The Latest Attempt to Use Copyright Law to Remove Negative Consumer Reviews–Small Justice v. Xcentric (Forbes Cross-Post)

By Eric Goldman

[Note: as you know, I closed comments on this blog in 2006 because of a virulent comment spam attack. Sometimes I miss having comments, but then again, seeing the comments I got at Forbes in response to this post has made me wish Forbes was a comment-free zone. A few of the comments were OK and mildly useful, but most were hateful, ill-informed or trollish. If you are interested in seeing a very different set of interpretations of this post than I intended, go ahead and check out the comments. But don't say I didn't warn you.]

Like many other business owners, Richard Goren, a Massachusetts attorney, was unhappy with an online consumer review about his business. Like many other business owners, he was frustrated by his inability to remove the review from Ripoff Report, which says it doesn’t remove consumer reviews and won’t let authors remove them either. Where Goren’s story diverges from prior stories is that he thinks he found an innovative way to use copyright law to solve his problem. This post will explain the different tactics businesses typically use to redress unwanted consumer reviews, Goren’s novel approach to dealing with Ripoff Report, and why his tactic will fail.

[Note: last year I filed an expert report in a Ripoff Report case, for which I received no compensation.]

Current Ways to Remove Online Reviews

How can a business remove unwanted online reviews from consumer review websites like Yelp or TripAdvisor? Often, it’s as simple as sending a letter to the review author threatening a lawsuit. This usually scares the author into removing the review to avoid any legal proceedings.

However, sending threatening letters doesn’t always work. Occasionally, the author will fight back. Threatening letters also carry the risk of blowing up and increasing the review’s audience (the “Streisand Effect”). See this fine example of a Streisand Effect involving a moving company, Casey Moving, imprudently threatening the wife of an operator of a search engine optimization business. Sometimes, the review author can’t be found, such as when the review is posted anonymously or pseudonymously; and some websites, most notably Ripoff Report, do not let authors delete their reviews.

Threatening the online review website rarely works. Due to a law Congress enacted in 1996, 47 U.S.C. 230 (Section 230), online review websites generally aren’t liable for their users’ reviews–even if the review website gets a takedown notice or otherwise knows the review is questionable. As a result, review websites typically ignore threats to sue them for user reviews. However,  if the business asks nicely, the review websites might voluntarily remove the reviews anyway, especially if the reviews violate their policies.

Prior Copyright Workarounds to Section 230

Section 230 doesn’t apply to copyright claims.  Instead, copyright claims regarding third party online content are governed the DMCA (17 USC 512), which says review websites may be liable for allegedly infringing reviews if they aren’t removed quickly in response to a takedown notice (sometimes referred to as a “notice-and-takedown” scheme).

Because review websites typically will respond to a copyright takedown notice where they ignore defamation takedown notices, businesses have tried different ways to use copyright law to scrub online reviews. Two such tactics:

1) Prospective Copyright Ownership. An enterprise called Medical Justice provided doctors and dentists with a form agreement (often called a Mutual Agreement to Maintain Privacy) whereby patients would prospectively transfer copyright ownership to their future online reviews of the doctor/dentist. Armed with this purported copyright ownership, the doctor/dentist could send copyright takedown notices to the review websites demanding they remove any unwanted review.

This technique didn’t actually work. Many review websites informally told me they would ignore takedown notices based on Medical Justice’s form. One patient sued a dentist for threatening to exercise copyright ownership in the patient’s Yelp review; the lawsuit is pending but it doesn’t look good for the dentist. Ultimately, Medical Justice gave up, “retired” its form agreement and advised its clients to stop using the form.

2) Post-Publication Transfer. After a review is posted, businesses can get the review authors to give them the copyright. Here’s how:

Step 1: threaten the author with a lawsuit;

Step 2: offer to settle the dispute for no money, just ownership of the copyright;

Step 3: once ownership is acquired, send copyright takedown notices to review websites.

We haven’t seen this technique too often in the consumer review space, but elsewhere people depicted in unflattering photos or videos are doing something similar to scrub the depictions from the Internet. See, e.g., Scott v. WorldStarHipHop and Katz v. Chevaldina.

Goren’s Copyright Workaround to Section 230

Richard Goren, on behalf of himself and his law firm named Small Justice (a perhaps unintentionally ironic name), found another way to use copyright law against an unwanted Ripoff Report. Here’s what he did:

Step 1: Goren sued the pseudonymous review author for defamation in Massachusetts state court. It’s unclear exactly what notice the review author got about the pending lawsuit, but the review author no-showed, meaning no one opposed Goren’s requests.

Step 2: Because the author no-showed, Goren got a default judgment. As part of the remedies, the judge gave him the review’s copyright.

Step 3: As the purported copyright owner, he sent Ripoff Report takedown notices. When Ripoff Report refused, hesued them for copyright infringement.

Unfortunately for Goren, this effort to bypass Section 230 doesn’t work. Here’s why:

1) I don’t believe a copyright assignment is a proper remedy for defamation.

2) Federal copyright law says that copyrights cannot be involuntarily transferred (17 U.S.C. 201(e)) except in bankruptcy, which is how Ron Goldman acquired the copyright to O.J. Simpson’s book “If I Did It.”

3) The Copyright Office should have denied Goren’s copyright registration. Without a copyright registration, he cannot sue to enforce the copyright (17 U.S.C. 411). [Note: the complaint references a copyright registration dated July 3, 2013, but I couldn't find the registration in the Copyright Office's online database for either "Richard Goren" or "Small Justice," and the complaint didn't attach a copy.]

4) Even if Goren owns the copyright, it’s subject to any previous licenses the author granted. In this case, the author granted Ripoff Report an irrevocable license, so Goren can’t change that deal.

How did we get into this mess? The trouble started when Goren convinced the Massachusetts state court judge to impermissibly award the copyright to him. Mistakes like this are all too common in “ex parte” proceedings. The judge probably isn’t familiar with copyright law (state court judges rarely see copyright cases), and no one appeared in court to explain the obvious legal flaw with Goren’s request. The federal judge hearing Goren’s case against Ripoff Report isn’t likely to make the same mistakes.

To me, Goren’s tactics are illustrative of the aggressive–and sometimes desperate–measures businesses are taken to remove unwanted online reviews. When the reviews are truly false and businesses lack other good recourse, those efforts make sense. On the flip side, given these tactics can be misused to scrub truthful negative reviews from the Internet, we all have reason to worry.

For more on this topic, see my essay The Regulation of Reputational Information.

Citation: Small Justice LLC v. Xcentric Ventures LLC, 1:13-cv-11701 (D. Mass. complaint filed July 16, 2013)