CATrends: Terms That Prevent Consumers from Posting Negative Reviews

Amazon claims it’s pioneered customer reviews. But according to a recent class-action lawsuit filed against the e-commerce giant, the company stifles consumers’ right to free speech by prohibiting customers from mentioning Amazon or any of its trademarked brand names “in any manner that disparages or discredits Amazon.”

Specifically, the lawsuit alleges, in order to use Amazon’s platforms, consumers are told they must agree to its conditions of use, which bar them from posting negative reviews about Amazon or its brands. The complaint adds that:

The Conditions further threaten that Defendants may terminate a user’s right to access and use the Platforms if users do not comply with the Conditions.

The lawsuit, filed in California in January, accuses Amazon of violating Section 1670.8(a) of the California Civil Code, which states that:

(1) A contract or proposed contract for the sale or lease of consumer goods or services may not include a provision waiving the consumer’s right to make any statement regarding the seller or lessor or its employees or agents, or concerning the goods or services. (2) It shall be unlawful to threaten or to seek to enforce a provision made unlawful under this section, or to otherwise penalize a consumer for making any statement protected under this section.

A survey found nearly 95 percent of online shoppers read customer reviews before making a purchase.

But it’s not just Amazon allegedly suppressing negative reviews.

Since November, class-action lawsuits have been filed against more than a dozen companies alleging their websites’ conditions of use (aka terms of use) prevent customers from posting negative reviews about them on their platforms in violation of California law.

Other companies named in litigation include Bank of America, Anheuser-Busch, UPS, Bass Pro Shops, Nationwide, Paramount, Home Depot and Mastercard. Many of the lawsuits allege the companies also threaten to suspend or terminate users who violate their conditions of use.

The majority of the lawsuits were filed by the same California law firm and note that these non-disparagement clauses are designed to protect the companies’ public image in the digital age:

Because of the current power of the internet and social media platforms to publicize a company’s offerings of goods or services—and the potential harm to corporate interests when negative consumer statements “go viral”—Defendants have a significant incentive to minimize the negative publicity they receive, including in the form of negative online reviews and comments.

The lawsuits seek orders requiring that the companies stop the alleged unlawful and unfair practices, in addition to civil penalties and damages.

Find more of our coverage on online reviews here.