California Passes Law to Protect Yelpers’ Right to Post Bad Reviews

It’s now illegal in California for businesses to fine customers for sharing negative comments.

Sept. 11, 2014, 6:09 a.m.

Cali­for­nia has a new law to pro­tect Cali­for­ni­ans’ right to Yelp.

Known as the “Yelp Bill,” As­sembly Bill 2365 makes it il­leg­al for busi­nesses to pro­hib­it or fine cus­tom­ers from writ­ing neg­at­ive on­line re­views.

On­line re­views can make or break a busi­ness, and small busi­nesses are es­pe­cially vul­ner­able. Para­noia has driv­en some busi­nesses around the coun­try to sneak non-dis­par­age­ment clauses in­to con­tracts to thwart bad re­views.

The new state law makes these kinds of pro­vi­sions il­leg­al, and busi­nesses in vi­ol­a­tion of this law could face up to $10,000 in fines.

Yelp cel­eb­rated the pas­sage of the law, call­ing it a vic­tory for free speech.

“A five-star rat­ing for a busi­ness who had used one of these clauses to simply scare all neg­at­ive re­view­ers in­to re­mov­ing their com­ments wouldn’t really rep­res­ent the ex­per­i­ence a con­sumer could ex­pect to have at that busi­ness in our opin­ion,” Yelp’s head of gov­ern­ment af­fairs, Laurent Cren­shaw, wrote in a blog post Wed­nes­day.

Cali­for­nia is the first state to pass le­gis­la­tion on the is­sue, but this is still a po­ten­tial prob­lem in oth­er states.

The bill was in­spired by a Utah couple whose cred­it score was dam­aged after they were fined $3,500 for un­wit­tingly vi­ol­at­ing a re­tail­er’s “Terms of Sale” con­tract by post­ing a bad re­view, ac­cord­ing to the bill’s au­thor, As­sembly Speak­er John Pérez.

Just last month, a New York hotel came un­der fire after new­ly­weds real­ized the hotel had sneaked in­to their con­tract a $500 fee for any neg­at­ive re­views pos­ted by their wed­ding party.

There have also been re­por­ted in­stances of med­ic­al and dent­al of­fices fin­ing pa­tients for bad re­views.

Rep. Eric Swal­well, D-Cal­if., plans to in­tro­duce sim­il­ar le­gis­la­tion at the fed­er­al level in the near fu­ture.

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