January 06. 2013 7:24PM

Know the Law: If online reviews are untrue, you might have legal option



Q. Recently my small business has been tarnished by a series of unfair reviews posted online by anonymous "reviewers." Do I have legal recourse?

A. You describe a problem that businesses increasingly are facing as the Internet becomes entrenched as the open marketplace. Virtually anyone who has access to a computer can attack a business by posting negative reviews - often reviews that are unfair, and in some cases, entirely untrue.

Indeed, the issue you face goes beyond jilted consumers posting about their bad experiences. Business competitors and disgruntled former employees have deliberately posted a series of negative reviews, and the impact can be immediate and disastrous, particularly for a small business like yours that presumably relies heavily on word of mouth. For better or for worse, reviews by purported consumers on the Internet are popular, and often are afforded instant credibility by other consumers.

When your business is faced with a cyber-smearing campaign, you may have legal recourse, as more courts are paying attention to the damages being incurred by defamatory postings. Earlier this year, a software developer obtained a verdict of $1.5 million against a medical doctor who made false posts about the services provided by the developer. Much attention currently is being paid to a recent $750,000 lawsuit brought by a Virginia contractor against a homeowner who posted scathing reviews on the popular website Yelp.

Depending on the facts of your case, you may have legal recourse, but navigating through the legal hurdles can be tricky. For one, free speech protections allow consumers to post their honest opinions online. If, however, someone submitted a post that goes beyond opinion and makes factual assertions that are untrue, and those untrue statements caused damage to your business, you may be entitled to relief.

But from whom do you seek recourse? Is it the online site where the post is made - sites such as Yelp, Tripadvisor, or Angie's List, where consumers often flock to post their gripes? Generally speaking, the answer is no, because the Federal Communications Decency Act provides significant immunity to these online sites, as they are akin to bulletin boards that simply host the postings rather than actually write them. Most often, damaged businesses must seek recourse from the author of the defamatory post. This can be challenging for various reasons, and before taking legal action, you should seek legal counsel regarding the costs versus likely benefits of litigation.

Jeremy Walker can be reached at jeremy.walker@mclane.com.

Know the Law is a bi-weekly column sponsored by The McLane Law Firm.

We invite your questions of business law. Questions and ideas for future columns should be addressed to: Know the Law, The McLane Law Firm, P.O. Box 888, Manchester, NH 03101 or emailed to knowthelaw@mclane.com.

Know the Law provides general legal information, not legal advice. We recommend that you consult a lawyer for guidance specific to your particular situation.