Customer Review Law in the United States
Small businesses often rely on word–of–mouth and online reviews to survive, and 86% of U.S. consumers consult online reviews before patronizing a local business. However, some business owners have tried to sue consumers for leaving negative reviews, citing non–disparagement clauses as justification. The Consumer Review Fairness Act (CRFA) was signed into law in 2016 to protect consumers’ ability to leave an honest online review of a business without fear of punitive action. The CRFA also makes it illegal for businesses to use non–disparagement clauses in contracts. Some states have anti–SLAPP laws that make it easier for defendants to seek dismissal of a meritless lawsuit (such as a business suing a consumer over an honest review) and can even impose financial penalties on plaintiffs who lose an anti–SLAPP motion. In states without anti–SLAPP laws, consumers may be more exposed. Consumers should always stick to their honest opinion when writing a review and, if necessary, make sure they can support their claims with documentation. The CRFA still leaves room for business–owners to sue for defamation in cases where a customer, or even a rival, posts false negative reviews online. In conclusion, it is important for consumers to carefully consider the potential legal ramifications of posting an online review of a business and to speak honestly and accurately about their experiences. Consumers should take advantage of their right to free speech and know their rights when it comes to posting online reviews. They should also be aware of the anti–SLAPP laws in their states in the event they are faced with a sue–happy business.
Customer Review Law in the EU
The new EU laws requires businesses to ensure that the customer reviews and rankings are clearly distinguished from its own marketing messages, that reviews are genuine and honest, are not manipulated and that customers are not offered incentives by businesses to submit reviews. In addition, regardless of the country, businesses should have a process in place to monitor customer reviews and rankings, respond to customer feedback, maintain a record of customer reviews and rankings and make sure they are not misrepresented. The increased importance of customer reviews and rankings, combined with the new EU laws, mean that online businesses must pay more attention to the customer reviews and rankings they receive, and take steps to ensure that they are genuine and honest. With the right processes in place, businesses can ensure that customer reviews and rankings remain a valuable tool for customers to make informed decisions about the products and services they are looking to purchase.
In the European Union (EU) regulators are taking customers reviews and rankings seriously and the new Omnibus Directive (EU 2019/2161) which came into force in November 2021 and amends the Unfair Commercial Practices Directive (2005/29/EC) now imposes significant new obligations that e–commerce businesses must comply with.
Customer Review Law in the United Kingdom
Maker&Son Ltd was a luxury furniture brand founded by the family of Sir Terence Conran that sold handmade English sofas and beds with price tags of more than £10,000. The company experienced financial difficulty last year and customers complained of phone lines being closed and having difficulty obtaining refunds for undelivered orders, leaving indignant feedback on review sites.
In response, the brand’s new owner Inc & Co applied for a number of cease and desist court orders to former customers accusing them of harassing and defaming the new firm. Lawyers for Inc & Co asked those served with the letters to pay £15,000 each to cover its legal bills and to stop all negative reviews online. Inc & Co claimed the former customers were “trying to cause as much nuisance as possible”.
When Maker&Son fell into administration in October, Inc & Co licensed the Maker&Son brand name to manufacturers via a “phoenix firm”. Customers who had paid Maker&Son Ltd were told to contact its administrator, FRP.
The dispute has also drawn in Trustpilot as customers complained their comments could no longer be seen due to Maker&Son “flagging” them as harmful. Trustpilot said it was conducting an investigation.
Inc & Co has sought to protect its reputation by taking this extraordinary step and is now attempting to rebuild its brand name. The Conran family is no longer involved in the Maker&Son brand, but expressed “deep concern” for affected customers.