A friend and I started an online business, hired a photographer for a shoot. He's been arrested for having child porn, and we are upset that his stage name is on our models photos, his association to us, and the damage this can cause for our image and character. We could lose our trust within the industry that we've worked with and they can spread the news to others, including prospective customers. He has all of our photos with our logo and we, as well as our models, are not comfortable with that. Can we sue him for defamation or losses of profit?
I do not think you can sue him successfully based on the information you provided here. However, it is best if you meet with an attorney and discuss the details. If the name of your company was used without your permission for advertisement, etc. or in connection with illegal activities, you might be able to sue.
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