Court ruling permits Yelp to manipulate ratings


Yelp (NYSE:YELP) has no obligation to display positive reviews on business owners' Yelp page, rules Judge Marsha Berzon.

The verdict comes after many years of small business owners claiming Yelp extorted advertising payments from them by threatening to remove positive reviews from their listings.

Yelp maintains that it does not engage in the hard-ball tactics, although the new ruling states that should the company do so intentionally, is would be perfectly legal under federal law.

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Comments (13)
  • King Rat
    , contributor
    Comments (1553) | Send Message
     
    Several people I know have stopped using Yelp claiming the reviews were bogus. Now I have to apologize to them for not believing them. I won't be using Yelp anymore either.
    5 Sep 2014, 03:06 AM Reply Like
  • june1234
    , contributor
    Comments (4260) | Send Message
     
    the court ruled a manipulated review is not illegal . YELP ain't the only one doing it that's for sure.
    5 Sep 2014, 08:55 AM Reply Like
  • JD in NJ
    , contributor
    Comments (1634) | Send Message
     
    I've seen it from the other side. The wife of a friend has been victimized by Yelp's attempted extortion. It is impossible to say how materially this impacted her business, of course.

     

    I stopped paying any attention to Yelp a couple of years ago as a consequence.
    5 Sep 2014, 09:11 AM Reply Like
  • Deja Vu
    , contributor
    Comments (1800) | Send Message
     
    Yelp will be making more offers that businesses can't refuse. It's "our thing".
    5 Sep 2014, 06:50 AM Reply Like
  • june1234
    , contributor
    Comments (4260) | Send Message
     
    "Reviews" biz in general is nothing more than a marketing gimmick. Products always come out with glowing positive reviews written by groups funded (one way or the other) by manufacturers themselves . With time reviews become more balanced doesn't matter by then, new products have already replaced those, everybody cashed in. Rinse and repeat, just marketing
    5 Sep 2014, 07:33 AM Reply Like
  • GaoDawei
    , contributor
    Comments (176) | Send Message
     
    I would like to see an example of how they extorted advertising from businesses. I wonder if any businesses have posted the threats they received? Time to fire up the ole search engine.
    5 Sep 2014, 08:44 AM Reply Like
  • buyandhold???
    , contributor
    Comments (907) | Send Message
     
    I know they called my dad and told him they'd remove a negative review about one of his businesses if he paid a monthly membership, he kindly reminded them that he owned a gas station and nobody read reviews before going to a gas station. It was pretty funny
    5 Sep 2014, 10:55 AM Reply Like
  • JD in NJ
    , contributor
    Comments (1634) | Send Message
     
    *phone rings*

     

    Hello?

     

    It's a nice gas station you've got here, it would be a shame if...

     

    What's that?

     

    I SAID: It's a nice gas station you've got here. It would be a shame if something were to happen to...

     

    You'll have to speak up! I can't hear you over the cars waiting for me. Look I'm really busy, call me back later, OK?
    5 Sep 2014, 11:01 AM Reply Like
  • LC7
    , contributor
    Comments (9) | Send Message
     
    I've been an avid user (reading and posting reviews) of Yelp for 3 years. There may be a small number of bogus reviews, but most of the time the overall average is spot on. Specifically with restaurants. If you're a great business, you'll get great reviews. Of course, the opposite is true. Simple concept.
    5 Sep 2014, 10:05 AM Reply Like
  • pra
    , contributor
    Comments (65) | Send Message
     
    I personally know that Yelp used strong arm techniques at our family restaurants. Once we used Yelp for marketing but following year when we didn't renew as our business was running well.. yelp pursued us for couple of months and tried to force us renew and when we didn't they conveniently hid the +ve reviews at the bottom under the "select +more reviews" button (and some manufactured -ve reviews to the top) just to force us to buy into their marketing. If one wants to see all reviews one has to go to the bottom of the page and expand the reviews view. Ofcourse these reviews shown are not in time based or in any order.. they pick what suits their marketing needs. Well we found out that it was not worth the cost.. ultimately people value quality of food, ambience etc. I'm sure we are not alone in this situation. This situation happened couple of years back and since then I stopped paying attention to their reviews!
    5 Sep 2014, 10:15 AM Reply Like
  • fseminario
    , contributor
    Comments (53) | Send Message
     
    this is something that from a credibility standpoint could affect their brand if the masses find out. It started as a rumor over a year ago but this pretty much confirms the allegation.

     

    I was long on this business before this news. As long as they are able to manipulate reviews this way I am staying away. Unfortunate really, they have the potential to completely replace the yellow pages.

     

    could someone please explain to me how this is good thing for business that don't want to pay?
    5 Sep 2014, 04:45 PM Reply Like
  • JayYen
    , contributor
    Comments (107) | Send Message
     
    The Achilles heel for the plaintiffs was that within the existing framework of law, Yelp can do whatever it chooses with the reviews. However, I'd think a smart attorney should base their theory on the fact that if Yelp manipulates reviews then in fact they fulfill the definition of exercising editorial judgement. As editors rather than unbiased dispensers of opinion they would be responsible and legally culpable for the numerous libelous reviews on their site. Just as the Wall Street Journal is legally responsible for libel, so to would Yelp. If they had to pay damages for every bogus and libelous review on their website, they would be bankrupt shortly. As editors it is their legal responsibility to present factual information which no fair judge of facts could believe to be the case. I suspect Yelp will find itself in court again and with a dismal prospect for a similarly favorable outcome.
    5 Sep 2014, 09:50 PM Reply Like
  • Titan101402
    , contributor
    Comments (85) | Send Message
     
    JayYen has hit the nail on the head.
    I am one of the small business owners that has experienced Yelps scum bag tactics on three separate occasions. I do not record phone conversations with customers. If I did, I would publicly humiliate Yelp. Their tactics may be deemed legal. At some point, the general public will catch on to Yelps manipulative ways in which it conducts it's platform. Or moat as some refer to it. Analysts that represent large institutions which own over 98% of its shares, are hard pressed to give anything but numerical data to support Yelp's stock. Once Yelp breaks below its 50 & 200 dma's, it's going to snow ball. If anyone in the SA forum is aware of any insider purchasing, please direct us to the site indicating such. It is apparent that sr. mngmt. is selling at every upswing. For a company expanding internationally, one would think top management would be willing to invest in their company. Yelp is a shameful company that has been given the green light by the ninth circuit court of Ca. to continue with its morally and unethical practices. Keeping its flawed platform and investors chugging along for the short term.
    10 Sep 2014, 08:21 AM Reply Like
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