Karen is shopping at Big Mart. She has with her an umbrella which is the same brand Big Mart carries. When a Big Mart employee, Steve, sees her leave with the umbrella without going through the checkout lane, he asks her to come back into the store. Steve says that he thinks Karen is shoplifting the umbrella. Karen tells him that she has had the umbrella for years and shows him marks of wear and tear. Steve apologizes and tells Karen she is free to go. Can Karen successfully sue for false imprisonment or defamation?
If the circumstances are exactly as you have stated them in this question, Karen does not have any cause to sue Steve for either defamation or false imprisonment.
In order for Steve to have defamed Karen, he would have to have in some way communicated to other people that she has indeed stolen the umbrella. This would be defamation because it would be untrue and because it would tend to harm her reputation in the eyes of anyone who heard the accusation. Therefore, if Steve had yelled something like “stop, thief” at Karen, he might have defamed her. But if he simply asked her (outside of the hearing of anyone else) in a conversational tone of voice to come back into the store with him he has not defamed her.
Similarly, he has not falsely imprisoned her. The “shopkeeper’s privilege” covers what he has done. He has detained her on or very near to the premises of the store. He has had reason to believe that she was shoplifting since the umbrella is identical to ones sold in the store. He detained her for a short period of time, not longer than was necessary to check if she was actually shoplifting. He did not detain her in any excessive way such as by handcuffing her or otherwise physically stopping her from leaving.
For these reasons, Karen has no cause to sue Steve.
She cannot sue for defamation because he did not spread the information, he only assumed she was stealing and cleared up the assumption in that one conversation. She would have been able to sue if he had spread the fact to other people in the store. For example telling his friends that the lady with the umbrella was a thief.
If Karen really wanted to go the extra mile, should could in theory try to sue for emotional trauma related to being accused of theft. However, he would not be able to sue for defamation of character unless the employee who stopped her was yelling and making a scene, or if he made his accusation public in some way. Similarly, because Karen was not imprisoned in any way, she would have no grounds for suing over it. Even in the unlikely event that Karen could get a lawyer and court case going for emotional trauma, I can't imagine any judge in his or her right mind would rule in her favor...emotional trauma claims need pretty serious evidence (witnesses, statements from mental health professionals, employer verification of missed work due to distress related to the incident, etc.) in order to be entertained.
Karen would not have any ground to sue. The employee can say that they were only spotted her out because the umbrella was suspicious since the same exact brand is sold in the store. That is basically following protocol. However Karen does have the right to take her story to social media and give the store a down rating because of the experience and ask for an apology.