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It was an axiom of childhood: “If you can’t say something nice about someone, don’t say anything at all.” The reality of business in the internet age is that if you can’t say something nice about a customer experience … you will probably post a negative review on Yelp, Google, Angie’s List or a similar review site.
For better or worse, customer reviews can have a profound effect on how people view a business and on their purchasing decisions. A recent Nielsen study indicated that 74% of consumers who search online for a local business do so using review sites. Consumers do not limit their evaluation to counting “stars.” They take the time to read multiple comments, sometimes from multiple sites. Reviews are a double-edged sword as positive reviews make businesses more trustworthy, while negative reviews are a strong deterrent to consumers.
No business is immune from occasional negative reviews. Marketing experts suggest that when faced with a bad review, businesses should provide a detailed reply to demonstrate the company’s overall responsiveness and its concern for the customer making the post. Companies may also wish to encourage satisfied customers to write positive reviews, especially in those instances where they have received exceptional service. Eventually, the good reviews will “bury” any negative comments and provide a fuller picture of the company’s behavior.
Although some bad reviews are an inevitable part of doing business and actually can provide valuable feedback, some posts can cross the line. Reviews that falsely accuse a business of criminal acts or intentional malfeasance can severely damage a company’s brand or reputation—damage that can take years to reverse. The potential motivations behind such unfounded posts range from a general disregard for the accuracy of statements, to intentional misstatements intended to punish the business for perceived failings. Such posts are not limited to customers; competitors and former employees sometimes also post false statements to damage a business. While litigation may appear to offer some relief, it comes with practical and legal challenges that must be considered before proceeding.
Just because a review is bad doesn’t mean there are grounds for a lawsuit. A review must be false to be actionable. If a customer posts that there were cockroaches in the soup—and there were cockroaches in the soup—there is no claim for defamation.
The review must also be factual and not just the poster’s opinion. Distinguishing between facts and opinions can be tricky. Comments that service was rude, slow or unknowledgeable are likely statements of opinion and not actionable. However, a post claiming the waitstaff was rude because they spit in the food is more than an opinion. If unfounded, such comments can be the basis for a defamation suit.
Successfully demonstrating that a poster made false and malicious claims may be sufficient for a court to order the poster to remove the review. But to recover monetary damages, a business must generally be able to show that it suffered a financial loss because of a false review. A drop in sales or a decrease in new customers is the typical metric. Having a system in place—prior to any postings—that tracks sales leads, website traffic, or new customers can be very helpful in quantifying losses. What’s more, the tracking system may also make it possible to recover costs incurred for additional advertising or re-branding to combat a false negative review.
Business owners often expect that the review site will assist them in removing a false review. It won’t. Most review sites take the position that reviews contribute to the “marketplace of ideas.” In their view, a bad review (even a false one) will be sorted out by the market over time.
Some sites take the “marketplace of ideas” mentality to an extreme by punishing businesses for suing or even threatening to sue a poster… even if the post is patently false. For example, a business that sues or threatens to sue an Angie’s List customer may be banned from advertising on the the Angie’s List website in the future. In addition, Angie’s List will place a prominent warning on the business’s page that company is “hostile toward an Angie’s List customer.”
Review sites are allowed to adopt this potentially radical position because of the Communications Decency Act. Section 230 of the Communications Decency Act gives immunity to sites such as Yelp, Google, and TripAdvisor from claims based on the defamatory posts of independent third parties. There are few exceptions to such immunity, and those that do exist generally require that the site actively participated in or contributed to the negative reviews.
This does not necessarily mean that businesses are without options. Courts may order websites to remove defamatory postings, and most will voluntarily remove posts that a court has determined are false.
While evaluating options and determining the feasibility of a legal claim can be complicated, one thing is clear: Business owners faced with negative reviews need to act quickly to devise a strategy for limiting their injury and to evaluate their legal options. Once posted, a single negative review can proliferate and appear on multiple websites, or be shared on social media to other customers. Having an advance strategy in place can make for a more focused and efficient response.
Timely evaluation of legal options is also important. In Pennsylvania, defamation claims must generally be brought within one year after the posting of the defamatory claim. Although there are circumstances that could extend this period, acting quickly to understand both the scope and limitation of legal rights—and to collect and monitor loss data—is important in mitigating any losses.
While negative reviews are always troublesome, marketing and legal strategies for addressing the most extreme comments are important tools for any business that operates online.