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Intra-Company Communications Spawn Employee Defamation Lawsuits

Prepared By: Melissa C. Marsh, Los Angeles Employment Attorney
Written: March 2009

Employers pay attention! Defamation occurs when an unprivileged false statement of fact is published. According to section 577 of The Restatement of Torts (Second), a communication by one agent (employee) of a corporation, acting within the scope of her or his employment, to another agent (employee) of the same corporation is a publication by both the agent and the corporation. In California, if an employee sends an intra-office disciplinary memo regarding another employee's behavior to any other employee within the company (including the human resources department) the memo will be considered a "publication" for the purpose of a defamation claim. In such an instance, the employee who was the subject of the disciplinary memo may sue both the company and the supervisor for defamation if the memo contains a false statement of fact.

Although an employer may defend a defamation claim with a "qualified privilege," the privilege defense can be defeated if the employee can show the communication was made with "malicious intent." If the employee's attorney pleads malice, the employer will find it very difficult to obtain summary judgment and will probably face a jury trial if the matter cannot be settled before trial. Evidence of malicious intent can be shown simply by such events as a failure to investigate the allegations, prior good evaluations, and inconsistent statements made by the company's employees.

All employers should advise their employees to investigate and substantiate facts before preparing a negative memo, negative review, or other written comment on an employee's behavior. After such an investigation, supervisory employees should be cautioned against making potentially false statements of fact and trained to phrase their allegations and/or perceived findings in subjective terms of cautionary opinion.

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If you would like the assistance of a Los Angeles, California employment law attorney to advise your small or medium sized business on employee matters, or to prepare your employee policies, please call: 818-849-5206 or Email Melissa C. Marsh, a Los Angeles, California employment law lawyer based in Sherman Oaks and West Hollywood. We are available to serve small and midsize businesses throughout Los Angeles County, including: West Hollywood, Beverly Hills, Miracle Mile, Burbank, North Hollywood, Valley Village, Toluca Lake, Studio City, Sherman Oaks, Van Nuys, Encino, and Woodland Hills.

© 2009 Melissa C. Marsh. All Rights Reserved.

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Located in Los Angeles, California, the Law Office of Melissa C. Marsh handles business law and corporation law matters as a lawyer for clients throughout Los Angeles including Burbank, Sherman Oaks, Studio City, Valley Village, North Hollywood, Woodland Hills, Hollywood, West LA as well as Riverside County, San Fernando, Ventura County, and Santa Clarita. Attorney Melissa C. Marsh has considerable experience handling business matters both nationally and internationally. We routinely assist our clients with incorporation, forming a California corporation, forming a California llc, partnership, annual minutes, shareholder meetings, director meetings, getting a taxpayer ID number (EIN), buying a business, selling a business, commercial lease review, employee disputes, independent contractors, construction, and personal matters such as preparing a will, living trust, power of attorney, health care directive, and more.