, the damage is presumed — the victim need only prove that the statement is false.

The law presumes that certain statements, whether printed or oral, automatically cause damage to the victim of the calumny. If a person is accused of a crime, they are presumed damaged if the statement is false.

So too, if their business is attacked, such as calling a physician a butcher, depicting a lawyer as a crook, or an investment banker as an incompetent bumbler is considered defamatory per se.

It hasn’t yet been fully decided whether a chat group is libel or slander, since it mimics talking, but really is writing — with “publication” coming with the carriage return that sends the line into cyberspace. This is a technical issue that will probably involve law review articles, and all sorts of scholarly debates for the foreseeable future.

But that makes little difference because except for minor technical differences, each seeks to punish defamatory conduct by allowing for substantial damages to be collected.

There is an added problem that libel and slander occur at the time of publication, and the author is not the only one liable– so is the publisher. Quaere: can the Internet service provider, CompuServe, Prodigy or American Online be held liable?

At least one trial court says that they can, Stratton Oakmont, Inc. v Prodigy Services Co., 1995 N.Y. Misc. LEXIS 229 (Sup Ct, Nassau County, May 24, 1995) and claims that it is the job of the provider to monitor the public chat rooms and use groups that print information on a first come, first served basis. For obvious reasons, the publisher isn’t taking this as a final word.

A subsequent case, Luney v Prodigy Services, 250 A.D.2d 230; 683 N.Y.S.2d 557; 1998 N.Y. App. Div. LEXIS 14047; 27 Media L. Rep. 1373 (2d Dep’t 1998) suggests that a passive carrier such as Prodigy or AOL may have no liability, but it does not excuse the actor who posted in the first place.

Hobbyists are not that unusual in speaking with frankness about their colleagues. Neither are merchants, who frequently like to tell each other if they have had a bad check passed — the better to prevent more of them, thank you.

But in reaching the conclusion that there is a duty to convey information, the courts have repeatedly held that there is also a duty of accuracy. Moreover, if the sender of the erroneous message can be found to have knowledge that it is false, regular damages may have punitive damages added on.

Scams find their way onto the wires, and the Internet, all the time. The key is to be certain that before you repeat what you hear, or before you start a rumor, be certain that it can be substantiated — and that it’s true.

Truth is an absolute defense to libel or slander. No matter how malicious, how ugly the claim, if it’s true, our system of justice says that the writer is permitted to state it as a fact, and there’s no consequence.

There are certain qualified privileges that are involved. If you’re a public figure — an elected official, for example, and perhaps the elected officer of a club if the position is public enough — even wrong things can be said about you, as long as it is without malice. If it is malicious, it is compensable.

In summary, it all goes back to what your mother said to you as a kid: if you don’t have something nice to say, don’t say it. Because if you do, you might have to pay the piper.

If you do find yourself in a situation where a claim of libel or slander is made against you, don’t panic. You may have protection that you didn’t know you had in the form of homeowner’s insurance, which protects against “advertising injury” that includes claims of defamation.

But don’t go testing out this area of coverage with much enthusiasm, because if the action taken was malicious, it is probable that coverage will simply be disclaimed.

If you find yourself in a pickle on this, consult your insurance agent, or even your local lawyer. Before you get into that jam, think twice about what you write, or what you say that you might regret at another time in the cool light of the morning.

so i suggest you remove this link and page before i proceed to take action