The Ministry of Justice is currently inviting views for a consultation about the draft Defamation Bill. It affects England and Wales.
Why should PROs care?
The Government is asking whether it should make it more difficult for companies to sue the media, competitors, individuals and academics for defamation. A Ministry of Justice press release says the department is seeking views on 'whether any specific restrictions should be placed on the ability of corporations to bring a defamation action'.
What currently happens?
Companies are able to sue anyone responsible for publishing defamatory statements. The law assumes that if a company is defamed, it is entitled to compensation even if it cannot point to a specific financial loss. The damages awarded to corporate claimants are typically £15,000 to £50,000 but the main remedy is generally a retraction and apology.
What could happen?
The most dramatic potential development for the PR industry is if companies are prevented from suing for defamation. Equally difficult would be forcing companies to prove an article has caused financial loss, something that can be hard to do. A better outcome for PROs would be if companies were still allowed to sue the media or other companies for defamation, but not individuals or academics. The term individuals, however, also covers bloggers and social media users. The Government may decide to make no changes at all.
The draft bill also proposes to make a change to how online articles are treated.
It plans to introduce a 'single publication rule' that will prevent anyone from suing the same publisher for the same article once it has been published online for 12 months. This will stop repeat claims for libel every time an article is accessed on the internet.
HOW I SEE IT: THE LEGAL VIEW
David Engel, Partner, Addleshaw Goddard
Any company that values its reputation should be seriously concerned by the prospect of being deprived of the legal right to take steps to defend that reputation.
The vast majority of cases where companies have to consult m'learned friends are where their reputations are threatened by the actions of the media or sometimes other companies or individuals who are determined to cause them commercial damage. To be left without legal recourse in such a situation, as an unintended consequence of the new Defamation Bill, would be less than ideal. PROs might wish to make appropriate representations to the MoJ consultation.
Requiring companies to prove that libel has caused substantial financial loss sounds reasonable, but in practice it's often very difficult to prove.
Some PR professionals may say they don't care about this proposed change to the law because their clients are not in the business of suing for libel. But it's not just about suing. In the vast majority of cases, it is the risk of legal liability that keeps the media honest - and their platoons of in-house lawyers busy tempering the enthusiasm of their journalists.
So it would be mayhem if the threat of legal liability were no longer there. It would be a carte blanche for the media to print what they like.
There is always the Press Complaints Commission, but it cannot impose financial sanctions, so the cost/benefit calculation of printing untrue and damaging material about a company would not be a difficult one. The risk would be that the standard of journalism would drop. Journalists would not bother to fact check or obtain comment from the subject of the story, because if their employer could not be sued, what would be the worst that could happen?
Main image from Rex