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IELG Brief: What is Defamation?

IE Law Group writes article entitled “What is Defamation?” for the Gaming Business Review

“What is Defamation?”

The Games Industry is no stranger to mudslinging.  Putting aside #GamerGate (and we should, as often as possible), we’ve seen several cases where games or industry figures were targeted for lawsuits in recent years: 2014 saw Lindsay Lohan sue Rockstar Games and Panama dictator Manuel Noriega sue Activision, both alleging defamation of character.

More recently, The Escapist drew attention in its recent piece concerning the alleged business practices of Cloud Imperium Games, the studio behind the crowdfunded Star Citizen. The article’s content compelled Cloud Imperium to issue a formal response letter, demanding a retraction. You can read the full article here. These incidences of verbal attack and legal counter-attack should give rise to similar questions for everyone working in or on games—when have you gone too far when it comes to someone else’s character? What is defamation, and when does one cross the free speech line and enter actionable territory?

Defamation Defined

Defamation law varies between states, but tends to follow a similar formula in each jurisdiction. In order to prove liability for defamation, a plaintiff must prove several key elements:

(a) The statements must be presented as facts, as opposed to an opinion

(b) The statement must actually be false

(c) The statement must be published or conveyed in any form to a third party. Written statements, called libel, are generally considered the more serious than oral statements, or slander, due to the fact that the impact of the statement may last much longer and find a wider audience

(d) The statement must result in some kind of harm to the plaintiff—however, states differ on what constitutes “harm”

Above all, the published statement must be both false and injurious. These two elements are frequently viewed as the most significant factors in determining liability. There is no such thing as defamation based on a true statement. However, other causes of action, such as invasion of privacy or misappropriation, may give rise to liability even if the utterance is an honest one.

Additionally, most causes of action require some kind of economic or obvious emotional or psychological harm. In some cases, injury can be presumed based on the nature of the false statement (e.g., false allegations of having an STD or debilitating disease, incompetence, or committing a serious crime).

Similarly, some false statements may be deemed defamatory if the person publishing the statement acted in bad faith. We see this most often in the news and editorial space, where authors are held to a certain degree of professionalism. Examples of bad faith might include an author of a blog or publication: (a) publishing the statement with knowledge that it is false; (b) acting with reckless disregard about the truth of the statement prior to publication; or (c) acting negligently in determining whether the statement was true prior to publication. More specifically, if a person had serious doubts about the truth of a statement but failed to investigate before publishing and still published the statement with such with serious doubts, that statement may rise to the level of defamation.

Fact versus Opinion

When looking at the specifics of a potentially defamatory statement, it is important to distinguish whether the statement was published as fact or opinion. In order to be considered defamatory, the statement must be presented as a fact. This is the basic threshold to freedom of speech: everyone has a right to express his or her opinion.

However, claiming a statement is an opinion doesn’t provide an absolute defense. Nor will prefacing a statement of fact with “allegedly,” “in my opinion,” or similar words qualify a statement squarely as an opinion. The phrasing, context, and even tone of the statement is often considered when determining whether something is a statement of fact or an opinion.

When “Actual Malice” is Required

A major consideration is most cases involving the games industry concerns “matters of public interest”, or matters where “public figures” come into play. These cases present an additional hurtle for “famous” plaintiffs. When government officials, celebrities, or other public figures claim defamation, they must also prove actual malice by the publisher of the statement in addition to the other elements of defamation.

“Actual malice” refers to either reckless disregard for the truth or publishing a statement that the publisher knows is false. In other words, the publisher must act in bad faith. Most celebrities or famous individuals must also prove the statements were made with the intent to cause harm. This presents additional freedom of speech protection for publishers and the media to defend against these claims.

Defamation in Action

There are many realities both the subject of a defamation suit and the publisher of defamatory statements must consider when statements give rise to a defamation claim. The plaintiff must consider whether he or she wants to draw more attention to the statements. There is also the very real consideration of costs. Defamation lawsuits can become astronomically expensive, especially as many may require resolution in federal courts due to jurisdictional concerns. There is also the possibility of counter-suits, as well as Anti-SLAPP (Strategic Lawsuits Against Public Participation) that further protect a defendant’s first amendment rights.

For the defendant, their own credibility is at stake, as well as their relationships with their sources or sponsors. They must also consider the inevitable costs of defending a suit in federal court. As a result, many such cases end in a settlement and, if necessary, a retraction or apology. Every person making a potentially inflammatory statement may be confronted with the question of “have I gone too far?” at some point in their career. This is especially true considering our increasing reliance on social media like Twitter and Facebook for community outreach. Our words have greater reach and duration than they have at any point in history. Understanding the nature of defamation and the elements that give rise to liability should become a priority for every individual with a social media account. Some statements or suggestions, especially those made flippantly, should be given a second thought before tapping that “post” button.

Conclusion

There are plenty of examples in the games industry where defamation has or could come into play. For companies such as Cloud Imperium, bad press can result in legitimate harm to business operations. In a case like this, Cloud Imperium is likely weighing the risks versus rewards of pursuing such a claim. Alternatively, while the first amendment provides ample protection for publishers, bloggers, and authors in the digital age (like The Escapist), there is a very clear threshold when a false statement may have gone too far. While we can’t predict how either party will respond to statements and demands by the other, we can work to keep our own houses in check when publishing content online. There is no point in opining about how the situation with Cloud Imperium and The Escapist will unfold or how I would counsel them if I was involved. No one outside of these two companies knows enough of the facts to make an informed opinion. Defamation is a highly personal situation. But, despite that, both entities have a lot of practical and legal considerations to make in assessing their way forward.

Written by Patrick Sweeney, Mona Ibrahim & Suzanne Jackiw for the Gaming Business Review

Follow IE Law Group on Twitter: @IELawGroup or visit them at www.IELawGroup.net