In 2016, the Federal Government passed a law called the Consumer Review Fairness Act (CRFA). The law is coded under 15 U.S.C. § 45b. The CRFA protects people’s ability to share their honest opinions about a business’s products, services, or conduct, in any forum, including social media. The Act makes provisions in consumer contracts invalid, if the provision: (1) prohibits or restricts individuals from reviewing sellers’ goods, services, or conduct; (2) imposes penalties or fees on individuals for such reviews; or (3) requires individuals to transfer intellectual property rights in such reviews.
While previous attempts to make this law failed, the Act was finally adopted in 2016. The law protects a broad variety of honest consumer assessments, including online reviews, social media posts, uploaded photos, videos, and other similar items. It also applies to consumer evaluations of a company’s customer service. The Act also bars sellers from offering form contracts with such provisions.
The law specifies that a violation of the CRFA will be treated the same as violating an FTC rule defining an unfair or deceptive act or practice. Which means that treble damages and attorney fees may also be available to a consumer when a business violates this law. Businesses need to be careful and remove any such language from their business contracts, especially if the business provides a consumer service.
The Act contains certain exceptions, including for contract provisions that bar the submission of confidential, private, or unlawful information. It is also important to note that defamation is still actionable, and consumers are still prohibited from knowingly making false statement about a business or a product.
