Yelp Extortion Allegations Stack Up 

More business owners come forward with tales of unethical behavior by the popular San Francisco-based web site.

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Larry Trujillo, co-owner of the Uptown Nightclub in Oakland (78 reviews, four-star average), said that shortly after he opened the club in November 2007, a Yelp salesperson harassed him almost daily about advertising. "He would call up and the first thing he would say is, 'I notice you have a lot of positive reviews,'" Trujillo recalled. "'We could make sure that those reviews stay positive.'"

One of the ways Trujillo could accentuate his positive reviews, apparently, was by giving Yelpers free drinks. Separate from the ad pitch, Trujillo said Yelp executives contacted him about throwing a party at the venue.

He recalled the scenario in an e-mail: "After numerous tours of the Uptown and rounds of free drinks given to the so-called brass of the Bay Area 'Yelpers' who were offering to throw a Yelp party at the Uptown, when I was finally contacted by a Sarah Lippman, I learned their real motive. ... After several phone meetings, she finally came to the point and pitched me on what she really wanted: free use of the club with staff and alcohol expenses covered by the Uptown in exchange for positive reviews."

When he questioned Lippman on how free alcohol would translate into positive reviews of his business, he said Lippmann responded, "because the party would be made up of Yelp bloggers/posters." Trujillo questioned her further: "But if they truly loved the Uptown, wouldn't they be posting these positive reviews anyway?" "Well not necessarily," he recalled her saying. "Well this party would be a little incentive to crow about the Uptown."

Trujillo likened her pitch to extortion, and then told her she could rent the Uptown and he'd risk bad reviews. "Well that's not how we do things," he said she had responded. "We never pay for stuff like this and other businesses have responded positively to these types of offers." Trujillo said he expressed his skepticism of whether his business' positive reviews were "posted merely to warm us up for your pitch" and ended the discussion: "Thanks but no thanks."

Debbie Leonardo, director of membership at Ruby Hill Golf Club in Pleasanton (ten reviews, 4.5 star rating), said she received a sales call from Yelp about a year ago. The saleswoman, whose name Leonardo could not recall, explained what Leonardo could control if she bought an ad, such as her business' photos, and that no competitor's ad would show up on their page. "And that's when she told us we could get rid of our worst review," Leonardo said. "The other people have said 'bury' — she said we could remove our worst review. She was the only one. Everyone else indicated that we could bury them, move them around." Leonardo declined the offer.

Bob Kurtz, owner of adult and collectibles store Collector's Realm 3 in Oakland (four reviews, four-star average), said that Yelp sales reps contacted him about advertising after he received a negative review. "We asked about our very negative review and we were told that as paid advertisers that review would be dealt with," he recalled in an e-mail. "While not said, there was the implication in my mind that the review would be buried in some manner or perhaps even removed." Kurtz said he wrote a negative review about Yelp on Yelp, but that it was suppressed. "Clearly they are hypocrites," he said.

Nicholas Paul, an instructor at an art studio in Chicago (which did not want to be named for fear of retribution) and who handles the studio's advertising, said that Yelp approached him to advertise starting in July of 2008. After he turned them down, "then all of a sudden three of our positives disappeared and then we got two negative ones," he said. Of the original thirteen reviews they had, only eight now remain, four of which are negative. Paul says the sales rep told him he could control that. "We could basically adjust the way our reviews are read," Paul said the rep told him. "We could highlight the ones we wanted and put the ones we didn't want on the backburner."

Stoppelman has proclaimed such stories as impossible: not only are changes of this type forbidden by the company, he says, but sales reps are not technically able to make such changes. But continuing to deny the stories — which are now adding up thanks to reporting by other news outlets — further damages Yelp's image as an objective, unbiased, user-generated review site. It also hurts their relationship with business owners, upon whom they rely for revenue.

Jo-Ellen Pozner, an assistant professor in the Organizational Behavior and Industrial Relations Group at UC Berkeley's Haas School of Business, believes the best thing for Yelp to do in the wake of this controversy is to increase its transparency. In other words, Stoppelman should publicly apologize for any potential wrongdoing, explain how the behavior might have occurred, and then outline the steps the company will make to avoid future wrongdoing. "That would be easy for Yelp to do," she said. But given Stoppelman's response so far, that scenario seems unlikely.

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