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Yelp.com sued over allegations of extorting small local businesses and restaurants

Saturday, November 26, 2011 by: J. D. Heyes
Tags: Yelp.com, lawsuit, health news

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(NaturalNews) The most savvy business person will tell you that they are always finding a better way to offer their product or otherwise make it more valuable, in order to increase sales and profits. But when that fails some companies, according to a recent lawsuit, resort to harder tactics - like extortion.

A number of small businesses have filed suit against local business review start-up Yelp, Inc., over allegations the latter's sales representatives offered to have negative reviews of businesses removed only if they bought advertising.

According to The Wall Street Journal, the owner of Chicago's Bleeding Heart Bakery has alleged that Yelp "offered in exchange for a paid sponsorship to push any bad reviews to the end of the bakery's listings on San Francisco-based Yelp's site." The owner alleged further that a Yelp sales rep said they would personally remove reviews the owner thought were "bogus," according to the suit.

"Yelp's practices are extortionate and especially harmful to small businesses, such as our clients, who are particularly vulnerable to reviews posted on the site," Jared H. Beck, co-managing partner of Beck & Lee, referring to the original plaintiff and nine new ones, told the paper.

Not surprisingly, Yelp officials say the suit is bogus and without merit. "The allegations stem from confusion over how our review filter works to protect consumers from fake reviews, and businesses from malicious reviews from competitors," Vince Sollitto, Yelp's vice president of communications, told WSJ.

But the complaints are not new. Last year, the East Bay Express newspaper ran a story describing similar allegations by businesses that Yelp sales reps were trying to help bad reviews in exchange for ad sales.

According to that report, a Yelp rep offered to "move" a local restaurateur's bad reviews "for $299 a month." Moreover, the restaurateur reported that the bad reviews of his business - which were, by far, the minority of reviews his restaurant received - even seemed seedy.

"When you do get a call from Yelp, and you go to the site, it looks like they have been moved," the owner, John, said. "You don't know if they happen to be at the top legitimately or if the rep moved them to the top. You don't even know if this is someone who legitimately doesn't like your restaurant. Almost all the time when they call you, the bad ones will be at the top." In the end, it looks like the courts will decide whether or not Yelp's business model was taken from an old mafia playbook.
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