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Bad review: Yelp, S.D. lawyer trade barbs – U

This spring, San Diego bankruptcy attorney Julian McMillan took a jab at Yelp, a well-known website where customers post anonymous reviews of businesses.

McMillan won a $2,700 small-claims court case against Yelp over an advertising contract dispute. The award was later was overturned on appeal. Still, Yelp is striking back.

The publicly traded company sued McMillan and his law firm last month in San Francisco Superior Court. It accuses McMillan of orchestrating bogus positive reviews for his law firm that were posted on Yelp.

McMillan denies the accusations and says he is collecting affidavits from clients to show the reviews are authentic. No trial date has been set. But the case showcases the sometimes rocky relationship between small businesses and Yelp.

McMillan thinks the lawsuit is retaliation for the small-claims case, which centered on McMillan wanting his money back because he claimed Yelp didn’t deliver the advertising results it promised.

“Why does Yelp sue me?” he said. “There are 36 million businesses on Yelp, and they pick the guy who uncovered the fallacy in their advertising contract.”

The small-claims judge, however, made some sharp comments in the hearing that may have gotten Yelp’s attention. According to a transcript, Judge Peter Doft likened Yelp to a “modern-day version of the Mafia going to stores and saying, ‘You wanna not be bothered? You wanna not have incidents in your store? Pay us protection money.’”

The Wall Street Journal wrote a story, highlighting the judge’s comments. Other news outlets picked it up as well. McMillan touted the small-claims victory on his website.

Yelp denied that the lawsuit is payback. It contends fake reviews could undermine the value of Yelp. The company spends considerable time and money maintaining the integrity of its review system.

“We take an aggressive stance against business owners who are attempting to mislead consumers through fake reviews,” said Kristen Whisenand, senior public relations manager for Yelp. “This case is about one thing: Holding the McMillan Law Group accountable for its attempts to deceive consumers.”

Yelp has filed lawsuits against two companies over manufactured reviews, Whisenand confirmed. The first is BuyYelpReviews, which, for a fee, emails frequent Yelp reviewers with the aim of getting them to visit and write positive reviews about businesses. The second is McMillan, who Yelp claims manipulated about a dozen reviews about his law firm.

Yelp, which posted nearly $138 million in revenue last year, is an online billboard where consumers write reviews of local businesses. It bills itself as a site for real people to post real reviews. Yelp makes money selling advertising to those businesses that are getting kudos or put-downs from Yelp posters.

Yelp uses a mathematical algorithm to red flag suspicious reviews, akin to an email spam filter. Yelp closely guards details about the algorithm, hoping to prevent gaming of its technology.

But some business owners complain that the algorithm filters out too many positive reviews while allowing negative ones through easily.

“When you have a whole bunch of four and five stars and then you get a one star, it could be an employee who was terminated. It could be a competitor. You never know,” said Jeff Rossman, owner of Terra American Bistro and Bunz restaurants in San Diego. “That’s the problem with online reviews.”


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Mystic Maggie

All of the Mystic Maggie Posts are RSS Reader Feeds from around the web. All copyright remains with the original publisher. No copyright is claimed or intended. Where supplied, links back to the original article are included.

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1 comment

  1. Lassen

    Yelp is a bad business decision. I can guarantee that. I was a customer myself…also i have a lot of friends who were customers…It just doesn't deliver. Should i also mention that they have a very aggressive marketing script ?
    As a conclusion…don't work with yelp! If you want to grow your business look for SEO or facebook ads.

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