How important are online reviews in your shopping experience? Many rely heavily on consumer reviews in order to generate business. But what happens when instead of providing customers the candid information that they deserve, companies try to silence their critics in order to improve their online reputation?
In recent years, companies selling products and services have included non-disparagement clauses (“gag clauses”) in their contracts in hopes of curtailing online criticism. Gag clauses are aimed at discouraging customers from writing honest reviews that criticize the company—and punished customers for their negative reviews in the form of liquidated damages. The problem is such clauses are illegal. In 2016, as we had previously written, Congress passed the Consumer Review Fairness Act, which prohibits companies from implementing gag clauses in non-negotiable consumer form contracts. In so doing, lawmakers sought to encourage free speech, consumer rights and the integrity of truthful criticism regarding goods and services sold online. Continue reading