Ferreting out the Frauds: a Virginia Court Orders Yelp to Identify Anonymous Users

-
Social media is widely-used in the hospitality industry for everything from promoting sales to recruiting new talent.  Facebook, Twitter, Pinterest, Foursquare, and a number of other sites provide hoteliers and restaurateurs with nearly limitless access to local, national, and international audiences.

In recent years, sites like Yelp have emerged to provide customers with an anonymous, online platform to post reviews of businesses, and its impact is far-reaching.  In the first quarter of 2013, Yelp allegedly averaged nearly 102 million unique visitors per month.  

Many businesses understand the importance of widespread feedback, monitor Yelp and other sites for both positive and negative reviews, and interact with reviewers about their experiences.  Cyber-saboteurs are an unfortunate risk to companies with an Internet presence, and a number of employers have undoubtedly been the subject of anonymous, negative and disparaging attacks by competitors or disgruntled employees. 

The lawsuit

A carpet cleaning company in Virginia filed suit against seven, anonymous individuals who posted allegedly defamatory statements about the company on Yelp.  To identify the posters, the company served Yelp with a subpoena duces tecum asking it to produce documents revealing the identities of the seven individuals.  Yelp refused, based in large part on its argument that the First Amendment to the United States Constitution protects the individuals' rights to anonymous, free speech.  The Circuit Court disagreed with Yelp, and held it civil contempt.  Yelp appealed to the Court of Appeals of Virginia.  See Yelp, Inc. v. Hadeed Carpet Cleaning, Inc., Court of Appeals of Virginia, Record No. 0116-13-4, January 7, 2014.

The appellate decision

The appellate court agreed that Yelp was in contempt for failing to comply with the subpoena.  In affirming the lower court's ruling, the Court of Appeals made the following observations:

  • The State of Virginia has enacted a statute that includes specific procedures designed to "unmask" people communicating anonymously over the Internet.  
  • Free speech is protected by the First Amendment.
  • Anonymous free speech is protected by the First Amendment.
  • "An Internet user does not shed his free speech rights at the log-in screen."
  • The freedom of speech, and the right to speak anonymously, is not absolute.
  • Defamatory speech is not entitled to constitutional protection.
  • "Commercial speech" is afforded less protection than literary, religious, or political speech.
  • Matters of opinion are protected as free speech.
  • "Factual statements made to support or justify an opinion…can form the basis of an action for defamation."
  • "Generally, a Yelp review is entitled to First Amendment Protection because it is a person's personal opinion about a business they patronized…" but if the customer never visited the establishment, then the review is not an opinion, and instead, is based on a false statement of fact.
In this case, the Court found the company had met the requirements of the unmasking statute by showing, among other things, that the communications by the anonymous Yelp users (which included statements that the company overcharged for services) are or could be tortious or illegal.  Persuasive to the Court was the company's evidence that it had conducted an independent investigation in an attempt to match the negative reviews with customers in its database.  Despite its efforts, it was unable to do so.  

The implications

 The line between free speech, including opinion speech, and defamation, remains a fine one.

Although Texas currently does not have an unmasking statute, the Hadeed opinion's rationale for revealing the identities of potentially defamatory Internet users may prove persuasive to Texas courts.  Hospitality employers should keep a watchful eye on comments and feedback from social-networking sites and discuss with counsel any potential defamation issues.

Comments

Post a Comment

Popular posts from this blog

(Un)Intended Consequences? Can Employers be Sued Under the New Texas Heartbeat Act?

-
On September 1, 2021, the most restrictive abortion law in the country went into effect in Texas.  Known as the "Texas Heartbeat Act," the statute, which creates a new subchapter of Chapter 171 of the Texas Health and Safety Code, privatizes a right of action against people who aid and abet abortions in violation of the new law. More specifically, the statute provides that "any person" other than a state actor can bring an action against "any person" who: knowingly engages in [or intends to engage in] conduct that aids or abets the performance or   inducement of an abortion , including paying for or reimbursing the costs of an abortion through insurance or otherwise, if the abortion is performed or induced in violation of this subchapter, regardless of whether the person knew or should have known that the abortion would be performed or induced in violation of this subchapter. ..(emphasis added). How could this affect employers?   First, how broadly will c...
Read more

Ten Things Texas Employers Need to Know About the New "No Need for a Firearm Carry Permit" Law

-
 At a time when gun violence is increasing across the country, and based on publicly available data, Texas currently ranks second in the nation (behind Illinois) in mass shootings for 2021, the Texas Legislature enacted the Firearm Carry Act of 2021.  Here's what Texas employers need to know: 1.     The effective date of the new law is September 1, 2021. 2.     The law applies to persons 21 years of age or older and not otherwise prohibited by state or federal law from possessing a firearm, and to those 18 years or older in the military. 3.    Persons who meet the criteria in #2 above will be able to carry a firearm without a government issued license or permit, which means they will not be required to take gun safety and handling courses as a prerequisite to carrying. 4.     The law does not prohibit an employer from prohibiting an employee who lawfully carries without a permit from possessing the firearm on the employer's premises. 5....
Read more

Are Private Employers Ready for the New Sexual Harassment Laws in Texas?

-
Texas is considered an employer-friendly state, so it may come as quite a surprise that several bills that significantly impact sex harassment law passed, without fanfare, in the last legislative session, and go into effect today, September 1, 2021.  More specifically, the legislature amended several sections of Chapter 21 of the Texas Labor Code, which includes the state's version of Title VII, to be more in line with the laws of California.  Here's what employers need to know: First, the legislature amended Chapter 21 to provide that with respect to sexual harassment , an "employer" is a person who employs 1 or more employees or "acts directly in the interest of an employer in relation to an employee."   What does this mean and why does it matter?   Until today, Chapter 21 has applied to employers with 15 or more employees; therefore, this amendment now covers virtually every employer with respect to sex harassment claims.  It also means that indivi...
Read more