Yelp Being Sued for allowing Businesses to Pay to Remove Negative Reviews
Business review/guide Yelp is being accused of behaving very, very badly. A class action lawsuit has been prepared by the company’s shareholders alleging that Yelp has been requiring businesses to pay to get rid of negative “first-hand” reviews posted on yelp.com. Companies that refused to buy ads on the website have complained about subsequently finding that their positive reviews on the site had mysteriously vanished.
The lawsuit puts it into more specific terms:
Algorithms purportedly designed to screen unreliable reviews did not comprehensively do so, and instead, the Company allowed such unreliable reviews to remain prominent while the Company tried to sell services designed to suppress negative reviews or make them go away…
According to Valleywag, the lawsuit claims that Yelp’s execs made over $81.5 million from extortion. If true, then those same executives conspired to keep their profits a secret, a kind of insider trading that the suit accuses Yelp of, going so far as to call it “a scheme to deceive the market.”