Yelp Changes Some Advertising Policies in Response to Miami Lawsuit

Categories: News

Score one for Miami lawyer Jared Beck and his class-action suit against Yelp.

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Beck's case, which alleges Yelp extorts small businesses by manipulating the placement of bad reviews in exchange for monthly fees, is still weeks away from a hearing in a California court.

But Yelp execs announced this afternoon they're making two major changes to the way their website works, in the hopes of stemming complaints like those made in Beck's lawsuit.

First, Yelp says businesses will no longer be allowed to choose which reviews appear first in their listings. Also, the site will begin including separate links to show any reviews that are removed.

Beck praised the changes but says the larger issue alleged in his suit -- that Yelp sales reps pressure businesses into becoming paying members with threats of bad reviews -- remains to be resolved.

"Small businesses have been expressing their outrage at Yelp's dirty business practices for a long time, and it is unfortunate that it took the filing of a class action to get Yelp to make even these amends," Beck says. "Still, there is much work left to be done... including the looming issues of Yelp's pay-to-play sales tactics."

In an interview with the New York Times, Yelp cofounder Jeremy Stoppleman characterizes the changes instead as a way to "debunk some of the myths and conspiracy theories out there" about the company.

"[The changes] will underscore the point that it really is and has always been a level playing field for businesses," Stoppelman tells the Times.

Beck's suit, as we reported earlier this month, is on behalf of nearly a dozen businesses across the nation, including a bakery in Chicago, a veterinarian in California, and a restaurant in Boston.

Each of the companies' owners says Yelp sales reps offered to remove bad reviews if they agreed to monthly memberships of $300 or more. The reps, in turn, also allegedly threatened to promote bad reviews -- and even to author new knocks against the business -- unless they paid up.

On Thursday, Yelp's lawyers filed a motion to dismiss the civil case in the U.S. District Court in Central California, claiming its sales techniques "do not constitute extortion" and that Beck's claims aren't recognized under state law.

A hearing on the motion is scheduled for early next month.

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