There isn't much that all members of the U.S. Senate can agree on these days, but protecting the ability of consumers to write reviews of businesses has emerged as a uniting issue.
The Senate voted unanimously December 14 to approve the Consumer Review Freedom Act, which outlaws contract provisions that prohibit or restrict individuals' ability to write reviews of the products or services provided under the contract, such as by imposing fines for such reviews or transferring the copyright in such reviews to the business. The Federal Trade Commission would enforce the Act and is instructed to provide businesses with best practices for compliance. The Act, introduced by Republican Sen. John Thune, passed with an amendment clarifying that website operators may still include contract provisions reserving their right to remove certain content, including content that is unlawful, false, or misleading.
While Rep. Darrell Issa introduced a similar bill in the House of Representatives last year, it has not yet seen any action.
The Senate's move to block such contract provisions addresses a rapid rise in businesses' attempts to stifle negative online reviews on sites such as Yelp.com. Some businesses claim that their reputation and livelihood have been threatened by anonymous, inaccurate, and potentially malicious reviews, as to which they have little recourse. Businesses are increasingly targeting consumer reviews with defamation actions, which often result in the reviewers retracting their statements. When such actions make their way into the courts, judges have found themselves with the task of interpreting whether online hyperbole constitutes actionable assertion of facts or merely protected opinion. And with increasing frequency, businesses are targeting the review platforms themselves, including Yelp, to try to unmask the commenters in the first place, with mixed results.
The Act as passed by the Senate seeks to eliminate what is often businesses' first line of defense against negative reviews—language in the terms and conditions to which customers must agree to obtain goods or services, language that threatens fines for expressing opinions. It also targets the controversial practice of businesses, including provisions that assign the copyright in any reviews to the business, allowing the business to issue takedown requests under the Digital Millennium Copyright Act. Consumer advocates claim that such language effectively deprives the consumer of his or her intellectual property rights, as well as freedom of speech. Other commenters have expressed reservations about the Act, which may punish not only businesses, but also individuals who enter into such agreements.
Whether or not the Act becomes law, businesses should use caution in drafting terms and conditions about consumer reviews. Even now, when such non-disparagement conditions come to light, they can be the subject of widespread negative comment online and cause the business to receive much more adverse publicity than it would have had it avoided such language. Even without a law forbidding these terms, businesses may be wise to avoid them lest they be asked what they have to hide.
This article is presented for informational purposes only and is not intended to constitute legal advice.
