Libel: Legal Ramifications and Defences

When you run a business, you need to focus on issues beyond making a profit and being productive. Importantly, you should be aware of defamation law concerning what you, as a business, say about others, including other companies. This is especially relevant to you if you use media such as social media to discuss competitors, as you may end up accidentally publishing libel. This is unlawful and may lead to a legal claim against you. 

This article will explain libel and its legal ramifications, as well as defences you can employ in case of legal proceedings. 

What is Libel? 

Libel is a form of defamation. Here, defamation is where a statement is published to one or more third parties about a person or a business, and it:

• causes severe harm to the person or business reputation; or
• is likely to cause such harm.

Libel is a permanent type of defamation. Therefore, it must be in some kind of lasting form. This is usually a written statement but can also include televised or radio-broadcasted statements. 

What Are the Legal Ramifications of Libel?

If you are accused of committing libel, this has legal ramifications. Ramifications, in this case, refer to the legal results of the libel, which may be complex and negatively impact you. 

Firstly, the other party, also called the claimant, can try to sue you (the defendant) in court. This is when the alleged statement may have or could likely cause severe financial loss. For example, you may have made a social media post about a competitor, which discouraged customers from purchasing from them. Crucially, you do not need to have been the author of the statement to be sued. You may be open to legal action if you were the: 

• editor;
• publisher; or 
• distributor.

A further legal ramification for libel is that suing can result in your business paying compensation to the claimant. The compensation you may have to pay depends on the harm your statement causes. If you are found to have published defamatory material, you will likely have to pay a substantial portion of the claimant’s legal costs. 

Furthermore, you may receive an injunction, which is an order to refrain from doing a certain action. Here, this is likely an order by a court not to publish the defamatory statement any further.

What Are the Defences Against a Claim of Libel?

If your business is accused of libel, knowing the defences to such a claim is essential. We outline five possible defences in more detail below. 

1. Truth

If the claimant attempts to make a claim for a statement that is true, you can use this truth as a defence. Not all the content of the statement needs to be true, but the essential part of it should be. In other words, if there are parts of the statement that are untrue but cause the claimant no damage to their situation, this defence may still stand.

2. Honest Opinion

Where your statement is a genuine, honest opinion, it can act as a defence against a libel claim. However, you must show:

• the basis of the opinion; and
• that any honest person, based on present facts when the statement was published, could also hold this opinion. 

3. Public Interest

If the court deems your statement to be in the public interest, you may have a defence available. However, you must also prove that you reasonably believed the statement was in the public interest. As such, if you had no concern about the greater community when making the statement, this defence is unlikely to be open to you.  

4. Reportage

Reportage is where a neutral account is given of a dispute and thus is not defamatory. This will usually apply to the work of a journalist reporting about, for example, your business or another company. You do not need to check if the account is valid when relying on the reportage defence. 

5. Privilege

Another defence to libel is where a statement is privileged. This is where it benefits society, and the defence should, therefore, not have the fear of being accused of libel. Privilege-based defences to libel include:

• Absolute privilege:  Here, the circumstances protect you from legal action for any statement made, such as a parliamentary proceeding.
• Qualified privilege: You may use qualified privilege when there is a specific type of social interest in making the statement, such as a public inquiry.
• common-law qualified privilege: This arises when the relationship between you and the other party requires shared duties or interests, like with an employer writing an employee reference.

It is also sometimes possible to use a defence for libel when writing peer-reviewed statements in scientific or academic journals. 

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Key Takeaways

It is possible that you, as a business owner, could be accused of libel when making statements about your competitors. Libel is where material about a business is permanently published, causing the subject matter severe harm or would be likely to do so. This may cause you significantly negative legal consequences, including facing court proceedings, paying compensation or being subject to an injunction. As such, it is essential you know some defences you may employ, including arguing the statement was:

• truthful;
• your honest opinion;
• in the public interest;
• under the reportage defence; and
• privileged. 

If you have any further questions about court involvement in arbitration proceedings, LegalVision’s experienced disputes lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.