Before we jump in, a quick note: this article isn’t legal advice (we aren’t lawyers!) Please always seek the advice of a qualified legal professional if you are unsure.
Love them or loathe them, online reviews are big business. Your star rating can play a huge part in whether someone chooses you or your biggest competitor.
But we all know reviews aren’t always fair, honest, or in some cases, even real. From glowing fake feedback to defamatory lies, the world of online reviews can get a little sticky, legally speaking.
In this guide, we’ll break down the key legal rules and cases that every US business and review writer needs to know.
Reviews and the law: TL;DR
| What the law means | Who it affects | Law |
|---|---|---|
| Stops incentivizing positive reviews | Businesses | FTC Final Rule on Consumer Reviews (2024) |
| Stops undisclosed insider reviews | Businesses | FTC Final Rule on Consumer Reviews (2024) |
| Stops misleading review displays on websites | Businesses | FTC Final Rule on Consumer Reviews (2024) |
| Bans the buying or writing of fake reviews | Businesses and consumers | FTC Final Rule on Consumer Reviews (2024) |
| Protects business reputation from false statements made by reviewers | Businesses and consumers | Defamation Laws (state-based) |
| Shields customers from frivolous lawsuits meant to silence reviews | Consumers | Anti-SLAPP Laws (state-based) |
| Protects customers’ rights to post honest reviews without being fined or punished by businesses | Consumers | Consumer Review Fairness Act (CRFA, 2016) |
| Shields platforms from liability for reviews posted by users | Review platforms | Section 230 of the Communications Decency Act (1996) |
The reality of reviews
Good, bad, or fake, every online review is subject to the law.
For businesses, it’s not just about customers breaking the law; your own actions can also lead to legal headaches. Staying up-to-date on the law can help you avoid lengthy lawsuits and significant fines.
Review site guidelines vs. the law
Let’s start with guidelines. Yelp, Google, Facebook, and all other reputable review sites have extensive terms and conditions and review guidelines for users to follow.
These guidelines aren’t the same as the laws around US reviews. Doing something perfectly legal may get you a telling off, or even a ban from some review platforms if it’s against their own rules.
For example, there is no hard and fast rule around incentivizing for reviews, but platforms, including Yelp, are firmly against this.
When you sign up for review platforms, you’ll often end up agreeing to their terms and conditions. This means that, in theory, if you break these, you could end up breaking contract law. Of course, what’s included in these terms can’t be illegal, but there’s more to think about than just US law.
The big one: FTC Final Rule on Consumer Reviews and Testimonials
In October 2024, the Federal Trade Commission announced its long-awaited online reviews Final Rule, formally known as 16 CFR Part 465: Trade Regulation Rule on the Use of Consumer Reviews and Testimonials.
While not the first legislation influencing online reviews, this Final Rule seeks to give clear national guidance on a previously grey area. It aims to stop the buying and selling of fake reviews, with big penalties against “knowing violators”.
This includes:
Fake reviews and testimonials
Reviews and testimonials are now banned if they are written by someone who;
- Doesn’t have real experience of a business
- Misrepresents their experience.
This includes AI-generated fake reviews, or fake review attacks by real people aiming to damage or boost a business’s reputation unfairly. It also covers testimonials falsely attributed to celebrities.
It is now against the law to buy and sell fake reviews if the business “knew or should have known” that the reviews or testimonials are false.
Buying positive or negative reviews
Businesses can no longer give money or other incentives if they are conditional on customers writing a positive (or negative) review. This is true whether the incentive is clear or just implied.
And it’s not just asking for positive feedback that’s a problem. In 2014, Italian restaurant Botto Bistro set out to take back control from the “cold, grubby hands of Yelpers” by offering a discount to anyone who left them a one-star review. Even incentivizing negative reviews is now against the law.
This doesn’t mean that incentives are completely out of the question. Businesses are still legally allowed to reward customers for leaving a review as long as it’s unconditional on whether this review is positive or negative. However, make sure you check the individual review site’s guidelines before doing this, as platforms including Yelp are against this.
Insider reviews and testimonials
Reviews written by someone with a vague link to the company are now prohibited. This includes reviews written by managers and officers, and any testimonial that the business should have known was written by a company insider.
It also imposes rules on reviews solicited from immediate family members, employees, or employees’ families. Transparency is key here. If a family member or employee has a legitimate reason to leave a review, they must disclose their connection to avoid misleading consumers.
Review suppression
Businesses are not allowed to threaten or attempt to intimidate review writers to prevent or remove negative reviews. This includes both physical and legal threats.
The Final Rule also bars businesses from misrepresenting the reviews shown on their website as if they represent all or most submissions, when in fact negative reviews have been hidden or suppressed.
This doesn’t mean you need to showcase your worst review front and centre on your website. But if you claim you have a perfect five-star rating on Google and this isn’t actually true, you could be fined.
To understand this, take a look at the case of Fashion Nova. The fast fashion retailer was hit with a huge fine after it hid thousands of reviews with ratings lower than four stars. By hiding negative feedback, Fashion Nova was found to have engaged in “deceptive review practices”. This would be a big no-no under the new FTC Final Rule.
Company-controlled review websites
The Final Rule makes it clear that businesses can’t pass off websites they own or control as independent sources of reviews or opinions if these include reviews about their own products and services.
This applies to company-run microsites, blogs, or platforms that look like review hubs but are in fact controlled by the business being reviewed. Even if the reviews themselves are genuine, failing to disclose a link is considered deceptive and could land you a fine.
Misuse of social media influence indicators
This is not related to online reviews, but the Final Rule also stops the buying and selling of fake indicators of social media influence (e.g., followers or views by bots or hijacked accounts).
This is limited to cases where the buyer “knew or should have known” that these indicators were fake and misrepresented their influence. This practice can mislead consumers about a business’s popularity or credibility.
Fines and the Final Rule
Rulebreakers won’t face jail time, but instead face civil penalties (AKA fines) of up to $51,744 per violation, or per day for ongoing violations. That’s not exactly pocket change for most local businesses.
Before the Rule, the FTC needed to jump through additional hoops to bring enforcement under Section 5 of the FTC act. Now, they can fine violators directly.
It’s important to note that the Final Rule doesn’t replace earlier laws or cover all areas of online reviews law (which we’ll touch on below). Instead, it strengthens the toolkit for the regulators, businesses, and local marketers fighting against fake and unfair review practices.
For those who want to dig deeper, the FTC has published the full 163-page ruling, which lays out the specifics of what is and isn’t allowed.
| Rule Area | What You Can Do | What You Cannot Do | Notes |
|---|---|---|---|
| Incentivized Reviews | Offer rewards for all reviews, good or bad | Pay or give incentives only for positive reviews | Even implied pressure counts as a violation. And be wary of review site guidelines! |
| Employee / Insider Reviews | Post reviews with clear disclosure of relationship | Pretend to be just a normal customer if you’re actually an insider | Businesses are responsible for monitoring and preventing undisclosed insider reviews |
| Owned Review Websites | Make any link clear on the review platforms you own | Pretend a website posting reviews of your business is nothing to do with you if you’re actually the owner | Make any link clear, even if the reviews are genuine and not written by you |
| Review Suppression | Accept negative feedback and respond professionally | Threaten a reviewer for leaving feedback | If a review shouldn’t be there keep a calm head and go through the proper legal and review platform channels for removal |
| Review Suppression | Give a fair picture of your online reviews on your website | Hide, filter, or misrepresent reviews shown on your website | Must not mislead that displayed reviews represent all submissions |
| Fake Reviews | Ensure all reviews are genuine and based on real experience | Publish or buy fake reviews written by people or AI | AI itself is not banned to help you write legitimate reviews or review responses |
| Social Media Influence | Use authentic follower counts, likes, views | Buy/sell fake followers or engagement | Applies if you knew, or should have known, indicators were fake |
Other US laws and online reviews
While the FTC’s Final Rule on Consumer Reviews and Testimonials is a strong cover all for fake reviews and misrepresentation, it isn’t the first rule to touch the murky world of online reviews.
Previous laws and cases already tackle some of the more pertinent issues surrounding reviews, while the Final Rule covers the gaps.
Other laws to be aware of include:
- Defamation laws
- Anti-SLAPP rules
- The Consumer Review Fairness Act (CRFA) 2016
- Section 230 of the Communications Decency Act
We’ll cover each in brief below.
Defamation laws
When it comes to online reviews and the law, one of the biggest legal risks comes down to defamation. In the U.S., defamation is defined as “a statement that injures a third party’s reputation”. To prove defamation, it must be:
- A false statement pretending to be a fact
- Published or communicated to a third person
- Be malicious or negligent in its intent (i.e., they knew it was wrong or should have checked)
- Caused harm to the reputation of the subject
Opinions (“The food was bland”) are protected by the First Amendment, but false claims presented as fact (“The food was laced with arsenic”) can cross the line into defamation.
Sharing a genuine bad experience is protected. But making up or exaggerating facts to damage a business’s reputation could land a reviewer in court.
Anti-SLAPP rules
SLAPPs (strategic lawsuits against public participation) have been used to intimidate or silence people through costly and baseless legal action.
In the past, some businesses have attempted to sue customers that left negative (but perfectly truthful) reviews. Even when these cases had no real chance in court, the threat of legal proceedings can intimidate reviewers into taking down their reviews. This kind of intimidation not only harms the reviewer, but also stops other consumers getting a full picture of a business.
The introduction of Anti-SLAPP laws aimed to stop people from using threats of lawsuits to those exercising their First Amendment rights. These laws remain in place and continue to protect free speech and public participation in honest opinions and criticisms.
In a recent case, Tampa restaurant Hales Blackbrick sued diner Irene Eng over a one-star Yelp review criticizing the food and service, seeking $50,000 in damages. The judge dismissed the lawsuit in February 2025, ruling that Eng’s comments were opinion, not defamation. The business also received a consumer warning label on its Yelp listing, reading “Consumer Alert: Questionable Legal Threats”.
Consumer Review Fairness Act
The Consumer Review Fairness Act (CRFA) 2016 is a federal law that protects consumers’ rights to share honest experiences online. It made it illegal for businesses to add clauses to contracts that prevent customers from posting honest reviews or penalize them for negative feedback. It also tackled the requirement for customers to give up intellectual property rights in reviews.
This law meant that customers could speak freely about their experiences without being punished or fined by businesses.
The CRFA followed a landmark 2014 ruling on online reviews, Palmer v. KlearGear, where customer Jason Palmer was billed $3,500 after leaving a negative review for the online store. KlearGear’s terms and conditions contained a clause stating that customers couldn’t post negative reviews. Palmer went on to successfully sue, arguing that the contract clause restricted his right to share honest feedback.
Like with the FTC Final Ruling, breaking the terms of the CRFA can lead to fines.
Section 230 of the Communications Decency Act
When it comes to online reviews, Section 230 of the Communications Decency Act is one of the most important laws businesses probably won’t have heard of. Essentially, it shields websites and review platforms from being held liable for content posted by users.
This means if a customer leaves a negative review, a business cannot then sue Yelp or Google for hosting the review. If a business is unhappy with the legality of the review, it must either take the reviewer to court or attempt to get the review taken down if it’s against the site’s terms and guidelines.
Review responses and the law
It’s not just the practices surrounding reviews and what customers can write, but also how businesses choose to respond. Responding to reviews is a key part of managing your online reputation, but these responses are still bound by the law.
California Consumer Privacy Act (CCPA/CRPA)
California’s CCPA and CRPA privacy laws protect consumers’ personal information and regulate how businesses can use it. When responding to reviews, avoid sharing any details that could identify a customer or reveal private information.
Other states including Virginia, Connecticut, and Utah have their own privacy protections in place. Avoid the risk of a lawsuit no matter the location of your customers and never disclose personal information without consent.
HIIPA
For healthcare businesses, the Health Insurance Portability and Accountability Act (HIPAA) is a critical consideration when responding to online reviews.
HIPAA protects patients’ private health information, meaning you can’t share any details about a patient or their treatment in a review response, even if the patient has publicly shared their own details. Avoid mentioning appointments, treatments, diagnoses, or any other information that could identify the patient. Even thanking a patient by name can be risky.
If a reviewer raises a serious concern, the safest approach is to address it in private by asking the reviewer to contact you directly. This way, there is no chance of breaking the rules.
GLBA
Financial services businesses such as banks, credit unions, or lenders should be familiar with the Gramm-Leach-Bliley Act (GLBA) when responding to reviews. GLBA protects consumers’ private personal financial information, including balances, credit history, and other sensitive financial data.
This means businesses can’t disclose any financial information in review responses, even if the original review raised specific concerns on these. Like with HIPAA compliance, the best way to tackle issues is to encourage the reviewer to get in touch privately.
How to handle illegal reviews
Reviews sometimes cross the line into defamation, false accusations, or harassment. When this happens, it’s important for businesses to act carefully and legally. Follow our step-by-step plan to make sure things don’t get worse.
1. Stay calm and assess the situation
Start by assessing whether the review is truly illegal or just hurtful. A review only crosses into lawbreaking if it includes defamation or involves threats or harassment. As you assess, keep in mind the Streisand Effect: could the effort to silence the review actually draw more attention to it?
2. Document everything
Before taking action, make sure you have a full record of the review. Save screenshots, note the date and time, and capture any related correspondence with the reviewer. This evidence is essential if you escalate to the review platform or go down the legal route.
3. Contact the review platform
Review platforms, including Yelp and Google, have procedures for reporting reviews that violate their terms of service and content guidelines.
Provide clear evidence that the review is false or illegal. Be prepared that platforms are often cautious and may only act when the violation is clear-cut.
4. Get legal advice
If you think the review may break the law, consult a lawyer who specializes in defamation to help you decide if your case has merit. Next steps may include a cease and desist letter or even pursuing a full lawsuit.
Keep in mind that the bar is high: courts generally won’t punish opinions, so legal action tends to only be successful if you can prove the review is false.
5. Get more reviews
While you’re working your way through potentially lengthy legal and review platform processes, work on strengthening your overall reputation. Encourage recent customers to share their genuine experiences so that the illegal review has less visibility and effect on your overall star rating.
Stay smart, stay legal
Online reviews are a powerful tool for businesses, but the legal landscape in the US around them is complex and constantly evolving. Between the FTC’s Final Rule on Consumer Reviews, defamation and anti-SLAPP protections, and state-specific privacy laws, it’s easy to get tangled in legal grey areas.
The good news? Most honest reviews and responsible responses are perfectly fine. Don’t buy fake reviews or indulge in dodgy practices, and you’ll stay on the right side of the law.
Please remember nothing here replaces professional legal advice. When in doubt, a qualified lawyer is the only person who can guide you safely through online reviews and the law.
