Ripoff Report Wins Against Extortion Claim

from the for-now... dept

Ripoff Report is a site that we’ve discussed a few times before, as it’s dealt with a bunch of lawsuits — all of which it has successfully defended itself against — from organizations upset that users wrote negative reviews on the site. Of course, as you should know, Ripoff Reports has a strong Section 230 safe harbor defense: it’s not creating the content, and thus, is not liable. But, over the past few years we’ve seen more and more attempts to get around Section 230 with creative lawyering. In the latest case against Ripoff Report, the workaround was to charge the company with RICO (racketeering) violations for trying to “extort” companies. Specifically, a company named the Asia Economic Institute (AEI) was upset about a series of negative complaints about its work environment, and asked for them to be removed. Ripoff Report notes that it never removes content, but did pass on information about its Corporate Advocacy Program (CAP), where, for a fee, it tries to effectively moderate between the company and the complaining individual. AEI suggested that this was presented in an extortionary manner — as in “if you want to fix your reputation, you need to pay.”

As Eric Goldman notes, this particular attack appears to have failed miserably, in large part due to the fact that Ripoff Report secretly recorded all of its phone calls. AEI fought against revealing the content of the phone calls, noting that it did not know its staff were being recorded — and, in the end, the judge actually does deem the evidence inadmissible. But just the fact that Ripoff Reports presented the recordings made the two principles from AEI suddenly have their memories jogged, and admit that they might have been “confused” about what was actually said in the calls. From there, the judge found little evidence that the CAP program actually represented any kind of extortion.

AEI claimed that Ripoff Report’s promise to defend itself against any lawsuit represented a legal threat. However, the judge points out that such an interpretation makes little sense. Claiming you will strongly defend yourself against any lawsuit is hardly a threat. On top of that, the judge notes that a “a threat to take legal action cannot constitute extortion unless the threat was made with knowledge that the threatened claim was false and without merit.” Furthermore, the judge notes that the threat to defend itself from any legal action was entirely separate from the CAP program. Thus, the supposed (but non-existent) “threat” was entirely independent from any request for money.

As for the CAP program, the judge doesn’t see that as a threat either, specifically noting that Ripoff Reports makes it clear that no reports on the site will be removed, so there’s no demand for payment to remove a negative report.

Unfortunately, the case isn’t entirely over. The judge did leave open the slim possibility of a RICO charges based on wire fraud, and AEI is heading down that path now. Still, as Eric Goldman notes in his writeup, AEI may have difficulty showing any “harm” to its business due to the following:

AEI was a content publisher from 2000-2009 (it’s now out of business), and during those 9 years, it had zero revenues. This could make it hard for AEI to garner much judicial sympathy over any harm to its business.

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Companies: asia economic institute, ripoff report

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Comments on “Ripoff Report Wins Against Extortion Claim”

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22 Comments
BearGriz72 (profile) says:

Are they "Out of Business"?

AEI was a content publisher from 2000-2009 (it’s now out of business), and during those 9 years, it had zero revenues. This could make it hard for AEI to garner much judicial sympathy over any harm to its business.

Now I realize Mike was quoting Goldman on this, but I just looked and there is an ‘Asia Economic Institute (AEI)’ website still up at http://www.asiaecon.org/

From the ‘About Us’ Page: “The Asia Economic Institute (AEI) began in 1999
From The ‘Contact Us’ Page: “Correspondent Office … Wilshire Blvd … Los Angeles, CA

Looks like the same company to me, are we sure they are out of business? I would hope they are with the bull they are trying to pull, but the website seems to still be active. Of course they could have paid for the hosting in advance and just never bothered to take the site down.

Anonymous Coward says:

Unverified

I personally have known about this site for a while. I had a friend that had an ex-employee try to start all kinds of crap on the site with different names. The first was his report, soon after another filed by a “customer” appeared, soon after another by someone trying to get hired all within a short period of time.

I wouldn’t take anything on the site serious or believe half of it since anyone can post anything under any name and it stays unless you pay. Great concept but apparently ran by assholes looking for a quick buck and it does sound like extortion to me.

I was looking for one about Ripoff Report but didn’t see one. Maybe I’ll post a complaint about them posting invalid complaints or accuse them of extortion, would it stay up?

Anonymous Coward says:

Re: Unverified

When you say “friend” you really mean yourself, dontcha

You know, I’m sure a smart business plan could use this to identify some issues and address them to the one making the complaint and also maybe..internally…

Nope fixing anything in your organization is too much effort. Bring on the lawreys

Anonymous Coward says:

Re: Re: Unverified

Sorry retail shops aren’t my thing. I worked there when I was a teen and still do IT work for him and I really don’t think a smart business plan will take care of a single person that gets canned because of work ethic.

There were no lawyers involved with RR, that would be insane for a few local retail shops. He did have his lawyer send a letter to the ex-employee that outlined the fabrications made. The guy wasn’t real smart and documented lies, that could be proven as such, in the report. But again, even showing that the guy was off in the head and a liar, the report remains some 7 years later.

Mark says:

Ripoff Reports doesn't just affect Companies...

Just to be clear here, Ripoff Reports doesn’t just attack large corporations. They’ll take any “report” on anyone who runs a (small) business.

Here’s the tale of one such young man who’s life was affected by Ripoff Reports.

http://www.reddit.com/r/AskReddit/related/ckcjc/reddit_can_you_please_help_me_for_five_years_i/

Another anonymous coward says:

My name showed up on that terrible site RR and I don’t own a business nor ever owned a business. The problem is that I am an accountant. And my name showing up as a scam artist isn’t a good thing.

They even went as far as to say they had a private investigator check me out. Of course all that info was completely incorrect. But how many people would I have to show my resume too and have them go through my references to prove it is all lies?

And by then the harm is done. People need to trust the accountant they hire for their business. And even though I have a squeaky clean background check it’s hard to bypass that lingering word, scam artist.

And the worse thing is, I’ve already read about people that have won court cases against people for deformation on that site, yet RR still refuses to take down the info. Check youtube, there was a news story about a woman that happened to in Chicago. And they were all complete personal attacks. None of it was related to a consumer issue.

RR needs to be shut down!!!

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