Since the Federal Trade Commission (“FTC”) published its updated 2023 Guides Concerning the Use of Endorsements and Testimonials in Advertising earlier this year, consumer reviews have been front of mind. This guidance covers, in part, the treatment of consumer reviews, and companies have been (or should be) preparing for an uptick in FTC enforcement. But it’s not just the FTC to watch out for. A recent wave of class actions arising under California Civil Code § 1670.8 related to a customer’s right to make statements about their experience with a seller has raised the bar for retailers to another level.
California Civil Code § 1670.8 is titled “Contracts for sale or lease of consumer goods or services; prohibited provisions waiving consumers’ rights to make statements regarding seller, lessor, employees or agents, or the goods or services; unlawful acts; waiver” and includes, in part, the following provisions:
(a)(1) A contract or proposed contract for the sale or lease of consumer goods or services may not include a provision waiving the consumer’s right to make any statement regarding the seller or lessor or its employees or agents, or concerning the goods or services.
(2) It shall be unlawful to threaten or to seek to enforce a provision made unlawful under this section, or to otherwise penalize a consumer for making any statement protected under this section.
(b) Any waiver of the provisions of this section is contrary to public policy, and is void and unenforceable.
Section 1670.8 protects California consumers’ right and ability to leave consumer reviews, negative or positive, for products and services by prohibiting contractual provisions that limit or waive that right, and deems any such waiver void. Violations of § 1670.8 are subject to civil penalties not to exceed $2,500 for the first violation, and any willful violations can result in up to $10,000 per violation. Further, the statute explicitly states that civil penalties are not the exclusive remedy for violations, which allows class action plaintiffs to seek other remedies. Notably, § 1670.8 does allow for a company hosting online consumer reviews to remove a review “that is otherwise lawful to remove.” For example, if an anonymous user posted sexually explicit content on a business’ consumer review webpage, this type of content could be removed.