MANOUSH ZOMORODI:  If a customer posting a negative review is a sort of punishment, it turns out that the subject of a grievance can punish right back. Jen Palmer is an executive assistant in the Salt Lake City area, and her review of an online business turned into a six-year legal rabbit hole.

JEN PALMER:  I’ve never regretted leaving that review. If things were different, I probably would have left exactly the same review, even – you know, even knowing what was gonna happen later.

MANOUSH ZOMORODI:  Alex Goldmark produces my podcast New Tech City, and he’s been following this cautionary tale of e-commerce and free speech.

ALEX GOLDMARK:  It was Christmastime in 2008 and Jen Palmer's husband John was browsing online for a little present, nothing fancy.

JEN PALMER:  I think originally what he was trying to get me was one of those little perpetual motion desk toys and a little smiley face bendy keychain. I mean, we’re talk – we’re literally talking about less than $20 worth of stuff.

ALEX GOLDMARK:  But after the tchotchkes never showed up, Jen wanted to know why.

JEN PALMER:  I started emailing, I started calling, could never get anybody on the phone.

KLEARGEAR OPERATOR:  Thank you for calling KlearGear.com. A customer representative is unavailable by phone at this time.

JEN PALMER:  So I said, you know what, I’m, I’m writing a review on these people, because this is just ridiculous. 

ALEX GOLDMARK:  Her review was scathing, she admits, but nobody, not even KlearGear has said it was false. So it was a total surprise when, two years later, Jen's husband got an email from the company with an ultimatum.

JEN PALMER:  And it was somebody claiming to be their legal counsel. They said this is on you to take it down, and if you don't take down within 72 hours we’re gonna fine you $3500.

ALEX GOLDMARK:  The Palmers refused to pay and, sure enough, 90 days later their credit-monitoring service alerted them to a debt of $3500. KlearGear had treated the fine as an unpaid bill, and John's credit was trashed.

JEN PALMER:  As soon as that happened, we both hit the roof.

ALEX GOLDMARK:  The website claimed that by buying something from the online store, John Palmer had agreed to a clause in their terms of service that said he could not disparage the company anywhere, not even on other sites.

I called KlearGear for comment and I got the same answering machine message that Jen Palmer got when she tried to contact them, and I also got no response to an email through their website.

As it turns out, there was no such clause in the terms of service agreement on KlearGear’s site until after the Palmers attempted the purchase. But the order of events, it, it doesn’t really matter here.

SCOTT MICHELMAN:  My name is Scott Michelman, I'm an attorney with Public Citizen, and I'm counsel for the Palmers.

ALEX GOLDMARK:  It's the idea of a non-disparagement clause that worries Michelman.

SCOTT MICHELMAN:  Just by contacting a consumer and telling him or her, you must take your criticism down, the company has succeeded in intimidating the consumer and possibly deterring other consumers from posting criticism of that company.

ALEX GOLDMARK:  Jen Palmer spent about a year petitioning the credit bureaus and appealing two loan decisions that levied higher borrowing rates on her husband. It was a lot to go through because of one online review, about a keychain and a desktop doohickey. But in the end, she was successful.

JEN PALMER:  John's credit has now been cleared. We can move on with our lives and try to make up for the last year.

ALEX GOLDMARK:  And by moving on, she means they’re suing KlearGear for damages.

Now, if this whole saga seems crazy, if it seems out of proportion for a business to be so tenacious and to pitch such a fight over one bad review, consider just how much a negative online comment can matter.

JOE HADEED:  Small businesses can be ruined by defamation.

ALEX GOLDMARK:  Joe Hadeed runs a carpet cleaning company in Virginia. He was hit with a series of negative reviews on Yelp and then, he says, his business started to drop off. The thing is, Hadeed claims, those comments weren’t all from actual customers.

JOE HADEED:  For example, there was a negative review from New Jersey, where we don’t do business. We checked the reviews against our records and we couldn’t identify any real customers that matched the reviews.

ALEX GOLDMARK:  This is something a lot of small business owners complain about.

RAIGHNE DELANEY:  What you’re seeing is scores of people who, who feel that they've been maligned unfairly and that there is really nothing they can do about it.

ALEX GOLDMARK:  Raighne Delaney is the lawyer representing Joe Hadeed, and with Delaney’s help, Hadeed is trying to get Yelp to turn over the names of the commenters, so that he can sue them for defamation. But Yelp says, nope. And a Yelp spokesperson wrote via email that most commenters aren't anonymous but sometimes they do have good reason to be, like if they want to review a plastic surgeon or if they fear retribution. She also added that Joe Hadeed has not actually shown that anything said about him on Yelp was untrue. Raighne Delaney.

RAIGHNE DELANEY:  What’s at stake, in this case, in the larger picture is two competing rights and, you know, one of the rights is the right to free speech and the right to speak anonymously, and the other right is the right to protect your reputation.

ALEX GOLDMARK:  So if the process of unmasking an anonymous commenter is too easy, then defamation lawsuits could be used to intimidate real consumers. If it's too hard to find out who’s slandering you online, then business owners are basically being told to just sit there and take it.

One of the other questions before the Virginia Supreme Court, which is currently considering this case, is should a small business have to prove a commenter is faking it or just have some good faith reason to suspect it?

SCOTT MICHELMAN:  The problem with that is there’s a First Amendment right to speak anonymously in this country.

ALEX GOLDMARK:  You might remember this guy from earlier.

SCOTT MICHELMAN:  My name is Scott Michelman. I'm an attorney with Public Citizen, and I represent Yelp.

ALEX GOLDMARK:   Michelman defended the Palmers’ right to comment on KlearGear, and he’s defending Yelp's right to protect the identity of its commenters. He especially likes to defend the rights of commenting anonymously.

SCOTT MICHELMAN:  It's very important because if you advocate an unpopular cause, if you are at risk of retaliation because of your speech, sometimes you want to share ideas with others and yet not reveal who you are.

ALEX GOLDMARK:  In the web-based economy, where a few bad reviews can sink a small company, we’ll likely be seeing more lawsuits like Hadeed’s against Yelp and KlearGear’s against the Palmers because, well, the negative comment is here to stay.

  [SOUND EFFECTS/MUSIC UP & UNDER]

SCOTT MICHELMAN:  If only good reviews get up, we’re, we’re like Lake Wobegon; everyone is above average. 

ALEX GOLDMARK:  And we can’t all live there. I’m Alex Goldmark – Gold-mark, not Gold-man.

MANOUSH ZOMORODI:  Alex Goldmark is the producer of my podcast, New Tech City. Come check us out on iTunes. We’re not your typical tech show.

MANOUSH ZOMORODI:  If a customer posting a negative review is a sort of punishment, it turns out that the subject of a grievance can punish right back. Jen Palmer is an executive assistant in the Salt Lake City area, and her review of an online business turned into a six-year legal rabbit hole.

JEN PALMER:  I’ve never regretted leaving that review. If things were different, I probably would have left exactly the same review, even – you know, even knowing what was gonna happen later.

MANOUSH ZOMORODI:  Alex Goldmark produces my podcast New Tech City, and he’s been following this cautionary tale of e-commerce and free speech.

ALEX GOLDMARK:  It was Christmastime in 2008 and Jen Palmer's husband John was browsing online for a little present, nothing fancy.

JEN PALMER:  I think originally what he was trying to get me was one of those little perpetual motion desk toys and a little smiley face bendy keychain. I mean, we’re talk – we’re literally talking about less than $20 worth of stuff.

ALEX GOLDMARK:  But after the tchotchkes never showed up, Jen wanted to know why.

JEN PALMER:  I started emailing, I started calling, could never get anybody on the phone.

KLEARGEAR OPERATOR:  Thank you for calling KlearGear.com. A customer representative is unavailable by phone at this time.

JEN PALMER:  So I said, you know what, I’m, I’m writing a review on these people, because this is just ridiculous. 

ALEX GOLDMARK:  Her review was scathing, she admits, but nobody, not even KlearGear has said it was false. So it was a total surprise when, two years later, Jen's husband got an email from the company with an ultimatum.

JEN PALMER:  And it was somebody claiming to be their legal counsel. They said this is on you to take it down, and if you don't take down within 72 hours we’re gonna fine you $3500.

ALEX GOLDMARK:  The Palmers refused to pay and, sure enough, 90 days later their credit-monitoring service alerted them to a debt of $3500. KlearGear had treated the fine as an unpaid bill, and John's credit was trashed.

JEN PALMER:  As soon as that happened, we both hit the roof.

ALEX GOLDMARK:  The website claimed that by buying something from the online store, John Palmer had agreed to a clause in their terms of service that said he could not disparage the company anywhere, not even on other sites.

I called KlearGear for comment and I got the same answering machine message that Jen Palmer got when she tried to contact them, and I also got no response to an email through their website.

As it turns out, there was no such clause in the terms of service agreement on KlearGear’s site until after the Palmers attempted the purchase. But the order of events, it, it doesn’t really matter here.

SCOTT MICHELMAN:  My name is Scott Michelman, I'm an attorney with Public Citizen, and I'm counsel for the Palmers.

ALEX GOLDMARK:  It's the idea of a non-disparagement clause that worries Michelman.

SCOTT MICHELMAN:  Just by contacting a consumer and telling him or her, you must take your criticism down, the company has succeeded in intimidating the consumer and possibly deterring other consumers from posting criticism of that company.

ALEX GOLDMARK:  Jen Palmer spent about a year petitioning the credit bureaus and appealing two loan decisions that levied higher borrowing rates on her husband. It was a lot to go through because of one online review, about a keychain and a desktop doohickey. But in the end, she was successful.

JEN PALMER:  John's credit has now been cleared. We can move on with our lives and try to make up for the last year.

ALEX GOLDMARK:  And by moving on, she means they’re suing KlearGear for damages.

Now, if this whole saga seems crazy, if it seems out of proportion for a business to be so tenacious and to pitch such a fight over one bad review, consider just how much a negative online comment can matter.

JOE HADEED:  Small businesses can be ruined by defamation.

ALEX GOLDMARK:  Joe Hadeed runs a carpet cleaning company in Virginia. He was hit with a series of negative reviews on Yelp and then, he says, his business started to drop off. The thing is, Hadeed claims, those comments weren’t all from actual customers.

JOE HADEED:  For example, there was a negative review from New Jersey, where we don’t do business. We checked the reviews against our records and we couldn’t identify any real customers that matched the reviews.

ALEX GOLDMARK:  This is something a lot of small business owners complain about.

RAIGHNE DELANEY:  What you’re seeing is scores of people who, who feel that they've been maligned unfairly and that there is really nothing they can do about it.

ALEX GOLDMARK:  Raighne Delaney is the lawyer representing Joe Hadeed, and with Delaney’s help, Hadeed is trying to get Yelp to turn over the names of the commenters, so that he can sue them for defamation. But Yelp says, nope. And a Yelp spokesperson wrote via email that most commenters aren't anonymous but sometimes they do have good reason to be, like if they want to review a plastic surgeon or if they fear retribution. She also added that Joe Hadeed has not actually shown that anything said about him on Yelp was untrue. Raighne Delaney.

RAIGHNE DELANEY:  What’s at stake, in this case, in the larger picture is two competing rights and, you know, one of the rights is the right to free speech and the right to speak anonymously, and the other right is the right to protect your reputation.

ALEX GOLDMARK:  So if the process of unmasking an anonymous commenter is too easy, then defamation lawsuits could be used to intimidate real consumers. If it's too hard to find out who’s slandering you online, then business owners are basically being told to just sit there and take it.

One of the other questions before the Virginia Supreme Court, which is currently considering this case, is should a small business have to prove a commenter is faking it or just have some good faith reason to suspect it?

SCOTT MICHELMAN:  The problem with that is there’s a First Amendment right to speak anonymously in this country.

ALEX GOLDMARK:  You might remember this guy from earlier.

SCOTT MICHELMAN:  My name is Scott Michelman. I'm an attorney with Public Citizen, and I represent Yelp.

ALEX GOLDMARK:   Michelman defended the Palmers’ right to comment on KlearGear, and he’s defending Yelp's right to protect the identity of its commenters. He especially likes to defend the rights of commenting anonymously.

SCOTT MICHELMAN:  It's very important because if you advocate an unpopular cause, if you are at risk of retaliation because of your speech, sometimes you want to share ideas with others and yet not reveal who you are.

ALEX GOLDMARK:  In the web-based economy, where a few bad reviews can sink a small company, we’ll likely be seeing more lawsuits like Hadeed’s against Yelp and KlearGear’s against the Palmers because, well, the negative comment is here to stay.

  [SOUND EFFECTS/MUSIC UP & UNDER]

SCOTT MICHELMAN:  If only good reviews get up, we’re, we’re like Lake Wobegon; everyone is above average. 

ALEX GOLDMARK:  And we can’t all live there. I’m Alex Goldmark – Gold-mark, not Gold-man.

MANOUSH ZOMORODI:  Alex Goldmark is the producer of my podcast, New Tech City. Come check us out on iTunes. We’re not your typical tech show.