United States: When Anonymous Reviewers Have No Clothes

Last Updated: January 22 2014
Article by Randal M. Shaheen and Mark S. Goodrich

Anonymous fake online reviews are back in the news, but this time marketers may not be the only ones who should be wary. As we have written before, astroturf is making a comeback, and not necessarily on the athletic fields. In September 2013, the New York AG agreed to settle  with 19 companies engaging in "astroturfing," requiring the companies to essentially stop writing their own fake online reviews and pay more than 350,000 in fines.

These fake reviews are particularly attractive to companies that lack a good reputation as they offer a quick fix to their reputation woes. A Harvard Business School study recently asserted that roughly 16% of online reviews are classified as fraudulent, a number which Yelp later confirmed,adding that its fraud logarithm excludes about 25% of reviews submitted. Despite efforts undertaken by companies such as Yelp, some false reviews inevitably slip through the cracks.

But what happens when the roles are reversed and private citizens or competitors slip negative reviews about a company past the goalie in an attempt to hurt the company's reputation? In a recent case, a company alleged that it was a victim of false attacks in online reviews. In response, the Virginia Court of Appeals held that Yelp must identify the online reviewers accused of defamation. =

In July 2012, Yelp displayed 75 reviews of Hadeed Carpet Cleaning ("Hadeed") in Alexandria, VA. In its complaint, Hadeed alleged a "rash of negative reviews" on Yelp relating to charges that were never performed, work causing stains on carpets, and actual costs being double what was initially quoted. Hadeed claimed that these reviews were false and defamatory and particularly suspicious because the reviews had the same themes of double the cost and false advertising throughout. Hadeed Carpet first attempted to work with Yelp to respond to these negative reviews and after those efforts failed conducted an independent investigation attempting to match the negative reviews of customers in its records. Ultimately, Hadeed Carpet concluded that the anonymous defendants had falsely represented themselves to the public as customers and subpoenaed Yelp for the identity of the customers. Yelp refused, citing its privacy policy and asserting that the identity of the reviewers should be protected to preserve free speech rights and prevent a chilling effect on online reviewers.

On January 7, 2013 the Virginia Court of Appeals acknowledged that anonymous speech is protected by the First Amendment and that "an internet user does not shed his free speech rights at the log-in screen." However, as all attorneys learned in Con Law during 1L year, the right to free speech is not absolute, and if statements are defamatory, the veil of anonymity may be pierced, provided certain procedural safeguards are met. The Court carefully examined a Virginia statute permitting the uncovering of the identity of an anonymous Internet communicator under certain circumstances and ultimately upheld the law as constitutional. Since Hadeed and the circuit court had complied with the statute's numerous procedural requirements and the court could not
"identify a clear, palpable, and free from doubt [constitutional]  infirmity" in the statute, the identities of the reviewers were required to be disclosed.

This case could also provide companies with a potential lever to use about sites such as Ripoff Report that arguably make taking down even false reviews time-consuming and expensive. Being able to request verification that reviews came from actual customers could decrease the quantity of false reviews and serve as a big weapon in the battle of public perception, However, it is important to note that this ruling does not necessarily open the door for every business that has received negative reviews to file suit to obtain the identities of reviewers. First, the court indicated that "generally, a Yelp review is entitled to First Amendment protection because it is a person's opinion about a business that they patronized."  The court explains:

"This general protection relies upon an underlying assumption of fact: that the reviewer was a customer of the specific company and he posted his review based on his personal experience with the business. If this underlying assumption of fact proves false, in that the reviewer was never a customer of the business, then the review is not an opinion; instead, the review is based on a false statement of fact – that the reviewer is writing his review based on personal experience. And 'there is no constitutional value in false statements of fact."

Thus, what makes this case sufficient to require disclosures of the reviewers' identities is that Hadeed attached sufficient evidence through its customer database to demonstrate that the anonymous reviews could not be actual customers. Second, the VA statute in this case is unique to the state of Virginia and therefore the holding is not easily transferable to other states. In fact, the Court cites case law related to disclosure of anonymous reviewers from other states that supports Yelp's arguments for nondisclosure.

It is unclear if this case will result in a litigation boom against private reviewers and websites providing negative reviews, but for now, it might be a good idea to tell your friends to keep the comment trolling to a minimum. If you do write an anonymous review, there is now the potential, however unlikely, for your identity to be revealed. So make sure you're not finally getting payback for that kid who beat you up in high school.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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