DON’T PROHIBIT BAD CUSTOMER REVIEWS – It’s now illegal

The federal Consumer Review Fairness Act of 2016 goes into effect on March 14, 2017. This law prohibits any agreement that restricts consumers from posting negative reviews online.

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Companies love positive reviews and hate negative reviews. So, in the past some businesses tried to “discourage” negative reviews contractually having a consumer agree not to post a negative review under penalty of an agreed fine. Others tried to be more intellectually creative and had the consumer grant copyright ownership to any online review so that the business could cause the review to be removed because it infringed the copyright in the review now owned by the business.

Let’s face it – reviews can have a powerful positive or negative effect on business. However, reviews are a fact of life online and must be addressed in a multi-pronged but professional manner. So, if you have inserted any restrictions on reviews into your website terms of use or other documents – now’s the time to remove them. The law allows the Federal Trade Commission, state attorney generals, and consumer protection agencies to initiate civil actions to enforce the law.

The new law makes exceptions for confidential information protected by law. Also, if a consumer posts a negative review on your site, you are allowed to remove that review.

Best practices for dealing with negative reviews include:

  1. Respond to the reviewer privately and attempt to solve the problem and ask them to remove the review. Be careful with the communication because the recipient might choose to post it publicly.
  2. Respond publicly on the review site, but be careful that the response is professional, and demonstrates the company’s desire to provide excellent service. Just denying an accusation contained in a negative review might backfire. However, if the review relates to medical treatment then much caution must be taken to ensure that the public response does not violate HIPAA.
  3. Garner positive reviews so that the weight shows overall positive experiences. However, don’t offer any incentives to customers for the positive reviews that might violate the Federal Trade Commission’s Guides Concerning the Use of Endorsements and Testimonials in Advertising.
  4. If the negative review is defamatory, libelous, or slanderous, then legal action can be taken.

Bottom Line:

It’s important to prepare legally compliant procedures for obtaining and managing both positive and negative reviews online.

 

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William Galkin manages GalkinLaw. Mr. Galkin has dedicated his legal practice to representing Internet, e-commerce, computer technology and new media businesses across the U.S. and around the world. He serves as a trusted adviser to both startup and multinational corporations on their core commercial transactions.

  
                                                                                                         
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