Defamation On The Inter-Office Electronic Bulletin Board: Is The Employer Responsible?

It is common for employers to set up an electronic bulletin board for their employees to share ideas over the corporate computer network. Typically, employers do not edit or control the content of employee messages to one another or employee messages sent externally via e-mail. This laissez-faire approach is a function of the economic and physical reality that there is simply too much electronic traffic to monitor and control all employee communications.

However, employers can control exchanges of information over their networks by participating in a discussion group, responding to employee feedback, or removing defamatory messages when they become aware of such information. When this type of control is exercised, an employer might be held responsible, as a distributor or librarian of a defamatory statement.

Where does the line of liability lie? A publisher who approves or adopts a defamatory statement can become liable for its publication. But does an employer, who gives its employees an electronic medium of communication to discuss workplace issues and share ideas, exercise sufficient control to become liable for a defamatory message? Some principles are beginning to crystallize in this evolving area of the law.

The two most frequently cited cases on this issue are Cubby, Inc. v. CompuServe, Inc., 776 F. Supp. 135 (S.D.N.Y. 1991), and Stratton Oakmont, Inc. v. Prodigy Services Co., No. 31063/94, 1995 N.Y. Misc. LEXIS 229, 1995 WL 323710 (N.Y. Sup. Ct. May 24, 1995).

In Cubby the Court held that CompuServe, an Internet Service Provider ("ISP"), could not be held responsible for a defamatory message that was alleged to have been published in an electronic newsletter on a CompuServe bulletin board. The reasons in this case were simply that the ISP did not have the technical means to review the content of all material published through its interface. The Court was of the view that CompuServe did not exercise sufficient editorial control over its computer bulletin board to impose upon it the same standard that is applied to a publisher of a newspaper.

At the other end of the spectrum is the decision in Stratton which dealt with the issue of whether defamatory statements made by an unidentified bulletin board user on Prodigy’s electronic board were published by Prodigy for the purposes of a libel claim. Prodigy’s computer network had at least two million subscribers who communicated with one another and with the general subscriber population on its electronic bulletin boards. The "Money Talk" bulletin board was recognized as the leading and most widely read financial computer bulletin board in the United States.

The Supreme Court of New York found that Prodigy held itself out as an online service that exercised editorial control over the content of messages posted on the bulletin board and thereby expressly likened itself to a newspaper. The evidence in this regard included:

"content guidelines" requesting users to refrain from posting insulting notes;

the use of a software screening program to automatically prescreen all bulletin board postings for offensive language;

the use of a "Board Leader" to enforce the guidelines; and

the existence of an "Emergency Delete Function".

The Court held as follows:

The case law in Canada and England has not evolved to the extent that it has in the U.S. Some conclusions can, however, be drawn from cases dealing with defamatory statements made in the paper world.

The English case of Byrne v. Deane, [1937] 1 K.B. 818 (C.A.), is authority for the proposition that liability will be imposed where publication occurs in a location over which the defendant has control, such as a bulletin board on business premises, and reasonable steps were not taken for its removal after the defendant becomes aware of the defamatory remarks posted there. Here, the Court determined that because a golf club was aware of a defamatory notice posted on its wall, it was liable for participating in its publication when it did not take steps to remove it.

Canadian cases arrive at similar findings. For example, in Lobay v. Workers & Farmers Publishing Association, [1939] 1 W.W.R. 220 (Man.K.B.), the Court found officers of a printing company liable for publication when they did not prevent their employees from using company presses to circulate defamatory material.

All of the above cases suggest that anyone giving credence to a defamatory statement faces potential liability for defamation. In the electronic bulletin board context "giving credence" might be effected by the exercise of some degree of control over the exchanges and communications between employees. For example, has the employer set up a code of conduct? Is it common practice for the employer to review or filter all messages? And most important, what action did the employer take if it became aware of a defamatory message? The case law indicates that the greater the ability and discretion of the employer to exercise editorial control over electronic messages, the greater the risk of liability.

In this regard, there are strong arguments to make in support of the proposition that an employer that exercises no control over employee communications on an electronic bulletin board should not be liable for a defamatory message posted on the board. However, once an employer becomes aware of a defamatory message, action must be taken to remove the message in question. Remember that in the English case of Byrne v. Deane, the Court imposed liability on the owners of a golf club because they had knowledge of a defamatory statement yet failed to remove it from their wall. Thus, no matter how little control an employer exercises over their electronic bulletin board, it will not be absolved of liability if it acquires knowledge of the publication of a defamatory statement and takes no action to remove it.

Scott Little practises in the area of libel and defamation in the Ottawa office. He may be reached at (613) 786-8660 or by e-mail at littles@gowlings.com.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.