Yelp Beats "Deceptive Acts" Claims

Chris CrumBusiness

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Yelp recently won a case against a dentist who tried who sued the site over a negative review, claiming defamation and "deceptive acts and practices" under New York state law.

The defamation part was pretty much old hat. This is not the first time someone has tried to sue the owners of a site (or even Yelp specifically) because they didn't like a review. The second part was new to the story, though the court still moved to dismiss it. Technology and intellectual property attorney Evan Brown writes on his Internet Cases blog

The other claim against Yelp — for deceptive acts and practices — was intriguing, though the court did not let it stand. Plaintiff alleged that Yelp’s Business Owner’s Guide says that once a business signs up for advertising with Yelp, an “entirely automated” system screens out reviews that are written by less established users.

The problem with this, plaintiff claimed, was that the process was not automated with the help of algorithms, but was done by humans at Yelp. That divergence between what the Business Owner’s Guide said and Yelps actual practices, plaintiff claimed, was consumer-oriented conduct that was materially misleading, in violation of New York’s General Business Law Section 349(a). 

In the end, the court decided that statements from Yelp's Business Owner's Guide were not consumer-oriented, so that was the end of it. 

Eric Goldman, an Associate Professor of Law at Santa Clara University School of Law, writes on his Technology and Marketing Law Blog: "While Yelp avoided liability in this lawsuit, it should scrub its site to ensure it does not claim that Yelp's reviews are bias-free or the sole product of automated algorithms. For example, the complaint alleges that Yelp's guide says 'We remove the guesswork by screening out reviews that are written by less established users. The process is entirely automated to avoid human bias.' Obviously, the second half of the statement contains a fatal logic flaw; any algorithm intrinsically reflects human biases in its configurations."

Do you think the court was right to side with Yelp? Tell us what you think.

Yesterday, Yelp announced that it surpassed 13 million reviews. Yelp reviews were recently removed from Google Place Pages, instantly giving them less visibility. 

Hat tips to Greg Sterling and Mike Masnick.

Chris Crum
Chris 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.