• Search Engine Land
  • Sections
    • SEO
    • SEM
    • Local
    • Retail
    • Google
    • Bing
    • Social
    • Resources
    • More
    • Home
  • Search Engine Land
  • SEO
  • SEM
  • Local
  • Retail
  • Google
  • Bing
  • Social
  • Resources
  • Live
  • More
  • Events
  • SUBSCRIBE

Search Engine Land

Search Engine Land
  • SEO
  • SEM
  • Local
  • Retail
  • Google
  • Bing
  • Social
  • Resources
  • More
  • Newsletters
  • Home
Local

Class Action Lawsuit Filed Against Yelp Alleging “Extortion”

It must be the season for litigation. Two class action law firms have filed suit in Los Angeles federal court claiming that Yelp has attempted to “extort” money from small businesses by offering to remove negative reviews in exchange for payment. The suit contends: Yelp runs an extortion scheme in which the company’s employees call […]

Greg Sterling on February 24, 2010 at 2:20 pm
  • More

It must be the season for litigation. Two class action law firms have filed suit in Los Angeles federal court claiming that Yelp has attempted to “extort” money from small businesses by offering to remove negative reviews in exchange for payment. The suit contends:

Yelp runs an extortion scheme in which the company’s employees call businesses demanding monthly payments, in the guise of “advertising contracts,” in exchange for removing or modifying negative reviews appearing on the website.  The plaintiff, a veterinary hospital in Long Beach, California, asked that Yelp remove a false and defamatory review from the website.  In response, as set forth in the lawsuit, Yelp refused to take down the review.  Instead, the company’s sales representatives repeatedly contacted the hospital and demanded a roughly $300 per-month payment in exchange for hiding or removing the negative review.

This kind of allegation has been out in the media in the past. Most notably in an article that appeared in weekly publication the East Bay Express almost exactly a year ago. The article was called Yelp and the Business of Extortion 2.0:

During interviews with dozens of business owners over a span of several months, six people told this newspaper that Yelp sales representatives promised to move or remove negative reviews if their business would advertise. In another six instances, positive reviews disappeared — or negative ones appeared — after owners declined to advertise.

Because they were often asked to advertise soon after receiving negative reviews, many of these business owners believe Yelp employees use such reviews as sales leads. Several, including John, even suspect Yelp employees of writing them. Indeed, Yelp does pay some employees to write reviews of businesses that are solicited for advertising. And in at least one documented instance, a business owner who refused to advertise subsequently received a negative review from a Yelp employee.

At the time of publication Yelp CEO Jeremy Stoppelman responded to the article.

These claims about extortion and other allegations of manipulation of reviews or wrongdoing are generally based on misunderstandings by the businesses themselves about how Yelp’s algorithm works (which causes some positive and negative reviews to be flagged and removed). And although I’ve never been on a sales call with Yelp reps I’m extremely skeptical of the contention that there’s a pattern of extortion or other, alleged strong-arm tactics.

Like Google, Yelp is now a target because of its success and visibility. Some business owners are frustrated with Yelp because, again like Google, positive or negative reviews can materially impact a business. The rampant proliferation of user-generated content and reviews is viewed by many SMBs as a positive thing but by others as a nuisance or even destructive.

It must also be said that there’s also a very distinct marketing angle here for the involved attorneys who are likely to grab national publicity from this action. This is a “sexy” case for them and the PR may be worth the effort even if there’s no money in the end. However, ethically attorneys are bound to not file frivolous lawsuits and can suffer penalties and potential civil damages if they do (i.e., “malicious prosecution”).

There must be some testimony or facts here to at least form the basis for the claims alleged in the action. The question is, beyond the perception of the individual plaintiff, is there objective evidence that Yelp offered to remove the negative review in exchange for payment and that there was a larger pattern of doing so to justify the class action.

Yelp does allow advertisers to highlight a (presumably favorable) review but that’s quite a different matter. Here’s an example for “Dentist, Berkeley CA”

Picture 216

The truth will out of course but I would be stunned if these claims were based in truth rather than the frustrations and misunderstandings of the plaintiff in this case.


Opinions expressed in this article are those of the guest author and not necessarily Search Engine Land. Staff authors are listed here.



About The Author

Greg Sterling
Greg Sterling is a Contributing Editor to Search Engine Land, a member of the programming team for SMX events and the VP, Market Insights at Uberall.

Related Topics

Channel: LocalLegal: GeneralSearch Engines: Maps & Local Search EnginesYelp

We're listening.

Have something to say about this article? Share it with us on Facebook, Twitter or our LinkedIn Group.

Get the daily newsletter search marketers rely on.

Processing...Please wait.

See terms.

ATTEND OUR EVENTS

Lorem ipsum doler this is promo text about SMX events.

April 13, 2021: SMX Create

May 18-19, 2021: SMX London

June 8-9, 2021: SMX Paris

June 15-16, 2021: SMX Advanced

June 21-22, 2021: SMX Advanced Europe

August 17, 2021: SMX Convert

November 9-10, 2021: SMX Next

December 14, 2021: SMX Code

Available On-Demand: SMX

Available On-Demand: SMX Report

×


Learn More About Our SMX Events

Discover actionable tactics that can help you overcome crucial marketing challenges. Our next conference will be held:

Next Event: Sept. 14-15, 2021

Available On-Demand: March 2021

Available On-Demand: October 2020

×

Attend MarTech - Click Here


Learn More About Our MarTech Events

White Papers

  • Gartner Magic Quadrant for Digital Experience Platforms
  • Selecting a Customer Data Platform For Your Organization: The 2020 Gartner Market Guide
  • The Complete Guide to Web Core Vitals
  • The New Era of Automation in SEO
  • Nielsen Annual Marketing Report: Era of Adaptation
See More Whitepapers

Webinars

  • Drive Customer Engagement with the Power of Personalization
  • 7 Use Cases That Prove Why You Should Implement DAM
  • Accelerate Your SEO & Content Marketing Program with 4 Key Milestones
See More Webinars

Research Reports

  • Local Marketing Solutions for Multi-Location Businesses
  • Enterprise Digital Asset Management Platforms
  • Identity Resolution Platforms
  • Customer Data Platforms
  • B2B Marketing Automation Platforms
  • Call Analytics Platforms
See More Research

Attend SMX For Only $149

h
Receive daily search news and analysis.

Channels

  • SEO
  • SEM
  • Local
  • Retail
  • Google
  • Bing
  • Social

Our Events

  • SMX
  • MarTech

Resources

  • White Papers
  • Research
  • Webinars

About

  • About Us
  • Contact
  • Privacy
  • Marketing Opportunities
  • Staff

Follow Us

  • Facebook
  • Twitter
  • LinkedIn
  • Newsletters
  • RSS
  • Youtube

© 2021 Third Door Media, Inc. All rights reserved.

Your privacy means the world to us. We share your personal information only when you give us explicit permission to do so, and confirm we have your permission each time. Learn more by viewing our privacy policy.Ok