In Form Contracts, Don’t Silence Consumers with Gag Clauses: FTC’s Consumer Review Fairness Act
Some companies, hoping to prevent negative online consumer reviews, include clauses in form contracts stating that bad reviews are prohibited and punishable by fines. However, the Federal Trade Commission seeks to protect U.S. consumers and ensure fair competition and business practices, according to a post on the website of Ryley Carlock & Applewhite.
The FTC’s Consumer Review Fairness Act states that such gas clauses are illegal and void in form contracts.
Companies should treat such gag clauses in past contracts as void, and essentially should ignore negative reviews from a relatively few consumers, the authors advise.
