Small Business

Yelp Extortion Case: Does a Company "Mantra" Have Legal Weight?


Bad reviews? We don't get ANY reviews!

Angry small business owners are, again, taking the shizzle out of, the customer review site alleged to be "highly popular." A Long Beach, California veterinarian has sued the company over Yelp's high-pressure sales pitches, which included manipulation of negative review rankings.

Wired has the story and the court filing [pdf]. We begin with the wrath of Gregory Perrault, owner of Dogs and Cats Hospital, over a negative review of his business…

He researched the information in the review and discovered that it referred to a hospital visit that occurred more than 18 months prior to its posting. (Yelp's policy allows reviews to be posted within 12 months of an experience with the business.) The hospital asked Yelp to remove the review for violating Yelp's review guidelines, and the site complied. But a second negative review appeared five days later from a user identified as Kay K.

That review read in part:

Dr. Perrault is the rudest vet I've ever been to … probably one of the rudest people I've had the displeasure of meeting. I agree with the previous reviews about making you feel like an unfit mom. My pup had been sick and I had a theory on what the problem may have been and he wouldn't even entertain the idea, but instead, made me feel bad because my dog got sick. And, my poor dog was terrified of him! He made me feel like I was 2 inches tall and repeatedly looked down his nose at me. Oh, and OVER PRICED! OMG! Who does he think he is??? I did not feel welcomed by him nor his staff. I paid you for a service! No need to treat me so bad!

The plaintiff claims that Yelp sales staff then began calling the hospital frequently with "high-pressure" tactics promising to move or delete negative reviews in exchange for purchasing a one-year advertising contract. The site also allegedly promised to ensure that negative reviews wouldn't appear in Google or other search engine results. When the hospital declined, the negative review from "Chris R." re-appeared on the site, followed by a second negative review from Kay K.

The latter review referred to Dr. Perrault as "an @$$" and "a jerk, a D-Bag, And so arrogant."

I ran in to him in a neighborhood store right after he saw my poor sick dog at his clinic and he looked right at me, recognized me, rolled his eyes and looked away!!!! Seriously, someone needs to knock this guy down to the size he really is. He needs to drop his Napolean complex and be a professional. After my horrible experience with him, I took my sick dog to Bixby Animal Clinic and I have never had a more pleasant vet experience! Go there instead! My dog loved everyone there!

When the hospital complained to Yelp, the site sent a letter to the hospital saying it would be leaving the reviews in place.

If you think the occurence of the phrase "Yelp would allow Cats and Dogs to decide…" in a lawsuit is more proof that web 2.0 is making America dumber, an old East Bay Express story details incidents including one where a Yelp representative offered a nightclub better review placement in exchange for free drinks.

Is any of this actionable? Short of demonstrating that Chris R. and/or Kay K. are Yelp employees or a single Yelp employee, I'm not sure it is. By reposting the Chris R. review, Yelp may have violated its own policy of only posting reviews written within 12 months of the customer experience. (I haven't found any reference to this policy on the site and I'm not a regular Yelp user.) This seems more in the way of an infraction and a peevish response than what the suit calls "unfair business acts and practices" that are "immoral, unscrupulous" and offensive to public policy.

The lawsuit alleges:

Yelp, however, regularly manipulates the content on listing pages, despite Yelp's mantra of "Real people. Real reviews."

But here's a reasonable person standard: Yelp does not promise not to manipulate the content on its listing pages, and it is wise to assume an advertiser would get more benefit from that manipulation than a non-advertiser. Go look at a long page of Amazon customer reviews and you'll see plenty of dark surmises about how Amazon may be moderating down negative reviews. If people believe that about Amazon, which actually lets you set your results page to read only negative reviews, it's a good bet readers of every review site take the people-empowerment claims made by social media sites about as seriously as their grandparents took the claim that Ivory Soap was 99 and 44/100ths percent pure or that Geritol relieved tired blood. (And who's reading these reviews anyway? Usually when I end up on Yelp it's to get the address or phone number of the place.)

Yelp's terms of service stipulate:

We may use Your Content in a number of different ways, including displaying it on the Site, reformatting it, incorporating it into advertisements and other works, creating derivative works from it, promoting it, distributing it, and allowing others to do the same in connection with their own websites and media platforms ("Other Media"). As such, you hereby irrevocably grant us permission to use Your Content for any purpose. You also irrevocably grant the Site's users and the users of any Other Media the right to access Your Content in connection with their use of the Site and any Other Media. Finally, you irrevocably waive, and cause to be waived, any claims and assertions of moral rights or attribution with respect to Your Content.

An Amazon customer reviewer once tried to get me to pay him damages me because I quoted his (very Joycean) negative comment that the only way for Ulysses to be a worse book would be for it to come to your house and defecate on your bed. So maybe there are rights attached to user-generated content I'm not aware of. And if there's one thing I learned at the media-law seminars they made us attend regularly at the L.A. Times, it's that every fact you publish will get your employer sued for millions of dollars so publish as few facts as possible.

But Yelp's terms to my eye give Yelp the right to edit, highlight, disappear or do pretty much anything else with its customer reviews. That may or may not make it worth $2,600 a year for an animal hospital to get more favorable treatment. But it also doesn't seem like grounds for a suit.

Courtesy of Rob McMillin.

NEXT: "Unanswered" Questions That Answer Themselves in the Very Next Line

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  1. I don’t know if the law permits this sort of (alleged) behavior, but if it does, maybe the legislatures of the states should take a look at the question.

    1. NO! That’s a bad Mad Max. Bad! Very bad!

      1. Oh, no, laws are bad!

      2. If they’re fabricating negative reviews, which they claim are from independent reviewers, which they offer to delete in return for payment, that certainly falls under defamation/extortion in my book. No libertarian problem with a law against that.

    2. Although I would prefer that the law be based on consumer-fraud grounds rather than ‘unfair competition,’ which is what this would-be class action is claiming.

  2. Stories like this will ruin Yelp, thus making it a non issue.

    1. Agreed. If Yelp! isn’t actively generating the reviews, which would be libel, they should be exposed as manipulating this information, ruining their utility as consumer reference.

      1. That’s about how I sees it.

  3. How are they going to prove anything, Max? This sounds like obnoxious behavior, sort of like a grade school extortion scheme, but unless you can prove that they are actually making up reviews, you can’t really do anything. It’s also moderated by the fact that no one gives a shit about Yelp.

    1. I’m not saying the accusations are true, or that any consumers got harmed.

      What I would like to suggest is that if someone markets their services as an impartial evaluator of other companies, and people use and rely on those services based on that representation, and in fact they’re not being so impartial after all, you might have a bit of a consumer-fraud problem on your hands.

    2. I’m sure Yelp has a few disgruntled employees who know where the bodies are buried.

  4. Does a Company “Mantra” Have Legal Weight?

    I thought that was settled long ago. My memory is hazy but wasn’t there a ruling that said “FedEx’s mantra of ‘absolutely positively overnight’ was not an implied guarantee.

    1. “You saved itchy and scratchy!”
      “Please sign these papers indicating you did not save Itchy and Scratchy”

  5. I’ve had negative reviews pulled at Amazon and at other sites, and I am careful not to swear or act crazy like those reviews did. I did not realize though that sites offered to pull negative reviews for money. Kinda defeats the entire purpose.

    Really the consumer should sue saying “I ate this crap because you only let the good reviews through, I still can’t get the taste out of my mouth! I need to be awarded damages for pain and suffering.”

    I guess that’s why the review sites don’t charge or else they’d have to be accountable to readers.

  6. I wonder if the doctor could post a review on Yelp about how much Yelp sucks? LOL.

  7. If Yelp is falsifying/spoofing reviews and using those reviews to leverage advertising, that strikes me as outright fraud, and actionable.

    If they are soliciting negative reviews for the same purpose, then again I think you have a fraudulent enterprise.

    Even absent all that, floating around this case is the category of fraud known as “material omission.”

    If Yelp will, in fact manipulate (legitimate) reviews favorably for paid advertisers, and doesn’t disclose that, then that strikes me as a material omission. Maybe their TOS boilerplate is broad enough, but having read it, I don’t know that a blanket statement of “we can use it for any purpose” is going to get them off the hook.

  8. Tim et al.:

    The good news is that, as our CEO explained on our blog (, the allegations in the suit are not true. Specifically:

    “The reason 29 million people used Yelp last month to find a great local business is because of the trust they place in the reviews on our site. The entire value of the Yelp community to consumers and businesses hinges upon that trust — and we would never do anything to jeopardize it. Simply put, Yelp does not remove or hide negative reviews in exchange for money and Yelp salespeople do not offer to do so. Additionally, Yelp treats review content equally for advertisers and non-advertisers alike. Advertisers pay for advertising and enhanced listings, and nothing more; and businesses are not penalized for declining to advertise.”

    The post also explains how the review filter we employ to protect consumers from fake, or shill, reviews can confuse or frustrate some businesses, leading to conspiracy theories or even a lawsuit. We are trying to increase our education efforts to businesses and the broader community; thanks for the opportunity.

    1. Oh, if your CEO says you’re not acting improperly, I guess that settles it.

  9. Uh, guess I’m the only one here who uses Yelp frequently. I’m moving from the Bay Area (where it’s damn popular) to Tokyo (where they don’t have jack for collective culinary opinion). Withdrawal will be painful. And trust me, businesses here are very mindful of their Yelp reviews. Yelp’s probably the easiest way to come up with a shortlist of restaurants, honestly, and it’s a hell of a lot better than relying on some expert’s review or a friend.

    For example, the hive mind gets the best 5 Japanese restaurants in downtown SF correct (notably giving the finger to Ozumo):

    Sure, plenty of reviewers say stupid crap like the shio ramen was salty (shio = salt), the sushi is great because you get big pieces, they only had plain rice, etc., but those get lost in the aggregation. What doesn’t is a single critic’s or friend’s mindless praise of any place with expensive o-makase.

    Also, you can check the worst reviews and get a feel for the shortcomings. And if those reviewers have dumb opinions, it’s usually a good sign. Takes all of a few minutes to find a good new restaurant, the same way Rotten Tomatoes helps for choosing which movie to see.

    And Cats & Dogs Hospital gets the same type of negative reviews time and time again. I’m not a statistician, but that looks like a trend.

    1. Also, you can check the worst reviews and get a feel for the shortcomings. And if those reviewers have dumb opinions, it’s usually a good sign.

      Totally agree with this part. I’ve definitely gone to restaurants (and been happy) because it was clear that what the person didn’t like about the restaurant was exactly what I was looking for– the shio raamen example you give being a good one.

  10. Yelp sucks anyway. It has worse grade inflation than Harvard. About 70% of the restaurants have 4 or 5 stars. Chowhound is a much better guide for eats.

  11. See: “Calling For YELP: How to Handle a Negative Review of Your Brand on The Internet.”


  12. And if there’s one thing I learned at the media-law seminars they made us attend regularly at the L.A. Times, it’s that every fact you publish will get your employer sued for millions of dollars so publish as few facts as possible.

    That was the most interesting line of this post. Feel free to elaborate.

    1. Legate, can you elaborate? Are you saying that Tiger Woods or Toyota brands are better off because they were silent as to the facts?

  13. I was a frequent user when I moved to my new neighborhood a few years ago. Since then, not so much. Also, the reviews are invariably wildly divergent for every business. It’s like trying to pick a candidate based on watching one of the Sunday morning shout-fests.

  14. Really the consumer should sue saying “I ate this crap because you only let the good reviews through, I still can’t get the taste out of my mouth! I need to be awarded damages for pain and suffering.”

  15. Yeah,The reviews are invariably wildly divergent for every business.

  16. at least it wasn’t food poisoning.

  17. Quite the extortion case, Yelp is known to be sketchy though.

  18. Yelp customers have really nothing better to do with their time then try and ruin small businesses and restaurants because they are nasty people. Thats why we set up our reputation defender and reputation mangement services to help businesses out restore their good name! Its called The Review Buster. Please link to us and facebook friend us as we are trying to get this service off the ground. also please don’t hesitate to send us any comments or suggestions!

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