….you might want to read this:
Libel in the Blogosphere: Some Preliminary Thoughts by Glenn Reynolds. It’s a free download. Only 14 pages long.
Although the paper was written in 2006, it is remarkably current.
Full disclosure time. Yes, I have a biased and vested interest in the idea of not suing bloggers. Take my comment with whatever size grain of salt you wish.
The biggest issue to consider is the pushback you may receive from the rest of the blogosphere if you even threaten a blogger.
A few minor points are that most bloggers don’t have enough of a deep pocket to make litigation worthwhile and you can probably get a near instantaneous correction with a polite request.
Back to the major issue.