Yelp Fights Back Against Carpet Cleaning Service That Sued Anonymous Critics For Defamation

from the good-for-yelp dept

We’ve seen plenty of lawsuits involving people upset about Yelp reviews, but here’s a fairly extreme case. Apparently, a DC-area carpet cleaning service named Hadeed Carpet Cleaning, which is somewhat infamous in the area for its “pervasive advertising” and direct mail coupons promising a $99 cleaning special, does not have the greatest reputation on Yelp. The key issue: apparently that $99 deal is often not honored. Also, there are multiple reviews of people getting a quote, dropping off a carpet, and then being told later if they want the carpet back they have to pay much more — with various excuses being offered as to why they’re charging more than the quote.

Hadeed then decided to sue seven anonymous reviewers for defamation. Here’s the oddity: Hadeed does not appear to be suing them over the contents of the bad review. In fact, the company doesn’t seem to dispute the various complaints about its pricing practices. Rather, it argues that it could not match these seven reviewers to actual customers within its database, and therefore, the reviewers are defaming them by misrepresenting that they were ever Hadeed customers. Hadeed appears to suggest that they reviews were really written by a competitor.

As we’ve discussed, many courts have adopted the so-called Dendrite rules for identifying anonymous speakers. The rules require giving the anonymous users a chance to respond and (more importantly) require the plaintiff to present enough evidence to prove there’s an actual case. However, the court in Virginia chose to not apply any such rules, but rather allowed a subpoena to Yelp ordering it to identify the posters. Yelp has refused, and the court ordered compliance, which Yelp again refused, leading to the court saying Yelp was in contempt.

Public Citizen has now filed a brief on behalf of Yelp with the appeals court, arguing both that the Virginia court had no jurisdiction over Yelp, a California company, and that Yelp was correct to ignore the order since the First Amendment (which protects anonymous speech) requires much more proof before an anonymous speaker can be revealed.

When pervasive advertisements from a local merchant feature prices that seem to be just too good to be true, they may, in fact, not be the price that the average consumer will pay. Dozens of consumers who have used pseudonyms to post about their experiences with appellee Hadeed Carpet Cleaning, Inc. (“Hadeed”) on the popular website www.yelp.com, maintained by appellant Yelp Inc. (“Yelp”), report that Hadeed routinely fails to honor the advertised discount prices. Hadeed’s responses to several consumers on Yelp suggest that it recognizes the problem; yet its complaint for defamation singles out the authors of seven reviews posted on Yelp that say the same thing as the other online detractors of Hadeed and its sister business, Hadeed Oriental Rug Cleaning. Based on that allegation, Hadeed invoked the court’s subpoena power to strip its pseudonymous critics of their First Amendment right to speak anonymously.

The main question on this appeal—an issue of first impression at the appellate level in Virginia—is whether the trial court applied the proper legal standard in overriding the anonymous speakers’ First Amendment rights. Courts elsewhere have recognized that, given the valuable role played by the First Amendment right to speak anonymously in encouraging ordinary people to express themselves fully, it is necessary to balance that right against a plaintiff’s right to seek redress for wrongful speech by adopting a standard requiring a plaintiff to do more than articulate a good faith belief that the speech “maybe tortious.” Before stripping the defendant of a First Amendment right, these courts take an early look at the merits of the plaintiff’s claim to determine whether a valid claim has been alleged and whether there is a prima facie evidentiary basis for that claim. In this appeal, Yelp urges Virginia to adopt the same approach, and to remand this case to give Hadeed an opportunity to pursue its subpoena by meeting the proper standard.

In the meantime, though, we have yet another case of a company suing over Yelp reviews — which just makes me wonder how they ever expect to get more customers. Any company that sues over online reviews someone makes is clearly a company not worth doing business with, since they might, potentially, sue you over any bad review you write online about them.



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Companies: hadeed carpet cleaning, yelp

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Comments on “Yelp Fights Back Against Carpet Cleaning Service That Sued Anonymous Critics For Defamation”

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39 Comments
out_of_the_blue says:

Gosh, an actual tough one!

First, Mike doesn’t highlight that plaintiff is a corporation and — presumably — the commenters are persons. But that’s important: corporations don’t suffer except “economically”, so in my view have MUCH less right to demand the names of persons wishing anonymity.

2nd is the interesting tangles for Yelp, which has now inserted itself as at least advocate for the (presumed) persons, thereby, in my view, losing the safe harbor protections. It’s such a dicey position that Yelp must be either digging in on a basic principle they need for their biz, OR are somehow more involved.

It’s a tangle that could be kept together only IF Yelp proved to judge that commenters are indeed real persons without revealing names to Hadeed — and of course if that can’t be proved, may expose Yelp to serious liability for both contempt and fabrication!

I won’t venture a guess at this point. I certainly don’t like anonymity of persons stripped in favor of a mere fictional economic entity, BUT that does have a limit, AND there may not be any real comments. May be some procedure for such in-chamber showing without revealing to plaintiff, which Law Student Mike should know.

Bottom line for me is that IF the TRUTH of the comments isn’t contested, then there’s NO standing to get the names, it’s JUST for intimidation.

Mike Brown (profile) says:

Just curious...

Yelp has currently filtered out 84 of Hadeed’s 91 reviews. Another 6 were totally removed. Most of those 6 are outside Hadeed’s area, so I can imagine they were totally inappropriate/spam/etc. But I wonder why 84 reviews were filtered out, leaving only 7? That seems suspicious, as if Yelp is trying to tell us there’s been a lot of shenanigans.

davebarnes (profile) says:

Re: Yelp filtering

Yelp filtering is automatic. That is, done by computer and not humans.

You will notice that most of the filtered reviews are 101s. One star, zero friends and one review.
Yelp wants people who write lots of reviews.
Usually, all the 101s and 501s will wind up in the filter bucket.

A large number of reviews in the filter bucket always means one of three situations:
1. Lots of pissed off customers. Hadeed Carpet.
2. Lots of fake positive reviews. http://www.yelp.com/biz/cherry-creek-modern-dentistry-glendale-2
3. Infrequently – lots of negative reviews from non-customers about a stance taken by the business. For example, a bakery that won’t serve homosexuals. http://www.yelp.com/biz/masterpiece-cakeshop-lakewood only shows 43 filtered, but at one time there were over 300.

Jerry woolfolk (profile) says:

Re: Re: Yelp filtering

Yelp has filtered all 4 of my reviews. All are true and honest reviews that I earned the good old fashioned way! (hard work for the client with superior results)I am a carpet cleaner in Colorado Springs and I perform phenomenal work at great prices. I deliver quality and my clients write unbiased, unsolicited reviews and yet they are still filtered out. I have not recieved any bad reviews yet, but wonder if those will remain posted online. I don’t get it. All positive reviews have been filtered. I am a 24 year retired army veteran working in my 2nd career, I conduct all my business with ethics beyond reproach and they still filter my reviews. (it’s embarrassing for me)
I recieved several, and I mean several emails from Yelp to pay for advertising, but declined due to advice I recieved from my SEO company. They didn’t knock Yelp, but rather advised me to put more emphasis and resources on Google+ (the internet leader). I can’t help but wonder if this has any weight in the deletions.
I have emailed yelp with my concerns, but they do not respond as posted on their site. Very, very frustrating. I am not saying that this other carpet cleaner is ethical, or unethical, I am saying I feel as though my company has not recieved a fair shake and I don’t know why!

M. Williamson says:

Yelp gets sued for extortion and loses, judge agrees yelp is scum.

According to the Wall Street Journal, a bankruptcy lawyer took Yelp to small claims court in San Diego and won a judgement of $2700.

?.the judge describing Yelp?s advertising contract as ?the modern-day version of the mafia going to stores and saying, ?You wanna not be bothered??

The case will be taken to a higher court on appeal.

The McMillan Law Group, which brought the claim against Yelp, agreed to an advertising deal with the site after it had become ?a good source of new clients for us,? said attorney Julian McMillan, representing his firm in the court. The deal involved the firm paying Yelp $540 per month in return for 1,200 ad impressions per month on the site. An impression is counted each time an ad is displayed to a user.

Mr. McMillan claimed Yelp did not deliver the 1,200 monthly impressions, leading to his firm cancelling the contract and asking for its money back. The site?s representative in the court, Bradley Bohensky, said the claim was based on a misunderstanding of how such impressions are measured, and that Yelp in fact ?over delivered? on the ad impressions promised.

Several thoughts:
-The Wall Street Journal, and to a lesser extent the lawyer making the claim, rehashed the Yelp conspiracy theory of pay to play but this case seems to revolve around the one-sided and coercive nature of Yelp?s contract and whether impressions were properly delivered.
-Rocky Agrawal has pointed out the extremely high pricing of Yelp?s advertising and the often irrelevant impressions that they provide. This would seem to me provide another avenue for a small claims court action.

William (user link) says:

I would be very interested

for Yelp to shed some light on how their algo works…the 101 theory proposed above simply is not true (I have seen one-star reviews published by those with no Yelp friends or other reviews written while more favorable reviews written by those who have posted past reviews and have numerous yelp friends are “filtered”). My intention is not to insinuate favorable treatment towards those who advertise with Yelp, but there seems to be no logical or mathematical rhyme or reason as to which reviews get posted and which are filtered. I am a small business owner and network regularly with many other business owners in my community who have experienced this firsthand.

Jason Hanleybrown says:

Suing Yelp

The Yelp filter is NOT setup to filter fake reviews. It is a reward system for people who post a lot.

Our company does a lot of installations and we encourage customers to post and since most people are not power Yelpers, they end up being “101”s.

Increasingly, we are seeing “Power Yelpers” use Yelp to renegotiate, often in abusive ways. Once per month we get a Yelper call in and say “You gave great service and I know I agreed to pay $x BUT I have 40 reviews on Yelp…so, I would like $300 back.”

All of our screened reviews (we have over 1,000 at this point) are real customers. We also have A ratings with BBB in multiple states and A ratings on Angie’s List. We also survey all of our customers and we regularly survey 9 out of 10 points.

I believe the Yelp filter should make them liable. It may be “automatic” but it has no relationship to review accuracy. If anything, it is a reward system for people who Yelp a lot. In this sense, Yelp is in fact manipulating its reviews and I would love to see someone sue Yelp on this basis.

Further, if you try to communicate with them, they are evasive and extremely aggressive about trying to get you to advertise.

We are at the point of not wanting active Yelpers as customers. On the other hand, we go 10 extra miles for an Angie’s List customer. And, if they are not happy we always address it. But, it’s not anonymous (as a business user, you can see the name and address of users) and if someone is unhappy, we want to fix it.

I think there is a basis to sue Yelp but not only that, I think they deserve to lose.

Anonymous Coward says:

The author is missing the point.

The point here ultimately is that the 1st amendment does not protect defamation. If the reviews are written from the perspective of customers by people who are not really customers then they are defamation by libel. If the company has no record of any of the reviewers actually being customers what more proof would you like? Many false reviews are written by business competitors and these may or may not be among those but there has to be some way for a company to establish whether or not the reviewer was at least a customer.

Anonymous Coward says:

Re: The author is missing the point.

The above said, it is entirely possible to anonymize Yelp or other reviews so that the author cannot be traced. Use open wifi with no cameras around and make sure you never use the associated accounts from a traceable connection and you will be very hard if not impossible to unmask. Even for a three letter federal agency unmasking anonymous posters can be extremely difficult to impossible. Ask the FBI, DHS, CIA and NSA about TOR. Couple TOR with open wifi and basic OPSEC procedures and it will be impossible to identify you, although TOR won’t work with Yelp without additional measures because Yelp blocks the exit ips for Tor. The bottom line though is, that for a civil litigant in most cases, if any attempt was made to anonymize the communication it’s going to be impossible more often than not to trace it.

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