Posted by Bella Bycroft & Brydie Godsiff on March 21 2023 in News

As the saying goes, “first impressions are everything” and, in the digital age, online reviews are just one tool that a business can utilise to influence and attract consumers.

There have been significant increases in customers shopping online, and in conjunction with the “Covid time” we live in, business and product reviews form a vital first impression for any business.

Online Defamation

Although online reviews allow customers to gain a first impression of a businesses’ reputation, these reviews can also leave the door open to reviews that can be biased or cross into the territory of defamation.

The effortlessness which accompanies the ability to post online reviews can increase exposure and customers for your business. However, with this comes the ability for individuals to post reviews anonymously. Anonymous reviewers can have a significant impact on your business as their hidden identity makes it difficult to tell if the feedback given is truthful.

This is problematic as it opens the floodgates to allow individuals to remove themselves from their personal identity when reviewing. Individuals can leave a permanent online footprint, without repercussion for them as an individual.

The recent Australian case of Colagrande v Kim [2022] FCA 409 demonstrates that although anonymous reviews provide additional hurdles in locating the defendant/author in defamation proceedings, it can be done.

In this case, an anonymous review was left on a website specifically for reviewing medical practitioners. The review, left for a plastic surgeon Dr Colagrande, claimed Dr Colagrande had been accused of sexual assault and stated they should no longer be practicing: “after what he did to me, I can’t believe he is still practising.”

It was discovered the review was made by a rival plastic surgeon and the false defamatory review had caused Dr Colagrande extreme harm. The Federal Court made an order for the Respondents to pay damages in the amount of $420,000.00 and special damages of $31,511.29. The damages in this proceeding were significant due to the costs related to discovering the identity and location of the anonymous reviewer.

The World Economic Forum stated in 2021 that the direct influence of fake online reviews on global online spending is $152 billion. Therefore, regardless of the products and services your business offers, online reviews are vital.

Colagrande v Kim also demonstrates the importance of this. Google reviews are usually a reviewer’s first port of call, but it is vital to remember there are numerous sites and apps available to publish reviews. Whether you are a medical practitioner, restaurant owner, real estate agent, or schoolteacher, specialty sites exist specifically for the purpose of reviewing individuals within these vocations.

It is good practice to annually review these sites where you or your business have an online presence, to ensure all information being published is true and correct.

What is considered a “defamatory review”?

In order for a statement to be considered defamatory of a business in New Zealand, it is required under the Defamation Act 1992 to be:

  1. published to a third party, and
  2. harm the reputation of your business.

It is important to note that statements of truth cannot be defamatory. Consumers who write harsh or critical reviews, but remain truthful, are unlikely to be considered as making a defamatory statement. But, if a consumer was to write a blatantly harsh and false review, such as stating the owner has a past criminal history (when they do not) in order to deter customers from purchasing from them, this could be considered defamation.

Your rights if you were to find your business in this position:

The predominant mode to challenge defamation is through the avenue of formal litigation. Unfortunately, with the costs and time involved with bringing a proceeding, litigation can be inaccessible for many people. In instances where the identity of the reviewer has been established, a formal letter from a lawyer requesting the removal of the review, and outlining the potential for legal action, could be enough to sway a reviewer to remove their defaming review.

Other avenues to consider:

Litigation isn’t suited to everyone, but what should you do if you find yourself in this position and cannot afford to litigate? Or if you have received a harsh review that may not reach the threshold for defamation?

The Harmful Digital Communications Act 2015 (the Act) exists to prevent online harassment and bullying. The Act covers all online communications and prohibits communications which are:

  1. threatening, intimidating or menacing,
  2. indecent or obscene,
  3. form the basis of harassment,
  4. consist of false allegations, and
  5. attack their identity.

The first step of this process is to lodge your complaint to be investigated with NetSafe New Zealand. If you are not happy with the outcome of the NetSafe investigation you can then apply to the Court for a harmful digital communications order. Based on the outcome of the order, the Court has access to a scope of remedies, this includes:

  1. order to take down the respective material,
  2. cease and desist orders,
  3. orders to publish a correction, an apology, or give a right of reply to the complainant,
  4. orders to release the identity of the source of anonymous communication, and
  5. ordering name suppression for any involved parties.

We are able to assist you in assessing whether you have a potential claim in defamation, as well as analyse all avenues available to you. Please get in touch with the team below.

Kalev Crossland | Partner |

Brydie Godsiff | Solicitor |

Bella Bycroft | Solicitor |

This paper gives a general overview of the topics covered and is not intended to be relied upon as legal advice.