FTC Enters Settlement and Issues Warning to Suppression of Negative Product Reviews

The FTC recently entered into a proposed settlement with a fashion retailer alleging the retailer violated Section 5(a) of the FTC Act by misrepresenting that product reviews on its website accurately reflected the views of all purchasers who submitted product reviews.  The complaint alleges the retailer installed a third-party review management interface that allowed it to automatically post certain reviews while withholding other reviews for its approval prior to posting. The FTC further alleges that, from 2015 to 2019, the retailer used this feature to automatically publish four-and five-star reviews while not posting any of the hundreds of thousands of reviews that got below four stars.  The settlement requires the retailer to post product reviews regardless of whether they are positive or negative, but recognizes there are legitimate reasons for not posting reviews, such as when they contain obscene, sexually explicit, racist, or unlawful content.  However, these criteria must be applied to all reviews equally, regardless of the opinion expressed.   

The FTC also announced it is sending letters to ten companies that offer on-line customer review management services, warning them to not take improper steps to avoid collecting or publishing negative reviews.  Finally, the FTC released new guidance for online retailers and review platforms to educate them on the key principles for collecting and publishing customer reviews in ways that do not violate the FTC Act.