Many website owners will be studying a legal decision issued in London this week, after the Digital Trends site from the US was ordered to pay £50,000 for allowing comments that libelled a company.
The irony is that under US law the company could not have been liable for allegations posted on its discussion threads. Under the Communications Decency Act the only possible defendant in libel litigation is the, frequently anonymous, poster.
The claimant company trades as Train2Game and SkillsTrain and provides distance learning courses in computer games design and IT and book-keeping. It sued Digital Trends over allegations made on discussion threads suggesting that it operated fraudulently.
To make matters worse the thread title,”Train2Game New Scam…”, came up in Google searches for the claimant. An attempt to join Google as a defendant in the case failed last year, when it was held that the search engine was not responsible for defamatory statements produced in its search results.
The defamed company may not actually be able to get its money from a US site, but it does now have a high court judgment which says that allegations published on the Digital Trends website are false and an award of damages high enough to represent vindication.
£50,000 seems like a very high settlement as companies, unlike individuals who sue for libel, are not entitled to compensation for hurt and humiliation (they have no feelings) and this usually means lower awards for damages.
But in this case the company argues successfully that untrue allegations made on a website that claims two million visitors a month substantially damaged its trading position. It also argued that other websites had quoted the allegations and that potential customers had been lost because of the statements made. Their courses cost £5,000 each, so a claim of 10 lost students would perhaps seem reasonable.
Website publishers will note that the award might have been lower had Digital Trends removed the offending comments when their libellous nature became clear. But it failed to do so.
There is actually no new law here, just an extension of existing legal principles. But the idea that a website owner can be held liable for comments made by users of its services on discussion forums is now clearly established in law.
And that might make many who run such forums look more carefully at exactly what their users are posting.