Blogs Can Get Insurance Clients ‘SLAPP’ed

A Dade County, Florida real estate developer in January 2008 filed a $25 million lawsuit against a real estate blogger alleging, among other charges, defamation of character based on the blogger’s opinion published solely on his blog (MiamiCondo Investments). Hollo v. Lechuga may serve as a landmark case in this relatively new debate over a blogger’s legal liability for alleged personal injury arising from the contents of a blog.

Blogs contain a mixture of commentary, opinion, advertising, marketing, facts and sometimes even news. Creators and contributors become citizen “journalists,” subject to the same legal liability and responsibility placed on publishers.

Blog Suits

Blog-related personal injury suits have produced judgments ranging between $7,500 and $11.3 million. The largest against a mother/blogger for defamatory statements (“crook, com artist and fraud”) blogged about a firm she hired to help remove her son from a boarding school in Costa Rica (Scheff v. Bock in Florida Circuit Court, Sept. 19, 2006). But pronouncements of blogger guilt are rare.

As of July 1, 2008, 39 states have seen 149 personal injury lawsuits and 11 criminal suits filed against bloggers. Forty-two cases are still pending, and 18 suits were resolved through pre-trial settlement. Only seven lawsuits have resulted in judgment against the defendant blogger. Nearly 77 percent of all civil cases were found in favor of the blogger or saw the charges dropped by the plaintiff. And 92 percent of blog-related suits making it to trial end in blogger triumph (Information is available at Media Law Resource Center at www.medialaw.org/bloggerlawsuits).

Odds at trial are in the blogger’s favor, but there is no guarantee that this propensity towards blogger victory will continue.

Why Bloggers Win

Bloggers’ higher-than-average winning percentages are due almost exclusively to First Amendment protection and/or state anti-“SLAPP” (strategic lawsuit against public participation) legislation. Freedom of speech and opinion are valued rights for journalists. Yet a blogger’s status and protection as a “journalist” in the legal sense is not settled. An April 2008 finding by a Maryland court declared that a blog publisher was not protected under that state’s law shielding reporters from defamation lawsuits (Webster v. Albero).

Protecting Free Speech Rights

First Amendment protection requires, among other standards, bloggers, like journalists, to practice and prove due diligence in the gathering and reporting of “factual” information. Bloggers must also prove that no actual malice was intended by statements or information ultimately found to be incorrect or untrue. Opinions, stated as opinion and not fact, published by bloggers are also potentially immune from charges of libel under the First Amendment because there is no such thing as a false opinion.

‘SLAPP’ed’ Into Submission

Winning is not necessarily the intent of the individual or entity filing a SLAPP lawsuit; fear, defendant exhaustion and intimidation are the main goals.

“Short of a gun to the head, a greater threat to First Amendment expression can scarcely be imagined,” New York Supreme Court Judge J. Nicholas Colabella said of SLAPP suits. Even if the plaintiff loses, he or she wins by scaring others away from the debate. And if the SLAPP perpetrator can stretch the case over a long enough time, the defendant, even if innocent or with a meritorious defense, may be financially forced to settle or concede the fight according to Colabella.

Individuals, corporations and governments file SLAPP suits packaged to look like civil suits alleging defamation, invasion of privacy, nuisance, malicious prosecution and other personal injury charges intended solely to embezzle the “offender’s” time and finances by means of legal wrangling and continually mounting legal costs. Most individuals and small businesses do not have the time or the financial resources to invest in their defense, choosing rather to end the publication or protest. That removes the primary thorn from the plaintiff’s side, and the tactic produces sufficient fear to keep others from voicing their beliefs.

Anti-SLAPP statutes make such suits illegal. Twenty-seven states have anti-“SLAPP” statutes: Arkansas, California, Colorado, Delaware, Florida, Georgia, Hawaii, Indiana, Louisiana, Maine, Maryland, Massachusetts, Minnesota, Missouri, Nebraska, Nevada, New Mexico, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island, Tennessee, Utah, Washington, West Virginia and Wisconsin. In those states, defendants that are able to prove a suit is a SLAPP generally prevail in court, provided all other standards of journalistic responsibility have been satiated.

Employer Liability

Blogs can subject the blogger’s employer to a civil suit and charges of personal injury. In Hollo v. Lechuga, Tibor Hollo, the developer/ plaintiff, did not limit the lawsuit to the blogger; Lechuga’s employer EMW Realtors also was named.

EMW Realtors’ liability for the alleged defamation is questionable at best, even from a vicarious viewpoint. The publication giving rise to the suit was made on Lechuga’s personal blog, not promoted or sanctioned by EMW, and the post was made prior to Lechuga’s employment with EMW.

No reasonable connection appears to exist between blog and the course and scope of Lechuga’s employment by EMW. To further distance itself from the accusations and any appearance of ratification, EMW fired Lechuga immediately following its receipt and review of the suit documents.

Regardless of EMW’s apparent lack of liability, time and financial resources were expended to defend itself against the actions of an employee committed before he became an employee. It is worthy to note that EMW Realtors is owned by Warren Buffet’s Berkshire Hathaway Group, so “deep pockets” could have been a motivating factor in bringing EMW in as a defendant.

Blog Risk Management

With legal trouble and the resulting expenses potentially just one mouse click away, individuals and business entities creating, sanctioning and/or hosting blogs should apply basic risk management to the posting of a blog.

Following are a few questions that every blogger should ask of the content contained in their blog:

• Do readers consider the blog a credible source of information and depend on it for up-to-date information (a matter of opinion that can be judged based on analytics and comments)?
• Is information in the blog accurate or is the blog rife with mistakes and misstatements?
• Have facts been checked (as required by due diligence standards) or have they simply been accepted as heard or read elsewhere without further verification?
• Have facts been attributed to the original sources?
• Are information sources reliable?
• Are rumors and gossip printed as fact?
• Are opinions labeled as such?
• Are comments in news and opinion pieces fair and based in fact or could they be considered malicious, libelous or defamatory?
• Is the information original work or plagiarized from another person or entity?
• Has permission been secured to include content or photos found online (leads to the possible charges of copyright infringement)?
• Are paid advertisements clearly separate from news and editorial content?
• Are procedures in place to allow quick response if someone demands correction, retraction or removal of information?
• Is the source of the blog clearly decipherable or is it written anonymously (hiding behind anonymity brings the veracity and intent of the blog into question)?

Additionally, consideration must be given to the employer’s potential liability for or harm caused by employee-maintained blogs. Employers can be pulled into personal injury suits — even if they did not direct or sanction the employee’s blog. Employees may post information or opinion harmful to their employers, such as trade secrets or defamatory statements that could harm the employer’s reputation in the community or lead to employment related practices type suits from other employees.

Employers should learn about and monitor employee blogs. The employee manual should contain a section addressing blogs, notifying all employees that blogs may be monitored for posts damaging to the employer or potentially subjecting it to suit. There is a delicate balance between the employee’s right to free speech and the right of the company to protect its interests. A lawyer experienced in this area should be consulted regarding the proper way to set up and monitor this program.

Insurance and Blogs

The status of the blogger directly affects the insurance protection provided or available. Individuals blog at their own risk, as there may be little to no insurance coverage available to finance a defense, settlement or judgment; and coverage for business entities hinge on exclusionary endorsements that may be attached to the policy.

Bloggers can be sued. Whether the communication is protected by the First Amendment or anti-SLAPP statutes is irrelevant if there is no means for the blogger to finance his or her defense. Agents need to know if their clients blog.

Topics Lawsuits Florida