15.3 Defamation, Privacy Torts & Business Torts
Key Takeaways
- Common law defamation requires: (1) a defamatory statement of fact, (2) of and concerning the plaintiff, (3) publication to a third party who understands it, and (4) damage to plaintiff's reputation; general damages are presumed in libel (written/recorded) and slander per se.
- Slander per se dispenses with the requirement to prove special damages for statements imputing: (1) commission of a crime of moral turpitude, (2) loathsome disease, (3) conduct adversely reflecting on business, trade, or profession, or (4) serious sexual misconduct.
- Under the First Amendment (New York Times v. Sullivan, Gertz), public officials and public figures must prove falsity and actual malice (knowledge of falsity or reckless disregard for truth by clear and convincing evidence); private figures in matters of public concern must prove falsity and at least negligence for actual injury damages.
- Absolute privileges (judicial, legislative, executive, and spousal communications) provide complete immunity from defamation liability; qualified privileges (good-faith employment references, shared common interest) protect speakers unless abused or made with actual malice.
- Invasion of privacy encompasses four distinct torts (FLIP): False Light, Intrusion upon Seclusion, Public Disclosure of Private Facts, and Commercial Appropriation of Name or Likeness; business torts protect contractual and prospective economic relations from intentional wrongful interference.
15.3 Defamation, Privacy Torts & Business Torts
Defamation and invasion of privacy represent key intentional and reputational torts tested on the Multistate Bar Examination (MBE) and Multistate Essay Examination (MEE). Successful performance requires mastering both traditional common law elements and the constitutional First Amendment overlays governing public figures and matters of public concern, as well as the four distinct privacy torts (FLIP) and economic interference torts.
1. Common Law Defamation
At common law, defamation is an invasion of the plaintiff's interest in their reputation and good name. A prima facie case of common law defamation requires four elements:
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| PRIMA FACIE ELEMENTS OF COMMON LAW DEFAMATION |
| |
| [1] Defamatory Statement of Fact: |
| A statement that holds the plaintiff up to hatred, ridicule, contempt,|
| or scorn, or lowers their esteem in the community. |
| - Pure opinion is NOT actionable; actionable if implies false facts. |
| |
| [2] Of and Concerning the Plaintiff (Colloquium): |
| A reasonable listener or reader would understand that the statement |
| refers specifically to the plaintiff. |
| |
| [3] Publication to a Third Party: |
| Intentionally or negligently communicated to at least ONE person |
| other than the plaintiff who understands its defamatory meaning. |
| |
| [4] Harm / Damages to Plaintiff's Reputation: |
| - Libel & Slander Per Se: General damages PRESUMED. |
| - Ordinary Slander: Requires pleading & proof of SPECIAL DAMAGES |
| (specific economic/pecuniary loss). |
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Defamatory Meaning & Group Defamation
- Fact vs. Opinion: Statements of pure subjective opinion or rhetorical hyperbole are not actionable. However, an opinion that implies undisclosed, defamatory factual assertions is actionable (e.g., "In my opinion, the treasurer is cooking the books").
- Group Defamation Rules:
- Small Group: If a defamatory statement is made about a small, cohesive group (e.g., "All four partners in that law firm steal client funds"), every individual member of the group can establish that the statement is "of and concerning" them.
- Large Group: If the statement targets a large, indefinite group (e.g., "All lawyers are thieves" or "All politicians take bribes"), no individual member can maintain a defamation action.
Publication Mechanics
- Requirement: The statement must be communicated to at least one third party who hears/reads and understands it. Communicating a statement exclusively to the plaintiff does not constitute publication.
- Primary Publishers vs. Distributors: Primary publishers (newspapers, authors, television networks) are strictly liable for publishing defamatory statements at common law. Secondary distributors (bookstores, libraries, newsstands) are liable only if they knew or should have known of the defamatory content. Under federal law (47 U.S.C. § 230 / Communications Decency Act), interactive computer service providers (social media platforms, internet search engines) are immune from publisher liability for third-party user content.
Libel vs. Slander & Slander Per Se
- Libel: Defamation embodied in written, printed, broadcast, podcast, video, or permanent recorded form. General damages are presumed by law; the plaintiff is not required to prove pecuniary loss.
- Slander: Spoken, oral, or transitory defamation. The plaintiff must plead and prove special damages (actual pecuniary, economic loss, such as losing a job or a commercial contract), UNLESS the statement falls within one of the four Slander Per Se categories.
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| THE FOUR SLANDER PER SE CATEGORIES |
| |
| CATEGORY DESCRIPTION & MBE EXAMPLES |
| ------------------------- --------------------------------------------- |
| [1] Business / Profession Statements directly reflecting adversely on |
| plaintiff's competence, honesty, or fitness |
| in their trade, profession, or office. |
| |
| [2] Crime of Moral Statements falsely claiming plaintiff |
| Turpitude / Felony committed a serious crime involving moral |
| depravity or felony (theft, fraud, perjury). |
| |
| [3] Loathsome Disease Statements falsely stating plaintiff currently |
| suffers from a contagious, loathsome disease |
| (historically leprosy, venereal diseases). |
| |
| [4] Serious Sexual Statements falsely imputing serious sexual |
| Misconduct misconduct or unchastity to the plaintiff. |
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2. Constitutional First Amendment Limitations (Sullivan & Gertz)
When a defamation claim involves a public official, a public figure, or a matter of public concern, the Supreme Court's decisions in New York Times Co. v. Sullivan (1964) and Gertz v. Robert Welch, Inc. (1974) require the plaintiff to prove additional constitutional elements:
- Falsity: The plaintiff bears the burden of proving that the defamatory statement is factually false (reversing the common law presumption of falsity);
- Fault: The plaintiff must establish a heightened standard of constitutional fault on the part of the defendant.
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| CONSTITUTIONAL DEFAMATION MATRIX |
| |
| PLAINTIFF STATUS & TOPIC REQUIRED FAULT STANDARD PERMISSIBLE DAMAGES|
| -------------------------- ------------------------- ------------------ |
| Public Official or ACTUAL MALICE: Presumed damages |
| Public Figure Knowledge of falsity OR AND punitive |
| (Any topic) reckless disregard for damages allowed |
| truth (clear & convincing).upon actual malice.|
| |
| Private Figure / NEGLIGENCE as to falsity Actual injury |
| Matter of Public Concern (reasonable care standard).damages ONLY. |
| Actual malice for |
| presumed/punitive. |
| |
| Private Figure / NO CONSTITUTIONAL Presumed and |
| Matter of Private Concern FAULT REQUIRED punitive damages |
| (Common law rules apply). allowed without |
| actual malice. |
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The "Actual Malice" Standard (New York Times v. Sullivan)
- Definition: Actual malice is a subjective standard requiring proof that the defendant published the defamatory statement with:
- Knowledge that the statement was false; OR
- Reckless disregard as to whether it was true or false.
- Reckless Disregard Defined (St. Amant v. Thompson): The defendant must have actually entertained serious subjective doubts as to the truth of the publication, or possessed a high degree of awareness of its probable falsity. Mere failure to investigate, professional negligence, or ill will/spite does not constitute actual malice.
- Standard of Proof: Actual malice must be established by clear and convincing evidence.
Classification of Plaintiffs
- Public Official: Individuals holding elected office or governmental employees with substantial responsibility for the control of public affairs (e.g., mayor, police chief, school board member).
- All-Purpose Public Figure: Celebrities, household names, and individuals who occupy positions of pervasive power and influence in society.
- Limited-Purpose Public Figure: Individuals who voluntarily inject themselves into a particular public controversy to influence its outcome. They are treated as public figures only for defamation concerning that specific controversy.
- Private Figure: Ordinary individuals who have not thrust themselves into the public spotlight.
3. Defenses and Privileges to Defamation
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| DEFAMATION DEFENSES & PRIVILEGES MATRIX |
| |
| DEFENSE / PRIVILEGE SCOPE & APPLICATION WAIVER / FORFEITURE|
| -------------------- ------------------------------- ------------------ |
| Truth ABSOLUTE DEFENSE. Complete bar Never forfeited if |
| to liability at common law. statement is true. |
| |
| Absolute Privilege Complete immunity regardless of Never lost, even |
| (Judicial, Legis., bad faith, ill will, or malice. if speaker acted |
| Executive, Spousal) with malice. |
| |
| Qualified Privilege Conditional immunity for good- LOST if made with |
| (Common interest, faith statements on matters of actual malice or |
| job references) shared interest or public duty. excessive spread. |
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- Truth: Substantial truth is an absolute defense to common law defamation. If the underlying sting of the statement is true, the action fails.
- Absolute Privileges (Total Immunity):
- Judicial Proceedings: Statements made by judges, attorneys, witnesses, and jurors during the course of judicial proceedings, provided the statements bear some reasonable relationship to the litigation;
- Legislative Proceedings: Statements made by legislators on the floor of the legislature or in official committee hearings (Speech and Debate Clause protection);
- Executive Communications: Official statements made by high-ranking executive officials in the performance of their duties;
- Spousal Communications: Statements communicated exclusively between married spouses.
- Qualified (Conditional) Privileges:
- Statements made in good faith where the speaker and recipient share a legitimate common interest, such as employment references, job performance evaluations, statements to law enforcement, or credit reports.
- Forfeiture of Qualified Privilege: The privilege is lost if: (a) the speaker acted with actual malice (knowledge of falsity or reckless disregard), or (b) the speaker published the statement to parties outside the scope of the common interest (excessive publication).
4. Invasion of Privacy Torts (FLIP)
Common law recognizes four separate and distinct invasion of privacy torts, easily remembered by the acronym FLIP:
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| THE FOUR INVASION OF PRIVACY TORTS (FLIP) |
| |
| TORT KEY ELEMENTS CRITICAL MBE RULE |
| ---------------------- ----------------------------- ----------------- |
| [F] False Light Wide public dissemination of Actual malice |
| highly offensive false required if matter |
| portrayal or attribution. of public interest.|
| |
| [L] Commercial Unauthorized commercial use of Protects name and |
| Appropriation plaintiff's name or likeness likeness; news/ |
| for advertising or trade. biography exempt. |
| |
| [I] Intrusion Upon Intentional physical or NO PUBLICATION |
| Seclusion electronic invasion of REQUIRED. Tort is |
| private space/affairs; highly complete upon the |
| offensive to reasonable person.intrusion. |
| |
| [P] Public Disclosure Wide public dissemination of TRUTH IS NO |
| of Private Facts private, confidential true DEFENSE. Must not |
| facts; highly offensive and be of legitimate |
| not of legitimate public concern public concern. |
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- False Light:
- Wide public attribution to the plaintiff of views they do not hold or actions they did not take, which would be highly offensive to a reasonable person.
- Distinction from Defamation: Defamation protects reputation from damage; False Light protects emotional dignity from highly offensive distortion. If the matter is of public interest, the plaintiff must prove actual malice.
- Commercial Appropriation of Name or Likeness:
- The unauthorized commercial use of the plaintiff's name, photograph, voice, or likeness for the defendant's commercial advantage (such as endorsing a product or boosting advertisement sales).
- Newsworthiness Exception: Using a person's name or picture in news reporting, historical biography, or artistic commentary is fully protected and not actionable.
- Intrusion upon Seclusion:
- The intentional, unauthorized physical or electronic invasion of the plaintiff's private sphere, home, secluded premises, or confidential personal affairs in a manner that would be highly offensive to a reasonable person (e.g., wiretapping private phones, peeping through bedroom windows, hacking personal cloud accounts).
- Crucial Bar Rule: No publication is required. The tort is complete the moment the unauthorized intrusion occurs.
- Public Disclosure of Private Facts:
- The wide public dissemination of true, private, confidential information about the plaintiff that would be highly offensive to a reasonable person and is not of legitimate public concern (not newsworthy) (e.g., broadcasting a private citizen's confidential medical records or private financial debts).
- Key Distinction: Truth is NO defense to this privacy tort.
5. Business & Economic Interference Torts
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| BUSINESS & ECONOMIC INTERFERENCE TORTS |
| |
| TORT PRIMA FACIE ELEMENTS DEFENSES / PRIVILEGE|
| ---------------------- ----------------------------- ------------------ |
| Tortious Interference (1) Valid existing contract; Fair competition is|
| with Contract (2) Defendant's knowledge; NO defense to |
| (3) Intentional inducement of inducing breach of |
| breach; (4) Lack of privilege; an existing, fixed-|
| (5) Resulting damages. term contract. |
| |
| Tortious Interference (1) Reasonable business FAIR COMPETITION |
| with Prospective expectancy; (2) Defendant's is a valid defense |
| Economic Advantage knowledge; (3) Intentional UNLESS defendant |
| interference by INDEPENDENTLY uses wrongful, |
| WRONGFUL MEANS; (4) Damages. unlawful means. |
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- Tortious Interference with Contractual Relations:
- Requires an existing valid contract between plaintiff and a third party. The defendant, knowing of the contract, intentionally acts to induce the third party to breach the contract. Standard commercial competition is not a valid defense to inducing the breach of an existing fixed-term contract.
- Tortious Interference with Prospective Economic Advantage:
- Protects prospective, expected business relationships (e.g., negotiations, bidding). Because no finalized contract exists, bona fide commercial competition is fully privileged, and the defendant is liable only if they interfered through independently unlawful or wrongful means (e.g., fraud, physical intimidation, bribery, or defamation).
A major metropolitan daily newspaper published an investigative article reporting that the city's elected Chief of Police had accepted bribes from an organized crime syndicate to protect illegal gambling operations. The reporter relied on a single anonymous telephone tip and did not review public bank records or interview police internal affairs investigators before publication. In reality, the Chief of Police was completely innocent, and the anonymous tip was fabricated. The Chief of Police sued the newspaper for defamation. At trial, the jury found that the reporter was negligent in failing to investigate the tip but did not entertain serious subjective doubts about the truth of the story. How should the court enter judgment?
During an oral conversation in the hallway of an office building with several corporate executives, a defendant falsely stated that a certified public accountant (CPA) was actively embezzling money from her firm's client trust accounts and had falsified corporate audit reports. In fact, the CPA was entirely innocent of any wrongdoing. The CPA brought a common law slander action against the defendant. The CPA did not introduce evidence of any specific monetary or pecuniary losses resulting from the conversation. The jurisdiction applies traditional common law defamation principles. Is the CPA entitled to recover damages?
A private investigator was hired by a tabloid magazine to gather personal information about a reclusive author. Without the author's knowledge or consent, the investigator entered the author's private residential property at night, climbed onto a balcony, and installed a concealed miniature video camera and audio transmitter inside the master bathroom. Over the next month, the camera transmitted private video footage to the investigator's recording device. Before the investigator could show the recordings to anyone or publish the material, the author discovered the hidden camera and filed an action for invasion of privacy against the investigator. Will the author prevail on a claim for intrusion upon seclusion?
A former employee applied for a managerial position at a logistics firm. The logistics firm contacted the applicant's former employer for a reference. In response, the former employer's human resources director wrote a candid letter stating that the applicant had repeatedly missed project deadlines and exhibited poor supervisory skills during his tenure. The HR director based this statement on internal performance reviews that she honestly and reasonably believed to be accurate, though one of the review summaries contained an inadvertent clerical error regarding a deadline date. The applicant was denied the job and sued the former employer for defamation. What is the former employer's most effective defense?