What are Non Disparagement (Gag) Clauses? Is it Illegal to Ban Honest Reviews? Consumer Review Fairness Act & More

With the use of the internet making it so easy, negative and positive opinions by customers and consumers about with the opportunity to voice their opinions about businesses. Because of these reviews that have helped the everyday consumer’s purchase decisions, both large and small businesses have been hurt. Non-disparagement clauses have gained popularity due to the many outlets that consumers have available to leave reviews about businesses. Non-disparagement clauses are what we at Kajioka & Associates, Attorneys at Law, would like to take the opportunity to further discuss.

What Does a Non Disparagement Clause Mean?

A non-disparagement clause is the attempt to prevent the receiver of a good or service from posting negative reviews about the seller or service provider from the language inserted in a contract or agreement. A non-disparagement clause is also referred to as a gag clause. If it is something you are seriously considering, you might want to consider seeking legal counsel before incluing this clause into your contract or terms of service.

Consumer Review Fairness Act

For a business today with a non-disparagement clause, even the worst critics can’t be silenced as for most businesses they are an unhappy customer. Few businesses tried to take matters into their own hands by putting provisions that allowed them to penalize or sue a customer for posting a negative review. In December of 2016 as the Federal Trade Commission took notice of these cases, Congress passed the Consumer Review Fairness Act. The law was passed in response to reports of businesses retaliating excessively to attempt preventing people from leaving an honest review about a product or service they receive. The law makes it illegal to use a contract provision that restricts customers from leaving reviews, enforce a penalty fee for a review, or require people to relinquish their intellectual property rights for their review for companies. The law will also protect businesses from people leaving inappropriate or irrelevant content, however.

Is a Non-Disparagement Clause Standard?

To protect your business in different aspects, you may find you need a non-disparagement clause. With the Consumer Review Fairness Act, employment contracts or agreements with independent contractors do not apply. These clauses can prove to be very useful when enforcing a settlement agreement due to a dispute. In the event you are considering adding a non-disparagement clause to your contract, consult with a Nevada business lawyer from the office of Kajioka & Associates, Attorneys at Law. If your business needs this provision, you can be better equipped to protect your business’ interest in the future and find out.

Criminal Defense, Personal Injury, Business Attorneys & More in Greater Las Vegas, Nevada

Your business can be better prepared with not only a non-disparagement clause, but in other avenues with the help of Kajioka & Associates, Attorneys at Law. In order to help protect your, your business, employees, and other assets, our attorneys specialize in business law and have the experience. Along with any other concerns you may have. We are ready to help you make your business a success, call Kajioka & Associates, Attorneys at Law to make an appointment for your consultation and we can discuss how the non-disparagement clause can affect your business.

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