THE law of defamation has been around for centuries. Its intent is to protect a person’s reputation.

Lawsuits for defamation whether libel (defamation in permanent form) or slander (by the spoken word) are extremely popular in the UK and the USA. They are not as popular here and it may be particularly because, for the most part, monetary awards for a finding of damages arising from defamatory material are nowhere near as lucrative as that in the USA or UK.

It is quite common to see individuals bringing a claim for defamation, but companies too, have a right to bring an action as our laws recognise “the company”, as a “person” for the purpose of such actions.

Further, a recent decision of England’s highest court has reaffirmed the point that a company that had a trading reputation was entitled to pursue a remedy in a defamation action without being required to allege or to prove that the publication complained of had caused it actual damage. It was enough for the purpose of bringing the claim to show that there is likely to be damage in the way of the business because of the defamatory material. This alone does not guarantee the company success at trial, as it becomes an uphill battle for the company after the claim has been filed.

There is also the view that if there was no real financial loss to the company, the damages awarded should be nominal or modest, at best, which may not be worth the cost of litigation.

In that English case, one judge commented that “the good name of a company as that of an individual is a thing of value. A damaging libel may lower its standing in the eyes of the public and even its own staff; make people less ready to deal with it, less willing or less proud to work for it. If this were not so, corporations would not go to the lengths that they do to protect and burnish their corporate images.”

The facts which gave rise to that case are, shortly after the 9/11 attacks the Wall Street Journal (Europe) published an article claiming that the Saudi Arabian monetary authorities were monitoring bank accounts of prominent Saudis for evidence of supporting terrorism, knowingly or not, at the request of the US Government. One of the accounts which it claimed was being monitored was that of the Abdul Latif Jameel Group.

This group of companies is involved in car dealerships, real estate, finance and general trading activities in Saudi Arabia and claimed to have a good reputation in Saudi Arabia and around the world. The main company in the group and its president, Mohammed Jameel, sued the Wall Street Journal (Europe) for libel.

In determining the matter, the judges had two main issues to consider, that is, whether the publication was in the public interest and whether it was a product of responsible journalism.

In relation to public interest, there are obvious issues of public interest which come easily to mind such as terrorism, crime and deep moral values. Generally, it is the responsibility of the judge and the court to decide whether a publication is a matter of public interest. To satisfy the court that a matter is in the public interest it will look at the article and broadcast as a whole and not just that small part that the company or individual considers defamatory. This will clearly depend on each particular case and its particular facts.

Thereafter, once the publication passes the public interest threshold, the burden now shifts to deciding whether the steps taken to gather and publish the information were responsible and fair. In this regard, there is a list of factors a court will look at in determining whether responsible journalism has been exercised, including (a) seriousness of the allegation; (b) whether the subject matter is of public concern; (c) the source of the information; (d) steps taken to verify the story; (e) the status of the information; (f) the urgency of the matter; (g) whether comment was sought from the claimant; (h) the inclusion of the gist of the subject’s response; (i) tone of the article; (j) other circumstances of the publication, including timing, reputation of the publisher, etc.

This list is by no means exhaustive. The cost of litigation, however, and the possibility that this may take years to be resolved before the courts are usually the deterring factors which ultimately direct the minds of a responsible board of directors. Also, as many small economies tend to have a short-term memory for scandals and “bad mouth”, a decision on whether to bring a claim for libel or slander usually becomes an economic rather than a legal decision.

Ky-Ann Taylor is an Associate at Myers, Fletcher & Gordon and is a member of the firm’s Litigation Department. Ky-Ann may be contacted via Ky-Ann.Taylor@mfg.com.jm or www.myersfletcher.com. This article is for general information purposes only and does not constitute legal advice.