What to do if your business is the victim of a gripe site (part 2 of 3)

When some criticizes your products or services unfairly it’s only natural to want to defend yourself.  And if the negative commentary is, in your view, a vicious untruth that can damage your business reputation and hurt sales, the urge to block what you perceive to be lies gets kicked into overdrive.   Before you know it, words like libel, slander and defamation get thrown around and you’re headed for the nearest lawyer.

But before you slam the car door shut and head off, you might be interested to know what happened in a case called Intellect Art Multimedia Inc. v. Milewski out of New York. 

The problem started when the defendant attended some college level summer courses offered by Intellect Art under the moniker of “Swiss Finance Academy.” According to Intellect Art the defendant was failed to pay the full tuition and behaved rudely to staff and disruptively in class.  As a result, the defendant was kicked out of the program.

Shortly thereafter the defendant posted highly unflattering comments about their Swiss Finance Academy experience on a website called ripoffreport.com.  In case you’re not familiar with that site, it boasts that filing a Ripoff Report is akin to having your own website.  “And, it’s FREE.”  It must also have some interesting SEO capabilities because they say “your Ripoff Report will be discovered by millions of consumers” and that “search engines will automatically discover most reports, meaning that within just a few days or weeks, your report may be found on search engines when consumers search, using keywords relating to your Ripoff Report.” 

It sounds like every business’s worst nightmare.  And that’s not the half of it.

The defendant’s Ripoff Report ripped Intellect Art, accusing the company of baiting & switching, challenging the quality of their course content, their competence, and the scope of the services provided (i.e. “all we got for breakfast was toast”).  I don’t want to dignify the other comments by repeating them here.  As a result of all the vindictive, Intellect Art says their course enrollment dropped by 70%.

OK, looks like there are some damages.  But will Intellect Art be able to collect?

First, let’s identify the legal standard the court used to determine whether the content of the defendant’s Ripoff Report was defamatory.  Defamation, the court explained, occurs when one’s reputation is injured by written expressions (libel) or verbal expressions (slander).  Proving defamation requires (1) a false and injurious statement of fact regarding the plaintiff that was (2) published to a third party, and (3) that caused injury to the plaintiff.  You need all three of these elements to hit a home run on defamation.  Injury alone is not enough.

We all know that truth is a defense to defamation, but the court added that alternatively it would be a defense if a reasonable person could conclude that the statements being complained of were nothing more than a personal opinion.  In other words, the statements weren’t being offered as statements of fact, they were opinion and didn’t need to be true.  Furthermore, when it comes to statements purporting to warn consumers about goods or services, courts have been reluctant to step in.

So what happened to Intellect Art?  Were they able to prevail in the suit against the author of harsh criticism?  The answer is no.

The court dismissed the defamation claim, holding that the “challenged speech [was] merely an alleged statement of personal opinion about the quality of services provided by plaintiff.”  It also said the Ripoff Report statements were “ambiguous” and the “loose, figurative or hyperbolic “ comments were not actionable even if they were unflattering of the plaintiff.  But the cap stone to the court’s reasoning was the fact that the comments communicated in the context of the website were clearly those of a disgruntled customer, they were obviously subjective expressions of consumer satisfaction.  Basically, the court said, consider the source.

So, if suing for defamation is a huge up-hill battle, what can a business do to protect itself?  More on that tomorrow in the third and final installment of the “Gripe Series.”