The Twenty Million Dollar Blog Entry

Ever had a bad experience with a company? unhappy faceI know I have. And I wanted to tell the whole world just how bad my experience was. In the past, I would tell my friends and family about the company and suggest they find another company to deal with. When I had my last apartment I had a list in my address book of companies that had cheated friends and co-workers and a list of companies that came highly recommended by those same friends and co-workers.

With blogs, anyone can instantly tell hundreds, thousands, even tens of thousands of strangers about their unhappy experience. That single blog entry has the potential to lead to lost revenue for the company being discussed and hurt that company where it matters most. If you think about it, isn’t that really the intent of telling others that a company should be avoided?

A clever marketing or business owner might find that blog entry, work with the blogger to resolve the issues and turn an unhappy customer into one of their happiest. That blog entry suddenly becomes a real-life example of how well the company deals with problems and how they fix them.

Or, the company being discussed could simply hire a lawyer and file a lawsuit looking for reimbursement for lost revenues and even ask for punitive damages. The blogger might feel they are simply relating a factual accounting of their experience and stating an opinion. Free speech and all that. Right? Maybe not.

Personal Opinion or Corporate Endorsement?

One blogger, an eco-friendly clothing designer, quickly learned the difference between a personal blog and a corporate blog. To be perfectly honest here, I have no idea when this transformation occurs. Does my little writing business and other income-producing websites classify Blog About Crafts as a corporate blog or would it be considered the opinions and rantings of a private individual?

In this month’s issue of Inc. Magazine, there was a cautionary tale about a small business owner in an article entitled, A Cold Call, a Blog, and a $20 Million Lawsuit. After an encounter with another business, she blogged about her unhappy experience with them. By expressing her opinion that she believed the other business was less-than-honest in its dealings with her, she ended up on the wrong side of a $20 million lawsuit. She had no idea that her blog entry was not a personal experience and opinion but was actually classified legally as a corporate endorsement.

Dozens of other small business owners posted comments on her blog. Unfortunately, all that conversation brought her blog to the attention of the company everyone was talking about and left her wide open for a lawsuit to recover lost revenue due to her blog post and a members-only forum post that referred to the blog post.

Because she owned a business and her blog was attached to that business, her blog post was classified as negative endorsement of a CEO and faced stronger defamation and liable restrictions than a blog post made by someone who is not a business owner.

Is any blogger safe from being sued?

I read the article in stunned silence. It seems ridiculous to call myself a CEO as I am a sole proprietor. With the little amount of money I make in a year, even calling myself a small business owner seems a bit overblown. I suspect the owner of that blog felt the same way when she started getting letters from lawyers who wanted a great deal of money from her for simply relating her opinion of another business. In fact, her first response was to assume that they were just trying to scare her with “imaginary lawyers” and she answered the first correspondence as she felt befitted an empty threat.

I have visited her website and it would appear that she runs a very small company. Her site gives no clue as to her income levels but I suspect that many crafters, artisans and web professionals achieve a similar level of success and never for a moment considered themselves a CEO or their blog as a “corporate blog”.

I won’t mention either the blogger or the “wronged” company as I have no wish to feel the wrath of either one.

Fortunately the blogger has obtained a lawyer that is helping her pro bono (for free). Unfortunately, she has spent a great deal of time and effort dealing with this mess instead of building her own business.

What is a business?

Like I said, I have no idea when a blog moves from a personal opinion to a corporate one. Is it as simple as being tied to an income producing entity or whether it requires that entity to be incorporated or defined in some specific way?

Many web professionals consider a site to be a corporate or commercial site even if it only has Adsense on it. Would such a site be legally defined as a corporate blog?

The Real Losers Here

It’s a shame that a small business owner can not share and warn other small business owners about a company that may be attempting to prey on young and growing companies without the fear of being sued for everything they own and then some.

After reading this article, I will certainly be more circumspect before expressing any unfavorable opinions of another business on my blog or on a public or private forum. I would also recommend to anyone reading this blog post that they too consider their blog posts as being a corporate endorsement if their blog is tied to an income producing endeavor. Tis a shame and everyone loses in the long run.

[If Inc. Magazine does a follow-up to this article I will let you know.]

I would love to hear what others think of free speech, blogging and when a blog is considered a “corporate blog”. Please do not post anything specific to the case discussed in the article.

A few suggestions for further reading...

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