2 Law suits have been filled in Los Angeles federal court against Yelp. The 2 class action law firms are claiming that Yelp has attempted to “extort” money from small firms in exchange for the removal of negative reviews.
The claim is that Yelp is running an extortionate scheme where the companies employees are calling companies and demanding monthly payments in the guise of advertising contracts and in exchange they will remove or change negative reviews appearing on the website. The plaintiff is a veterinary hospital in Long Beach, California and said that when they approached Yelp to request removal of a false and defamatory review from the website they refused. Instead Yelp’s sales rep repeatedly contacted the hospital and demanded an approx payment of $300 per month in exchange for hiding / removing the negative review.
This isn’t the fast allegation of this kind that Yelp have faced, as a year ago they faced similar allegations. Over the last several months 6 different companies have told newspapers that have been approached with the same proposal, and after they declined the offer all positive reviews were removed and negative ones appeared.
Some business owners even suspect that not only do Yelp employees use the negative reviews as sales lead but suspect that they maybe writing them. Yelp do currently employee people to write reviews for companies that pay for advertising.
Yelp have released a statement the allegations are a result of misunderstanding by the business’ them selves about how Yelps algorithm works.
