President Barack Obama has signed a new bill that aims to protect consumers' right to post critiques of businesses.
The Consumer Review Fairness Act invalidates standardized contractual provisions that restrict consumers' ability to post reviews. The bill also prevents companies from shutting down criticism by asserting a copyright interest in reviews -- a technique used by some health care professionals earlier this decade.
Numerous advocacy groups backed the bill, as did review sites like Yelp.
"The Consumer Review Fairness Act is a welcome law," the watchdog Public Citizen stated Thursday. "Consumers should be able to comment about businesses and services, and this law will help ensure that they can do so."
In the past, some retailers or other business owners who tried to enforce non-disparagement clauses have ended up in court. Judges have sided against those businesses in several cases, including a highly publicized dispute involving online retailer KlearGear.
Several years ago, that company attempted to impose a $3,500 fine on the married couple John Palmer and Jennifer Kulas, who supposedly violated a non-disparagement clause by panning the business on RipoffReport.com. (The non-disparagement clause apparently was added to the KlearGear's terms of service after the couple tried to place an order.) When Palmer and Kulas refused to pay KlearGear, the company allegedly wrecked their credit. Palmer and Kulas subsequently sued KlearGear for violating federal fair credit laws. A federal judge awarded the couple $306,750 in 2015.
In another example, the Dallas-based pet-sitting service Prestigious Pets recently brought a $1 million lawsuit against a couple who gave the company a one-star review. Prestigious Pets alleged that its pet-sitting contract contained language prohibiting consumers from "taking any action that negatively impacts" the company.
In August, Dallas County District Court Judge Jim Jordan dismissed Prestigious Pets' lawsuit and ruled that the company may also face sanctions.