How incredible it is that a single shareholder in a PLC can cause the company tremendous amounts of financial damage just by using Twitter and other social media. Defamation by shareholders, often disgruntled shareholders, against their own company, is one of the most irrational acts that we have seen in recent years.
In the case of the international gold mining company RRR and its shareholder Gary Carp, the consequences of Mr Carp posting defamation against the company were particularly serious to the company and to the thousands of investors who at one point saw the value of their shares plummeting very sharply.
The company was left with no choice but to issue legal proceedings against its shareholder in order to protect the interest of the rest of its shareholders who were being scared off by dangerous speculation and by highly defamatory conversations that Mr Carp initiated on various investors’ forums.
This was probably the first ever case in the UK of a PLC suing a shareholder over defamation on internet forums and on Twitter. The dilemma that the company faced, whether legal action for defamation against a shareholder would be viewed as a bullying act or whether it would be accepted as an act of protection, appreciated by other investors, was resolved very quickly when following the successful law suit, it received nothing but positive and encouraging feedback from its investors. The investors viewed the initiation of legal proceedings against their fellow shareholder as a demonstration of leadership by the company’s board of directors rather than an oppressive act and their confidence in the company grew. Read about the case of legal action against a shareholder instructed by Cohen Davis solicitors here.
There is now evidence that proves that between 16 per cent to 20 per cent of online reviews might be fake. Fake online reviews could be reviews in favour of a company or against it. If they are against it, they are likely to be defamatory and this is where we can help as a specialist internet law defamation law firm .
However, you are most likely to benefit from the support of an expert social media defamation solicitor if you want to remove a defamatory review without the need to obtain court orders.
Most Lawyers, particularly defamation solicitors and social media lawyers, are very well trained in spotting a lie. Investigating evidence and finding inconsistencies…
Occasionally a spate of defamation against a company, particularly on the various investors’ forums, has the potential of influencing the company shares price which means there could be a sizeable portion of shareholders who lost some of their money as a direct result of defamation against the company.
In such case, can a company sue the defamer for damages for the loss of value of its shares?
The general answer is no because the company and its shareholders are separate legal entities, the shareholders will need to sue for damages independently of the company, after all, it is the individual shareholders who lost their money following the defamation on the company as opposed to the company itself.