The Law of Defamation and Injurious Falsehood
The internet allows anyone to publish customer reviews of businesses, whether they be positive, negative, true or false. These statements become linked to an online search for the business and are made public for anyone to view. If a review is negative and false, business owners have options to have the comment removed.
However, it is important to note, that the comment must be both negative and false, not just negative. Any removal of a review on the grounds it is negative only, may be seen as misleading or deceptive conduct as outlined by the Australian Competition and Consumer Commission (ACCC). This could give rise for them to bring an action against you.
The first step in a situation where your business is subject to false and negative reviews, is to attempt to contact the reviewer. Asking the reviewer to personally remove the comment provides an opportunity to remedy the issue privately. The issue could also be dealt with publicly, by directly replying to the review on the platform. However, this approach faces problems such as how your reply may be seen in the context of the initial review, taking into account how much time has lapsed since the review was made and confidentiality of the reviewer (if you’re in an industry where this is applicable), etcetera.
Another option is to utilise third party services who specialise in removing negative reviews. These online businesses are available in Australia and often operate on a ‘no win, no fee’ basis. These third parties contact the site where the review has been published and make a case on your behalf.
From a legal standpoint, business owners have two courses of action against negative and false reviews.
The first is defamation. This occurs if a person communicates, verbally or written, something about another party that is untrue and harmful. Such harm may be reputational, economic and/or mental. This course of action can be taken by an individual or company with less than 10 employees.
Businesses with more than 10 employees can follow the route of injurious falsehood. For this course of action, the burden is higher, including previous actions, and the review must have malicious intent. The aggrieved party has the burden to prove a clear intention of the reviewer to injure their business and the statement must be false and reckless to the truth.
In order to bring a case for defamation or injurious falsehood, you must be able to substantiate the harm caused. In previous cases, the Courts have accepted evidence such as reduced revenue, a decline in users of the business service and increased cancellations since the date of the review being published. These examples are quantifiable and show a connection between the review made and the harm caused.
Once you have established evidence of the above nature, the next step is to determine the identity of the reviewer. This can be simple if the name is on the review or alternatively, a private online investigator can be engaged. Another option is to petition the Court for release of information from the platform that hosted the review in issue.
Once the reviewer’s identity is obtained, you can serve a Concerns Notice on them. This notice outlines your claim against the individual and grants them the opportunity to remedy the situation, for example, by removing the review themselves. On a Concerns Notice, you can also outline the remedy you seek such as an apology or payment of legal costs.
Before taking legal action, it is important to consider the defences available to the reviewer. Relevant defences include the defence of truth and honest opinion. The first defence relies on the material being substantially true and the latter defence applies if the communication is an honest opinion, in the interest of the public and based on proper materials.
Ultimately, if you consider a review to be negative, false and substantially harmful, you have access to a number of pathways. If you are seeking further advice or are approaching legal action, Jenkins Legal Services can help. We can be contacted on 02 4929 2000 or at office@jenkinslegal.com.au.
Jenkins Legal Services can also assist with all matters relating to commercial business, property, estate planning, and employment law.
Luke Nicolson, Lawyer, and Laura Kokolis, Paralegal.
This article is not legal advice and the views and comments are of a general nature only.
This article is not to be relied upon in substitute for detailed legal advice.