The Case Against Expanding Defamation Law

Abstract

It is axiomatic that defamation law protects reputation. This proposition—common sensical, pervasive, and influential—is wrong. But it is wrong in a very instructive way, and a careful examination of its mistaken assumptions carries deep lessons for First Amendment jurisprudence, defamation law, and the regulation of falsehoods across legal fields.

The key fallacy is the failure to recognize that laws not only affect how individuals behave, but also how they think. Whenever an allegation is made, individuals decide whether and how much to trust it based on myriad factors. One such factor is the strictness of defamation laws. To the extent strict defamation laws deter purveyors of falsehoods, they also make statements appear more trustworthy, as individuals will reason that few would brave a falsity in the face of strong financial sanctions. Thus, strict defamation laws have the unintended consequence of making individuals more susceptible to believe those statements that are actually false.

This heretofore unrecognized complexity of defamation law has the potential of tipping the scales in First Amendment jurisprudence towards greater protection of free speech and free press. Most urgently, these findings give pause to the presidential calls to fight ‘fake news’ by expanding libel laws, by showing that such laws may well backfire and exaggerate the effect of fake news.

Keywords: defamation, libel, first amendment, rational audience, free speech, free press, torts

JEL Classification: D82, D00, K13, K39