Protecting Your Business From Attack

CityLife Business

WGC LAWYERS

Protecting Your Business From Attack

John Hayward
: (07) 4046 1126
: jhayward@wgc.com.au

If you need any assistance contact one of our lawyers at cairns@wgc.com.au or call 07 4046 1111 for a no-obligation discussion and expert legal advice.

WGC Lawyers –
We’ve Got you Covered!

Being attacked in the public arena is never a pleasant experience. What can you do if you are attacked by a customer or members of the public who are posting negative and false reviews? What if they are making defamatory remarks online about the business, its owners or its staff?

“Defamatory material” means any material that carries an imputation of a person which is likely to injure that person’s reputation, injure them in their trade or profession, or likely to induce others to shun, avoid, ridicule or despise them.

If an online review or remark refers specifically to the owner of a business, or even an employee, then they may be able to commence legal action for defamation.

However, there are some limits to what types of businesses can bring a claim for defamation. A corporation which employs fewer than 10 persons may bring a claim for defamation, whereas larger corporations may not.

In addition, changes were recently made to the law of defamation.

There is now a requirement of a “serious harm element” before an aggrieved person can bring a claim for defamation. This means that an action in defamation will require an individual aggrieved party to prove that the publication has caused, or is likely to cause, serious harm to their reputation.

Corporations also need to prove that the publication has caused or is likely to cause the entity serious financial loss.

What is involved in bringing such a claim?
The general process to be followed in relation to legal action for defamation is as follows:

1. An aggrieved person must give a publisher of defamatory material a written “concerns notice” which informs the publisher of the defamatory imputations that the aggrieved person is concerned about in the material.
2. Under recent changes to the Act, the aggrieved party now also needs to:
a. specify the location for where the publication can be accessed (for example, on a webpage);
b. inform the publisher of the harm that the aggrieved party considers to be serious harm to their reputation;
c. if the aggrieved party is a corporation, the financial loss that the corporation considers will likely be caused resulting from the publication;
3. If the aggrieved person’s “concerns notice” is in order, the publisher may make an offer to make amends. The publisher may do so within 28 days after the date of the concerns notice.
4. Any offer to make amends may include:
a. an offer to publish an apology;
b. an offer to pay compensation for economic or non-economic loss.

An aggrieved person cannot commence an action in defamation unless they have first issued a concerns notice and the time in which to make amends has elapsed.

An aggrieved person should be aware that there is a strict 12 month time limit for bringing a claim for defamation.

If I can’t take action for defamation, are there any other options?
Yes, there is another form of legal action which a business may be able to take as an alternative to defamation. It is called “injurious falsehood”.

Injurious falsehood is similar to defamation in that it relates to the publication of statements concerning an aggrieved person or a business.

Whilst defamation tends to relate to damage caused to personal reputation, injurious falsehood is often about protecting a person’s interest in a business.

A business may be able to take action and sue for injurious falsehood when another person makes false representations about the goods and services of that business.  Those statements can occur online, in the press, or verbally.

In addition to proving that the false statements were published about the business, the business will need to prove that the statements were published with malice and that the statements have caused actual loss and damage.

In some cases, a business may also wish to take urgent action to prevent the spread of further false statements being made. It may be possible for the business to apply to the court for an injunction preventing further false statements being made until there has been a trial determining the matter in court.
What if it is actually a competitor who is making negative reviews about my business?
In some cases it may actually be a competitor who is publishing the negative reviews (or they even be encouraging or paying someone else to publish the false and negative reviews). If that is the case, then your business may be able to commence proceedings against the competitor for misleading or deceptive conduct under the Australian Consumer Law.

What usually happens when a business takes legal action to protect itself from these attacks?
Ideally, the person making the false statements stops doing so, and also removes the offending publications before any significant damage is done.

However, they might also attempt to defend themselves and maintain that the comments or the review was fair. It is not necessarily a straightforward matter to prove that someone has acted with malice. Any person who leaves a negative review does have potential defences – they might argue that their review was truthful, or that it was their honestly held opinion about a matter of public interest, that their review was trivial, or that it only reached a small audience.

What alternatives are there to taking legal action?
Google, Facebook, TripAdvisor and similar platforms have processes where an individual or a business can report defamatory or malicious posts and request that they be removed. Whilst those platforms may be able to remove such offending posts, their response time can vary and the removal may not always occur quickly enough to limit significant damage.

Finally, in extreme cases, where online attacks or trolling occurs and there are actual threats of violence against a business, its owners or its employees, then it may be necessary to refer the matter to the police.

In summary, what can a business do about a false online review?
A business is just like a person. It has a reputation that it can protect. A business may be able to take legal action in response to false statements or malicious attack from customers or members of the public where the business suffers financial loss as a result.