Someone has decided to create a hate blog on a hosted blogging service (wordpress.com) that bashes my company. The blog contains posts that completely flame myself, my service, and contains complete falsehoods about how I run my business. Without going into details, I'm pretty sure the author of this blog is an owner of a competing service (although it is authored completely anonymously).

Frankly, I'm not sure if the content would qualify for defamation or not, but I really don't like the idea of spending money on a lawyer to even attempt to prove this. I also have no interest in retorting or even replying to the blog in any sort of way -- I feel this would justify the ludicrous claims that have been posted.

Unfortunately, whoever wrote the blog was pretty smart about using key words that people commonly use to search for my service. Because my customer base is relatively small and local, our PageRank is not incredibly high. As a result, when someone Google's our business name, this blog is usually within the top five results (thankfully, it's never above the business' actual website, but it's usually within eyeshot).

It's incredibly frustrating to hear from customers who have seen the link (luckily, most of the time they think the author is crazy).

Is there anything I can do to combat this? Would it be worthwhile to setup my own hosted wordpress.com branded blog, in an effort to trump this wordpress.com with a blog that is more active of my own?

TL;DR: Someone made a hate blog using wordpress.com and is now on the first page of my business' search results. What are my options?