The suing of critics. Or, bloggers being seen in court.

Being Australian, I’m of course aware of ‘the’ story about lawsuits against critics – an Australian restaurant critic sued, successfully, by his target:

In 2003 the food critic Matthew Evans gave a Sydney restaurant nine out of 20. Particularly affronted by the limoncello oysters, he’d used adjectives including “unpalatable” and “wretched”. When the owners sued, a four-person jury found the comments weren’t defamatory; but on appeal the NSW Court of Appeal found the jury’s verdict unreasonable. Last week the High Court agreed.

Harsh – why the lawsuit?

The restaurant closed within months of the review, with its owners blaming the comments for its demise.

In a 6-1 decision, the High Court decided that the review was an attack on the restaurant as a business.

“Business capacity and reputation are different from personal reputation,” the court judgement said.

Americans will be more than familiar with the line about “chilling effects.” In fact, this was a particular kind of lawsuit, principally because it went to the High Court and the speaker of the words lost. Australia does not have a bill of rights, like the Americans used to have (a cheap shot, but a dead-accurate one), so it would play out a little differently, perhaps, here? Hard to say. You can (and will) be sued for calling for a boycott of a given commercial enterprise, for the same reasons that our High Court found in favour of the restaurant: attacks on businesses are not cool (apparently).

The other kind of lawsuit, including bloggers (as opposed to ‘real’ journalists, like food critics in newspapers), is the silencing attempt. This includes (so far)

The list continues, but I will not. I’m already bored with looking stuff up online. That last one, though, included a general call for ‘the courts’ to ‘crack down’ on bloggers. We dangerous anarchist … whatevers (now that Bill O’Reilly is more concerned with lesbian gangs than our vast left-wing conspiracy, I can’t raise the energy to maintain the appearance either).

This all occurred to me today, as my wife and I went to a very odd exhibition downtown. Now I’m an economist, so I won’t comment on whatever the hell it was – it was a long, long way from my thing. My wife is an Arts student, though, so she did. Try not to share that link too much. The mere words ‘conjugal’ and ‘visit’ brighten the missus’ eyes, but it doesn’t appeal to me terribly.

Fortunately this exhibition is free – so the artist would be hard-pressed demonstrating any great injury (also my wife’s blog is not a newspaper, so there’s an audience issue – basically I don’t fear a lawsuit). The essential question, however, remains. In the initial case of the Australian food critic, for example. He visited the restaurant twice, and had some very unkind things to say about their food both times. Like don’t eat it. They did poorly, and he we are. Two things here are relevant:

One: Causality

Can the restaurant demonstrate that the people who didn’t come to their restaurant did so because of this reviewer? Frankly, I’d be surprised. Judges (in countries where they aren’t political appointees – United States, I’m looking in your direction) are smart, but they aren’t likely to be economists or econometricians, so they’re probably light on the amount of skepticism I would prescribe for this sort of claim. Many visitors to the restaurant could have told their friends that it was terrible.

Two: The markets vs. Command and Control

This is where my economist…ness (?) really comes to the fore. The High Court’s decision says to food critics, “don’t call food at a restaurant unpalatable or it’s your ass.” It isn’t about freedom of speech – they’re bloody critics, and I have little respect at all for professional critics, I have to say. If you as a restaurant don’t want to be reviewed, don’t. Surely critics dine either at your invitation or with your permission, professionally. The response was predictable:

Critics have cried foul, saying their opinions could now become as banal as the food at the heart of the case was reported to be.

“If a poor review leads to diminished returns at the box office of the theatre, are we now going to say that it is due to the review and not to the quality of the work?” veteran critic Leo Schofield told reporters.

I agree, almost for the same reason. More importantly, this is regulation where I don’t think it is warranted, which is inherently a bad thing. Here’s the market solution:

  1. Critic gives a bad review, generating two sets of information: Good signals from the Restaurant, bad signals from the critic.
  2. Consumers will start here, and aquire more information. Ask around, read other sources. Other critics may go to the restaurant – they may agree with the first critic, or disagree.
  3. If the consensus is that the restaurant is bad, it will fail. If the consensus is that the restaurant is good, that critic will fail.
  4. Repeat.

That is rather grossly simplified, for purposes of exposition. It is also a very neo-classical perspective on the market, and takes a very long-term view.

If the critic’s claim was wrong, people will figure that out. The restaurant went under, though, suggesting people worked out that the critic’s claim was correct. Didn’t the restaurante invite other critics as soon as they saw a problem? If they knew he was wrong, why not? They could have balanced the signals in the market, properly informing consumers. Ultimately the restaurant probably failed because a source of information arose that identified a poor product to potential consumers, and no contra-indicating signals came along to save them.

This probably seems cruel, and it is – in ‘my’ system, critics will get too much clout, certainly amongst easily swayed readers (the ‘smart’ metropolitan newspapers, I’m looking in your direction), and restaurants will fail when they couldn’t overcome a bad review. That’s the way it goes. We don’t sue our lecturers (thank God!) for giving us an ‘F’ when we had a bad day for the final exam – having a bad break is the chance you take with any endeavour.

That’s how the market works, it is how it has always worked. The High Court cannot tell you good or bad places to eat. On aggregate, restaurante reviews (possibly) can. As I said, I can barely tolerate critics in newspapers I don’t read, so none of this affects me directly, but it is illogical from the perspective I/we have on the interactions of consumers and producers (i.e. the market).

Remember Christopher Walken’s immortal lines from the Suicide Kings:

That phone call I got, it came from outside high walls and fancy gates; it comes from a place you know about maybe from the movies. But I come from out there, and everybody out there knows, everybody lies: cops lie, newspapers lie, parents lie. The one thing you can count on: word on the street … yeah, that’s solid.

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