Lawyers involved in a class action suit against Yelp, the popular consumer review site, are taking credit for changes Yelp is making in its advertising and display policies.
The recent modifications to the website are an important first step in the right direction for the thousands of businesses who have seen their livelihoods trampled or threatened by Yelps extortionate practices, said Jared H. Beck of Beck & Lee Business Trial Lawyers, Miami, and Gregory S. Weston of The Weston Firm, San Diego, the lead attorneys for the plaintiff businesses.
The class action suit, filed less than two months ago, charges that Yelp "runs an extortion scheme through which the companys employees call businesses demanding monthly payments, in the guise of 'advertising contracts,' in exchange for removing or modifying negative reviews appearing on the website.
Small businesses have been expressing their outrage at Yelps dirty business practices for a long time, and it is unfortunate that it took the filing of a class action to get Yelp to make even these amends. Still, there is much work left to be done through the legal process, including the looming issues of Yelps pay to play sales tactics, as well as the pursuit of substantial restitution and damages owed to the class members, the attorneys said.
The plaintiffs in the class action are Cats & Dogs Animal Hospital, Inc. of Long Beach, California; Bleeding Heart Bakery of Chicago, Illinois; Scion Restaurant of Washington, D.C.; J.L. Ferri Entertainment, Inc. of New York, New York; Sofa Outlet of San Mateo, California; Celibr, Inc.of Torrance, California; Astro Appliance Service of San Carlos, California; Wag My Tail, Inc., of Tujunga, California; Le Petite Retreat, of Los Angeles, California; and Mermaids Cruise of San Francisco, California.
The original plaintiff, a veterinary hospital in Long Beach, California, asked that Yelp remove an allegedly false and defamatory review from the website. Yelp refused and, instead, the companys sales representatives repeatedly contacted the hospital and demanded a $300 per-month payment in exchange for hiding or removing the negative review, the suit charges.
The most recent version of the lawsuit contains 39 pages detailing Yelps conduct, including the activities of its Elite Squad members, as well as several counts, or legal claims.
Also narrated in the Amended Complaint are the experiences of the newly added small business plaintiffs, each of which was also allegedly approached by Yelps representatives requesting payment in exchange for manipulating content on the businesss Yelp listing.
For example, the owner of Astro Appliance Service in San Carlos, California, was allegedly told that in exchange for becoming a paying Yelp sponsor, Yelp could control the reviews of his business, allowing his listing to shine above his competitors.
The case, Cats and Dogs Animal Hospital Inc. v. Yelp! Inc., was originally filed on February 23, 2010, and is pending in the U.S. District Court for the Central District of California before Judge Valerie Baker Fairbank. A scheduling conference has been set for April 26, 2010.
Yelp co-founder and CEO Jeremy Stoppelman has called the lawsuit without merit and said that the company will fight it vigorously. In a blog entry, Stoppelman wrote that [t]he entire value of the Yelp community to consumers and businesses hinges upon that trust and we would never do anything to jeopardize it.
Stoppelman acknowledged that the site has long faced charges of monkeying around with reviews in exchange for money, but pointed out that such allegations ignore empirical evidence in favor of conspiracy theories.
Despite counter-examples to the contrary (virtually no advertiser on Yelp has a perfect reputation), extensive media explorations that end inconclusively, and the absence of any actual evidence to support this theory, this unfortunate and untrue meme has taken on a life of its own, Stoppelman continued.
Simply put, Yelp does not remove or hide negative reviews in exchange for money and Yelp salespeople do not offer to do so. Additionally, Yelp treats review content equally for advertisers and non-advertisers alike.