Internet Defamation Law Blog

When Is Substantial Truth an Adequate Defense to Defamation?

In a 1964 decision, the Supreme Court established that truth is an absolute defense against defamation. New York Times Co. v. Sullivan, 376 U.S. 254 (1964). However, for parties involved in defamation suits, it is similarly important to know about the affirmative defense of substantial truth.

In a recent case, a Texas Court of Appeals found in favor of defendants who had posted a critical review of the plaintiff’s product online. David Rafes, Inc. v. Huml, 2009 Tex. App. (1st Dist. Oct. 29, 2009). In the suit, David Rafes alleged that Michael Huml and Slowboy Racing, Inc. published defamatory statements about Rafes’ business, Turbochargers.com. The allegedly defamatory statements included Huml claiming that Rafe’s turbocharger was a “poorly manufactured turbo from China” that would “inevitably fail in a short amount of time” and that it was a “Chinese version us[ing] an inferior stainless in its composition.” Id. at 2. Among several defenses asserted by the defendants was that their statements were substantially true.

In order to bring a cause of action for defamation, a plaintiff must establish that the defendant:

1. published a statement about the plaintiff
2. that was defamatory
3. while acting with either actual intent or reckless disregard, i.e. malice (if the plaintiff was a public  official or public figure) or negligence (if the plaintiff was a private individual) regarding the truth of the statement

Id. at 13.

Generally, a defendant can defeat a libel claim by establishing that the published statement on which the action for libel is based is a true statement. Additionally, a defendant can defeat a libel claim by establishing that the statement at issue is substantially true. The Court explained that in order “[t]o determine if a publication is substantially true, we consider

1. whether the alleged defamatory statement was more damaging to plaintiff’s reputation, in the mind of the average person,
2. than a truthful statement would have been, and
3. [w]e look at the ‘gist’ of the publication to determine whether it is substantially true.”

Id. at 14.

The substantial truth standard has also been referred to as the “gist” test because, under this approach, only the “gist” of the statement in question must be true in order for the statement to be protected. As the Court explained, “[t]he defense of truth does not require proof that the alleged defamatory statement is literally true in every detail; substantial truth is sufficient.” Id. This doctrine protects certain false statements so long as any inaccuracies do not materially alter the dissemination of otherwise truthful speech.

The Huml Court decided in favor of the defendants, finding that the trial court had heard sufficient evidence to conclude that the plaintiff’s turbocharger was, as it concluded, a “bad product” and that the evidence “substantiat[ed] the ‘gist’ of the statements contained in the internet article regarding the production and manufacturing of the turbocharger.” Id.

The substantial truth defense is significant in that it provides defendants with a less stringent – and potentially less expensive – way to combat a libel suit. If a defendant can show that the statement at issue is substantially true, it will hopefully be possible under the right circumstances for the defendant to have a motion for summary judgment granted (which will allow the case to be disposed of without going to trial). The doctrine is also important for libel plaintiffs because it notifies them that statements that criticize them need not be entirely true in order to be protected.

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What is the current legal status of Europe’s “right to be forgotten” doctrine as it relates to Internet Defamation?

A Spanish court recently asked Internet-search provider Google to remove data about a private individual from its index.  Spain and other members of the European Union made this request under a doctrine that is commonly referred to in Europe as “the right to be forgotten.”

In 1991, a Spanish newspaper published a critical profile of Spanish plastic surgeon, Dr. Hugo Guidotti Russo.  The article referenced a dispute Dr. Russo had with a patient, but failed to mention how meritorious the claims were or how the dispute was ultimately resolved.  According to Dr. Russo’s attorney, the lawsuit was dropped once Dr. Russo was cleared, but no media covered that aspect of the case so it never appeared on the Internet.  Dr. Russo is still a practicing plastic surgeon in Spain and when potential patients use Google to search for him, the critical article regularly appears on page one of the search results.  Dr. Russo believed that the article was harming his ability to attract patients and, with the support of a Spanish court and the Spanish Data Protection Authority (“SDPA”), asked Google to remove the article from its index.

Google refused to remove the article claiming that the Spanish regulators exceeded their authority and that their directive was equivalent to censorship.  The important issue raised was how much control private individuals should have over the information about them that appears on the Internet.  Currently, there is a groundswell of support in Europe for the “right to be forgotten” movement such that it may be codified as law.  The SDPA has previously ruled that freedom-of-expression laws in Spain protect only newspapers and other publications and do not protect search engines.

Other examples of private individuals seeking to “be forgotten” in Spain include:

A high school principal whose citation for urinating in public was published by an official regional government gazette and may still be seen by students and parents alike via a Google search. 

A prison guard concerned that a job-related sanction that appeared in Google search results might lead criminals to determine where he works.  Spanish police and prison guards are often granted anonymity due to fears that they might be identified, located, and targeted by the armed Basque separatist group ETA. 

An individual accused of homicide forty years prior but acquitted due to mental illness.  A Google search performed forty years later reveals news of the accusation, but no news of his acquittal or the mental illness that justified the acquittal.

Google’s response is that Spain should require the publications that make the material available via the Internet to embed coding that would tell search engines not to index the information.  Privacy experts agree that requiring Google to remove information from its index could have a profound chilling effect on free expression.  Advocates of the “right to be forgotten” rules counter that users of the Internet should have a right to be forgotten when the data is no longer needed or when an affected individual requests that the data be removed.  The legislation being considered by the European Union would focus mainly on data, photos and, videos that individuals post of themselves on sites such as Facebook and Twitter, that the individuals may later want removed.

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May statements made in the course of an ongoing fraud investigation be defamatory?

On April 7, 2011, the First Department of New York’s Appellate Division upheld a trial court’s dismissal of a lawsuit for defamation.  Akpinar v. Moran, 2011 WL 1311902 (1^st Dept. 2011).  The plaintiff, Reverend Dr. Bill Akpinar, sued attorney William Moran; Moran’s law firm; and the firm’s client, Wachovia Mortgage, FSB (“Wachovia”) for defamation.  Akpinar alleged that Moran defamed him in a newspaper article about a pending criminal investigation into a mortgage fraud and a lawsuit brought against Akpinar by Wachovia alleging mortgage fraud.

When referring to Akpinar, Moran told the newspaper, “I’m looking forward to getting him under oath” and “I want to get to the bottom of many questions myself.”  Id.  Akpinar argued that when considered in the context under which the statements were made, they amounted to defamation.  Akpinar claimed “that he lost $17 million in venture funding from unspecified individuals who read the [defamatory] statements.”  Id. 

The Appellate Division dismissed Akpinar’s complaint, holding that “a reasonable reader would understand the statements defendant made about plaintiff as mere allegations to be investigated rather than as facts.”  Id.  (Emphasis in original).  The court reasoned that “the statements neither impute to him the commission of a serious crime nor tend to injure him in his trade, occupation or profession, and therefore do not constitute slander per se.”  Id.  Neither Akpinar’s reference to the pending criminal investigation nor the civil lawsuit were sufficient to establish a claim for “defamation by innuendo” – whether the statements are defamatory requires a balancing between the alleged defamatory words and the facts and circumstances that surround their publication.

The court also found Akpinar’s allegation that he lost “$17 million in venture funding from unspecified individuals” inadequate to plead special damages as required in a defamation action.  Id.  Finally, the court noted that Moran’s statements were protected under Civil Rights Law §74 as a “fair and true report of a judicial proceeding.”  Id.  The court similarly dismissed Akpinar’s claim for intentional infliction of emotional distress as duplicative of his defamation claim and on the ground that Moran’s statements were “not so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency.”  Id.  Thus, the court upheld the decision of the trial court dismissing Akpinar’s lawsuit in its entirety.

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What is the standard for a private person to sue a public official for defamation?

The Second Circuit of the United States Court of Appeals recently dismissed a defamation lawsuit brought by a private citizen against the mayor of Yonkers, New York.  Zherka v. Amicone, 2011 WL 710462 (2d Cir. 2011).

Selim Zherka, a citizen of Westchester County, New York, publishes the Westchester Guardian, a weekly local newspaper.  In 2007, the Guardian was highly critical of Philip Amicone, the Mayor of Yonkers, accusing him and his administration of corruption, fiscal mismanagement and police brutality.  Zherka claimed in his lawsuit that Amicone retaliated against him for making those accusations by publicly defaming him at a campaign event.  According to Zherka, Amicone called him a “convicted drug dealer,” an “Albanian monster” and a “thug.”  Amicone also said that Zherka would open “drug dens” and “strip clubs” throughout Yonkers and “loot” the “pension funds” of Yonkers’s residents if Amicone was not re-elected Mayor of Yonkers.

Zherka sued Amicone in the United States District Court for the Southern District of New York for violation of his First Amendment rights and per se defamation under New York common law.  Amicone admitted being present at the campaign event, but denied making any of the statements.  Amicone moved to dismiss Zherka’s lawsuit for failure to state a claim upon which relief could be granted.  The District Court granted Amicone’s motion and dismissed Zherka’s First Amendment claim with prejudice and dismissed his defamation claim under New York common law without prejudice.  Zherka appealed that decision to the Court of Appeals.

The Court of Appeals affirmed the District Court’s ruling and upheld the dismissal of Zherka’s First Amendment claim and his common law defamation claim.  The Court reasoned that Zherka could not establish that Amicone’s retaliatory comments “chilled” his speech in any way – that is, that they caused Zherka to refrain from speaking – which is required to establish a First Amendment violation under 42 U.S.C.A. §1983.  Id. at *2. 

Zherka argued that the injury presumed as a result of his claim of per se defamation under New York common law was sufficient to establish an injury under §1983.  The Court disagreed, reasoning that Zherka’s alleged injury under New York common law was insufficient to serve as a substitute for the actual “chilling” of speech.  In fact, the Court found that Amicone’s comments seemed to influence Zherka to speak, rather than chill his speech.  For example, following Amicone’s comments Zherka published articles critical of Amicone with headlines such as “Mayor Amicone Stumbles Over the First Amendment,” “Dumb, Dumber and Dumbest,” and “Scrooge Amicone-Rapes Taxpayers; Rewards Cronies.”  Id. at *2. 

Thus, the Court held that Zherka could not establish an injury sufficient to prove a violation of §1983.  In conclusion, the Court stated:

Retaliatory insults or accusations may wound one’s soul, but by themselves they fail to cross the threshold of measurable harm required to move government response to public complaint from the forum of free speech into federal court.

The arena of political discourse can at time be rough and tough.  Public officials must expect that their decisions will be subjected to withering scrutiny from the populace.  A public official’s response to that criticism is subject to limits, but the injury inflicted by that response must be real.  Without that limitation, the Constitution would change from the guarantor of free speech to the silencer of public debate.

Id. at *3.

Download Zherka v. Amicone, 2011 WL 710462 (2d Cir. 2011)

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Can a lawyer speaking for a client sue when a newspaper misquotes what she says?

Recently, an appellate court in Texas refused to deem a lawyer representing a native American tribe a “public figure” for purposes of a libel lawsuit.  A newspaper article covering an increasingly public controversy within the Kickapoo Indian Tribe stated that the tribe’s lawyer, Gloria Hernandez, was “skimming 10% of casino profits off the top.”  In fact, what she had said was that “she was hired to be legal counsel for the tribe in October 2002, and was on retainer at the time of the hearing.  In response to a question about how much of her legal practice is devoted to work for the tribe, Hernandez testified, ‘I make roughly about ten percent of my income from the tribe.’” ZYZY Corp. v. Hernandez, No. 04-10-00311-CV, 2011 WL 228101 at *1 (Tex.App.-San Antonio 2011)

Hernandez sued the newspaper for libel.  The newspaper argued that Hernandez had injected herself into the public controversy in an attempt to influence its outcome.  As a result, the newspaper argued, Hernandez was a “limited-purpose public figure” and could only prove libel by showing the newspaper acted with actual malice.  The trial court disagreed with the newspaper and denied its motion for summary judgment.

The appellate court agreed with the trial court and upheld its decision.  The appellate court held that Hernandez’s actions, which included accompanying the tribe to meet with elected officials to discuss the controversy, did not render her a public figure.  Instead, the evidence showed that Hernandez provided legal advice and representation to the tribe.  There was no evidence she became involved in the controversy beyond her role as legal advocate.  There was also no evidence that she thrust herself into the public eye by engaging the media, had any special access to the media or attempted to use the media to influence the outcome of the controversy in any way.  As a result, Hernandez was not a “limited-purpose public figure” under the law and did not have to show that the newspaper acted with actual malice to prove libel.  Download ZYZY Corp. v. Hernandez, No. 04-10-00311-CV, 2011 WL 228101 (Tex.App.-San Antonio 2011)

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Does a person have to show that his reputation was harmed to bring a lawsuit for per se online libel or slander?

The NJ Supreme Court is currently considering an appeal that may determine once and for all whether a person can proceed with an online per se libel suit even though there is no evidence that his reputation has been actually harmed.

In W.J.A. v. D.A., 416 N.J. Super. 380 (App. Div. 2010), the nephew created a website in which he posted allegations that his uncle had molested him years ago. The uncle then sued his nephew for defamation.

Defamation is when the defendant communicates to another person a false statement about the plaintiff that harms the plaintiff’s reputation in the eyes of the community or causes others to avoid him. There are two types of defamation, libel which is when the false statement is written or printed and slander which is when the false statement is spoken.

New Jersey law provides that someone suing for defamation must show actual damages. However, there is an exception to that requirement in which damages will be presumed. It is called “per se” slander or libel. The usual examples are set out in the standard New Jersey jury charges:

• The statement charges someone with the commission of a crime. 
• The statement accuses someone of having an offensive or loathsome disease that would tend to deprive the person of companionship. 
• The statement concerns matters that are incompatible with business, trade, profession or office.
• The statement charges serious sexual misconduct.

In this case, the Appellate Division of the Superior Court of New Jersey determined that per se defamation is not limited to the spoken word (slander), but also applies to the written word (libel). The Court reasoned that:

“[F]or purposes of summary judgment, no one disputed that the defamatory statements attributed to defendant were defamatory. Thus, dismissal of the action at that stage-merely because plaintiff presented no proof of actual damage - provides defendant with a license to defame. If there has been a wrong, there should be a remedy, and the time-honored approach of allowing such a case to be decided by a jury, which may then assess a proper amount of damages based upon their experience and common sense, does not offend us.”

W.J.A. v. D.A., 416 N.J. Super. At 606-607 (App. Div. 2010)

The opinion is also notable because it clarifies that a defamatory Internet posting is libel, not slander.

This case is now on appeal to the NJ Supreme Court, which should issue its ruling sometime this term.

Download W.J.A. v D.A., 416 N.J. Super. 380 (App. Div. 2010)

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An Internet Service Provider is Generally Protected from Liability for Defamation by the Federal Communications Decency Act

On September 2, 2010, the Supreme Court of New York, New York County decided a case in which it determined a defamation claim regarding negative remarks about the plaintiff’s dental practice posted by a third-party on defendant’s web page.  The court in Reit v. YELP!, Inc., et al. --N.Y.S.2d---, 2010 WL 3490167 (N.Y.Sup.), held that the Federal Communication Decency Act of 1996 (“CDA”) protected Yelp from liability for defamation.  The Court analyzed plaintiff’s defamation claim pursuant to the CDA and stated:   

Section 230 of the CDA provides that “[n]o provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider,” (CDA § 230[c][1] ), and that “[n]o cause of action may be brought and no liability may be imposed under any State or local law that is inconsistent with this section” (Id., § 230[e][3] ).  “Interactive computer service” is defined as “any information service, system or access software provider that provides or enables computer access by multiple users to a computer server ...” (CDA § 230[f][2] ).  An “information content provider” is “any person or entity that is responsible, in whole or in part, for the creation or development of information provided through the internet or any other information computer service” (CDA § 230[f][3] ).

Id. at 1.

Through the CDA, Congress granted interactive computer services immunity from liability for publishing false or defamatory material so long as the information was provided by another party.  Similarly, lawsuits seeking to hold a service provider liable for its exercise of a publisher's traditional editorial functions-such as deciding whether to publish, withdraw, postpone or alter content-are barred.  However, an internet computer service is liable for its own speech, or when it develops information.

Id. at 2.

The Court held that the plaintiff’s defamation claim was barred by the CDA because defendant was an interactive computer service as defined under the CDA and was not considered an internet content provider.  The allegedly defamatory content was supplied by a third party information content provider and consisted of a message board posting.  Id.  Thus, the Court granted defendant’s motion to dismiss plaintiff’s complaint.       

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Court Orders That the Identities of Anonymous Internet Posters be Disclosed

Under certain circumstances, people who defame others anonymously on the Internet may lose their anonymity.   A recent example is a  case decided on July 12, 2010,  In re: Anonymous Online Speakers, Anonymous Online Speakers, v. United States District Court for the District of Nevada Reno, 611 F.3d 653, 10 Cal. Daily Op. Serv. 8774, 2010 Daily Journal D.A.R. 10,795 (Ninth Cir. 2010). That matter involved Quixtar, a “[m]ultilevel marketing business [that]  brought suit alleging that [a] competitor [TEAM] orchestrated [an] Internet smear campaign via anonymous postings and videos disparaging it and its business practices. As part of discovery process, the [lower Court] , ordered [the] competitor's online content manager to disclose identity of three of five online speakers who allegedly made the defamatory comments.” Id.

 

Examples of the alleged defamatory statements included the following:  “Quixtar has regularly, but secretly, acknowledged that its products are overpriced and not sellable”; “Quixtar refused to pay bonuses to IBOs in good standing”; Quixtar “terminated IBOs without due process”; “Quixtar currently suffers from systemic dishonesty”; and “Quixtar is aware of, approves, promotes, and facilitates the systematic noncompliance with the FTC's Amway rules.”  Id. at 656.

 

The Court acknowledged that First Amendment protections involving anonymous speech apply to the Internet, as well. “ First Amendment protection for anonymous speech was first articulated a half-century ago in the context of political speech, Talley v. California, 362 U.S. 60, 64-65, 80 S.Ct. 536, 4 L.Ed.2d 559 (1960), but as the Supreme Court later observed, the Talley decision hearkened back to “a respected tradition of anonymity in the advocacy of political causes.” McIntyre v. Ohio Elections Comm'n, 514 U.S. 334, 343, 115 S.Ct. 1511, 131 L.Ed.2d 426 (1995). Undoubtedly the most famous pieces of anonymous American political advocacy are The Federalist Papers, penned by James Madison, Alexander Hamilton, and John Jay, but published under the pseudonym “Publius.” Id. at 344 n. 6, 115 S.Ct. 1511. Their opponents, the Anti-Federalists, also published anonymously, cloaking their real identities with pseudonyms such as “Brutus,” “Centinel,” and “The Federal Farmer.” Id... Although the Internet is the latest platform for anonymous speech, online speech stands on the same footing as other speech-there is “no basis for qualifying the level of First Amendment scrutiny that should be applied” to online speech. Reno v. Am. Civil Liberties Union, 521 U.S. 844, 870, 117 S.Ct. 2329, 138 L.Ed.2d 874 (1997). As with other forms of expression, the ability to speak anonymously on the Internet promotes the robust exchange of ideas and allows individuals to express themselves freely without “fear of economic or official retaliation ... [or] concern about social ostracism.” McIntyre, 514 U.S. at 341-42, 115 S.Ct. 1511.” Id. at 656-7.

 

    The Court also acknowledged that just because this was commercial speech, not political speech, that did not mean it lacked First Amendment protection. “The Internet postings and video at issue in the petition and cross-petition are best described as types of ‘expression related solely to the economic interests of the speaker and its audience’ and are thus properly categorized as commercial speech. Central Hudson Gas & Elec. Corp., 447 U.S. at 561, 100 S.Ct. 2343. The claimed disparagement goes to the heart of Quixtar's commercial practices and its business operations. However, this characterization alone does not determine the First Amendment protections for the anonymous commercial speech central to this case. The Supreme Court has underscored that “an author's decision to remain anonymous, like other decisions concerning omissions or additions to the content of a publication, is an aspect of the freedom of *658 speech protected by the First Amendment.” McIntyre, 514 U.S. at 342, 115 S.Ct. 1511.” Id. at 657.

 

 The Court concluded that “[t]he district court here appropriately considered the important value of anonymous speech balanced against a party's need for relevant discovery in a civil action. It also recognized the “great potential for irresponsible, malicious, and harmful communication” and that particularly in the age of the Internet, the “speed and power of internet technology makes it difficult for the truth to ‘catch up’ to the lie.” Id. at 661

 

Accordingly, the Court of Appeals held  that because the lower Court’s ruling was not clearly erroneous, they would not disturb it on appeal.

A Professional Negligence Policy Will Not Necessarily Cover A Related Defamation Claim Against the Insured.

    On June 15, 2010, a Federal Court in Pennsylvania considered whether an insurance policy for professional negligence will cover a related claim for defamation. In Post v. St. Paul Travelers Ins. Co., __F.Supp.2d__, 2010 WL 2490750 (E.D.Pa.), the Court held it would not.

    In that matter, the insurance company that issued the professional negligence policy, St. Paul, argued that there was no basis for awarding attorneys' fees for legal work performed in defending a defamation action against the insured. While it admitted that the claim against its insured for professional negligence was covered, the claim for defamation was not because “the general rule is that related matters pled in the same action are generally covered, while matters that are separate from the original action are not covered.”

    The Court agreed, holding that one has to show that the two lawsuits were “inextricably intertwined” which “is a higher standard to meet. To meet the standard, the two actions should be so related that it is difficult to separate the work completed for each, or to argue that the work done on the collateral litigation was not necessary to the defense of the litigation as a whole. …” The defamation action “was too separate and distinct to be considered inextricably intertwined with” the professional negligence action.

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Consumer Reviews: A Form of Permitted Defamation?

Commentary: We regularly receive inquiries relating to postings on consumer review websites. The usual issue concerns the fact that the business owner feels that the customer’s posting is defamatory and should be removed. In such a case, there are a number of things that the “victim” business needs to keep in mind.

First, for most of these websites, the publication of customer reviews, whether positive or negative, is the nature of their business. If they were to remove negative reviews, their credibility would arguably be hurt and the website’s viability as a business model might be diminished. These sites generally need to allow the posting of negative reviews in order to survive. Accordingly, injured parties are likely to face resistance when requesting that a host website remove such content. In order to have a posting removed, additional legal action may need to be taken; more often than not, a mere demand letter will not do the trick. It is also important to keep in mind that the websites may not have incentive to cooperate with the complaining business under the law. The Communications Decency Act states that a website will generally not be liable for its posters’ speech.

The next question is what right does a business owner have to seek damages against a customer who has posted a negative review. All of the rights and remedies that may be available will vary based upon the specific information relayed in the posting and the unique context facing the victim and the speaker. This is yet another reason that it is important to seek legal counsel to evaluate a specific claim. However, for purposes of this discussion, our analysis will focus on the potential defamation claim.

It is critical that businesses understand that simply because information is negative, and even injurious, that statement may not be defamatory. The posting itself would not be a “permitted form of defamation” since if it is found to be defamatory, it would not be permitted. The question is really whether or not the statement is defamatory. Defamation law is almost always analyzed in accordance with First Amendment law. Just as a business or person has protections under the law from being defamed, so too does the speaker have a First Amendment right to speak about his experiences.

The balance therefore comes from an analysis of the speech itself. Again, the negative nature of the statement is not itself conclusive. Rather, for a defamation claim to exist, the speech must not only be damaging, but it also must be false. Thus, if the customer reports a bad encounter, but he is truthful in his recitation of the history, there is likely no claim for defamation. Similarly, opinions are protected. If a customer simply indicates that he does not like the business owner or did not like the business’s products or services, that is arguably an opinion and therefore, is not a statement that is capable of being false. It therefore cannot be defamatory. The customer has a First Amendment right to share his opinions and experiences.

Defamation law seeks to protect those who are injured by lies. If a posting is made by someone who has never been a customer of a business or by someone who falsifies facts about the business or its products and services, a viable claim for defamation may exist. Of course, the claim would rest upon the extent of the resulting money damages that could be proven.

There is a complex analysis of all statements and underlying facts to determine whether or not a claim for defamation can be made based upon a customer’s online review of a business’s products and services. It is therefore critical that all potential plaintiffs immediately consult with counsel to evaluate the statements and to review the applicable remedies that may be available.

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