National Journal - Congress' Fight For Your Right to Yelp

Fear of the Yelp review has driven some businesses around the country to attempt to fine customers for writing a bad review online.

California Rep. Eric Swalwell says this is a violation of free speech and will propose legislation this week to make it illegal.

The Consumer Review Freedom Act aims to make it illegal for businesses attempt to thwart negative online reviews by slipping non-disparagement clauses into customer contracts threatening to impose a fine for posting negative comments. The rules would be enforced by the Federal Trade Commission and state attorneys generals.

"It's un-American that any consumer would be penalized for writing an honest review," said Swalwell. "I'm introducing this legislation to put a stop to this egregious behavior so people can share honest reviews without fear of litigation."

Salwell's legislation is similar to a California bill signed into law by Gov. Jerry Brown last week, known as the "Yelp Bill." California businesses in violation of the new law could face up to $10,000 in fines.

Yelp called the California law a victory for free speech in a blog post last Wednesday, and the web-based consumer review company backs the federal legislation bill as well.

"We are supportive of [Swalwell's] effort and the efforts of other lawmakers to make it explicitly clear under law that non-disparagement clauses in consumer contracts violate the core tenets of the First Amendment of the U.S. Constitution," Yelp's head of public affairs Laurent Crenshaw said.

The California Republican's bill was inspired by a Utah couple whose credit score was damaged after they were fined $3,500 for unwittingly violating a retailer's "Terms of Sale" contract by posting a bad review, according to the bill's author.

The issue came under the spotlight again last month after it was reported that a New York hotel attempted to stick a pair of newlyweds with a $500 fee for any negative reviews posted by their wedding party.

Rep. Steve Cohen, D-Tenn., ranking member of the House Judiciary Subcommittee on Constitutitution and Civil Justice, and Rep. Brad Sherman, a California Democrat, are cosponsors of the bill.