The U.S. House of Representatives last week unanimously passed the Consumer Review Fairness Act, which would make it illegal for companies to put so-called gag orders (also called non-disparagement clauses) in their customer contracts to prevent consumers from posting honest opinions on review sites like Yelp and Trip Advisor.
The act would void existing clauses in consumer contracts and empower the Federal Trade Commission and state attorneys general to take action against businesses that attempt to silence consumers.
Companies will still be able to remove false and defamatory reviews.
The House version of the bill now goes back to the Senate, which approved an almost identical bill late last year. Once the Senate acts, the bill would finally go to the president for signing into law.
"This bill is about protecting consumers posting honest feedback online," Rep. Leonard Lance (R-N.J.), one of the bill's sponsors and vice chair of the House Commerce, Manufacturing, and Trade Subcommittee, said in a statement. "Online reviews and ratings are critical in the 21st Century, and consumers should be able to post, comment, and tweet their honest and accurate feedback without fear of retribution. Too many companies are burying non-disparagement clauses in fine print and going after consumers when they post negative feedback online. That needs to stop."
The congressman also notes that consumer reviews are a powerful, valuable informational tool.
The bill was reportedly influenced by a number of lawsuits brought by businesses against customers who posted negative reviews. In one instance, a Texas petsitter sued a customer for $1 million over a negative review on Yelp. In another, an online retailer reportedly tried to collect $3,500 from a customer who gave the company a negative online review. Others have included a wedding contractor and even an apartment complex.
"Bullying consumers into keeping quiet about their genuine travel experiences goes against everything we stand for at TripAdvisor and denies freedom of expression. When businesses attempt to silence consumers with fine print, everyone is harmed," said Adam Medros, senior vice president of global product at TripAdvisor, in a statement.
TripAdvisor now features more than 385 million reviews and opinions—both good and bad—covering more than 6.5 million accommodations, restaurants, and attractions in 48 global markets. It is against TripAdvisor's policies for a business to include gag orders in its contracts with travelers. Businesses that violate these policies could receive a red badge on the site warning travelers about these practices, the company said.
Sara Spivey, chief marketing officer at Bazaarvoice, a provider of online review platforms, also hails the move. "It's important that consumers feel safe and empowered to leave fair and honest reviews about goods and services without fear of legal action," she says.
Such freedom benefits both the consumer and the company, she adds. "Consumers benefit from reading honest reviews—both positive and negative—from other consumers when making their purchase decisions, and companies have an opportunity to improve their products or business models based on negative feedback from their customers."
Spivey says companies needn't be concerned about unfair or fake consumer reviews. Not only does the law allow companies to remove fake reviews, but companies like hers have protections in place.
"At Bazaarvoice, we've invested heavily in our fraud detection program to filter out fake reviews," she says.
At the same time, however, Bazaarvoice's authenticity policy "does not support any client who would want to stifle a consumer's right to post a negative review," Spivey adds.