Is Yelp Scamming Businesses? FTC Says “No.”

Yelp scamming businesses
Sorry Small Business Owners, The FTC Says Yelp’s Advertising Policies Are Perfectly Legal.

In this post:

  • Is Yelp scamming businesses via their advertising model?
  • Advice for people dealing with negative Yelp reviews

Dear FTC: Is Yelp Scamming Businesses or Not?

“Yelp! (“Yelp”) is a pay-for-play sham!” For years, that was the accusation. So, the Federal Trade Commission investigated. Unfortunately for small business owners, after said investigation, the FTC deemed Yelp’s business procedures to be 100% fair.

In a triumphant blog post, Yelp spokesperson Vince Sollitto wrote:

“The FTC recently concluded a deep inquiry into our business practices and informed us that it will not be taking any action against Yelp. The FTC looked into our recommendation software, what we say to businesses about it, what our salespeople say about our advertising programs, and how we ensure that our employees are not able to manipulate the ratings and reviews that we display on our platform. After nearly a year of scrutiny, the FTC decided to close its investigation without taking further action. This marked the second time that the FTC had looked at our advertising practices and ended its inquiry without further action.”

This FTC’s Yelp decision is a big deal – for both Yelp and small business owners. For years, there’s been rampant speculation that Yelp was a pay-to-play platform. A group of entrepreneurs even launched a class action suit against the consumer review website. But Yelp prevailed in that kerfuffle, too; the judges ultimately ruled that the website’s tactics amounted to “hard bargaining” – a perfectly legitimate business approach under U.S. law.

You Can Still Mitigate The Effects Of Damaging Yelp Reviews

Do these rulings mean there’s no way to successfully sue someone over a defamatory review posted on Yelp or another consumer review website? No. If a customer or competitor posts a false statement of fact about your business online, there may be grounds for a defamation, trade libel, or false light lawsuit – even if the negative review is anonymous.

If someone posts a negative review on a Yelp page, and you’re interested in legal options, get in touch with Kelly / Warner. We’ve helped hundreds of businesses overcome issues related to online consumer reviews. In many instances, we’re able to get the offending material removed.

Get in touch today to learn more about your legal options regarding defamatory reviews on Yelp and other consumer review websites.

Even though the “Yelp scamming businesses” trope isn’t legally viable, it’s still possible to get defamatory reviews removed from the consumer review website. Get in touch to find out how.

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