What is injurious falsehood? Five things you need to know to defend your business’ reputation

A bad review about your business left on an online review site, or statements made in the public arena, have the potential to make or break a business and ruin many years of hard work and investment.

Beginning proceedings of defamation is a potential cause of action if you believe your reputation has been damaged, but only if you are an individual, a not-for-profit organisation or a company with fewer than 10 employees. 

Unfortunately, if defaming statements are made about your business and you have more than 10 employees, suing for defamation is not available, and you will instead need to investigate the option of bringing a claim for injurious falsehood. 

Who can make a claim for injurious falsehood?

Anyone — any individual or company, regardless of the size or type. 

In what form must the statement be made?

The statement can be verbally, in writing or online. The verbal statement could be made to someone person-to-person, or to a journalist who publishes the comment.

What do I have to prove?

You need to prove three things:

1. The statement was false
2. That it was made maliciously with the intention of doing financial harm; and
3. That you have suffered a loss.

It is worth noting that, unlike defamation, in proceedings involving injurious falsehood you must be able to prove the loss to you which is directly attributable to the false statement(s). 

What if I don’t know who has made the statement?

This has been a problem in recent times due to the ability to remain largely anonymous when making statements online, however the courts have recently ordered Google and other similar companies to provide information about the identity of reviewers.

Negative reviews can be devastating for a business and can directly affect its sales and profit. 

If you believe you or your business have had false statements made about you on the internet or social media you should seek legal advice on the merits of your claim as soon as possible after the material is published.