New law says Illinois businesses can't stop bad online reviews through gag clauses.
Illinois Governor Rauner recently signed a law that prohibits businesses from enforcing “non-disparagement” or “gag” clauses in contracts for the sale or lease of consumer goods. The gag clauses are typically placed in the Terms and Conditions portion of the contract. Why there? Simple. Consumers don’t read Terms and Conditions. The purpose of the gag clauses is to strip an unhappy customer of the right to air his grievance on Twitter, Yelp, TripAdviser or any of the dozens of similar sites that offer “Reviews” sections for consumers.
Hotels frequently use gag clauses as do some retailers, moving companies and even dentists. Steve Stadelman, the sponsor of the bill felt that the explosion of social media requires that consumers have some degree of protection when they take to the keyboard to describe just how awful that burrito was.
The legislation tracks the Consumer Review Freedom Act that President Obama signed in 2016. The new law, which is now part of the Illinois Consumer Fraud and Deceptive Business Practices Act, allows consumers who are get harassed for online reviews to sue for damages and attorney fees.
The bill passed unanimously in both the Illinois House and Senate.
Businesses can, however, still sue for defamation is a consumer posts a review that is untrue.