St. Louis businessman gets $150,000 in punitives after online defamation

"The Internet isn't written in pencil, Mark. It's written inink."

So says Facebook creator Mark Zuckerberg's ex-girlfriend to himafter he slams her on his blog in the movie "The Social Network."

The Internet may be written in ink, but determining just how muchbusiness bad online reviews can ink out is a bit more complicated.

One St. Louis County jury seemed reticent to try in an Apriltrial, awarding a St. Louis-area business owner just $1 in actualdamages and $150,000 in punitive damages in a defamation case hebrought against his former business partner over online reviews.

Pete Mitchell runs a property restoration business called TheFire Works Restoration Co. He has been in business since 1999, hesaid, and is the guy you call to come out and fix up your home aftera storm.

He started Fire Works with Michael Hosto, he said, and the pairformed a second business for referrals and lead generation called 1-800 Board-Up Inc. about four years ago. But then their businessrelationship soured, and the pair split.

Mitchell took Fire Works, and Hosto took Board-Up. In 2008, twodetailed, negative online reviews about Fire Works showed up onGoogle, and another showed up on Yahoo. The title of one of thereviews was, "They were a pain in the neck..." Another, "Thefireworks earns the grade = F," according to court documents.

Hosto admitted that he had written and posted the negativereviews, Mitchell's attorney, Brad Bakula said.

Hosto's attorney, David Bohm, of Danna McKitrick in Clayton,declined to comment, citing pending post-trial motions.

Bakula said the defense argued that the economy, weatherconditions and getting off a lead insurer's preferred program listwere contributing factors to Fire Works' downturn in business.

And while the jury sent a clear message to Hosto in its punitiveaward, the $1 in actual damages was also telling.

"Jurors don't have any basis to say how much money [Fire Works]lost just on this," Bakula said. "Yahoo and Google can't tell us howmany people go to that and read it."

Mitchell said the verdict amount was "reasonable" but that it"doesn't compensate for the loss of business." In closings, Bakulasaid he asked for over $300,000 in actual damages.

"With the change in the way people seek fulfillment of theirneeds and services -- using iPhones, smartphones, computers -- whensomebody wants to use somebody else's name, like this guy did, itreally can be damaging," Mitchell said. "It is very, very hard andvery, very expensive to bring anybody to justice."

Fred Sussman, a St. Louis business coach and consultant, servedas an expert in the case. He said in an interview after trial thatnobody really knows how important online reviews are, but everybodyagrees that they are.

"The typical behavior is if somebody sees a bad review, they moveon to the next alternative," he said.

Bakula said Yahoo, immediately, and Google, after two years,pulled the reviews.

The case is The Fireworks Restoration Company v. Michael Hosto,08SL-CC02323.