AVOIDING LIBEL: STAY COMPETITIVE WITHOUT TALKING TRASH

By James Forrest

There’s an old saying that goes something like “All’s fair in love and war.”  The same can’t be said about business. We do have widely-accepted notions of fair business practices, and we have the basis of our jobs as business attorneys—the law.

jamesThere are many common mistakes that await the owner of an early-stage business.  Since almost all of us have competitors, a common challenge we have is how we go about “talking” about those with whom we compete.  Talking covers a wide range of communications in our modern era, and we need to consider that concept in its fullness—especially in any form of written communications. Think about it—there are so many venues where we may trip over ourselves verbally these days:  email, social media, texts, websites, banner ads, newspaper ads, e-newsletters, and so much more.

One of the most common mistakes that young businesses make is leaving themselves open to charges of libelous competitive behavior in their advertising and other communications. While often thought to need malicious intent, libel typically needs to be proven only to be false statements made by one party about another in order to damage the offended party’s reputation.

Right now, businesses have at their disposal a greater abundance of free, inexpensive, and powerful communications tools than ever before, thanks to companies like Google, Constant Contact, Yahoo, Facebook, and Twitter.  As with many other things in life, this freedom has come at a price, and the temptation and ease to libel competitors has only made these types of mistakes increase on the whole.

It’s better, as a general rule, to leave communications to positive stances on your own products and services.  When you do need to take a stand against a competitor for comparative purposes (a Pepsi challenge, for example, common in consumer advertising), it’s best to get legal counsel and hire professional communications and advertising professionals to execute the campaign, to ensure that you avoid costly legal ramifications.   More and more, I see clients hiring legal counsel to review communications prior to release (Twitter, FB posts, etc.).

Starting a new business is a fun time and it’s also a stressful time.  It’s not a time to be creating more problems for yourself—there are plenty of challenges to solve on a daily basis —related to your clients, competitors, and the marketplace itself.  That should be plenty!  Sometimes, you do need to engage your competitors directly in your communications—companies do this all the time. But before you do so, get the correct resources in place and protect yourself.