The Gray Legal Landscape of Negative Online Reviews


Recent news coverage about legal battles between online anonymous reviews and the companies negatively affected by them has created a stir about people’s rights to post negative reviews of businesses without fear of reprisal. Several companies have been vilified for their attempts to prevent customers from posting negative comments online. Lately, several companies have tried to accomplish this by including in their terms of services an express prohibition against venting publicly later if they are dissatisfied. Often times, these terms of services were never agreed to, or even seen, by the customers they later wish to take legal action against, and the resulting public outrage creates even more negative online press for the companies.

Most Americans view it as a “right’ to say whatever they want about a company online. While some people overstep, and go beyond posting merely negative opinions and into defamatory or untrue reviews, the right of free speech is cherished one to Americans who share their views on a daily basis online. Dozens of websites like RipOffReport and Scambook exist that give people a public forum to air their grievances about everything from the slow service at their local Thai restaurant, or their frustrations about their new tech gizmo they just can’t quite figure out, to the surprise add-on fee from their national bank they just noticed in their online banking statement.

Unlike a complaint spoken to a few close friends or neighbors that the affected company would likely never know about, the digital world allows any single angry complaint about an undisclosed baggage fee to immediately be viewed by thousands and thousands of that business’s customers, both now and in the future. So-called “gripe” websites often rank highly for searches about a company and their products, and it’s easy to see how one negative review of a company, accurate or not, could cost them dearly in lost sales from potential customers who were turned off by reading a negative online review. Companies complain that these reviews are often unvetted, inaccurate, and even plain dishonest, but that doesn’t save them the lost business from prominent negative comments left online for the world to see.

While actions against the websites that serve as a forum for angry customers to vent their frustration generally fail (these websites are protected by a law known as the Communications Decency Act, which limits their liability for negative comments posted by others), legal action against the actual posters of the negative comments can be successful when the companies are able to convince a court that the comments were defamatory and untrue. With the recent court decision that Yelp has a right to charge companies to hide negative reviews, and a EU court decision being handed down granting a judgment against a blogger who left an unfavorable review about a restaurant that featured prominently in search results, it’s clear that some companies are now opting to pursue legal action against those who they claim are defaming them online, even if it risks a public backlash. As more and more companies fight back against negative online postings, and more and more anonymous commenters push the envelope between expressing their personal opinion and defaming a deep-pocketed company illegally, these types of lawsuits will become much more common in our digital future, and courts will be left trying to sort out the murky line between freedom of expression and a legal case for online defamation.