Disparagement in law, often referred to as “commercial disparagement” or “trade libel,” is a legal concept that involves making false statements or spreading false information about a business, product, or service with the intent to harm its reputation and economic interests.
It is a civil tort that allows individuals or businesses to seek damages if they can prove that false statements led to financial losses.
Disparagement typically involves making derogatory or damaging statements that go beyond mere criticism or opinion and are demonstrably false, resulting in harm to the business’s reputation and financial standing.
Courts and commentators have struggled with the tort of disparagement for four hundred years.’
The problems inherent to the concept of disparagement have recently been exacerbated by new developments in the interpretation of the first amendment.
Disparagement Vs. Defamation
Disparagement and defamation are both legal concepts related to damaging a person’s or entity’s reputation, but they have distinct differences.
Defamation encompasses false statements that harm a person’s reputation, with libel (written) and slander (spoken) as subcategories.
Disparagement, often known as “commercial disparagement” or “trade libel,” specifically relates to false statements made about a business, product, or service with the intent to harm its economic interests.
While defamation is broader and includes harm to personal reputation, disparagement is more focused on economic harm to businesses or their products/services.
Both can result in legal actions and potential damages.
In a business disparagement case, the false assertion harms the economic interests of the business. In a defamation case, the false assertion harms the reputation of an individual (who may be a business owner, for instance).
Elements For Disparagement
According to DUKE LAW JOURNAL, there are six elements to the tort of disparagement:
- Intentional and
- unprivileged
- publication of
- a false statement that
- disparages the property of another
- in a manner that can be measured.
To establish a claim of disparagement in law, the following elements are typically required:
- False Statement: The defendant made a false statement about the plaintiff’s business, product, or service.
- Publication: The false statement was communicated to a third party, either in writing (libel) or orally (slander).
- Economic Harm: The false statement must have caused economic harm or financial losses to the plaintiff, such as a decrease in sales or damage to the business’s reputation.
- Intent: The plaintiff must demonstrate that the defendant made the false statement with the intent to harm the plaintiff’s economic interests or acted recklessly regarding the truth.
- Falsity: The plaintiff must prove that the statement is false or misleading.
- Causation: The plaintiff must establish a causal link between the false statement and the economic harm suffered.
These elements may vary by jurisdiction, and the specific requirements can depend on the circumstances of the case.
Idaho Case Law On Proving Disparagement
“—a plaintiff in a disparagement action must show the falsehood to be substantial, going to the gist of the publication” Matheson v. Harris, 572 P. 2d 861 – Idaho: Supreme Court 1977
“In order to maintain a cause of action for slander of title, the claimant has the burden of showing:(1) uttering or publishing of slanderous statements;(2) when the statements were false;(3) with malice; and (4) resulting in special damages.” Matheson v. Harris, 572 P. 2d 861 – Idaho: Supreme Court 1977
