Brian Bowman – On the Cutting Edge

As you know, instant messaging, text messaging, blog postings, online chat forums and social networking websites (such as Facebook and MySpace) have changed the way in which people communicate.  Regrettably, however, many of these new communications tools (in particular, online forums and social networking websites) are being used to defame not only individuals, but businesses as well.  It should not be forgotten that businesses can be defamed.

In general, the defamation (written and spoken) of a business occurs when a party lowers the reputation of a business in the estimation of other members of society or an industry.  Since a business doesn’t have “feelings”, defamation cases related to businesses focus on the damage to a business’ reputation or goodwill due to the comments of another party.   The following court cases are worth checking out, both of which confirm that a business can be defamed and, as a result, is entitled to receive monetary compensation.

In Barrick Gold v. Lopehandia, the defendant was found liable for a massive online defamation campaign initiated by the defendant against the plaintiff.  The defendant had posted comments on gold and mineral investor related online forums defaming the plaintiff.  The Ontario Court of Appeal noted that Internet defamation is different than traditional written forms of defamation since online defamation, or “cyber libel”, is often taken at face value, and is capable of instantly reaching an unlimited number of persons around the globe.  The plaintiff corporation was awarded $75,000 in general damages for damage to its reputation and goodwill, $50,000 in punitive damages, and a permanent injunction to prevent further postings.

In WeGo Kayaking Ltd. et al v. Sewid, the British Columbia Supreme Court awarded $250,000 in general damages to the plaintiff corporation in relation to “review” comments posted online that incorrectly and intentionally classified the plaintiff as a “bad” tour company.

Defamation doesn’t just happen to individuals.  These cases serve as a reminder to businesses that they are capable of being defamed and, as a result, should diligently protect their online reputations.