UPDATE: Because this Yelp Wars segment received such a large response that many callers were turned away and key questions were left hanging, Patt is having back Vince Sollitto, vice president of corporate communications of Yelp. He will be here, in studio, to take your calls and comments about Yelp. Please see attached segment page for the part two of this segment.
August 25, 2011:
The influence of Internet sites that rank businesses has surged in the past several years, as has the number of people posting on them. For businesses, that's come with difficulty protecting themselves against unfavorable – sometimes unfair – reviews, largely because of anti-SLAPP legislation that protects individuals' free speech.
Business was steady for Dancing Deer Mountain, a mom-and-pop wedding venue in the small town of Junction City, Oregon, until one wedding went terribly wrong. Several rules of the venue contract were broken: outside alcohol was brought on the premises; a man exposed himself while urinating on the premises; combative behavior took place when owners warned of rules. Afterwards, five reviewers wrote scathing online reviews of Dancing Deer Mountain, including "These people are insane!," "The owner is absolutely crazy and, in my opinion, is in need of professional help!" and "DO NOT USE THIS VENUE!!!”
The aftermath: Dancing Deer Mountain's business nearly halted, costing the venue a supposed $20,000 in lost revenue. The owners, Carol Neumann and Tim Benton, hired a company to write positive reviews to boost business but that didn't work as the disgruntled wedding party followed suit by adding more negative reviews. Against recommendations but with nothing else to do, the owners sued the reviewers; as expected, they lost under Oregon’s anti-SLAPP law, which protects the "little guy's" free speech against a big corporation that can bankrupt him. The only problem, Carol Neumann says, is she's a "little guy" herself—not a big corporation but just a small business trying to protect its reputation and existence.
Owners who say they've been victimized by negative reviews often encounter the same hurdle that the proprietors of Dancing Deer Mountain did. Under anti-SLAPP law, if an owner attempts to sue consumers for defamation over negative reviews of a business, the case is expedited, and, if the court finds that the comment is not defamatory, the law requires the business pay for the legal costs incurred by the defendants. Almost always, the comment is found to be protected, qualifying as opinion. About half of US states have some sort of anti-SLAPP law. California has the strictest anti-SLAPP law, which many laud as vital for the protection of consumer free speech.
With online review services having the ability to make or break a business, the credibility of the reviews has been called into question. Though services like Yelp, Amazon and TripAdvisor claim they use algorithms to filter out false reviews, some small business owners say that false reviews make their way to their enterprise's page anyway, scaring potential customers away for good. In response, the number of services that offer to write and post positive reviews for business owners is on the rise, an analysis by the New York Times shows. Such false reviews, used to combat negative reviews, can go for $5 or $10 a piece.
A further complicating matter, Kathleen Richards, co-editor of the East Bay Express, explained to KPCC's Patt Morrison, is the claim of numerous small business owners that their reviews have been manipulated by Yelp—one of the most popular online review services in the nation.
Richards said that she talked with several Bay Area business owners in 2008 who claimed that Yelp representatives had aggressively approached them about advertising on the website. The company allegedly offered to move a business's negative reviews to the bottom of its Yelp page, where users couldn't easily view them, in exchange for a monthly advertising fee. When some owners declined, their positive reviews on the website disappeared without explanation.
The owners organized a class-action suit against the online giant, accusing it of extortion. The suit was recently struck down by a federal judge in April, who ruled that the owners had not proven how Yelp had hurt their businesses through its advertising offers. The group filed a second lawsuit against Yelp in May.
Yelp vice president of corporate communications, Vince Solitto, firmly denied the accusations of extortion to KPCC’s Patt Morrison.
“What she described didn't happen, and there is no amount of money that anyone can pay to manipulate Yelp reviews or move their placement," he said. "Yelp reviews are written by real consumers about real businesses, and they serve as a helpful resource for more than 50 million consumers each month.
“I think because of that there's a great temptation on the part of some businesses to try to manipulate their own rating,” he said.
Solitto, who points to consumer confidence as a reason for Yelp's success, acknowledged the popularity of false review services among small businesses. He said his company has taken steps to protect the consumer from false or purchased reviews, though he allowed that "our filtering efforts do sometimes cause some consternation and perhaps some confusion of business owners." He also suggested that those who sued Yelp were just disgruntled by their negative reviews.
The recent conflicts over online reviews and their susceptibility to manipulation have raised questions about the accuracy of consumer review sites. Are these online companies a valuable way for consumers to hold businesses accountable? Or, without a foolproof method of detecting false reviews, defamation and slander, are the sites inaccurate – or even deceptive and harmful?
Kathleen Richards, co-editor, East Bay Express; reported on extortion law suits against Yelp, Inc.
Vince Sollitto, vice president of corporate communications, Yelp, Inc.