Does Slander Apply to Organizations?
Laws regarding slander apply to organizations, such as corporations, limited liability companies, and professional associations. Organizations victimized by slander may file civil lawsuits for damages, and organizations that perpetrate slander may be sued by the parties they injure. Each state has its own slander laws; however, no state law may go so far as to restrict an organization or person's constitutional rights of free speech.
Organizations may sue or be sued regarding slanderous statements that injure a person or business's reputation. Slander is verbal, not written, in nature. Slanderous statements are false and must be published, meaning spoken, to a third party. Truthful statements, even if they are negative, do not constitute slander. Parties may recover money damages for losses incurred by slander; also, court orders, or injunctions, can be issued to stop parties from spreading further slanderous statements.
Some states, like Michigan and Arizona, categorize certain slander in a way that assumes that hurtful damages can be presumed. Generally, slander regarding contagious or sexually transmitted disease or that a woman is unchaste; significant business inaccuracies, such as bankruptcy rumors; and allegations of crimes allow damages to be presumed. Practical examples include a manufacturing organization suing for false allegations that its products are dangerous and an individual suing a retail organization for false rumors that he shoplifted.
Slander claims against news organizations must show that false statements were malicious or deliberately spread to cause damage. Simple errors in news reporting are not enough for slander cases. States like Arizona allow punitive damages in slander lawsuits. Punitive damages are meant to punish defendants and exceed actual damages a news organization may cause by disseminating malicious slander. News organizations generally can avoid these punitive damages by retracting slander following a written demand by the plaintiff.
State laws classify certain statements as privileged, preventing them from being the basis for slander suits. For example, statements made in court proceedings against an organization are privileged and cannot be used to form a slander claim. Privileges encourage important communications without the fear of slander reprisals. States also have varying privileges for quasi-legal proceedings outside of court. For example, privileges generally cover state ethical complaints against professionals such as doctors and lawyers.