Can Corporations Sue for Defamation?

Corporations may sue for defamation when false statements are made about their businesses or reputations. Each state has different laws regarding defamation; however, generally corporate defamation suits must meet three requirements. An actionable statement must be untrue, it must be made in writing or verbally to a third person, and it must cause the corporation damage.

Truth is always an absolute defense to a lawsuit for defamation. Corporations cannot sue if honest, unflattering statements are made about them even the statements hurt their reputations. People may freely express facts and opinions about their experiences with corporations if their characterizations are accurate. For example, truthfully stating, "My personal opinion based on my experience is that the company has poor customer service" would generally not be a basis for a defamation lawsuit.

To allege defamation, corporations must show false statements were made to third parties. This is called "publication" even though it doesn't involve publishing the statement in a newspaper or public forum. For example, you can't be sued for writing a defamatory email that you never send. Generally, you may be sued even if you are not the original publisher of false statements. For example, passing on defamatory rumors may lead to a lawsuit.

Generally, corporations must show defamatory statements resulted in damages to their businesses or reputations. For example, if you make false statements that cause a corporation to lose customers, you may be sued for the losses it incurred in revenue damages. In some states, like Arizona, defamation suits allow for punitive damages. This means a party may be able to sue for damages beyond the actual losses suffered to punish and deter defamatory communications.

Corporations must sue within specified times after defamation occurs. Some states, like Arizona and Michigan, have short, one-year statutes of limitation. Others states, like Indiana and Hawaii, allow two years to sue. A few jurisdictions, like Massachusetts, allow three years. Limited exceptions extend filing deadlines. In Arizona, if false statements are deliberately hidden, such as in secret communications, filing deadlines begin to run when the statement is discovered rather than when it was made.