In a defamation case in which the plaintiff is claiming harm from libel or slander, that harm is typically quantified as damages, which are usually divided into two kinds: damages capable of exact calculation (generally called special damages), and damages not capable of exact calculation. In this article, we'll present the basics of assessing and calculating damages in a defamation case. (For more in-depth coverage of these kinds of claims, check out Nolo's Defamation, Libel & Slander topic.)
Special (Economic) Damages in Defamation Cases
Special damages are defined as damages that are capable of exact calculation because they can be, and customarily are, calculated to the dollar.
A plaintiff in a defamation case is entitled to receive damages for any lost earnings, future lost earning capacity, and other lost business or economic opportunities that he/she suffered or is likely to suffer as a result of the defamatory statement.
If the plaintiff is self-employed, lost economic opportunities may include such losses as loss of current clients or a reasonable expectation of losing future clients. Regardless of whether the plaintiff is self-employed or not, lost economic opportunities may also include the plaintiff’s inability to get a new job if the plaintiff lost his/her old job as a result of the defamatory communications.
If the plaintiff required medical or mental health treatment as a result of the defamatory communications, the plaintiff is also entitled to recover damages for his/her health care bills and expenses, just like in a regular personal injury case.
Lost earnings and lost earning capacity refer to the earnings (i.e., wages or salary) that the victim lost or will lose -- past, present, and future -- as a result of the defamation. Lost earnings and lost earning capacity also includes any employment benefits such as health insurance, vacation time, pension or 401(k) contributions, and the like that the victim may have lost.
Non-Economic Damages in Defamation Cases
The plaintiff in some defamation cases is also entitled to recover damages for what is generally called pain and suffering, which can be a significant component of damages in a personal injury case.
Pain and suffering in defamation cases includes not just mental pain and suffering, but also things like mental anguish, emotional distress, loss of enjoyment of life, and anxiety. Significant mental pain and suffering can also cause severe anger, appetite loss, lack of energy, sexual dysfunction, mood swings, and/or sleep disturbances.
These non-economic damages in defamation cases also include such injuries as impairment to the victim’s reputation and standing in the community, personal humiliation, shame, and disgrace.
Non-Economic Damages? Not in Every State
It's important to note that defamation plaintiffs are not always entitled to recover non-economic damages. For example, in some states, victims of slander (verbal defamation) are only entitled to recover non-economic damages if they in fact suffered economic damages, or if the defamatory speech:
- charged the victim with having committed a crime
- accused the victim of suffering from a communicable or loathsome disease, or
- prejudiced the victim in his/her profession or business.
How to Calculate Lost Earnings
Calculating past lost earnings is easy. Simply add up the earnings and employment benefits that the victim lost from being out of work. If the victim earns $80,000 per year, and was out of work for one year due to the defamation, he/she lost $80,000, plus lost employment benefits.
How to Calculate Lost Earning Capacity or Lost Business Opportunities
Calculating future lost earning capacity or lost business opportunities in a defamation case is harder and often will require expert testimony.
Let’s take a simple example. Let’s say that you had earned $60,000 per year, but that, as a result of the defamatory speech, you can only find a part time job earning $30,000 per year and that you think that it will take five years to work your way back to $60,000 per year.
You can see how even this simple example gets complex very fast. For the first year, your damages would be $30,000 plus lost employment benefits. But now you need to estimate how much you might make in the second year in the new job or new career that the defamation forced you into. This is why you customarily need an economic expert to provide an expert opinion as to economic damages in a defamation case.
If you are or were self-employed, and your damages involve loss of clients and lost opportunity to acquire more clients in the future, this makes the calculations even more complex. In this type of case, you would almost certainly need to hire an economist to present your damage claim to the jury.
How to Calculate Non-Economic Damages in a Defamation Case
There are no guidelines for determining the value of mental pain and suffering, humiliation, and lost reputation. A jury cannot look at a chart to figure out how much to award for these types of damages. In most states, judges simply instruct juries to use their good sense, background, and experience in determining what would be a fair and reasonable figure to compensate the plaintiff for pain and suffering.
You may have read about a “multiplier” in personal injury cases, and you may be wondering if it is applicable to defamation cases. Using a multiplier means that insurance companies in personal injury cases calculate pain and suffering as being worth some multiple of your special damages. Unfortunately, whether in a personal injury case or in a defamation case, the multiplier concept is a very rough estimate at best because there are so many other factors that affect the valuation of non-economic damages. Some of the more important factors are:
- whether the jury likes the plaintiff
- whether the jury thinks that the plaintiff or the defendant lied about anything -- as a general rule, the jury punishes whoever it thinks lied at trial. If the jury thinks that the plaintiff lied, the plaintiff will generally lose. If the jury thinks that the defendant lied, the plaintiff may very likely win big
- whether the plaintiff has a criminal record, and
- whether the plaintiff obviously exaggerated his/her damages (whether economic or non-economic).