A libel defendant recently learned that the key question in a defamation lawsuit is not where you make the comment, but what you actually say. As a result a California federal court denied the defendant’s motion to strike the claims against it.
The case is interesting, in part because it involves allegations that both the plaintiff and the defendant bad mouthed each other. Things started when the plaintiffs, Piping Rock Partners, and its sole shareholder wrote some comments that criticized the defendants David Lerner Associates and its president. The criticisms concerned DLA’s real estate investment business.
DLA apparently decided to adopt the “I know you are but what am I” strategy, and posted a number of articles accusing Piping Rock of dishonest and even criminal conduct. Those comments led Piping Rock to file a libel suit, and DLA countersued.
DLA also filed a motion to strike Piping Rock’s complaint. DLA argued that its comments couldn’t support a libel claim because they were posted on sites like “Ripoff Reports” and “scamfound”, sites which are “inherently hyperbolic.” According to DLA, because it posted on sites designed for anonymous posts by disgruntled consumers, any comments on there are inherently non-actionable opinion.
But the court disagreed. It focused on the comments themselves, noting that they were presented as pure factual statements. In the court’s view, DLA presented no evidence “that readers of either Google or Ripoff Reports would expect [the] purported facts to be anything but true.” The test for whether a statement is opinion is whether it contains a verifiable fact. “Joe is ugly” is not verifiable – beauty is indeed in the eye of the beholder. “Joe steals from customers” on the other hand, is verifiable. It is either true or false. Joe couldn’t sue on the first comment, but he could on the latter. No matter where it was posted.