Beauty clinic awarded $82,500 in damages for defamatory Insta story. What can small business owners learn?


A small business has been awarded $82,500 in damages after an Instagram story posted by a former employee was found to be defamatory.

According to two commercial lawyers, the case proves there is recourse available for small businesses that are aggrieved online, but also highlights some of the social media pitfalls they should avoid themselves.

In the Brisbane District Court, Judge David Reid found that a former employee of the BeautyFULL Cosmetic Medical Clinic defamed the owners of the business in an Instagram story — a format typically only shared and visible for 24 hours.

A photograph was posted on the clinic’s Instagram account showing co-founder Margeret Scruton in her work uniform, with the caption “Dr Margaret serving during COVID-19”.

The former employee then shared a picture of this post in an Instagram story, claiming this image was ‘fake’.

“Before you watch my story I am not naming and shaming but when I see a company upload a FAKE photo that a medical practitioner is going to work on the frontline during the Covid-19 crisis, it’s disgusting and disrespectful to the people who are actually putting their lives at risk to save others,” the story said.

The plaintiffs, however, pointed out that Scruton is indeed a registered general practitioner, and was providing medical services at a GP clinic at the time of the post, including referring patients for COVID-19 testing.

The judge accepted that this constituted working ‘on the frontline’. He also said it was “very possible” the defendant was aware of this, and that she “almost certainly” had knowledge of Scruton’s typical work practices.

He awarded a total of $82,500 in damages, including sums payable to the business and the three owners, with $30,990 awarded to Scruton.

“Despite the defendant’s assertion that she was not ‘naming and shaming’ it appears to me that this is exactly what she intended,” Judge Reid said in his decision.

The Instagram story was “no doubt … motivated by unexplained anger and resentment towards BeautyFULL and those associated with it”, he added.

As the defendant did not give evidence, he noted that the reason for her taking exception to the original Instagram post “was never properly explained”.

Digital defamation

Speaking to SmartCompany, Hamish McNair, special counsel at Hall & Wilcox, said this case goes to highlight some of the issues small businesses should be aware of when it comes to their social media activity.

In this case, the small business was the aggrieved party. But it goes to show how damaging a social media misstep can be, and small business owners should be mindful of what they’re posting.

We often hear of posts going viral, McNair notes.

That can be great for businesses, “but it cuts both ways”.

Posts that are damaging to them — whether their own or someone else’s — can reach a lot of people, fast.

The former employee in this case had 1,844 followers, although it’s not clear how many saw the offending post.

However, the fact that this centres around a temporary post shows that something doesn’t need to be up for long “to have a significant effect,” McNair explains.

Equally, he also notes that it’s not only words that can be problematic.

Images, memes and even emojis have been found to be defamatory, he explains.

At the same time, the case shows there is legal recourse, and potentially significant damages to be won, for businesses that find themselves being wronged online.

Defamation is often considered as “something that is only for the rich and famous,” McNair says.

In fact, for small businesses that are just starting out, anything that damages their reputation unfairly can be catastrophic.

Typically, people don’t associate a platform like Instagram with defamation risk. But McNair says he’s seeing a “significant upswing” in the number of ‘digital defamation’ cases involving social media.

Most are either resolved out of court or in the lower courts, so don’t get into the public sphere.

What should you do with Instagram?

In order to prevent themselves from falling foul of the Defamation Act, Jessica Andreacchio, associate director of Law Squared, advises small business owners to, first and foremost, be very aware of what they’re posting, and ensure that their staff members are aware of the laws around social media publication too.

Many small businesses use Instagram as a marketing platform, she notes. But anywhere you’re communicating to customers, it’s important not to post anything that’s misleading or deceptive.

“There needs to be some form of checks and balances in place to make sure someone isn’t running rogue or taking on that platform for their own personal vendetta,” she tells SmartCompany.

McNair notes that one notable thing about the BeautyFULL Cosmetic Clinics case is “the way in which the defendant conducted herself”.

She did not apologise for the post or acknowledge the damage done, and she did not give any evidence in her defence.

This led the judge to make an award of aggravated damages, he says.

If you’re a business owner on the pointy end of a defamation claim “you need to engage with that and take it seriously,” he adds.

“Even in the most egregious forms of defamation, an apology and a retraction goes a long way.”

When it comes to defending themselves against defamatory comments, Andreacchio advises simply keeping an eye out and being aware of what people are saying about you or your business online.

Business owners should read up on the laws and understand what protections are in place when unfair comments are being made online.

Then, they should take screenshots of any offending material — especially if it’s of a temporary nature — so they can prove who said what and when.

“There is potential recourse, and this is a really good example of one that has been before a judge,” she says.


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