Corporations don’t have feelings, so why should they be able to sue for libel?
Major companies have alternatives to litigation, says Mike Harris. With PR teams and big advertising budgets they can easily counter false claims or unfair criticism
21 Sep 12

Major companies have alternatives to litigation, says Mike Harris. With PR teams and big advertising budgets they can easily counter false claims or unfair criticism

This article was originally posted at Independent Voices

Companies can’t cry. In any other context this would be a statement of the obvious, but in English libel law, this is questionable. Historically, our libel laws have been about protecting the reputations of the rich and powerful. Now, major corporations use them as part of their media strategies, paying huge sums to advertise and huge legal fees to bully their critics. As companies take on the running of public services, this raises serious questions over the ability of citizens to criticise services that they pay for. Fair play say some. But libel laws are about protecting the psychological integrity of individuals who find themselves defamed. Corporations don’t have feelings — so why should they be allowed to sue?

This isn’t an academic question, as Dr Peter Wilmshurst found out. For four years he battled with now bankrupt US corporation NMT Medical in a case that nearly cost him his career and his home. Wilmshurst, a senior NHS cardiologist, made critical comments at a scientific conference on an NMT product which was designed to close a specific hole in the heart. Over the four years of the case, patients continued to have the product implanted in their hearts. In some cases, they needed extensive surgery to have them removed. If his concerns had not been silenced, doctors might not have recommended this treatment.

Peter Wilmshurst nearly lost everything in a libel case

Olympic sponsor ATOS has also used our libel laws to silence its critics. CarerWatch, a closed forum has attracted critical posts on the work of ATOS in its state-funded testing of whether disability claimants are fit for work. In August last year, their lawyers sent a legal threat to which hosts the site., fearing an expensive libel action, pulled the plug. The founder of Carer Watch Frances Kelly told me “many members are very fragile and the sudden disappearance of a support group has caused a lot of distress and fear. Some are ringing us in tears.” In a statement the company said: “While we fully support the right of people to express their opinions, it is our duty to protect the reputation of our employees and company against false and malicious allegations. In such circumstances, we will look to take any necessary steps to ensure that these unsupported claims are addressed swiftly and appropriately.” After a public outcry, CarerWatch is now back online.

Robust criticism of the work of a corporation carrying out a public function paid for by taxpayers should be protected, but isn’t. The Derbyshire principle which in English law prohibits the state for suing its citizens is slowly being undermined. As Lord Keith said in the judgment: “It is of the highest public importance that a democratically elected governmental body, or indeed any governmental body, should be open to uninhibited public criticism”. Yet, local councils alongside corporations as “non-natural bodies” have continued to use our libel laws to sue their critics. Carmarthenshire county council is so broke it’s switching off 5,000 street lights but has found the money to sue a local critic Jacqui Thompson for libel. Meanwhile as South Tyneside council makes £35m worth of cuts including closing the main local centre for dementia care, it admits it has used in excess of £75,000 worth of public money to launch a legal action by the council’s leader Iain Malcolm and fellow councillors against a local blogger.

Corporations have alternatives to libel. With PR teams and big advertising budgets they can easily counter false claims or unfair criticism. The law of malicious falsehood and recent regulations protecting firms from misleading marketing all protect firms from deliberate falsehoods from rivals, or those with a grievance. And it’s unclear as to why companies can claim libel damages at all. Damages are meant to compensate for psychological damage. Companies don’t have feelings, so shouldn’t get damages. Moreover, no damages could ever compensate for real corporate damage – if a newspaper defames Apple for suggesting it operates sweat shops, costing the company billions of dollars, does anyone seriously believe it ought to compensate Apple in full – rather than printing an apology?

Luckily, there’s an opportunity to stop this. The Defamation Bill is currently passing through Parliament and in October the House of Lords has an opportunity to amend the Bill. Former Justice Secretary Ken Clarke was adamant that corporations ought to be able to sue for defamation, but post reshuffle the Libel Reform Campaign (English PEN, Index on Censorship and Sense About Science) believe the new Ministerial team may be more open to reform. There is cross-party support to block corporations suing individuals with Conservative MPs such as Peter Bottomley and David Davis, Liberal Democrats Tom Brake, Julian Huppert and Simon Hughes and Labour’s Sadiq Khan, Rob Flello and Paul Farrelly all questioning whether large companies really do need to resort to suing citizens.

In a world where McDonalds’ revenue is larger than Latvia’s GDP and Exxon Mobil’s bigger than Thailand’s, it’s becoming hard to justify the rule that states can’t sue citizens but corporations can. There’s much to praise in the Defamation Bill going through Parliament, but without action on corporations we may see yet another scientist or NGO risking everything in the High Court against a company that can afford to lose.

You can sign the Libel Reform Campaign’s petition here:

Mike Harris is Head of Advocacy at Index on Censorship

By Mike Harris

Mike Harris is head of advocacy at Index on Censorship