Nobody Wins In Yelp Defamation Suit

By: Chris Crum - February 5, 2014

Over a year ago, a Virginia judge ordered a Yelp user to change a negative review on the site. Building contractor Dietz Development sued user Jane Perez, claiming to have lost business because of her negative postings on the site (as well as on Angie’s List). He sued for $750,000, and claimed that he lost $300,000 because of her “defaming” words.

Perez had written that Dietz had caused damage to her home, trespassed and stole jewelry. The judge granted a temporary injunction, and ordered Perez to change parts of the review, specifically the accusations of theft.The following month, the Supreme Court of Virginia overturned the injunction, ruling that it was not justified.

The case went to trial last week, and has now apparently been resolved without a real victor. The trial lasted for five days, and a verdict was reached on Friday evening. They found that both had defamed one another (Dietz defaming Perez through responses to her initial reviews), and neither party was awarded damages.

The Washington Post shares statements from both of them with Dietz expressing shock, and Perez claiming victory because “freedom of speech won in this case, and that’s a good message to send.”

Last week, Yelp took to its blog to encourage users not to be afraid to leave negative reviews.

“But despite this press hype, it’s important to keep in mind that the First Amendment guarantees the rights of consumers to express their opinion about a business and honestly describe their experience,” wrote elp Senior Director of Litigation Aaron Schur. “These strong protections are why these suits are unlikely, especially when a reviewer has thoughtfully shared their views (Yelp provides guidance on how to do this in our Content Guidelines). We find the most useful reviews include a rich narrative, a wealth of detail and perhaps a helpful tip for others who are looking to spend their hard-earned money at that local business.”

“As we mentioned a couple weeks ago, litigation is not a good substitute for customer service,” he added. “Businesses that try to sue their customers into silence rarely prevail, end up wasting their own time and money and usually bring additional, unwanted attention to the original criticism (a phenomenon known as the Streisand effect). Many states (though, unfortunately not Virginia) have laws designed to further protect consumers from being intimidated or silenced by these types of lawsuits. These Anti-SLAPP laws allow consumers to quickly end meritless lawsuits and require the business to pay the consumer’s legal fees when the business loses.”

Yelp reviewers help both consumers and “good” businesses, he noted.

It does seem like the lengthy Virginia case’s conclusion could dissuade some businesses from going after Yelp reviewers. At the very least, it will make them think twice about the responses they post to any negative reviews.

On the flip-side, businesses who feel they have been defamed may feel their hands are tied.

Yelp will announced its Q4 and full year 2013 earnings today.

Image via Yelp

About the Author

Chris CrumChris Crum has been a part of the WebProNews team and the iEntry Network of B2B Publications since 2003. Follow Chris on Twitter, on StumbleUpon, on Pinterest and/or on Google: +Chris Crum.

View all posts by Chris Crum
  • stopandconsider

    The problem here is that Yelp allows reviews to stay up even when owners provide factual proof that the negative review is not based on what actually happened. Come on Yelp, stop allowing small business to suffer at the hands of Internet trolls claiming “free speech.” I’m all for a fair and balanced review, but have first hand experience with abusive practices from Yelp where positive reviews are blocked and trolling behavior allowed to continue.