Reputation management for businesses in the era of social media

Recent news reports of alleged misconduct by professional contestants in the BBC’s ‘Strictly Come Dancing’ and an allegation of cruelty towards a horse by equestrian, Charlotte Dujardin, call to mind once again the knotty legal subject of reputation management.

For businesses, allegations can be very damaging to reputation and goodwill, especially when posted on social media. When facing such harm, what can be done?

How bad is the allegation?

If the matter might burn itself out quickly without lasting harm, there is a risk of making things worse by taking action. Litigating may result in the public airing of ‘dirty laundry’ before the courts not otherwise revealed by the initial allegation. Be wary of the ‘Streisand effect’, whereby complaining about something might draw more public attention to it, causing more trouble than simply doing nothing. Instead, putting out positive messages about one’s business might drown out the negative.

Sometimes, of course, an allegation is simply too harmful. If this is the case, there are some points to consider.

Defamation

Defamation is where an untrue statement is made by a person about another to a third party where serious harm to reputation may result. A statement may be in a recorded form (such as in writing, whether online or on paper), constituting libel; or may be made orally, constituting slander.

Slander is often difficult to prove as the comment is unrecorded. Total reliance has to be made on witnesses, and actual loss (‘special damage’) usually has to be shown.

Libel is more straightforward, but not free of pitfalls. The claimant must indicate the defamatory meaning to be inferred from the published statement. The court then decides what any defamatory meaning is. It is then for the defendant to prove that what was said is substantially true.

Unlike the position for a non-trading person, a business must show actual, or likely, serious financial loss when proving serious harm to its reputation. For a larger business, that may be difficult.

Even if what is said is untrue, success in court is not guaranteed: if the statement was made over a year ago, then a claim is time-barred and republication does not reset the clock. The defendant may have expressed an opinion which a reasonable person may also have held in their position; provided the defendant genuinely held that opinion themself, there could be a defence. There may have been a strongly arguable public interest in making the statement. Though untrue, the public may not have taken the allegation seriously, thereby not sufficiently harming the defamed party’s reputation.

Breach of confidence

An injunction is usually unavailable to prevent threatened defamation not yet published. However, where the reputationally harmful statement relies on confidential information, the threatened publication may lead to an anticipated breach of confidence for which an injunction may be granted.

Malicious falsehood

Where a false statement is made deliberately or recklessly, a claim for malicious falsehood may arise. Unlike defamation, there is no need to prove harm to the claimant’s reputation. Instead, the claimant has to show that they have suffered actual loss as a result of an untrue statement made maliciously. Where the statement is made in a permanent form or concerns a profession, trade or calling, then anticipated rather than actual loss may be sufficient.

Wrongful interference

In certain circumstances, the defendant’s making a false statement with a view to inducing a third party to breach a contract or to interfering in a business relationship with the claimant might give rise to a legal claim.

Social media platforms’ complaint processes

Social media platforms have procedures to take down harmful content. For the largest providers, an enhanced duty to prevent harm is created by the recent Online Safety Act 2023.

However, in defamation cases, a social media service often argues that it has no idea whether or not what is said is untrue. As such, the service asserts it cannot determine whether the statement is clearly ‘unlawful’. Where unmoderated, user-generated content is posted, the service provider has no criminal or financial liability until it becomes aware that what is said is ‘unlawful’ and has failed to block it or take it down with reasonable expedition. The incentive to promote freedom of speech is weighed against possible liability for defamation. The service provider will have an ecommerce hosting defence where it has no knowledge of unlawfulness. That is often interpreted by the provider as ‘clear unlawfulness’.

Sadly, posts harmful to reputation may also make statements inciting hatred or harm to individuals concerned in a business. A service provider will be more willing to remove content where it poses a potential risk to safety.

Data protection

A defamatory post online may contain information which identifies a living individual (potentially an employee or owner of a business). As such, the online platform’s computer servers will be processing such personal data. Under the UK GDPR, it must have a lawful basis for such processing. Where the data subject clearly has not given consent, the platform may be processing illegally, thereby attracting unwanted regulatory interest.

AI

An ethical business would not knowingly wish to engage in defamation. Where artificial intelligence (AI) is used to generate content, great care should be taken to ensure that what is generated and published has been checked for accuracy to avoid inadvertent defamation.

SLAPPS

Recently, concern has been raised about wealthy parties attempting to curb free speech by aggressive and oppressive litigation tactics against defendants to intimidate them away from making true, lawful statements embarrassing to the claimant. So-called ‘strategic litigation against public participation’ (‘SLAPPS’) is not tolerated by the Solicitors Regulation Authority and is frowned upon by the courts. This must be avoided as a legal strategy.

If you have questions or concerns about reputation management, please contact Marcus Collins.