Business Case:

Business Case:
Today’s plugged-in, online world has posed a new threat to corporate Canada — the cybersmear. Disparaging comments can be posted on blogs and social networking sites at rapid speed and can spread around the world in a matter of minutes. But beware before you fire off a cease-and-desist letter — it’s a different world out there.



There was a time when corporations needed only to keep an eye on the daily newspapers and watch nightly newscasts to know just what the public knew about them. With the rapid expansion of online media, potentially defamatory information can now pop up in unforeseen places and quickly gain traction.

And if you’re hearing about it for the first time on the television or learning about it in a newspaper, it may be too late.

Roger McConchie, who among other specialties focuses his Vancouver practice on defamation and internet law, says cyber libel or cyber malicious falsehoods — commonly called “cybersmears” — are an increasing concern for companies as the popularity of online tools such as YouTube and Facebook expand.

He notes that the focus of online defamation previously was with entities known as “suck sites,” which were consumer-oriented web sites alleging companies’ products were faulty.

More recently, such activity has shifted to postings by unhappy insiders, disgruntled staff, or others who have a vendetta against a company and decide to launch an attack using social media such as chatrooms, blogs, or networking sites like Facebook, says McConchie.

“More and more of the slagging that used to go on in the past has moved onto the web and more and more of corporate attention has moved onto the web,” he says, adding that a lot of potentially defamatory statements remain online after being rejected because of the way information circulates and is archived on the web.
Such content can be very hazardous to small upstart companies — whose ability to move forward depends largely on their ability to establish trust with consumers and partners — trying to gain entry to the market, says McConchie.

“That stuff is, I won’t say it’s impossible to clean it off the web, but it’s at a minimum time-consuming, extremely expensive, and pretty close to impossible.”

McConchie guesstimates that, in 10 to 15 years from now, there will be a communal effort by courts across the globe to stop smears that are obviously erroneous from circulating on the web.

“But we’re a long way from that right now. Although it’s still a zone of activity that’s governed by law, it’s like the Wild West in the sense that the marshals are few and far between and they’re often outgunned; the courts are outgunned by the sheer volume of these defamers,” he says.

Jane Shapiro, senior vice president and senior partner at public relations firm Fleishman-Hillard Canada, conducted a qualitative study at a 2006 conference that queried a group of in-house lawyers on what issues keep them up at night. She discovered that threats to corporate reputation and major litigation were the two things that in-house lawyers feared most.

Shapiro went further to ask the lawyers about the internet and, more specifically, blogging. She found that about half were worried about liability issues related to blogging.

About one-third of the lawyers said they would either monitor or monitor and respond to false statements that appeared in blogs. One in five said they would take legal action against bloggers, if warranted.

While the response wasn’t overwhelming in terms of concern for online smears, Shapiro says times have quickly changed.

“I think if we were to go back and do that same survey today, we would find increased interest, or concern for that matter, about blogging.

“I think the environment is changing that rapidly in terms of the presence of blogs and bloggers, and the credibility they have,” she says.

Shapiro says an important factor for companies to keep in mind is that many of the reporters they work with in the mainstream media have their own blogs, and they are also reading and reporting the content of blogs.

“Because bloggers, many of them don’t need to verify their facts in the same way that a reporter in a mainstream newspaper or media outlet would, the facts are not always entirely accurate, but they’ll be reported if they’re in a blog in any event.”

There was a time when companies quickly responded to any false allegations with a threatening letter, but lawyer David Canton, who advises on information technology and e-business matters at Harrison Pensa LLP in London, Ont., says that can backfire now.

“These days, before you do that you have to step back and think about it,” he says. “Because sometimes you can cause more harm than good if you come at it too strong. You have to look at what kind of harm it has really done and [ask], ‘What can I say to change that?’”

Often, says Canton, a nasty letter from a company will be posted online and subject to ridicule.

“That can come back to haunt you for a couple of reasons. One is, quite often when people write these letters they tend to go a bit overboard in an attempt to try and intimidate . . . you may exaggerate some of the claims you have. But what can happen is it doesn’t have the effect you wanted because it’s so over the top that people pick away at certain parts of it and say how silly it is. It just doesn’t get you anywhere.”

Sometimes it’s best to ignore a claim than bring even more attention to it, says Canton, referring to the concept known as “The Streisand Effect.”

The term refers to an action taken by songstress Barbra Streisand, whose home was included in a series of photographs of the California coastline.

She didn’t like that people could find her house in the pics, sued to cease and desist, and in the end, the action of the suit brought far more attention to the fact that her house was viewable than if she had left it alone.
“They’re not easy calls, but you certainly can bruise your own brand by responding a bit over the top to things like that,” says Canton.

Shapiro says she and her colleagues at Fleishman-Hillard advise companies not only to be aware of what’s happening online, but be on the lookout for activity and decide if and when it’s necessary to respond.
She offers the following tips:

• If you decide to respond online to erroneous statements, it’s vital to be clear who you are when posting a statement. Some companies have been hurt after having someone post a comment without making clear who was behind the posting.

• Learn the language of the blogosphere. Communication is far less formal in these spaces and anyone responding for your company should be fluent in it.

• Monitor the web. Figure out where your company is regularly talked about and what the interested blogs or chatrooms are. If there isn’t a place where your company is currently discussed, where are the likely places for it to be talked about should a crisis erupt? Also find the sites with the most influence; don’t waste your time monitoring comments from someone without credibility or audience. If you don’t narrow the field, you will be overwhelmed when trying to monitor web presence.

• Set guidelines for employees for their activity online. “If the ground rules are clear, it avoids a lot of serious situations down the road with employees saying, ‘I didn’t know that I couldn’t do this,’” Shapiro says.
McConchie suggests in-house lawyers compile a catastrophic smear plan, “So that if something happens that involves a wide-scale, really damaging attack on reputation, you’ve got a team identified ahead of time to respond to it.”

McConchie says you should keep the following in mind when assembling a team:

• Include a public relations consultant experienced in crisis management.

• The group should contain a small internal team of individuals at the management level who have the authority to take action after consulting with the PR crisis manager.

• From a legal perspective, if you don’t have the expertise in-house, get counsel experienced in dealing with disparaging internet expression.

“If it’s a serious attack, you’re not going to have the time to put that team together,” he says. “That team should have a protocol, at a minimum, describing what factors it’s going to look at in the context of the corporation’s particular situation . . . and what mechanism it’s going to employ.

“It’s just the speed with which information can be disseminated on the internet that makes it essential, I think, to have this facility available.”

One common nugget of advice regarding the threat of the cybersmear is the need to monitor you company’s online presence. For some companies, a Google e-mail alert ( of any online content that refers to your company will be enough.

But other companies, such as Collective Intellect, offer services that can go much further in keeping tabs on your brand.

Darren Kelly, vice president of business development at Collective Intellect, says the company offers a real-time, persistent search for references of your company on all media. Blogs, online message boards, and social networking sites — all commonly known as “social media” — are included. Companies are alerted when there’s some kind of anomaly in activity.

Kelly says about a dozen companies are using the service, but a lot more are thinking of adopting it. “I usually get calls when something hits the fan. Then they become clients right away,” he says from the company’s Boulder, Colo., head office.

The service ranges in price from thousands to tens of thousands of dollars monthly, depending on the level of tracking required, says Kelly.

“Social media is a critically important part of media today. There are large pieces of society which no longer watch television commercials, no longer engage in things like reading newspapers. There’s a whole younger demographic which communicates only in social media,” says Kelly. “If you don’t have your ear to ground about that world, you’re missing out on major parts of the conversation and you need to be engaged in it.”

While many companies fear the corporate cybersmear, Michael Eisen, chief legal officer for Microsoft Canada, says the mammoth technology company’s Canada wing hasn’t been hit with such an attack, and he’s not preoccupied with the issue.

“There’s no question that our intellectual property folks are constantly on the lookout for people taking liberties with our trademarks, or misrepresenting a relationship with Microsoft, or infringing our copyrights,” he says.
“We’re also on top of the news and are aware of things that are being said, but haven’t bumped into anything outside of the intellectual property area that warranted a response on our part.”

He suggests that Canadian values impact his approach to comments posted online.

“Within certain limits, we are a country that champions freedom of speech and things are going to be said that you don’t like,” says Eisen.

While not all companies are equally susceptible to the threat of a cybersmear, McConchie says companies in the service, financial, and consumer goods sectors of the economy are most at risk.

And don’t stall on putting a plan in place, he urges.

“Until it happens to you, it’s an easy thing to ignore. You should check the levies before the storm hits,” he says. “Because if you’re not solid, you’re just going to be wiped out.”  


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