Yelp.com changes policies after vet files class-action suit

Long Beach, Calif.

-- Just two months after a veterinarian initiated a class-action battle against the online review site Yelp.com, the company -- which has denied any wrongdoing -- is making changes to its business model.

The complaint initiated Feb. 24 by Dr. Greg Perrault, owner of Cats and Dogs Animal Hospital in Long Beach, Calif., charged that the company used hard-sell tactics to force small businesses into signing expensive online advertising contracts. For the right price, Yelp representatives promised to hide bad reviews, Perrault contended.

Yelp.com denied any inequal treatment of the businesses reviewed on its site, explaining that the contracts sell “advertising and nothing more.”

But changes just announced by Yelp’s Founder and Chief Executive Officer Jeremy Stoppelman indicate the company is making some big changes -- and those changes seem to touch on the complaints outlined in the class-action suit.

The two major changes are that Yelp users will now be able to see reviews previously filtered out by Yelp’s programming, and advertisers will no longer be allowed to post a “favorite review” at the top of their listing page.

“Today we’re announcing two important product changes to reinforce that trust and make it even more clear that Yelp treats review content equally for all businesses, with no connection between advertising and reviews,” Stoppleman writes in an April 5 blog. “Despite our best efforts to educate consumers and the small business community, myths about Yelp have persisted. We’ve said all along we believe these incorrect notions stem from the combination of the filter and this advertising feature -- and we’re practicing what we preach.

“Lifting the veil on our review filter and doing away with “favorite review” will make it even clearer that displayed reviews on Yelp are completely independent of advertising — or any sort of manipulation. We also hope it will demonstrate the importance of a safeguard such as our filter and the unique challenge we face daily to maintain the integrity of the review content on our site.”

Other minor changes include the creation of a small business advisory council to provide Yelp management “guidance and perspective regarding the concerns of small-business owners.”“The recent modifications to the Web site are an important first step in the right direction for the thousands of businesses who have seen their livelihoods trampled or threatened by Yelp’s extortionate practices,” counters Jared Beck, lead attorney for Perrault’s class-action suit. “Small businesses have been expressing their outage at Yelp’s dirty business practices for a long time, and it is unfortunate that it took the filing of a class action to get Yelp to make even these amends.”

The class-action suit is pending in the U.S. District Court for the Central District of California.