Defamation Lawsuits Increasingly Lead to Bankruptcy as ‘New Media World’ Creates Financial Risks
LONDON – A growing trend is emerging globally: defamation lawsuits are driving individuals and public figures into bankruptcy. From bloggers to politicians, the financial fallout from losing-or even fighting-defamation cases is proving devastating, forcing a reckoning within both the legal and media landscapes.
the phenomenon highlights a critical intersection of evolving free speech laws and the ease of modern publication. As U.S. Supreme Court Justice Neil Gorsuch noted in a 2021 concurring opinion, we live in a “new media world” where speech is readily disseminated and monetized, but also carries heightened risks, especially in a polarized climate. This has led to a strategic shift where bankruptcy filings are increasingly becoming part of the defamation “playbook,” according to legal experts.
Across the anglophone common law jurisdictions, several high-profile cases illustrate this trend. In New Zealand, blogger Cameron Slater faced financial ruin following a defamation suit (2019). The United Kingdom saw far-right activist Tommy Robinson pursued for an estimated £2 million debt after a bankruptcy claim (2021). Canada’s Chelsea Hillier, a political figure, declared bankruptcy amidst a defamation case stemming from Twitter posts (2022). And in Australia, both Brittany Higgins (expected 2025) and politician John Pesutto (2025) are currently facing bankruptcy proceedings linked to defamation claims.
This escalating pattern necessitates closer collaboration between communications and bankruptcy lawyers. Communications lawyers must understand the potential for strategic bankruptcy filings, while bankruptcy lawyers need a firm grasp of defamation law – including slander, libel, false light, and invasion of privacy – and the underlying legal principles.
“A strategic bankruptcy filing is now part of the defamation playbook,” explains University of Florida law professor Christopher D. hampson, whose recent paper explores this emerging trend. “Communications lawyers might find themselves knocked off balance if they do not know what to expect.”
The rise of this “defamation-to-bankruptcy pipeline” raises broader questions for policymakers and citizens alike about the balance between free speech,accountability,and financial stability in the digital age.
https://www.journaloffreespeechlaw.org/hampson.pdf
