As a Texas business owner in Texas, there is a chance someone may have disparaged your business on a popular website or social media, possibly giving rise to a business disparagement claim in Texas.
If this hasn’t happened to you yet, it may very well be something you face in the future.
But what exactly is business disparagement in Texas, and how does it differ from a defamation claim?
In this blog post, the Massingill team will explain business disparagement in Texas and how to distinguish it from defamation.
We’ll provide some clear examples of when you need to take immediate action to protect your business.
Remember, if you believe someone has disparaged your business, you may have a claim for relief.
It is always worth contacting a member of the Massingill team online or calling 512-410-0343 for a free case evaluation.
Disparagement: The Business Law Definition
Words are disparaging if they “cast doubt” on the quality of the business.
The defendant must also know that those words would cast doubt on your business’s quality or reputation.
Unfortunately, you must be able to prove that those words are false. In business disparagement cases, you, as the claimant, will have the burden of proof.
Elements of Texas Business Law Disparagement
The Texas Courts have recognized four elements of claiming business disparagement in Texas.
Under Texas law, business disparagement means that someone:
- Published false and disparaging information about a business;
- Acted with malice;
- Acted without some kind of privilege; and
- Committed actions resulting in some kind of special damages to the plaintiff.
If you believe that someone has disparaged your business, contact Massingill as soon as possible.
We can evaluate your case and see if it meets the Texas standard for business disparagement.
Making False Statements
Business disparagement is not simply a matter of criticizing a company on social media after a bad customer experience.
Even if someone’s statements about your company are false or misleading, that by itself does not prove business disparagement.
You must show that someone intended to interfere with your business or economic interest to prove your case for business disparagement.
Alternatively, you can show that someone knew they were making a false statement or acted with reckless disregard for the truth when speaking about your business.
Actual Malice
Standards for proving disparagement are different for public and private figures.
Texas courts have held that when the plaintiff is a public figure, there must be proof of “actual malice” by the person defaming your business.
If you are not a public figure, then you only need to show that someone was negligent in defaming your business when bringing a business disparagement case in Texas.
Privilege
The third element of business disparagement is demonstrating that someone does not have “privilege” to speak falsely and in a damaging way about your business.
Examples of privileges that would protect someone from liability in a business disparagement lawsuit include:
- Statements made under oath in a judicial or regulatory proceeding;
- Comments by legislators during legislative debates; and
- Statements made by the media that may be in the public’s interest to hear.
If you are unsure whether a statement made in your case is privileged, contact Massingill today.
Our firm can help evaluate your case and help determine whether to bring a business disparagement lawsuit.
Special Damages
Proving special damages is the final element of bringing a business disparagement case in Texas.
You will need to show the court that the defendant’s actions caused others to avoid doing business with you.
You will also need to show that the defendant’s actions economically harmed your business.
Statute of Limitations
It is important to note that there is a time limit on how long you have to bring your business disparagement claim.
The statute of limitations for a business disparagement claim is two years.
If you wait longer than two years to file your claim, absent special circumstances, you may have an extremely hard time prevailing in court against someone whose false statements have harmed your business.
What Is the Difference Between Business Disparagement and Defamation?
Both business disparagement and defamation have to do with spreading false information that damages your business.
However, in a business disparagement case, false information harms the economic interests of your business.
In a defamation case, a false statement harms the reputation of a person, for instance, the business owner.
Contact a Texas Business Law Attorney Today
If disparaging comments have harmed you or your business, we can help.
Business disparagement in Texas can be a complex claim to navigate, but Massingill can help you every step of the way.
Our experienced business litigation team assists clients with legal disputes so that they can keep their businesses on track.
Contact Massingill today online or call us at 512-410-0343 for a case evaluation and to discuss how we can help you navigate your business disparagement claim.
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Joshua Massingill
Joshua Massingill is an attorney practicing in Austin, Texas. He serves on the Texas State Bar’s Law Practice Management Committee, the Leander Educational Excellence Foundation (LEEF) Board of Directors, and the Success-Werx Board of Advisors. He mentors young entrepreneurs in Leander ISD’s INCubatorEDU program and is active in his church.
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