Got Bad Reviews? That’s Too Bad, Under New Law
It’s been said that “opinions are like a________s – everyone has one”. But they can do serious damage to a business when they take the form of negative
reviews online.
People are entitled to express their opinions (it’s that pesky free speech thing). Reviews have become powerful influencers. Most of us won’t consider buying or using something, choosing a restaurant, hotel or activity, without first checking out its reviews.
But it’s practically impossible for a business to get negative ones removed from third party websites, such as Yelp or TripAdvisor. And, other ways to minimize or combat their effects have been very limited.
Well, it just got even more limited.
What you need to know. As of March 14, 2017, the Consumer Fairness Review Act (the “Act”) became a federal law. If a business’s online or printed forms of Terms of Use/Service, codes of conduct, employment and engagement contracts, warranties for goods and services, policies and other standardized terms (“Form Contracts” for purposes of this blog) contain:
- any bad review or bad feedback prohibitions, restrictions or penalties, and/or
- requires an individual to transfer to the business any intellectual property rights (like copyright ownership) in that individual’s review or feedback content (except for a voluntary license authorizing the business to use the content)
Those Form Contracts are now illegal and void from inception. In fact, the Act makes it unlawful to even offer such a Form Contract.
And, by December 14 of this year, states can enforce violations of the Act as “unfair and deceptive trade practices”, by bringing lawsuits against violators under the Federal Trade Commission Act. The FTC can intervene as well.
Why Was the Act Passed? To prevent businesses from deleting, refusing to post, or otherwise trying to suppress unfavorable reviews and comments about it, its products or services. The Act directly targets one effective way businesses were fighting negative reviews – making their posting a breach of contract by the reviewer. Form Contracts began including language prohibiting the posting of, imposing penalties, including financial ones and/or vesting copyright in negative reviews with the business.
What Should You Do? Some spring cleaning. Businesses should have their Form Contracts reviewed immediately. If they contain any restrictions or prohibitions on user-posted reviews and similar content regarding the business, its products or services, these should be removed and updated Form Contracts posted and implemented.
What Can a Business Do Legally About Bad Reviews? Not much, really. Businesses are still left with
the ability to respond to negative reviews by posting an apology, rebuttal or offer to make it right. But, these appear below the bad review. They’re consequently read, if at all, after the review is. This often reduces their effect to mere excuses or deflection.
But, you should know that the Act doesn’t impose obligations for a business to publish on a website they own, operate or control, negative reviews and comments about them or impose restrictions on removing those it does publish. In this instance, you can still (carefully) use discretion about publishing customer reviews. It may be acceptable to ensure that reviews are published and remain published that relate to the product or services bought or used and are authored by those who actually bought or used them.
The Act also doesn’t prevent or prohibit a business on a website they own, operate or control, from refusing to display or taking down content, that:
- is unlawful;
- violates a duty of confidentiality imposed by law (including via agency guidance);
- includes privileged or confidential information (like trade secrets);
- is defamatory, libelous or slanderous or constitutes a similar cause of action. It also doesn’t prevent lawsuits being filed to address these;
- contains someone’s medical or personnel records, commercial, financial or other personal information or in some instances, another person’s likeness, that would clearly be an invasion of their personal privacy;
- is harassing, abusive, obscene, vulgar, sexually explicit, or inappropriate with respect to race, ethnicity, gender, sexual orientation, or other intrinsic characteristic;
- is unrelated to the goods or services offered by or available on the business’s website;
- is clearly false or misleading. (Be careful here. Inaccurate reviews, like someone having a bad day and taking umbrage at a small part of an otherwise positive experience, probably isn’t “clearly false or misleading”. But, a socially-challenged person who posts a negative review for FUN!, when they’ve never patronized the business or used the things they’re excoriating, may be;
- contains records or information compiled for law enforcement purposes;
- contains potentially damaging viruses, worms, code, programs, applications or files that pose a security risk.
The Takeaway? Have your Form Contracts reviewed and tidied up. You don’t want to be the recipient of the worse type of negative review – a lawsuit.
Just Sayin’ . . . TM