WASHINGTON, D.C. – U.S. Senator Richard Blumenthal (D-CT) issued the following statement applauding news that bipartisan legislation he cosponsored to ensure free speech in online reviews was signed into law by President Barack Obama on Wednesday. Businesses had attracted national scrutiny after using “gag clauses” to punish or silence honest criticism of products and services. The Consumer Review Freedom Act will outlaw the use of gag clauses in non-negotiable form contracts.
“This law is a victory for free markets and free speech—outlawing anti-consumer clauses that have censored shoppers and undermined online reviews,” Blumenthal said. “From toys and tools to hotels and services, consumers rely on online reviews to decide how and where to spend their money. Consumers have a right to expect that these reviews are honest and uncensored—not muzzled by insidious contract language buried in the fine print of contracts and invoices. This success should be viewed as a model for how bipartisan collaboration can protect and advance consumer interests.”
As consumers increasingly rely on online reviews for all types of purchases from toys and household goods to hotels and even doctors, some retailers are sneaking “non-disparagement” clauses into contracts that allow them to exact harsh penalties on consumers for honest, negative reviews. In one case, a New York hotel threatened to penalize newlyweds $500 for every negative review posted by anyone attending their wedding. In another case, an online retailer demanded $3,500 and from a consumer who posted online – truth – that the company had failed to send a Christmas present she had ordered for her husband.