What is Commercial Disparagement?

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What is Commercial Disparagement?

Commercial disparagement—similar to defamation—is also referred to as “trade libel” or “business disparagement.” It is the publication of false and derogatory statements or information about a business or its products or services that discourage people or other companies from dealing with that business.

Elements of a Commercial Disparagement Claim in Arizona

In order to pursue a commercial disparagement claim in Arizona, you must be able to prove that:

  • A statement was made about a business that was false, intentional, and derogatory.
  • The defendant either intended to cause financial harm or reasonably believed that the statement could result in a financial loss for the business.
  • The defendant acted with malice.
  • The statement caused the business financial harm.

Commercial disparagement not only covers false statements about a company’s products or services, it also covers derogatory statements made about a company’s financial health — e.g., statements alleging that a company is in financial trouble, which could negatively affect its ability to obtain credit or investment capital for its operations.

Common Defenses to a Commercial Disparagement Claim

A defendant accused of commercial disparagement may rely on one or more of the following defenses:

Truth — a true statement is an absolute defense to a commercial disparagement claim. Sometimes statements that are found to be “substantially true”—meaning they are factually true with some slight inaccuracies for expression—may also provide a defense to a disparagement claim.

Opinion — if the statement was asserted as opinion by the defendant and not as a fact.

Absolute privilege — witness statements during a judicial proceeding and those made by someone in the course of a professional duty are covered by absolute privilege, which bars legal action against the speaker or publisher even if it is made with malicious intent.

Conditional privilege — if the statement was made to protect a defendant’s life or other legally protectable interest, conditional privilege may apply unless the statement was made with malice.

Damages for a Commercial Disparagement Claim

Commercial disparagement claims can be difficult to prove, which is why you need an experienced business litigator to help you protect your business.

If a disparagement claim is successful, damages can be awarded for loss of reputation, lost sales, and even punitive damages if the defendant’s conduct was egregious enough.

Williams Mestaz, L.L.P., has the experience and reputation that you want when you are dealing with a business-related lawsuit. We are here to obtain the best possible outcome for your situation. Do not hesitate to contact Williams Mestaz, L.L.P., at (602) 256-9400, and see how we can help you resolve your legal matter.

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