Let’s talk about trade libel basics, using the ABC Pink Slim case as a backdrop.

Trade Libel Basics: A Simple Definition

Healthy competition fuels the U.S. economy. But lying about a product, business, or service isn’t allowed — it’s called trade libel and it’s against the law. Claimants can seek injunctions and financial restitution.

Proving a lie, however, is not enough to win a trade libel lawsuit. Plaintiffs must also prove that the defendants’ actions led to financial loss. In other words, if someone lies about your company, but it has zero effect on your bottom line, you may not win; or, you may win, but not be awarded any damages.

Some plaintiffs must prove that the defendants intended to cause harm.  Other jurisdictions presume ill-intent.  The detail of the law varies depending on the state and case circumstances.

Trade Libel Basics: The “Pink Slime” Case

Beef Products Inc. (BPI) sued ABC News  over that latter’s coverage of a product dubbed “pink slime”.   BPI claimed the network depicted the product as unhealthy and unsafe, which mislead consumers.

To win, the meat processor must prove that the network purposefully broadcasted false information, with the intent to harm.  BPI’s attorney, Dan Webb, is confident in his client’s case.

Veggie Libel Laws

The lawsuit seeks damages under South Dakota’s defamation law, as well as a 1994 state “veggie libel” law that allows businesses to sue anyone who knowingly spreads false information about a perishable food product. BPI is seeking $1.2 billion in damages for roughly 200 “false and misleading and defamatory” statements about their meat.

The 257-page lawsuit names ABC and several correspondents as defendants, in addition to Gerald Zirnstein, the USDA microbiologist who coined the product “pink slime”; Carl Custer, a former federal food scientist; and Kit Foshee, a former BPI quality assurance manager interviewed by ABC.

Each Side’s Stance

ABC News denied BPI’s claims.  “The lawsuit is without merit and we will contest it vigorously,” said Jeffrey W. Schneider, a network vice president.

Filed in a South Dakota, the suit cites phrases used in the segment, like “low grade,” “scraps” and “waste” to make the libel argument. Plus, ABC reported that the product was made from connective tissue; according to the lawsuit, it’s made from muscle.

Need an experienced trade libel attorney? Contact Kelly Warner Law.