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Minnesota Businesses Claim Yelp Withholds Positive Reviews for Cash

A California district court threw out a class action lawsuit against Yelp in 2010 because the businesses that sued couldn't prove that Yelp authored bad reviews as a scare tactic.

A California district court threw out a class action lawsuit against Yelp in 2010 because the businesses that sued couldn't prove that Yelp authored bad reviews as a scare tactic.

The hugely popular customer review site Yelp is a one-stop source for making impulsive decisions on where to spend money.

Yet some small businesses on the receiving end of those reviews swear that Yelp has a way of manipulating the star rating system for cash.

See also: [UPDATE] Robbinsdale's Nyberg Photography Is Being Extorted on Yelp

Jodi Schoenauer, currently marketing director for eTouchMenu, says she had miserable experiences with Yelp when she used to run the marketing departments of Edina's Parasole Restaurant Holdings and Minneapolis's the Melting Pot. She says Yelp sales reps would call her about each of the 14 restaurants under her responsibility and try to sell her "review management" services.

"It would be, 'You have negative reviews and it's really going to hurt your business. The cost of a negative review to a business is somewhere around a $6,000 loss to your business, and we can help you manage these reviews,'" Schoenauer says of the phone calls she'd receive from Yelp. "They were vague. You pay them money, and I don't know what they do."

Small business owners all over the country report the same. They claim extortion, that if they refuse to pay for help managing reviews, their five-star ratings would get filtered away as "not recommended" and the one-star reviews would remain on their profiles.

Yelp says it doesn't mess with customer reviews, and no amount of money from a business could push the company to prioritize positive comments over negative ones.

Yelp spokeswoman Hannah Cheesman says sales reps do try to sell ads to businesses, but Yelp doesn't punish those that decline and it doesn't award those that buy. Yelp has software engineered to weed out fake reviews from business owners' friends and family, as well as unhelpful rants or raves. That could be the reason why some five-star ratings never make it onto the business profile.

"The [filtering system] is something we didn't talk a lot about at the beginning, but as we became more popular and more business owners started realizing, 'Hey, what happened to that review,' it's worth it to talk about it more," Cheesman says. "In the past few years we've tried to be a lot more transparent about how we're looking out for fake and biased reviews."

She says there's no such "review management" package that would allow businesses to pay for higher ratings, and Yelp definitely would not hold real reviews hostage to any amount of money.

"It's also worth mentioning that we are aware of reputation management companies that call business owners and claim to be able to help them control their Yelp listing and reviews," Cheesman says. "They can't, and they are not affiliated with Yelp."

The extortion claims have been a touchy subject. Kaylie Millikan is a California documentary filmmaker who is releasing an expose called Billion Dollar Bully on the allegations this fall. She says she keeps hearing the same stories of strong-arm bullying and retaliation from small business owners across the country.

"It's very alarming that their stories are all the same," Millikan says. "They have the evidence to back it up that they have five-star reviews, but then they get a phone call from somebody trying to get them to sign up for their services. After they decline so many times, all of a sudden their five-star reviews get filtered away and their one- and two-star reviews show up."

Millikan says she decided to investigate Yelp after she went in for a check up with her physician, and they started chatting about how harmful the review site was for businesses. Millikan didn't want to believe it at first because she had always trusted Yelp. But after doing some research, she found the physician's claims weren't unique.

Yelp declined Millikan's interview requests, but representatives have repeatedly denounced her reporting. Millikan's scratching her head about how they could discredit Billion Dollar Bully when it hasn't even been released yet.

Send news tips to Susan Du.