Friday, July 25, 2014
C.A. Revives Suit Claiming Yelp Lies About Its Review Filter
By KENNETH OFGANG, Staff Writer
A restaurateur’s lawsuit accusing the popular review website Yelp of falsely claiming that its software accurately and efficiently filters out biased and unreliable reviews was revived yesterday by the Court of Appeal for this district.
Los Angeles Superior Court Judge Yvette Palazuelos had tossed out James Demetriades’ suit, citing the anti-SLAPP statute. But Div. One, in an opinion by Justice Jeffrey Johnson, said the suit is exempt from anti-SLAPP treatment because it arises from commercial speech.
The plaintiff, who runs three restaurants in Mammoth Lakes, attacked Yelp’s claim that it largely filters out positive reviews by business owners and their friends and family members, or negative ones by competitors. While Yelp refers to its filtering process as “remarkable” and “trustworthy,” Demetriades claims, the software actually allows the “most entertaining” reviews to be viewed on an unfiltered area of the website, regardless of source, and suppresses a number of reviews from unbiased, trustworthy sources.
The plaintiff specifically alleged that Yelp filtered half of the reviews for his Rafters restaurant, refused to remove a review that contained false statements or to identify the reviewer to the plaintiff, and erroneously filtered out positive reviews that Yelp claimed came from an IP address associated with the restaurants.
‘Matters of Public Interest’
In granting Yelp’s anti-SLAPP motion, the trial judge reasoned that “statements regarding the filtering of reviews on a social media site such as yelp.com are matters of public interest,” and that Yelp’s laudatory statements about its review filter were “puffery,” not representations of fact. She found the commercial speech exemption of Code of Civil Procedure §425.17 inapplicable because, while the plaintiff’s restaurants advertised on Yelp, the dispute did not concern sales of advertising.
Johnson, however, in his opinion for the Court of Appeal, said the trial judge took an overly restrictive view of the exception.
The primary purpose of the exception, the justice explained, is to allow plaintiffs to pursue false advertising and unfair competition claims without being subject to anti-SLAPP motions. To defeat the motion, he noted, the plaintiff had to show both that he was suing based on representations of fact about his or his competitor’s business that were used for the purpose of securing business, and that the statements he was suing over were made to an intended audience of actual or potential customers.
The jurist wrote:
“Here, plaintiff’s claims satisfy both prongs of section 425.17, subdivision (c). Although Yelp’s website is a public forum and contains matters of public concern in its reviews of restaurants and other businesses…Yelp’s statements about its review filter—as opposed to the content of the reviews themselves—are commercial speech about the quality of its product (the reliability of its review filter) intended to reach third parties to induce them to engage in a commercial transaction (patronizing Yelp’s website, which patronage induces businesses on Yelp to purchase advertising).”
CDA Held Inapplicable
Johnson also rejected the contention that the action was barred by §230 of the Communications Decency Act, providing in part that “[n]o provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.”
The statute does not apply, Johnson wrote, because Demetriades is not suing over the content of the reviews, but “seeks to hold Yelp liable for its own statements regarding the accuracy of its filter.”
Attorneys on appeal were Robert M. Waxman and David N. Tarlow of Ervin Cohen & Jessup for the plaintiff and Laura W. Brill and Nicholas F. Daum of Kendall Brill & Klieger for the defendant.
The case is Demetriades v. Yelp, Inc., 14 S.O.S. 3894.
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