JUST BECAUSE THEY PUT IT IN THEIR TERMS OF USE DOESN’T MEAN THAT THEY CAN ENFORCE IT (OR THAT IT’S A GOOD IDEA)

This has been a subject of discussion for a while, but somehow I missed it: an online retailer billed a customer $3,500 for posting a negative review of the retailer’s service, then turned the bill over to a collection agent when the customer didn’t pay.  The retailer’s terms of service apparently contain a provision, called a “non-disparagement clause” that says they will do this.


A court has now ruled that not only doesn’t the customer have to pay the retailer, but the retailer has to pay damages to the customer.  It should be noted that the retailer did not defend against the claim because they claim they aren’t subject to the jurisdiction of the court.

I detect at least one or two reasons that the “non-disparagement clause” in the retailer’s terms of service may not be enforceable.  Beyond that, there’s the notion (discussed in the comments to the blog posts linked above) that you may not want to do business with a company that puts such a provision in its terms of service.