Lawmakers want to protect the online freedom to Yelp

A new bill in Congress would prohibit companies from including non-disparagement clauses in customer contracts

If the waiter was rude, your hotel room dirty or the plumber sloppy, you should be able to say so online without fear of getting slapped with a lawsuit.

So said a group of lawmakers who want to make it illegal for U.S. businesses to use contracts to preemptively muzzle customers so they can't post negative reviews.

Four members of the U.S. House of Representatives introduced legislation last week that would render non-disparagement clauses in consumer contracts unenforceable. The bill, the Consumer Review Freedom Act, comes after consumer uproar when geek toy company KlearGear.com tried to charge a Utah couple a US$3,500 fee for a negative review they wrote.

The company demanded the couple take down a negative review they wrote on Ripoffreport.com, saying they violated its terms of service, specifically a part that reads: "Your acceptance of this sales contract prohibits you from taking any action that negatively impacts KlearGear.com." After the couple refused to pay the fee, KlearGear reported them to credit agencies.

A judge later threw out KlearGear's claims, but the sponsors of the new legislation said it would discourage other companies from adopting similar non-disparagement clauses. Online review sites like Yelp, TripAdvisor and Angie's List voiced support for the bill.

The new legislation is similar to a bill introduced by two of its sponsors in 2014 that failed to pass in Congress.

Internet users should be free to engage in "all types of commerce and communication," including product and business reviews, said Representative Darrell Issa, a California Republican and a sponsor of the new legislation.

"Some organizations have sought to stifle customers' abilities to express their opinions online by threatening punitive action if a customer leaves a negative review," Issa said in a statement. "The mere threat of monetary penalties or fines for writing honest reviews would chill the free exchange of opinions we expect to find on the Internet."

Customers shouldn't be punished for "an honest review," Representative Eric Swallwell, a California Democrat, added in a statement. "This is commonsense legislation to ensure the rights of consumers are protected and to penalize businesses attempting to silence fair criticism."

The issue may be bigger than non-disparagement clauses in consumer contracts, however. Congress should look for additional ways to discourage lawsuits filed against customers who post negative online reviews, the Information Technology and Innovation Foundation, a tech-focused think tank, said this week.

ITIF, in a paper published Monday, called on Congress to introduce and pass legislation to discourage so-called SLAPPs (strategic lawsuits against public participation).

Good anti-SLAPP legislation would require plaintiffs in such lawsuits to prove actual malice by reviewers and would allow courts to award costs and attorneys' fees to defendants, ITIF said.

It's unclear how big of a problem SLAPPs are, said Daniel Castro, vice president at ITIF and co-author of the report.

Exact numbers are hard to track "because nobody says, 'I'm filing a SLAPP,'" Castro said by email. "Similarly, if someone threatens a SLAPP, there may not even be a public record."

However, there have been reports of numerous cases where companies filed lawsuits or threatened to take action against reviewers, he added. "It's important to address this before the problem escalates because we do not want people to believe (falsely) that posting truthful information can get them in trouble," he wrote.

While 28 states have anti-SLAPP laws, a federal law is needed because those laws are not uniform and other states do not have them, Castro said. "We don't want consumers on vacation to have to consult a lawyer before posting a review about the hotel or restaurant they visit," he said.  "Federal legislation would create a national baseline so any consumer no matter where they live or travel in the United States could respond to a SLAPP."

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's email address is grant_gross@idg.com.

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Tags governmentsocial mediainternetlegislatione-commerceyelpInternet-based applications and servicesDarrell IssaInformation Technology and Innovation FoundationU.S. House of RepresentativestripadvisorDaniel CastroAngie's ListKlearGear.comEric SwallwellRipoffreport.com

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Grant Gross

IDG News Service
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