Everyone is a critic, especially on the Internet. But as a business owner, how do you handle negative reviews online? It’s tricky. On the one hand,
It’s tricky. On the one hand, you have a right to not be unfairly disparaged in a way that hurts your business. On the other hand, the consumer has a right of free speech in reviewing your business.
Recently, the U.S. House of Representatives passed the Consumer Review Fairness Act of 2016 (the “CRFA”), a bipartisan bill that prohibits businesses from inserting non-disparagement clauses into customer agreements and thereby prevent customers from leaving negative reviews online. While not yet law, a corresponding bill has already passed the Senate and is expected to be signed into law by the President. The new law would invalidate existing non-disparagement clauses and give the Federal Trade Commission (the “FTC”) the ability to take action against the businesses that use them.
Recent case law suggests that the States are willing to step in to protect consumers from being bullied by businesses that overreach by suing over negative reviews online. Two states — California and Maryland — have enacted laws that prohibit non-disparagement clauses in consumer contracts, and several others considered similar measures this year. However, in Florida, non-disparagement clauses in contracts are generally legal and courts have held online complainants liable for defamatory statements in online reviews.
It’s almost guaranteed that at some point a customer will write a negative review online about your business. So what’s a business owner to do? The best practice is to be vigilant. Watch your online reputation like a hawk. Respect consumers’ right to be angry and to speak their minds, even in online forums. Respond respectfully to negative reviews online, and apologize if the complaint has merit. But always respond. Most experts agree that responding to negative review online in an appropriate way can help minimize damage to your business reputation.
You don’t have to be heavy-handed in writing your consumer agreements either. Non-disparagement clauses should not be liberally enforced in the context of negative reviews online. Reserve litigation and enforcement of non-disparagement clauses to cases where the reviewer goes too far by making allegations of illegality, immorality, or fraud.
Carlos Carbonell, CEO, Echo Interaction Group
Rob Henlon, Fierce Entertainment
Michelle Widmer, Founder & Director of Events, The Empress Table
Rodney E. Luke, President, Luke Brothers Custom Homes