Pseudonymity Litigation and Reputational/Economic Risks from Litigation
I’m putting up some excerpts from my new draft article, The Law of Pseudonymous Litigation, hoping to get some feedback. This one is on how courts deal with claims that pseudonymity is needed to prevent harm to reputation or (relatedly) risk of economic retaliation. (The preceding portion of the article deals with the separate, though sometimes connected, argument that pseudonymity is necessary to protect information that is often seen as highly private, such as sexual orientation, transgender status, sexual behavior, mental illness, physical illness, and the like. Earlier portions dealt with, among other things, the costs of pseudonymity to the public, to adversaries, and to the judicial process.)
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When we get past privacy and move on to reputational harm—and the economic and professional harm that can stem from reputational harm—the dominant answer is no pseudonymity, except in one important class of cases. I’ll begin by laying out a few categories of situations where the risk of reputational harm is especially serious, and then summarize the state of court decisions on the subject.
[1.] Risks of reputational harm
[a.] Defendants accused (perhaps wrongly) of serious misconduct
Many defendants could be ruined simply by being publicly accused of certain offenses (rape, sexual harassment, embezzlement, fraud, malpractice, and the like)—or can be materially harmed even by being sued for more minor matters, such as in landlords’ unlawful detainer actions against tenants.  Even if they know they’re innocent, they might agree to settle as a means of avoiding the lawsuit even being filed, thus giving in to a form of legally permissible blackmail (“pay me money or I’ll file a lawsuit accusing you of misconduct”).
[b.] Employees and others fearful of getting reputations for litigiousness
Plaintiffs suing ex-employers may worry that suing will make them look litigious, and thus turn off prospective future employers.
Antidiscrimination laws generally forbid employers from retaliating against people who had brought discrimination claims or engaged in whistleblowing, and “a subsequent employer may be held liable for retaliation against a current employee for engaging in protected activity at a past employer.” But, first, such retaliation is only illegal when done because of certain kinds of claims, and not many other employment claims (such as breach of contract claims). And second, such retaliation tends to be very hard to prove, since an employer has so many possible reasons to reject a prospective employee. As a result, many employers likely think that they won’t be caught if they refuse to hire litigious employees—and likely think that, if they hire and later dismiss a litigious employee, the risk of a future lawsuit by the employee is greater than the risk of a lawsuit for retaliatory refusal to hire.
The same of course is possible in other situations. Tenants, for instance, may worry that suing a landlord will lead other landlords to decline to rent to them.
[c.] Plaintiffs fearful of public hostility stemming from the nature of their claim
Some plaintiffs might think that their claims will appear legally or morally unjustified to the public—even if the claims are themselves legally valid—and could lead to public ridicule or shaming.
[d.] Parties fearful of revealing disabilities and other conditions that might lead to future discrimination
Plaintiffs filing lawsuits that reveal their disabilities, mental illnesses, and the like might worry that publicizing this information would lead to discrimination by future employers, clients, patients, and the like. In this respect, requests for pseudonymity in such cases might not just be a matter of protecting privacy but also be a matter of protecting reputation and preventing retaliation.
[e.] Libel plaintiffs fearful of amplifying the allegedly false statements
Plaintiffs suing for libel may understandably worry that suing will just further amplify the libels. People Googling for the plaintiff’s name would see the lawsuit, and may easily find the complaint and other filings, which will necessarily repeat the libel in the course of alleging that it is indeed a libel. Likewise, newspaper articles or blog posts may be written about the lawsuit, especially if the plaintiff or defendant is famous.
Perhaps the libel lawsuits will ultimately vindicate such plaintiffs, and give them judgments that they can point to as evidence that the allegations over which they sued were false. But even when libel plaintiffs have strong cases, that might not happen. The lawsuit may be dismissed without a decision about the truth of the allegations (e.g., if a court concludes that the statements were privileged, or were said without “actual malice,” without reaching whether they were true). Litigation costs might pressure plaintiffs into accepting a settlement. The defendant might not appear, which will give plaintiffs a default judgment that third parties might not credit as an authoritative decision on the facts. And in any event, there likely wouldn’t be a final verdict for years.
[f.] Other plaintiffs fearful of amplifying allegedly false allegations
The same concern would apply for other lawsuits that aren’t framed as libel claims but are still based on false allegations or their consequences—lawsuits over wrongful expulsion from universities, wrongful firings, wrongful discipline of a professional, and the like.
[2.] How courts deal with these risks
Despite these serious risks, courts generally refuse to allow pseudonymity aimed at avoiding “the annoyance and criticism that may attend any litigation,” including “inability to secure future employment,” “economic harm,” “economic or professional concerns,” “reputational harm,” or “blacklisting.” And that’s true both for plaintiffs and defendants.
As I suggested above, this may stem from the ubiquity of reputational risk in civil litigation (and even more so in criminal litigation). Courts do often say that “we allow parties to use pseudonyms in the ‘unusual case’ when nondisclosure of the party’s identity ‘is necessary . . . to protect a person from harassment, injury, ridicule or personal embarrassment.'” But there is nothing “unusual” about embarrassment or risk of harassment, reputational injury, or ridicule stemming from people believing the allegations in a case, or being wary about a person because of those allegations. If reputational damage sufficed to justify pseudonymity, our civil system would become (for better or worse) one in which pseudonymity is the norm.
Yet here too, courts are divided. In one recent sexual assault lawsuit, for instance, the judge let the defendant proceed pseudonymously, reasoning that:
[T]he court finds that the chance that [plaintiff] would suffer reputational harm is significant. The defendant is a partner of a well-known law firm in New York and an adjunct law school instructor.
It’s of course likely that an allegation of sexual assault would indeed be ruinous to a partner at a well-known law firm who also teaches at a law school. And it would be ruinous right away, even before any verdict in the case, and even if eventually the defendant is vindicated. But wouldn’t it be devastating to a janitor as well?
Likewise, in a lawsuit over an allegedly false credit report—basically, a narrow statutory quasi-libel claim—the court allowed plaintiff to proceed as a Doe, because “Publicly identifying Plaintiff risks impeding her future employment prospects by making the improperly disclosed information public knowledge.” Some cases that discuss a party’s disability have likewise led to pseudonymization on the theory that they could lead to “severe” “economic and career consequences.” Some courts have also allowed pseudonymity for whistleblowers, out of a concern that being known as a whistleblower might create “a reasonably credible threat of some professional harm.”
[3.] The special case of university student lawsuits
And there is one other large array of
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