crybaby_insideCan posting a factually accurate, but negative review of a business online be considered slanderous? On the surface, it seems to defy logic, but a lawsuit filed by refurbished medical equipment reseller Med Express against one consumer making such a complaint challenges this notion.

The situation, first reported by consumer law and privacy blog Public Citizen, is that South Carolina resident Amy Nicholls ordered an unspecified item from Med Express’ eBay store, paying for both the product and the listed shipping costs via PayPal. When the item was delivered to her, there was a balance of $1.44 to be paid toward the shipping cost. According to the complaint filed by Med Express, the company had weighed the item prior to shipping and couldn’t explain the postage shortfall.

Nicholls left negative feedback on the company’s eBay account which read “Order arrived with postage due with no communication from seller beforehand.” Approximately one month after the item was delivered, Med Express offered to reimburse Nicholls for the expense and asked her to revise her negative feedback. She declined, and the company subsequently filed a defamation complaint in Medina, Ohio against the consumer and requested a temporary restraining order against eBay (hoping to have the feedback temporarily removed). Thankfully, the judge denied the TRO but did set an oral hearing on a preliminary injunction.

Whether leaving such feedback is ethically fair, given the company’s efforts to rectify the situation, is subjective at best. But, to call it false and deliberately slanderous of Med Express’ good name and reputation, as the company asserts in its suit, is ridiculous.

Based on the facts listed in Med Express’ complaint – which includes a clear admission of the shipping shortfall and indicates that Nicholls’ case was not the only such instance – the feedback was neither inaccurate nor slanderous, given that the legal definition of slander requires that a statement made by one party about another be untrue, and be harmful to the second person’s reputation.

Med Express’ desire to maintain a pristine seller rating, is irrelevant in the event that the negative feedback left by a consumer is factual. But this is precisely its motivation. As the company’s attorney explained to Public Citizen, “[the client] sells exclusively over eBay, where a sufficient level of negative feedback can increase the cost of such sales as well as possibly driving away customers.”

Boo hoo.

At worst, Nicholls’ comment is petty for publicizing a situation for which the company offered a reasonable solution. At best, she is exercising her duty as a member of the community of online consumers who implicitly agree to police Web merchants for the collective benefit. It’s not like this is a new concept either. The Better Business Bureau has been collecting and disseminating business reliability ratings and reviews since 1912.

Unfortunately, Ohio doesn’t have an anti-SLAPP statute, which is designed to prevent lawsuits intended to censor, intimidate, and silence critics. Instead, the Med Express is free to bully Nicholls, who must bear the cost and time burdens of defending herself.

Three things should happen immediately. First, Ebay should step in, with all the muscle afforded through its $73.6 billion public market cap, and offer to defend Nicholls against Med Express. Secondly, the company should investigate avenues to suspend Med Express’ merchant account on its platform until the suit is dropped. Third, consumers and vendor partners should immediately cease doing business with Med Express until it drops this ridiculous and frivolous suit.

Longer term, the legal system in this country needs serious reform such that litigants can no longer manipulate smaller defendants. We regularly see similar abuse from patent and copyright trolls who intimidate startups and small companies into paying penalties or entering licensing agreements, rather than risk a costly court battle.

The Internet, in general, and the ecommerce category in particular, rely on free speech and transparency to function – particularly when purchasing items sight unseen from an individual or company you’ve never met in person. Negative reviews, when justified, are a necessary part of this system functioning healthily. For the positive reviews to mean anything, the possibility of negative reviews must exist.

[Image courtesy plaisanter~]