Business & Finance Business Insurance

Protecting Your Reputation

However you look at the world today, the fact of the internet has changed the way in which business relates to the world. Twenty years ago, if a customer had a complaint, he or she was a lone voice in the wilderness. Unless a newspaper was prepared to publish details, there was very little the complainer could do to be heard. Now it's routine to email, sms and tweet, we have hundreds of cyberfriends on Facebook and other networking sites, we join forums, post messages on bulletin boards and, if we choose to spend a few dollars, we can even set up our own website. Worse, there are now websites like RipOffReport and that not only encourage people to complain, but also link into press and other media coverage. Their pages get high Google rankings. They exist to give your customers a better way of making a complaint if they feel ripped off. Instead of writing letters to your own complaints department which can safely be ignored, they can post one long rant on one of these sites and get a top-ten Google ranking.

Remember the posts on these sites do not have to be real. They are anonymous and can be made by angry employees or jealous competitors who just want to damage your reputation. So it is not enough for your company to have the best service in the world. You may also need to fund litigation to identify who is making these attacks and, if necessary, claim damages for loss of reputation. From the outset, the courts have held the law of defamation applies to all content posted on the internet. But, as always, there is a problem. The Communications Decency Act protects all the sites allowing third parties to post. Even though they may have deep pockets and good insurance to cover all your losses, they are excluded from liability. But the ISPs can be forced to reveal the personal information of their anonymous posters.

The way this works is for you to file John Doe proceedings alleging defamation and apply to the ISP for the poster's identity. If you find out this is an employee, you can terminate. If it is a competitor, you can change from John Doe to the actual poster and continue the action. But the ACLU has now started to take on some of these cases and the fact you are suing can, in its own right, become a PR problem. There are new cases that sometimes require the ISP to notify the poster of the claim and give time for a reaction. With the ACLU's help, many of the posters are now raising First Amendment rights of free speech, i.e. that legal proceedings are being used to intimidate internet users. New cases are arguing there should be sufficient evidence to show a reasonable chance of succeeding in a defamation action before the potential defendant's name is disclosed.

Before you even think of setting off down this route, read your business insurance policies to find out exactly what legal costs are covered. Even if your costs will be covered, ask whether suing is a sensible way of managing your reputation. You are the big guy chasing the little guy over a complaint. Sadly, business insurances does not cover your loss of reputation if you act like a bully.

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