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Long Beach Business Sues Yelp, Claims Site Runs 'extortion scheme'

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Some businesses are so excited to receive customer feedback that they put up signs asking patrons to leave a rating on the popular website Yelp. Sometimes questioned for their dubious methods, Yelpers these days can have a profound impact on a business' success or failure. Two law firms representing a Long Beach veterinary hospital have filed suit against Yelp, however, alleging "that the heavily funded startup runs an 'extortion scheme' and has 'unscrupulous sales practices' in place to generate revenue, in which the company’s employees call businesses demanding monthly payments in the guise of advertising contracts, in exchange for removing or modifying negative reviews," according to TechCrunch.

The hospital claims that the company denied their request to have a negative review removed, and then "sales representatives repeatedly contacted the hospital demanding payments of roughly $300 per month in exchange for hiding or deleting the review."

Yelp's response:

Yelp provides a valuable service to millions of consumers and businesses based on our trusted content. The allegations are demonstrably false, since many businesses that advertise on Yelp have both negative and positive reviews. These businesses realize that both kinds of feedback provide authenticity and value. Running a good business is hard; filing a lawsuit is easy. While we haven’t seen the suit in question, we will dispute it aggressively.