User generated reviews have exploded in popularity over the past few years, with industry leader TripAdvisor becoming one of the most valuable travel companies in the process. Another user review site has been seeing enormous growth, to the tune of over 100 million unique monthly visitors - Yelp.
Known primarily for restaurant reviews, the site has been growing the breadth of reviews to include all kinds of services. One such service is Hadeed Carpet Cleaning in Alexandria, Virginia.
The case
The business owner, after becoming suspicious that some of the negative reviews were not from actual customers (by allegedly checking their own customer database), asked Yelp to turn over the identifying information of the reviewers.
The owner's lawyers subpoenaed the consumer review website for the identities of the seven reviewers in question in order to pursue individual defamation suits.
According to Yelp's Terms of Service, reviewers must have been actual customers of the business to leave a review.
Yelp did not respond to the repeated request related to these seven reviews, and was actually held in contempt of court for not responding as required by law.
The lack of response led to pursuit of a court case. The initial ruling judge found that Yelp must comply with the request, which was then appealed to the Virginia Court of Appeals.
The appeal
The appeal was denied in a 2-1 decision requiring Yelp to turn over the identities of these seven reviewers. The court actually made a wider ruling that stated user generated "comments were not protected First Amendment opinions."
In the majority decision, Judge William Petty emphasized that the underlying problem is that Yelp does not provide any direct verification of actual patronage of a business by a reviewer:
An internet user does not shed his free speech rights at the log-in screen. Generally, a Yelp review is entitled to First Amendment protection because it is a person's opinion about a business that they patronized. The anonymous speaker has the right to express himself on the Internet without the fear that his veil of anonymity will be pierced for no other reason than because another person disagrees with him.
But this general protection relies upon an underlying assumption of fact: that the reviewer was a customer of the specific company and he posted his review based on his personal experience with the business.
If this underlying assumption of fact proves false, in that the reviewer was never a customer of the business, then the review is not an opinion; instead, the review is based on a false statement of fact - that the reviewer is writing his review based on personal experience. And 'there is no constitutional value in false statements of fact.'
The judge goes on to state that the identity of the reviewers are vital to pursuing defamation for false reviews:
Without the identity of the Doe defendants, Hadeed cannot move forward with its defamation lawsuit," the 27-page opinion states. "There is no other option. The identity of the Doe defendants is not only important, it is necessary.
The dissenting judge, James Haley, had this to say:
A business subject to critical commentary, commentary here not even claimed to be false in substance, should not be permitted to force the disclosure of the identity of anonymous commentators simply by alleging that those commentators may not be customers because they cannot identify them in their database.
Yelp yelps back
Yelp's response to the suit has been fast and furious, fueled by the "friends of the court" contributions in support of Yelp by heavy hitters such as The Washington Post, Gannett Co. Inc., the Reporters Committee for Freedom of the Press and the American Society of News Editors.
Yelp spokesman Vince Sollitto distributed this statement to the media:
We are disappointed that the Virginia Court of Appeals has issued a ruling that fails to adequately protect free speech rights on the internet, and which allows businesses to seek personal details about website users — without any evidence of wrongdoing — in efforts to silence online critics.
Other states require that plaintiffs lay out actual facts before such information is allowed to be obtained, and have adopted strong protections in order to prevent online speech from being stifled by those upset with what has been said. We continue to urge Virginia to do the same.
Yelp makes no mention of the pursuit of verified user reviews, which would at the very least legitimize a review as actually coming from a paying customer - the key issue at play here as far as fake reviews, online critics, and defamation.
Look for this case to be escalated further into the US judicial system, as a potentially hallmark case related to protections of anonymized online reviews.
Yelp moves into lobbying
Yelp is not sitting back and watching the action; they are jumping into the fray with their very own Political Action Committee, uncovered last month in an FEC filing. This setback related to the protection of their users' contributions - verified or not - will undoubtedly lead to accelerated lobbying spend. Yelp joins other prominent tech companies on Capitol Hill , such as Facebook and Google's much-publicized efforts to shape favorable legislation.
The case has wide ranging implications for user reviews across all websites, especially those that do not have a direct mechanism for verifying patronage at a business - such as a credit card integration that affirms a purchase.
Will the industry see some sort of consolidation or partnerships related to verifying actual purchases? This is already occurring, with the linkup of TripAdvisor and American Express, but is still only in the nascent stages of development.
Actual verification of patronage should be a significant priority for review sites in 2014, making partnerships with some of the emerging financial technology startups much more appealing.
NB: Angry reviewer image courtesy Shutterstock.