Yelp is taking action against Web sites that offer to help businesses improve their reviews and ratings, filing suit against three individuals for unfair competition, false advertising, cybersquatting, and trademark infringement, as well as violating Yelp’s own terms of service.
Not only are the businesses a sham, they “undermine the integrity of Yelp’s platform,” according to the California federal court complaint. “The Yelp site has become one of the most popular business review websites on the internet because consumers trust that the reviews are genuine and unbiased. This established trust and goodwill is no accident—Yelp vigilantly protects the legitimacy and authenticity of the reviews on the Yelp site.”
The defendants operate “unlawful” and “predatory” sites such as “Yelpdirector” and “Revleap,” which claim to sell business owners 4- and 5-star Yelp reviews and to “filter” or remove businesses’ existing 1-, 2- and 3-star Yelp reviews, Yelp alleged. Using spam—and infringing on Yelp’s trademark in the process—the defendants marketed and promoted their services to Yelp customers, prospective customers, and listed businesses.
For example, one e-mail message read, in part, “Hi there, We invented a software that allows you to proactively generate a large number of 4 and 5 star reviews from your customers in a way that makes them stick to the front page of Yelp. All reviews 3 star and below are filtered by the system and never posted online.” Another claimed that “Yelpdirector.com is giving control back to businesses.”
Yelp learned of the defendants when customers began to complain to the review site about the e-mails. Although the company sent cease and desist letters to the defendants, they continued their illegal activities, Yelp alleged.
The defendants willfully and knowingly violated federal and state unfair competition and false advertising statutes, according to the complaint, in addition to infringing Yelp’s trademark and cybersquatting. Not only are consumers likely to be confused by the defendants’ use of Yelp’s marks, but actual consumer confusion had already occurred, the company said, with consumers complaining about the spam messages and believing an affiliation or connection existed between Yelp and the defendants.
Further, the defendants violated Yelp’s terms of service, which explicitly prohibit compensating someone or being compensated to write or remove a review, posting fake reviews, and other conduct that could lead to biased reviews.
The suit seeks an order enjoining the defendants from infringing and diluting Yelp’s marks, transferring the “yelpdirector” site to Yelp, awarding actual, statutory, punitive, and treble damages, as well as attorney’s fees and costs, and halting any activity that violates Yelp’s terms of service.
To read the complaint in Yelp v. Herzstock, click here.
Why it matters: Yelp has cracked down on similar scams before. Last year, the company won a default judgment in California federal court for $45,000 against a man who allegedly operated a fake review company that claimed it could help improve the ratings for reviewed businesses. In addition to the monetary award (for trademark infringement), the court also enjoined the defendant from using Yelp’s name in ads or Web sites. Ironically, Yelp itself has been accused of the exact same behavior in multiple lawsuits, with businesses claiming that the site offered to hide bad reviews with the purchase of advertising on the site. While the Ninth U.S. Circuit Court of Appeals recently affirmed dismissal of one suit, a separate case remains pending in California state court.