# Defamation Law in the Age of AI with Lyrissa Lidsky | Hoover Institution

Source: https://www.youtube.com/watch?v=Nmm5p_LkYBs
Recap page: https://rapidrecap.app/video/Nmm5p_LkYBs
Generated: 2025-12-02T16:46:03.086+00:00

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## Quick Overview

The Restatement (Third) of Torts: Defamation and Privacy project, led by reporter Lyrissa Lidsky, seeks to modernize defamation law by eliminating the outdated distinction between libel and slander, and the project lays groundwork for addressing novel issues arising from generative AI, although it cannot alter established First Amendment constitutional principles.

**Key Points:**
- The Restatement (Third) of Torts aims to eliminate the complex, artifact-of-history distinction between slander (oral defamation) and libel (written defamation), which the internet has rendered obsolete.
- The Restatement process involves drafting by reporters, feedback from an advisory board, approval by the ALI Council, and final vote by the 2000+ ALI membership, ensuring rigorous vetting.
- Courts heavily rely on the Restatement, especially federal judges, to fill gaps in state law by looking to its "most articulate, well reasoned statement of what most states do."
- The Restatement cannot change constitutional law, meaning it must accept the backdrop of *New York Times v. Sullivan* requirements that public officials and public figures must show knowing or reckless falsehood to win defamation suits.
- The discussion explored whether courts should revisit the rule that mental state (actual malice) is judged only at the moment of initial posting, despite the low cost of removing content online later, which differs from expensive newspaper retractions.
- The group anticipates that defamation claims against LLM chatbot companies will press the issue of liability, noting Section 230 immunity likely does not apply because AI generates content rather than merely hosting user-generated content.
- Lidsky proposes reforming damages by eliminating 'presumed damages' absent proven harm, aligning defamation with other dignitary torts, allowing only nominal damages unless specific damages are proven.

**Context:** The discussion features Eugene Volokh and Jane Bambower interviewing Lyrissa Lidsky, a reporter for the Restatement (Third) of Torts: Defamation and Privacy project, about the process and the significant substantive issues arising in modernizing this body of law, particularly in light of technological changes like the internet and generative AI.

## Detailed Analysis

Lyrissa Lidsky explained that the American Law Institute's Restatement process involves academics synthesizing and modernizing the law across 50 states, resulting in a heavily relied-upon document used by courts to fill legal gaps. A primary substantive goal of the current Restatement is abolishing the centuries-old, technologically outdated distinction between libel and slander, along with associated complex doctrines like 'libel per se' and 'slander per se,' which are artifacts of the printing press era. However, the Restatement is confined to state tort law and cannot alter constitutional principles established by the Supreme Court, such as the actual malice standard from *New York Times v. Sullivan*. Regarding online content, the panel debated whether the law should adapt to the low cost of digital removal by imposing liability for failing to take down known falsehoods after publication, contrasting with the traditional rule focused only on the mental state at the time of initial posting. Furthermore, the rise of generative AI chatbots presents novel challenges, as Section 230 immunity for platforms may not apply because AI actively generates content, forcing courts to rely on analogy (publisher vs. distributor) to assign liability. Lidsky also advocates for reforming damages by eliminating 'presumed damages,' suggesting only nominal damages should be awarded unless the plaintiff proves actual damages with evidence, to curb massive, windfall awards.

### Restatement Process and Influence

- Put out by the American Law Institute (ALI)
- Reporters synthesize law across 50 states
- Heavily relied upon by courts, especially federal judges, to fill gaps in law
- Process includes advisory boards and council approval before membership vote

### Modernizing Tort Law

- Major issue is abolishing the distinction between libel (written) and slander (oral) due to technology
- The 1977 Restatement predates the internet revolution and social media
- Proposal seeks to eliminate terms like 'libel per se,' 'slander per quod,' and 'special damages'

### Constitutional Backdrop

- Restatement only concerns state tort law and cannot change constitutional principles like First Amendment requirements
- Public officials and public figures must show 'knowing or reckless falsehood' to win defamation cases (*NYT v. Sullivan*)
- The public figure category extension is considered the most controversial aspect of the *Sullivan* precedent

### Internet and AI Challenges

- Section 230 of the CDA, granting immunity to platforms, likely does not apply to generative AI because AI creates content, unlike passive hosts
- Courts must determine the proper analogy for LLMs: publisher or distributor?
- The law traditionally judges mental state only at the moment of posting, ignoring post-publication knowledge of falsehood, which seems odd given cheap digital removal

### Damages Reform

- Lidsky is examining defamation damages, specifically targeting 'presumed damages' where juries award amounts based on the statement's nature alone
- Proposal suggests allowing only nominal damages unless the plaintiff proves actual damages with evidence
- This aims to stop claims for 'billions of dollars' and align defamation with other dignitary torts