Bad Reviews can sink a business! But can you stop clients of your business giving you a bad review? Testimonials and reviews can carry incredible weight for your potential clients – fitness business owners know the value of good reviews. What this has meant is that fitness professionals, like many other service providers, have sought to prevent customers leaving a negative review through a contractual clause. Often this “no bad reviews” type clause will levy a penalty on any customer who leaves a negative review. These “penalties” or “fees” run from as small amount <$50, to acceptance of damages up to $100,000 and acknowledgement of the likelihood of legal action. One such example is that of a small hotel in Hudson, NY included a contract provision that fined the bride and groom $500 per negative review written by anyone associated with the wedding party. For the fitness and sports industry, The Bo Pelini case brought non-disparagement clauses in college coaching contracts to the forefront. While this case to relates to employment contracts, the fitness industry needs to be aware of recent changes that will impact the use of non-disparagement clauses in client contracts. Lawsuits over reviews are nothing new. In March of this year, a New Hampshire health club sued a former member for $750,000 in damages for leaving a bad review following a billing dispute. You may still be seeing advertisements for online reputation improvement services, or reading about why you should include a “non-disparagement” or “no bad reviews” or “gag” clause in your client contracts and website policies. The Consumer Review Fairness Act became US Federal Law in mid December 2016. The legislation, “makes certain clauses of a form contract void if it prohibits, or restricts, an individual from engaging in a review of a seller’s goods, services, or conduct.” Despite being law for over 12 months, there still seems to be some confusion about how this impacts the inclusion and enforceability of non-disparagement clauses in client contracts. The Consumer Review Fairness Act protect the rights of the consumer from businesses seeking to impose stipulations or enforce clauses in contracts limiting reviews published in any forum (whether online or in print). Referred to as “gag-clauses” and “non-disparagement clauses,” these types of contractual clauses have been designed to discourage customers from posting honest reviews that criticize the company – and imposing a financial penalty to dissuade the client from doing so. It doesn’t make it illegal to include these clauses in contracts, but it makes it legally impossible to enforce them. If a business includes such a “gag clause” knowing that it is not enforceable it could void part or all of a client contract. It could also give rise to a change of misleading or deceptive conduct. The Consumer Review Fairness Act also empowered the Federal Trade Commission (FTC) and the States to be able to take legal action in addition to that brought by individual customers. It remains to be seen how involved the FTC or the States will be in curbing businesses unfairly seeking to limit negative reviews of their products or services by utilizing non-disparagement contractual clauses. Some states, like California and Maine already had preexisting legislation so it is likely that actions could also be brought under those State laws as well. Remember, this is a federal law, so it less important which state the transaction occurred in - A consumer can now bring legal action against companies who attempt to pressure customers or potential customers into not offering negative reviews.