What would you handle this situation?

A face painter in your area is going to other painters and badmouthing you. They are saying you do not pay the painters you contract out, and telling painters that they "heard from someone" that you did a horrible job for someone you never even worked for.

Would you contact painters in the area to set them straight? Or would you just let it go?

more sticks that are used to stir the pot, only makes the water muddier faster

The same thing is happening to me but not just to face painters, they are doing it to clients as well. I have just left it alone. The people that have taken the chance and worked for me or that have gotten to know me figure it is not true. When people see your work it should speak for itself. There is always two sides to every story and anyone that is worth having around will find out the truth. At first I was worried about how it would effect my business but I have actually grown since the other person started bad mouthing me.

even bad advertisement is advertisment, lol

lol... perhaps

I have had people book me over this other lady because I do not bad mouth.

That is the hope of my friend... She never mentions the other painter to other painters; unless they bring them up first. They are not... exactly liked in the area.