Yelp Denies Ratings Favor Those That Advertise

Online review site Yelp can lower or raise the rating of a business depending on whether it advertises with the company, a federal appeals court ruled in a lawsuit filed by small businesses claiming Yelp used the tactic to try to extort ads from them.

Yelp has denied doing that, saying it uses an automated system to cull reviews that determine ratings. But the 9th U.S. Circuit Court of Appeals ruled that even if Yelp did manipulate reviews, that wouldn’t constitute extortion.

The plaintiffs have yet to indicate they would appeal, but one of their attorneys responded “The mafia wishes it had this ruling.”

ABC’s Scott Goldberg joined us from New York to discuss.

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