Can a company sue you for a negative review?
As Americans, our opinions are protected by our First Amendment right to free speech. But now, with the internet giving consumers the ability to rapidly voice their opinions of restaurants, doctors, products and other services to potentially huge online audiences, some companies are trying to fight back against any negative reviews or publicity.
A Virginia contractor filed a $750,000 "internet defamation" suit in 2012 against a homeowner in Fairfax who posted devastating reviews on Yelp regarding the company's work on her home.
And earlier this week, federal regulators announced they were taking action against Florida-based marketers of a brand of weight-loss supplements that reportedly threatened to enforce a "gag clause" against customers to keep them from posting negative reviews and testimonials online.
According to the complaint filed in federal court by the Federal Trade Commission (FTC), Sarasota-based Roca Labs Inc., Roca Labs Nutraceutical USA Inc. and their principals had sued or were threatening to sue customers who complained to the Better Business Bureau or made negative postings online against the company.
For the past two years, the complaint continues, the company had marketed and sold its line of dietary supplements and food products directly to Internet consumers as a safe and cost-effective alternative to gastric-bypass surgeries used to treat obesity.
Roca Labs said consumers who publicly complained about the company were violating non-disparagement provisions buried in the "Terms and Conditions" specifications they had been asked to agree to when they bought the products in question.
But the FTC criticized Roca Labs' warnings, threats and lawsuits, saying such actions keep consumers from sharing truthful, negative comments about a company and its products.
"Roca Labs had an adversarial relationship with the truth," Jessica Rich, director of the FTC's Bureau of Consumer Protection, said in a statement.
"Not only did they make false or unsubstantiated weight-loss claims," she continued, "they also attempted to intimidate their own customers from sharing truthful - and truly negative - reviews of their products."
Along with the unfairness charges due to the gag clauses, the FTC alleges the company's weight-loss claims were false or unsubstantiated. What's more, federal officials say Roca Labs failed to disclose it "compensated users who posted positive reviews" and that the company violated the privacy of consumers by disclosing personal health information, in some cases giving that data to payment processors and banks.