Business Owners Beware: Avoid the Temptation to Post Fake Reviews or Feedback Regarding Your Competition on Social Media or Elsewhere on the Internet

February 10, 2015Articles The E-Discovery Stage Blog

Facebook, Twitter, Google Plus, LinkedIn, Angie's List, and the list goes on and on. Today there are more sites than ever where users are invited to opine about their interactions with service providers, give their thoughts on products, and share their experiences. Retailers are getting in the game too. You can buy toilet paper online and write a review about it. It is literally reshaping the way companies must allocate their marketing budgets. Heck, there is a function that will allow you to add your two cents to this very blog post. See below, we welcome your comments! The point is that user generated content, whether it is couched as a review, feedback, or an online message board is now the way of the world. More and more opportunities exist for consumers of a wide array of goods and services to express a viewpoint, and the impact cannot be ignored.

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Everything being equal, including price, would you buy a television from a big box retailer's online store that was rated with 1 star by reviewers over one that was rated with 4.6?

I had a recent personal experience that hammers this point home. My town has a community Facebook page. People post all kinds of things, including their views on local businesses. A user opined that a local business had been less than welcoming to her disabled child. However, there was no way to verify whether the story of intolerance that she told was true.

Nonetheless, I became resigned to the fact that I would never patronize the referenced business. Not that I had an immediate need for the business' product or service, or that I gave the business the benefit of an honest review of what was said about it. I just viscerally reacted in disgust to the story that I heard. I formed that opinion sight unseen, without investigating the story told. If half of the story told on that page was true, the owner of that business deserved whatever he had coming to him. But, what if it was not true? What if someone with an ax to grind simply made it up? Worse yet, what if it was an attempt by a competitor to gain a competitive advantage knowing that others would respond the same way I did?

Online posts often enjoy an anonymity that lures people into a false sense of security. Coupled with the inherently impersonal nature of the internet, the impact from user generated online content can be devastating to a business. Like I wrote off that local business because of one story recounting an alleged disgusting incident, one bad review online can be the difference between success and failure in business.

A word of caution is due to the unscrupulous business that cannot resist the temptation to somehow "manufacture" negative feedback about its competition using online forums. Simply put, there are plenty of ways to track down the origin of an online post with simple requests for e-discovery, even if it is ostensibly anonymous.

In most jurisdictions, there is mechanism to obtain a pre-action subpoena, including where that pre-action subpoena seeks the e-discovery materials necessary to link a derogatory internet post to a suspected perpetrator of misinformation. For example, in New Jersey, Rule 4:11-1 on the New Jersey Rules of Court allows an aggrieved party to make an application for authority to issue a pre-action subpoena by fulfilling 6 separate criteria:

  1. that the petitioner expects to be a party to an action cognizable in a court of the State but is presently unable to bring it or cause it to be brought;

  2. the subject matter of such action and the petitioner's interest therein;

  3. the facts which the petitioner desires to establish by the proposed testimony or evidence and the reasons for desiring to perpetuate or inspect it;

  4. the names or a description of the persons the petitioner expects will be opposing parties and their addresses so far as known;

  5. the names and addresses of the persons to be examined and the substance of the testimony which the petitioner expects to elicit from each; and

  6. the names and addresses of the persons having control or custody of the documents or property to be inspected and a description thereof.

If the Court is convinced that "perpetuation of the testimony or evidence or the inspection may prevent a failure or delay of justice[,]" it has the authority to issue the necessary orders to permit a party to take pre-action discovery. This can be a useful device to, for example, link an IP address from an anonymous post with a suspected culprit.

Once armed with e-discovery secured through a pre-action subpoena, hell hath no fury like a business engaged in legitimate competition scorn by a competitor bent on getting ahead by improper means. Causes of action available to the aggrieved business abound, including, but not limited to, causes of action based upon a tortious interference theory, common law and statutory unfair competition claims, and defamation, assuming the existence of proximately caused damages. It also goes without saying that grounds for injunctive relief could exist, perhaps even on a preliminary basis.

The lesson is a simple one. Resist the temptation to post a negative review about your competition as a means by which to gain a competitive advantage. The digital footprint that process leaves may put you in a situation where you have bitten off more than you can chew. The types of claims that are supported by that type of conduct are enough to put you out of business, let alone the probable scrutiny you will likely face from regulators. So much for that competitive advantage you sought to achieve.

If you have been the victim of false or misleading anonymous online posts that you suspect are the handiwork of your competition, contact me for a consultation regarding the best course of action to preserve and vindicate your rights.