Is there anything really illegal going on here?

After Yelp.com’s successful IPO, there’s been a lot of attention paid lately to disgruntled establishments crying foul over the posting of negative reviews. I understand what they’re saying, but legally they would all be better off figuring out new media, rather than demonizing a successful business model that for better or worse represents the future. It is the future where all these establishments must exist. The good ole days are gone.

The argument is that punishing establishments that don’t buy ads with negative reviews amounts to extortion. The problem is that so far the complaints seem based on anecdotal conjecture. “We got negative reviews after we refused to advertise.” “Our positive reviews were being filtered out because we refused to advertise.” Maybe your food is bad. Maybe your service sucks. Who knows?

Let’s check out the legal definition of extortion: It is essentially the forcing of someone to do something they’re not legally obligated to do, through threats and coercion involving things that harm the victim, like announcing false negative information, or even true information, if it is private and harmful.

Is there any real evidence of that? I haven’t seen any reported. I’ve just seen  complaints from places that, for all I know, serve bad food or offer bad service. None of us know at this point.  What we have seen is people accusing Yelp of extortion. This brings up a more credible legal complaint: defamation. If you say things in public that are untrue, and they are the kind of thing that makes the public “spit on the ground” in disgust when they hear it, you’ve got a defamation case. If these people cannot prove these allegations, Yelp could come after them and then they are in real trouble.

I use Yelp.com about a ½ dozen times each day. I am smart enough to do my own filtering. Most Yelp reviewers are young cheap bastards that like food if they are served a lot of it at a low price. I take this into consideration.  Phony bad reviews stink from a mile away. From a consumer standpoint, it’s one of the good things about the Internet, not one of the bad things, like Youtube comments. If I’m a terrible restaurant, or mechanic in 2012, I’ve got to watch out. The game is played differently these days and there’s no way to go back to the old models.

You’ve got to be more honest and transparent these days, if you get caught up in some unjustified bad review nonsense, that’s unfortunate but this is our world now. You could also get robbed. It’s unfair but it happens. I’ve got people writing all kinds of false things on the Internet. I just have to do enough good stuff to make up for it. It motivates me to be better. And people know there are lies on the Internet, if not, someone would have surely killed me by now.

So my advice, which is free and worth every penny, is for establishments to adjust to the Internet age and try to make it work to your advantage. If you don’t, you will be replaced by people who are growing up in this age.  I made positive reviews on an obscure restaurant in Hawaiian Gardens on Yelp a couple years ago. It caught on and now I can barely get a table. This has made these honest tortilla makers into wealthy restaurant owners. The cream will always rise to the top eventually.

In a way, the Yelp controversy mirrors the shake up in the music industry  with the advent of the internet. You cannot do things by the old model. You need honesty, transparency, and the best product. Only the best will do these days. It’s rough for some, but a net positive for society. What are your experiences with Yelp?