Can Businesses Enforce Contract Defamation Clause In Customer Agreements?

contract defamation clausesIn 2010, Jen Palmer’s husband ordered her a “desk toy” from Klear Gear. It never arrived. Eventually, however, the Palmers got a refund. Nevertheless, they added a negative review to Klear Gear’s Ripoffreport page after not being able to connect with a customer service representative from the company.

After venting their feelings online, presumably the Palmers got back to their lives. Then, out of the blue, two years post-incident, the couple received an official letter in the mail. It was from Klear Gear, and the company was demanding that the Palmers pay $3,500 for violating a non-disparagement clause in the customer contract.

WHA!?!?! Yeah, that’s what the Palmers said, too. But sure enough, Klear Gear’s “buyer’s contract” prohibits customers from trashing the company “to ensure fair and honest public feedback and to prevent the publishing of libelous content in any form.”

A Customer Contract That Forbids Online Defamation

The agreement asserts that Klear Gear has “sole discretion” to determine what violates its defamation clause. Under the contract, consumers are given 72 hours to remove the material. If it remains, the negative reviewer is billed $3,500 for “legal and court fees until such complete costs are determined in litigation.” The letter goes on to state that if the bill is not paid in 30 days it would be passed on to a collection agency.

Are The Palmers In Trouble? Can A Company Legally Include A Defamation Clause In A Contract?

According to reports, the Palmers are in a pinch; both the $3,500 fine Klear Gear ask and the $2,000 Ripoffreport fee to remove bad reviews are beyond their bank account. So what’s a couple to do?

Actually, the Palmers are sitting pretty. Here’s why:

  1. The contract defamation clause on which Klear Gear is basing their claim was not a part of the agreement when Palmer made the purchase back in 2010. A business can’t retroactively enforce this provision.
  2. It is highly likely that a judge will deem the clause “unconscionable” and unenforceable.

Other Businesses Have Tried and Failed To Enforce Contract Defamation Clauses

This is not the first time a company has tried to stave off negative online press by way of a questionable contract . Last year, Medical Justice, a company specializing in doctor defamation protection, tried to institute a contract wherein patients relinquished all copyrights to their online reviews of a given doctor. The theory went that if a patient posted a negative review, then the doctor could simply claim copyright infringement and get the negative content removed via a DMCA take down request.

In the end, judges laughed Medical Justice’s contract out of court and the company no longer offers it.

RipOffReport Lawyer

Are you stuck in the middle of a Ripoffreport defamation battle? Do you need to speak with a Ripoffreport defamation lawyer? If so, contact Kelly Warner Law. We’ve handled a multitude of Ripoffreport defamation cases – for both claimants and defendants – and have a deep understanding of how the platform responds to issues of defamation.

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