DelcoReviewSummer2017 - 22
"The Glacier is Too Cold"
Protecting Your Right to Complain
By Joshua D. Waterston, Esquire
an your client prevent an unreasonable customer from
posting a negative (and unfair) online review to Yelp, Facebook, Amazon, or other online platform? For example,
a reviewer wrote, "Do Not Camp Anywhere Near Here - You
Will Freeze" when posting a one-star TripAdvisor review of the
Columbia Ice Field in Canada.* Yes, that's right - the reviewer
was upset that the ice field was too cold. You just can't please
A client recently asked me to include a non-disparagement
clause in his website development agreement. He was concerned
that a customer might violate the agreement but threaten to post a
negative online review if his company didn't refund their money
or otherwise accede to the customer's demands. A negative (and
false) online review seen by enough potential customers could
seriously damage his business. How should I reply?
My gut reaction was to say no. Period, the end. First, it's not
great business to censor your customers. Second, it was likely
unenforceable as a practical matter, even if it was legally proper.
Third...something tugged at my memory. That something was
the Consumer Review Fairness Act of 2016.
On December 14, 2016, President Obama signed into law the
Consumer Review Fairness Act of 2016 ("CRFA"). In a rare moment of bipartisanship, a bitterly divided Congress joined together to tackle the issue of negative online reviews. The issue was
that businesses had started to use non-disparagement or "gag"
provisions to prevent customers from posting negative online reviews, even if those reviews were accurate. Here are two examples cited by the House Committee on Energy and Commerce:
* Online retailer KlearGear demanded that a customer remove
a negative online review from ripoffreport.com or face a penalty of $3,500 for violating the retailer's gag clause. After being
threatened by a collection agency, the customer sued and was
awarded $306,750 in damages.
* Roca Labs sold a dietary supplement with the creative name
of "Gastric Bypass NO Surgery" priced at $480 for a three-tofour month supply. The FTC alleged that, "Unfortunately for
consumers, Defendants are simply selling common, dietary
fibers with exaggerated claims at a grossly inflated cost. Their
weight-loss claims lack any scientific basis, and are often flat
out false." Worse, Roca Labs included a "gag" clause barring
customers from writing any negative reviews about the product, with a penalty of having to pay the "full price" of $1,580.
Essentially, customers would be fined $1,100 for writing negative - even if truthful - reviews about the product.
To guard against such abuses, Congress passed the CRFA.
The act addresses terms in a "form contract" (a standardized contract that doesn't give the customer a meaningful opportunity to
negotiate the terms) and prohibits the following:
* Imposing a fee or penalty against a party that writes a negative review
* Requiring a party to assign his or her intellectual property
rights in a review back to the seller. Some creative companies
22 | Summer 2017
used such provisions to obtain an automatic assignment of the
copyright for the negative review, and then used the Digital
Millennium Copyright Act to demand that social media platforms take down the negative reviews. It was very creative and
very sneaky, and the practice is now very illegal.
There are important exceptions. Companies can still remove
content from their own websites if such content is irrelevant to
the goods or services provided, is harassing/abusive, is clearly
false or misleading, or contains the personal information or likeness of another person. Companies can protect their trade secrets
and other confidential information, and can put restrictions on the
creation of photos or video of their products by the company's
employees or contractors. Perhaps most importantly, the CRFA
does not apply to employer-employee or independent contractor
contracts, which often include non-disparagement clauses.
Violations of the CRFA are considered deceptive trade practices, and the FTC and state attorney generals therefore have
jurisdiction over those who violate the CRFA. Remedies can include restraining orders and heavy fines.
The good news is that the CRFA is a significant step in protecting consumers' rights to complain - even if that complaint is
unreasonable. The bad news is that companies can still find creative ways to "inspire" their customers. Remember Roca Labs?
The company is still very much in business, and they promise a
"100% money back guarantee" for customers who provide "inspiring" video and photographic testimonials about their weight
loss experience - but only if "Don approves you to be a valuable
inspiring member."** So don't start trusting every review you
read just because of the CRFA. If a client asks whether they can
ban negative reviews, the answer is a resounding no - but they
can still reward customers for posting positive reviews (though
appropriate disclosures would be required).
My client appreciated my advice, and I included provisions in
the contract which should lead to satisfied customers who don't
feel the need to post negative reviews online. Feel free to call me
with any questions. You can now post any (truthful) review that
you want about this article. Enjoy, and please be kind.
Josh Waterston, Esq.
Elman Technology Law, P.C.
Josh Waterston is an associate with Elman Technology Law, P.C.
(https://elman.com), a boutique law firm in Media which advises
clients on intellectual property, cybersecurity, and Internetrelated business matters. He also has been known to make the
occasional pun, for which he humbly asks ongoing forgiveness.
* TripAdvisor review accessed on June 14, 2017 at https://www.tripadvisor.com/
** Roca Labs website accessed on June 15, 2017 at https://rocalabs.com/about/
Table of Contents for the Digital Edition of DelcoReviewSummer2017
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