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Fining customers for negative Yelp reviews? Welcome to the future of big data

Lisa Schmeiser | Aug. 8, 2014
The Union Street Guest House made news this week with its purportedly tongue-in-cheek policy of fining a wedding party $500 for each negative online review left by their wedding guests. The "We were joking!" defense defuses the original story. However, it doesn't neutralize the very real prospect of businesses trying to strike back against negative reviews by hitting customers right where it hurts--the wallet.

If someone's looking to make money off charging others for their bad opinions, they better hustle. A policy like the Union Street Guest House's may not pass legal muster in the U.S. As reported by Alison Griswold at Slate:

If a policy like the one employed by Union Street Guest House were to wind up in court, it would most likely be struck down as illegal under a doctrine of contract law known as unconscionability. "It says if there's a surprise term in the contract that is so unfairly one-sided that one can doubt that a reasonable party would have knowingly agreed to it, that the clause cannot be enforced," Scott Michelman, an attorney with Public Citizen, says. "Nobody enters into a consumer contract expecting that they're going to be paying a fine if another consumer doesn't like the business."

And there's already a precedent for reputational-management user clauses being found laughable in a court of law: In June, a federal court fined online retailer KlearGear $306,750 in compensatory and punitive damages plus lawyers' fees, after the company cited its "disparagement clause" and attempted to charge a would-be customer $3500 for a negative review.

However, there's a difference between lawyers or tech-news junkies knowing that and consumers reeling from a $500 sucker punch knowing this. Into the blissful gap of ignorance will step a startup promising to keep tabs on customers' online reviews and make them pay for smack talk. And a business desperate to control its online profile will pay.

That it, they'll pay until something, or someone, forces a legal case to make it clear throughout the land: Your privacy may be in flux, but your right as a U.S. consumer to leave your customer feedback without penalty will remain uncontested.


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