Zero Stars: How Gagging Honest Reviews Harms Consumers and the Economy

November 4, 2015

U.S. Senate Committee on Commerce, Science, and Transportation will hold a full committee hearing entitled “Zero Stars: How Gagging Honest Reviews Harms Consumers and the Economy” on Wednesday, November 4 at 10:00 a.m. The hearing follows the introduction of S. 2044, the Consumer Review Freedom Act, by Senators John Thune (R-S.D.), Jerry Moran (R-Kan.) and Brian Schatz (D-Hawaii) on September 16, 2015. The bipartisan bill would prohibit the use of non-disparagement clauses referred to as “gag clauses” in form contracts between consumers and businesses. S. 2044 was referred to the Senate Commerce Committee where it is currently pending.
 
Gag clauses are appearing in a large number of non-negotiable form contracts. This practice can occur when one party imposes a standardized contract without a meaningful opportunity for the other party to modify the contract. Some businesses have sought to use these clauses unfairly to penalize or pursue fines from customers for negative but honest reviews of their services on websites such as Yelp or TripAdvisor.
 
One of the witnesses, Ms. Jen Palmer, is a plaintiff in Palmer v. KlearGear.com, where a website demanded that she remove a negative online review or pay $3,500 in damages because the website’s terms of service included a non-disparagement clause. When she refused to pay the penalty, the website reported the $3,500 to credit reporting agencies as an unpaid debt.
 
Witnesses:
 
- Mr. Adam Medros, Senior Vice President for Global Product, TripAdvisor LLC
- Ms. Jen Palmer, Plaintiff, Palmer v. KlearGear
- Mr. Robert Atkinson, Founder and President, Information Technology and Innovation Foundation*
- Mr. Eric Goldman, Professor, Santa Clara University School of Law
- Mr. Ira Rheingold, Executive Director of National Association of Consumer Advocates

* Change made on November 4 due to scheduling change

Hearing Details:
 
Wednesday, November 4, 2015
10:00 a.m.
 
Full Committee hearing
 
This hearing will take place in Senate Russell Office Building, Room 253. Witness testimony, opening statements, and a live video of the hearing will be available at www.commerce.senate.gov.

For reporters interested in reserving a seat, please contact the press gallery:

• Periodical Press Gallery – 202-224-0265

• Radio/Television Gallery – 202-224-6421

• Press Photographers Gallery – 202-224-6548

• Daily Press Gallery – 202-224-0241

Individuals with disabilities who require an auxiliary aid or service, including closed captioning service for the webcast hearing, should contact Stephanie Gamache at 202-224-5511 at least three business days in advance of the hearing date.

Webcast

Majority Statement

  • Chairman John Thune

Minority Statement

  • Bill Nelson

Witness Panel 1