It’s an unavoidable fact of running a business that, sooner or later, a customer will be dissatisfied. Decades ago this would have meant that they told a few of their friends, but today it can often mean a negative review on any one of a number of widely trafficked consumer review websites like Yelp.
When the inevitable happens, there are a few ways you can handle it. For example, if you want to avoid bad publicity, you can simply ignore the review or respond calmly and professionally. If you don’t mind things potentially blowing up in your face, you can respond angrily and irrationally. And, of course, if you actively want things to go south in a great big hurry, you can do what a watch repair shop in New York did and threaten to sue the person leaving the unflattering review for defamation.
Lawsuits are seldom the best solution to a civil problem, but suing for defamation over a bad review is an especially poor choice. From a legal standpoint a bad review is almost never sufficient to rise to the level of a viable defamation claim, a fact that Yelp itself notes on it’s support page in answer to the hypothetical question, “I’m considering legal action — what are my rights?” Yelp correctly notes that “there may be rare cases where it’s appropriate to take legal action,” but the bulk of the answer is spent pointing out that defamation cases are 1) rarely winnable, 2) often expensive for the plaintiff, and 3) almost always a public relations disaster. This last point alone is generally sufficient reason to avoid instigating a lawsuit against a customer over a bad review; even in the rare case where the business is legally in the right for bringing the suit, public perception can often be sufficient reason for the business to let the matter pass unlitigated.
Even limiting consideration to reasons existing solely within the legal system, the balance of factors still argues against bringing these sorts of suits in almost all cases. To explain why, let’s look first at the elements of a defamation claim.
- First, the defendant must have made a statement of fact. This is different from an opinion and the distinction is determined by the overall context of the statement and not merely by the it’s syntax. The classic example is a dissatisfied customer calling a business owner a “thief” during the customer’s rant. Even if the ranting customer flatly states, “the owner is a thief,” such statements are generally considered by the courts to be statements of opinion protected by the first amendment. Note, however, that an accountant who, after examining the company’s books, made the same statement would probably not be considered to be uttering a protected opinion as the overall set of circumstances would make a casual listener assume the accountant’s statement was based on facts.
- Second, the statement must be published to a third person. In practice, this is usually met, but it’s good to keep in mind that it is not possible to defame someone if there are no third parties involved in the discussion; simply calling the business owner a thief when it’s just the two of you in the store can never be defamation.
- Third, the statement must be false. This seems obvious, and generally is, but it bears stating nonetheless. In cases where the plaintiff is a private individual, it is enough to show simply that the statement is false. However, if the plaintiff is a public figure, he or she will have to prove actual malice and that the defendant had either knowledge that the statement was false or had a reckless disregard for the truth. There is also an in-between category where the plaintiff is a private individual, but the defendant’s statement(s) is/are about a matter of public concern (as, for example, reviews of a business generally are). In this case, the plaintiff must show that the defendant was negligent in making the statement and that the plaintiff suffered actual damages.
- Fourth, the statement must be about the plaintiff. Again, this is generally obvious.
- Fifth, and finally, the statement must have negatively affected the plaintiff’s reputation. This follows the general tort principle of no harm, no actionable tort. Although there are some areas where statements are presumed to have a negative effect even if the plaintiff cannot document such an effect, this is not available to plaintiffs when the defendant’s comments are on matters of public concern.
Attempts to sue for defamation based on customer reviews almost always fail at either the first or third elements. To begin with, courts tend to classify statements in online reviews as protected statements of opinion. Even in cases like the watch repair review, where the statements at issue are likely to be the reviewer’s statements about the time it took to receive a reply and the repair shop’s comments about the unavailability of parts and, therefore, are reasonable candidates for being considered statements of fact, the claim is still apt to fail at the third element. As the conduct of a business held open to the public is inherently a matter of public concern, the watch repair shop would need to show that the reviewer was negligent in his statements, not merely technically false or misleading. This seems to me to be an insurmountable hurdle given that negligence requires a failure to act as a reasonably prudent individual would do. I have substantial difficulty imagining that a “reasonably prudent person” would phone a business for clarification (“Did you say that the part wasn’t available anywhere or only that you couldn’t get it?”) before writing a review that, in absolute terms, is merely tepid and quite far from scathing.
So, if defamation lawsuits generally don’t hold up in court (assuming the defendant bothers to defend the case and the plaintiff can’t simply sit back and cruise to a default judgment), why bother with them at all? The unfortunate fact is that, for much of this country’s history, the mere threat of such lawsuits was very often sufficient to convince a defendant to take down his or her review. Before the internet, when individuals who were threatened with such suits could neither easily discover the emptiness of the threats nor easily publicize the threats, businesses were largely able to avoid any negative consequences associated with making these sorts of take-down demands regarding bad reviews. Today, however, pursuing legal action against customers who publish bad reviews is most often a path to ridicule and even worse publicity than than the review the business is attempting to stifle. In these sorts of cases business isn’t all that different from personal life; it’s usually best to just let it go and move on.