All language subtitles for Billion.Dollar.Bully

[Music playing]

[reporter] Tonight,
some local businesses are yelling "Help!"

After getting targeted on Yelp.

A lot of business owners
say what Yelp is really doing

is extorting them
for advertising money.

One bad review can really,
like, destroy your business,

you can lose
thousands of dollars.

Consumer investigative
reporter,

Harry Sandler,
wanted to speak with Yelp

about its top reviewer
right here in Atlanta.

And as it turns out,
that reviewer is actually a paid Yelp employee.

[Reporter] Yelp would only give us an on-camera interview

if we would agree to give the story a positive spin.

We don't work that way.

A Yelp spokesperson
says we are being unfair.

Is Yelp good or evil?

Let's take a look and see what the research has to say about the debate.

[David Balto] Over 2,000 complaints were filed by businesses

that their rankings
were diminished

because they refused
to advertise with Yelp.

My name's Adam Fisher,
I own Computers WTF.

I manage
AAA Appliance Service Center.

We're Gentle Giant
Moving Company.

BCR-Propridge LLC.

Pizzeria in Nashville
Tennessee.

I own Belle Roche
Estate Jewelry,

and I've been
extorted by Yelp.

And I have been
extorted by Yelp and Yelpers.

I was harassed by Yelp.

I'm being exploited by Yelp.

Extorted by Yelp.

- Extorted and harassed...
- By Yelp.

We have been extorted by Yelp.

[Charlie Rose]
Jeremy Stoppelman is here,

he is co-founder
and CEO of Yelp.

It is a website and mobile app
dedicated to user reviews.

Since its IPO in 2012,
Yelp stock price has soared.

It now has a market capitalization of $3.2 billion.

I'm pleased to have Jeremy Stoppelman at this table

for the first time. Welcome.

- Thanks for having me.
- Oh, boy, you, uh...

Let's... I don't know
where to start.

Tell me what Yelp does,
that's where we can start.

Uh, one way to look at it is it's just word-of-mouth, amplified.

You know, we set out
to create the new Yellow Pages,

a better way
for finding local businesses.

- And so, just like Wikipedia, it's open to all commerce.
- Right.

Anyone can come onto the site,

write a review of their favorite local business,

and all of that local knowledge can then be searched over.

And so,
you can find just about any business that you want.

And, you know,
here in the States,

just about any city,
and increasingly throughout the world,

you can find the best local businesses by turning to Yelp.

I use Yelp.

[Woman] My friends and I
will get in a circle

and talk about it
from the Yelp review,

and then we'll choose
where we go.

We usually try and find a restaurant based on Yelp reviews.

Looking up food and places
and stuff like that.

I go straight to...
First of all, the stars.

If it has, like, two stars,
most likely I won't go to it.

- Exactly. Exactly.
- Two stars. Like, whoa.

I always use Yelp
to get any kind of service.

I started at Yelp
in March of 2011.

There was some kind of appeal,

I just had to know
what was going on in there.

Some kind of allure and romance to working at a big company like that,

it seemed very exciting.

There was a feeling that you had to be exceptional to work there.

There was a feeling
you had to be really smart

and talented.

[Stoppelman] We've got
this wonderful feature

for all of our top salespeople.

So if you're a top salesperson
for the month,

you get to go have
an incredible photo made.

Uh, there's this place
in the Mission

that specializes in, like,
quinceanera photography and, uh...

So we send our top sales rep
over to that studio

and then they come up with a costume
and a theme and an idea of their own.

That is some
really good incentive

to become a top salesperson,
is to get something like this.

Everyone wants to be
on this wall, for sure.

[Valentine]
Sales floor, it's like...

Each team has a couple of pods,

and it does feel
kind of like, you know,

you're on the rowing team
or something,

where you're definitely aware of, like,
"How's that team doing?"

And there's even a board,

you know, all the teams
and their number.

Each team has a board

and each rep
has their number up.

So there's complete transparency,
the whole time,

of how everybody's doing.

And so you're naturally
going to want to show success.

[Amy Lane] It was somewhere I would
go to get phone numbers and addresses,

and business information,
so I thought it kind of worked.

Just like the Yellow Pages,

and maybe it was set up
by the city or something,

but then, it's not.

It's a private corporation
that has a business model

and their business model
affects everybody.

Whether you want
to be on Yelp

or whether you don't
want to be on Yelp,

whether people know you're on Yelp or not,
you're gonna be on there.

Yelp always controls
the narrative.

[Indistinct chatter]

My name is Danny Teran

and I am the owner-operator
of The Wheelhouse Brooklyn.

I did not put myself on Yelp.

One of the users and people
who came into our restaurant

created an account for us
and started our account off

with a nice five-star review
for their first experience.

From then on, it was new
and it was fresh

and people were really
enjoying theirselves

and coming in here and leaving us positive reviews

and we got all the way up
to about 35 five-star reviews.

[Gabriel Vitol] I used Yelp as a consumer on and off for ten years,

when I wanted to check out
a new restaurant

or see a new place.

But I was never
hardcore, like,

elite Yelp user
or anything like that.

As a consumer, if I saw
a negative Yelp review,

it would absolutely
make me think twice

about using those services
or buying that product.

I came to California in 2012
to start a restaurant

and I sacrificed so much and I left a lot behind at home.

And I was the youngest woman
in San Diego

to have a restaurant
and run it alone.

This was the front patio
of my restaurant.

So I had a huge
glass window...

And I was just glad that
I was able to come here

and start a business

and I was really
proud of myself.

I never imagined Yelp
would be the reason

that I would close
my business.

There's no accountability
for jobs being lost.

There's no accountability
for first-time businesses

who start up
and take out a huge loan

and have everything crushed.

[Alexander G. Chamandy] Really,
what got me interested in Yelp in general

is just having
a mix of experiences,

starting off with lots of positive feedback from customers.

We started to hear from
these sales people in Yelp

and they'd call us
several times a week

and we'd, uh, basically
be given a pitch that,

"Hey, you can spend anywhere
between $300, $500 a month.

It'll improve
your visibility.

You'll get all
of this traffic."

And I would politely decline.
Uh, just basically say,

"Look, we're a home-based business.
We're of modest means

and we cannot afford that
in our budget."

[Teran] So a sales representative from Yelp reached out to me

about three months
into being a business.

What they were explaining was

we're getting X amount of
clicks on our Yelp page daily

and that we should be,
kind of,

paying for every single one
of those clicks.

Yelp would call me
every couple of days

and they'd try and sell me these ridiculous advertising packages.

And they would keep me on the phone for 40 minutes or so,

it was impossible to get
these guys off the phone.

[Teran] So I listened to her pitch and after a week or so,
hearing her out,

it seemed to be as if it would be like $500 or $600 a month.

I let her know
it's out of my budget.

It's not something
we can do right now.

And she was very persistent

and almost to a...
Like a harassing point

where she just did not stop
calling me and e-mailing me

and calling me
and e-mailing me.

Telling me reasons why
we need that service.

And realistically,
three months into the business,

it wasn't in our budget
at the moment.

My name is Davide Cerretini

and I am one of
the chef-owners

of Botto Bistro
in Richmond, California.

Yelp, it started, like,
I think it was 2006.

We'd jump on the wagon

and, you know, we embraced
their idea like everybody else.

Along those years, from 2006 to 2015,
many things have changed.

Many things happened.

It's a different story
from what it was before

or what we expected it to be.

Yelp started to harass us
around 2012.

And I mean harass us.

We were talking about seven
or eight, nine calls a week.

And there is
no way to deny it

because Yelp can go back
and look at their record,

then they see that it's true.

I pay them $270 a month

to shut the fuck up.

Okay, on behalf of Anton
who just got a deal,

I'm ringing the bell for him.

I feel like I'm taking
something from you.

- [Anton speaking indistinctly]
- [man laughing]

All right. All right.
Here we go.

This is what it sounds like.

- [Bell dinging]
- [clapping]

- [all cheering]
- Yeah!

[Chuckling]

Yelp is impossible
to contact,

so they call you

when they have something
to sell you.

[Teran] It wasn't till
after our conversation

and me denying their service

that everything happened
to my account.

[Reporter] A busy time
at the post of Yelp,

the latest hot market debut.

The consumer review website
came to market late Thursday

at a higher than anticipated
price of $15 a share.

The share price climbed
as high as $26 a share

before backing off
that opening high.

It was... It was
a great IPO, I think.

Everybody wins
in that situation.

Investors were happy.
Employees were excited.

The day of IPO came

and it was this big, like,

wow, you know,
and celebration and...

Then, after that, I felt
my experience was,

maybe, a dark cloud
passed over the land.

And going forward,
it did feel a lot more like

our intentions
are different now

and we're answering
to different people.

You know, stockholders.

And, um, it's a different...

It's a game changer
once you go IPO.

Yeah, it's definitely "Now,
we're in the capitalist world."

[Chamandy] Every time
we'd get those calls,

I would get more
and more nervous.

That when the phone was ringing and it was a 415 area code,

it was likely Yelp.

That this was
gonna be a call

that might harm
my business's reputation

if I don't say
the right words.

[Teran] It got to a point
where I said to her, "Stop.

I can't do this. I'm sorry."

You know, "Leave me alone,"
in a sense.

The day after I created
my profile,

I started getting hounded
by sales people.

They just called
every single day

making me
all kinds of promises.

Yelp sales people
called me

approximately three
to five times a week.

Until I finally gave in.

That feeling of
winning is really,

uh, satisfying in some
kind of way.

You know,
that you won somehow

and you get to ring this gong

on the floor and get to be
famous for a second.

[Woman] Each time a Yelp user
views your business page,

it's an opportunity
to gain a new customer,

client or patient
for your business.

[Lane] Local businesses,
small businesses,

should have the right
to be able to say,

"I don't want to be on here."

And there is no... There is
no ability for them to do that.

[Teran] I think
it's definitely unfair

that businesses cannot be
removed from Yelp.

Even at our darkest point,

where all our reviews
were being deleted,

you know, I would ask them.
I would say...

I was like, "Can we just
delete our account?

I mean, can we just
get rid of this?"

And they would tell me that
there's nothing to do.

Your page is there forever.

What I want, what every
other business wants,

give me the option
to walk out from your list,

and I will.

If I can call them up right now
and say take us off,

I would take us
off Yelp. 100 %.

Someone in Yelp

is taking every business
they can find,

and any business that
they think is out there,

and putting it in one place.

And then,
imposing restrictions

on how you represent
your own business.

[Woman] Do you ever look
at the filtered reviews?

Filtered reviews?

The... The what?

I'm not aware of
the filtering system.

No, I've never heard
of that. [Chuckles]

Are those the bad reviews?

I've read some of
the filtered reviews before

but I didn't realize that
they were, um, filtered out

by Yelp for
a particular reason.

[Man] Let's say you wanna check out a new restaurant in town.

Your foodie friend
has been there.

The gentleman
who lives next door

who only goes out to eat
once a year has been there

and that new guy
across the street

that you just met
has been there.

So you ask them all
what they thought.

And you're probably gonna trust one of
those opinions more than the others.

Because no matter
how nice the gentleman is,

he only goes out
to eat once a year.

And the new guy, well,

you don't really know
anything about him yet.

Yelp understands that just as your neighbor's restaurant opinions

may not be as useful
as your foodie friend's,

not all reviews
are created equal.

Which is exactly why we recommend some reviews and not others.

Reviews that Yelp
doesn't recommend

can still be seen via a link

on the bottom of each
business' profile page.

But they don't factor into the business' overall star rating.

I was really interested
to look at

the reviews that were filtered

and the reviews
that weren't filtered,

because it just seemed like a really interesting comparison to me

to see which reviews
were getting prioritized

over the ones
that were being filtered.

And the discrepancy
was quite staggering.

I think the first thing I found
was in the content guidelines.

They lay out all of
these bullet points

for how you're supposed
to be on Yelp.

So, "Colorful language
and imagery is fine,

but there's no need
for threats, harassment,

lewdness, hate speech,
or other displays of bigotry."

That's great. That's exactly
what I want to hear

if everyone is forced
to have this review page.

I don't want to read things that are bigoted or hate speech.

And then I started looking
at the actual reviews

and they did not live up

to the content guidelines
that Yelp had set forward.

For instance, uh, this was
one review that I found.

[Reading]

That sounds like...
What would Yelp call that?

That would be,
uh... "No need for threats, harassment,

lewdness, hate speech,

and other displays
of bigotry."

Well, then the next day after
this guy wrote the review,

so I'm thinking, you know,

"Maybe someone from Yelp
hasn't seen this,

maybe this is just one
that slipped through the net."

The community manager
for Yelp said,

"Can't wait to check out all those killer reviews you're cooking up, Jim."

[Mumbles]
That's not really a review.

Saying that you walk into a bar that's full of ugly chicks

who won't sleep with you
is really not, uh...

It's not really a review
of the establishment.

I'm not sure what it is.

I have one from
the 9/11 Memorial,

which is up
and which is on the page.

Hasn't been filtered.
Hasn't been taken down.

[Reading]

"If you want to see
the effects of 9/11,

just look at the pile of rubble next to the museum."

And this was a review that was filtered for the 9/11 Memorial.

"As a New Yorker
who saw 9/11 firsthand,

it's beautiful to see
what they've done

to help remember
those who were lost

by creating this memorial.

You close your eyes and you
feel different emotions,

you feel peace.

Beautiful, and a must-see
for anyone visiting New York."

Having a Yelp for Auschwitz

seems to be in
serious poor taste.

I think it just shouldn't
be there at all, really.

I mean, who leaves a review
of one of the worst sites?

They haven't got the Cambodian death fields yet

but I'm surprised.

I feel like it's one thing
to review a restaurant

and to review a bar
and a place of business.

But to allow people to say
stuff about memorials...

It just doesn't seem right

and it doesn't seem right

that they have this
content guidelines

where it's like nothing
offensive, no hate speech.

Who is enforcing
these guidelines?

Because I can't really see
any enforcement on that.

I see a lot of nasty reviews

and almost pitting the consumer against the business.

If you're going to
filter reviews,

that's fine,
it's your website.

But you're not explaining
your criteria

for filtering them.

And worse yet, you're putting
out some content guidelines

and you're not
adhering to them.

[Indistinct chatter]

[Cerretini]
After a couple of months,

we started receiving very aggressive phone calls from a guy.

So aggressive that I actually told him a few times

to go fuck himself.

A Yelp representative
reached out

and we refused their offer
to market on their website

and after doing so,
within three to five days,

we had three good
reviews disappear

and one bad review appear.

The sales representative
was calling me daily.

It wasn't till after
our conversation,

and me denying their service,

that our Yelp page got spammed
with 15 of the same reviews

stating the same exact thing.

You can call it coincidence,
you know, uh...

A corporation like that
that is, you know,

accused of extortion from
every corner of the country

should not have that coincidence happen in the first place.

So what happened
after not even a day,

suddenly, you see three
or four bad reviews appear

and some of the good ones
disappear.

They take your good reviews that are legitimate and they filter them,

and they put them in
this section at the bottom

that nobody looks at.

It doesn't come up on Google

and it doesn't affect
the star rating.

[Ronn Owens]
The claim that, you know,

I was asked to
advertise with Yelp.

I said no, and all of a sudden
I went from four stars to one.

How do you react?

[Sollitto] Uh, we hear it
all the time.

[Owens] I know you do.

[Sollitto] And unfortunately,
it's not a true statement

as far as what we do.

One of the ways business owners
think that this happens

is that they get a call
from Yelp saying,

"Hey, you have a decent
reputation on Yelp.

You should think about advertising,
so more people can see you."

And they say, "No, thanks,"
and they hang up the phone.

And they look at Yelp
and go,

"Gosh, I do have
a reputation on Yelp.

I should go get all my friends
and family members

to start writing reviews."

And so, within 24 hours
of getting that phone call,

they suddenly solicit,
you know,

dozens of five-star reviews

that then end up getting
filtered out the next day

because our software can't
recommend or trust them.

My family has a history
in home improvement.

And so, I started Allied
Outdoor Solutions in 2009.

And now we're one of the larger residential construction companies

in the state.

We originally contacted Yelp

because we saw many of our
reviews being filtered out.

And at that time,

I believe we didn't have any,

quote-unquote, positive reviews
that were unfiltered.

The only things that were
showing were one-star reviews.

Uh, and it was only a couple,
but it only takes a couple

to have the average
be one star.

We just contacted Yelp
trying to see

why our real reviews
from actual customers

were being filtered out

and not affecting
our score in any way.

[Over phone]

The only way to improve
my rating on Yelp

was to advertise.

He said if you talk
to your customers

and you can't get them
to change their rating

to a positive from negative,

then advertising
is your option.

We had a one-star review

and we reached out
to this customer,

and he had never talked to us
about his experience.

So we reached out and we said, "Hey,
we never talked to you.

We didn't realize
you had a bad experience."

And so, he explained why
and what the problem was

and, fortunately, that was
a problem we could fix.

And so, we went out,

we fixed the problem,

made him a happy customer.

He updated his Yelp review
from a one star to a four star.

It was populated in our unfiltered reviews as a one star

and when he upgraded it
to a four star,

it, within a few days,
had been filtered out.

So, it was pretty telling when we have
a one-star review that Yelp believes

is a valid review
from a valid customer.

We go to that customer,
we make things right

because there is
a way that we can.

He upgrades it
to a four-star review.

Within a few days,
it's no longer showing up on our profile.

That was kind of when I read the handwriting on the wall,
if you will.

We have no problems
once a customer calls us

and we come out because
then they see our company.

They hear our company's story.

They see pictures of our work.

I don't believe that
we've ever lost a job

over a Yelp review

when that customer met with us.

But there are countless
number of people

that didn't call us because of our not so great Yelp rating.

[Man] Currently, about 75 % of
all reviews are recommended.

We try not to
highlight reviews

written by users
we don't know much about

or those that might be fakes

or unhelpful rants or raves.

Of our 21 reviews,

only seven of them
are not filtered,

so 33 % are not filtered

and two-thirds of our reviews
are filtered out.

[Man] It's also important
to note that Yelp treats

advertisers and non-advertisers
exactly the same.

Our recommendation software
is entirely automated.

Which means the same
objective standards

are applied to every business
and every review

to ensure no one gets
preferential treatment.

[Vitol] A month prior to my six-month contract running out,

I sent them the notice
that I wanted it to end.

As they require,
otherwise it'll keep...

They'll keep charging you
month by month.

That same week,

I started noticing my
five-star reviews dropping.

I also started noticing that

any new five-star
reviews I got

would stay up on my page
not even a day.

By the end of the day,

they would just drop into
the non-recommended section.

It was really incredible

how precise it was.

Recently, I had
a customer come in

and had a great experience.

Her dog was a lot
of fun to have here

and she gave us
a five-star review.

And I was thrilled.

You know,
I was thinking I was getting my five-star rating back,

and same day
that review dropped.

All of her other reviews
are considered recommended

under the other
businesses' profiles.

So I was curious.
I contacted this customer

and just asked her,

"By the way,
is this review showing up when you log in to Yelp?

Is it showing up as a review
that is recommended?"

And she sent me
a screenshot of it

and it absolutely shows that
it's a recommended review

when she logs in
to her profile.

I feel that Yelp continually masquerades as a public service,

like, "This is for the public.

You can get, like,
a fair and balanced opinion."

But, in essence,
you're segregating people.

You have the elite on the top.

You have everybody else
in the middle.

And then you have
the outcasts at the bottom.

But you're not telling us

what your criteria
for segregating people are,

you're just randomly doing it.

And that raises
questions for me.

[Upbeat rock music playing]

Congratulations and welcome
to the Yelp Elite Squad.

Click the shiny badge
on your profile

and it'll take you
to a private calendar

that only Elites can see.

I have researched as much as I can about elite members,

and the process
is shrouded in mystery.

It's pretty much like joining the league of assassins or something,

to become a Yelp Elite.

That's how open it is.

To apply for
an elite membership,

doesn't really say.

How they select
their Yelp Elite,

doesn't really say.

It says they... They'll know it
when they see it.

And they're looking
for a je ne sais quoi.

The Elite Yelpers have
a huge amount of power.

It seems like they're
more like interns

and their position to go to all these really extravagant parties

where they're treated
like celebrities

and they, kind of,
walk into restaurants

and be like, "I'm an elite."

And, you know,
everyone's supposed to bow down

and give them
lots of free stuff.

But why are these people
being given so much power?

[Susan Reynolds] Some of these Elite Yelpers have left 5,000 reviews.

I will write, you know,
how I feel about the food

and be 100 % honest about it.

But that isn't the case
with Yelpers

because they are taking
all these freebies.

I'm in the restaurant business,

I don't think I've been in 500 restaurants in all my life.

You know, there are people here
that are 21 years old,

and in two years, they wrote
a review for 500 businesses.

Let me ask you this,

how is it fucking possible?

I mean, if you're going to work,
and you have a family,

and you have time
to have a little sex,

you're not gonna...
You're not gonna have time to write all those reviews.

What it means
to be a Yelp Elite,

is that you,
every now and again,

will have the opportunity
to go to...

Um, they're called
Elite Tastings.

So, there's like a little, like,
appetizers and stuff like that,

all the way on up
to really fancy tastings

at, like, Michelin star
rated restaurants.

Those ones are more rare,
but they happen.

We actually bring
these people together

uh, every few weeks
for parties that we call...

We have this Yelp Elite Squad
and we bring them together,

and they get
to meet each other.

And it's working professionals,
just like you and me.

[Renee]
You get to meet the chef.

They give you appetizers,
their entrees,

various other things that they really want you to try,

along with drinks and so on.

So, this could be something
where a restaurant

may be wanting
to premiere a new menu.

Or I think it could be
like, blossoming business

and they want to, sort of
spread the word.

And then, sometimes,
it really is just a treat for the Elites.

And that rhymes, but...

They hold more weight
than someone

who's written, say, 20 reviews.

The interesting thing is that I find just as many inaccuracies

and a lack of knowledge about the food they're writing about,
in the Elite Yelpers.

A Yelp review is like gold

'cause if you get
a five-star Yelp Elite,

it's there forever.

They can give me
20 stars on Yelp

and I will poop on it.

And they do nothing all day
except write these reviews.

How these Yelp Elites have all this time on their hands

to write these unpaid,
prejudiced reviews

on any whim that pops
into their head...

"Oh, the sauce
was too garlicky.

I don't like that. One star."

Like, "I'll just ruin
any small business."

I can't. I can't...

I want a company
that's a mature adult

who takes accountability
for their actions,

and takes accountability for the actions of their Elite crew,

who Yelp themselves describe

as a pack of wild animals,
in a leaked email.

[Stolfi-Tow] The problem
with the Yelp Elite,

is the reviewers are just very naive to how small businesses are,

and can be very arrogant.

They're starting
to wield this power, as well.

Hi. Two of us
for lunch, please.

Yes, right away.

Oh, and, uh, I just
wanted to mention

that my wife and I
are Yelp reviewers,

so, uh,
your best table, please.

Oh, jeez! You guys, too, huh?

Okay, um...

I'll get you set up
right over here, okay?

[Cartman] Mmm-hmm!

Hmm, this place seems nice.

I guess we'll see.

I guess we'll see, won't we?

Oh, God! Now everyone
thinks they're a food critic.

What's this vindictiveness
that Yelpers have?

These one-star, like,
"Ooh, I'm gonna destroy you."

It's just such
anti-social behavior.

Once potential online reviews
start to be used

for leverage,
for a discount on a project or something like that,

then, you know,
I think that's not the way

even Yelp would have intended
for their reviews to be used.

My name is Ayesha Kiani

and I owned a restaurant
in New York with my mother.

One of the things
that I found out

was how easy
it is to buy reviews.

I wanted media to pick this up

that the reviews
can be bought easily.

I created an ad for Craigslist.

I would get at least
about 50 to 70 requests

each time I posted the ad.

A guy named Nelson Wu e-mailed
and he said,

"Hi, I'm interested in taking up your offer for writing a review.

I use Yelp all the time,
I'm an Elite,

and could use
some easy money."

And I said, "How much
will you charge?"

And he said, "I'll be willing
to do it for $50."

A lot of the initial requests that came from,
were from Yelp Elites.

Some were very picky
and very demanding.

So they would say,
"Oh, you know,

I would have a meal,
and I would also write your review.

And then my per-hour rate
is $50."

[Lively piano music playing]

I own a piano shop.

We are a full-service
piano shop

that does retail
as well as wholesale

and then, also, repair.

[Playing melancholy music]

When we moved
into this location in 2007,

there were some issues.

Next door to us
is a tiny little ski shop.

When they opened for business,

there was no parking
for any of our customers.

So I complained
to the landlord.

And the landlord said,
"Well, you're right.

It's sort of
gotten out of hand.

How many spaces do you need?"

Because my shop
operates by appointment,

and we usually only have
one customer at a time.

I said, "Really,
all I need is one."

So he said, "Well, that's
more than reasonable.

We'll dedicate
one spot to you."

We put up this big obelisk
that says,

"Piano store only.

If you park here,
well, you'll be towed."

Still,

a lot of people
going into the ski shop

would park there anyway,
and not care.

I complained again
to the landlord.

He said, "Okay, well,
let's start towing them and see what happens."

The first four people
that got towed

wrote a negative Yelp review.

- [Keyboard clacking]
- [Gerald] In finality,

I would say my experience
at Applebee's was sublime

and my treatment near that
of a gladiator most decorated.

But the street parking
wasn't that great.

Two-and-a-half stars.

Yes.

I didn't think that was fair.

So, I called,

and the girl I spoke to said,

"Yeah, you know, I'm sorry.
Freedom of the press.

They can say anything.
You know, we can't take it off.

Or if it was a false thing,
our algorithm would've caught it.

So, you know,
I can't help you."

The next day,
at ten o'clock in the morning

I got a call from their
advertising department

saying, "Would you like
to advertise with Yelp?"

[Playing lively music]

I said to the girl,

"Hey, why should
I advertise with you

when people who had parking
were never in my shop,

are writing nasty things
about us?"

She said, "Well, Mr.
Kassman, don't worry.

If you spend
$400 a month with us,

we can manage
your reviews for you."

And I said,
"What do you mean?"

She said, "We can help you
with it. Don't worry.

Just $400 a month

and we can really make sure that your
online reputation is absolutely fine."

And I said not only no,
"Hell, no."

- [Woman] Hi, Mr. Martinez.
- Hello, hello.

[Woman]
Is that knee getting better?

- Yes, ma'am.
- [Woman] Good.

[Dawn King]
We had a former employee

leave a fake Yelp message,

um, as a retaliation
for her being terminated.

"I am a former patient
of Dr. King,

and I had
a in-office surgery..."

Their grammar, not mine.

"...here, one year ago.

Worst of all, she gave me
an infection in my IV line,

and I ended up in the emergency room,
in serious condition.

Dr. King did not inform me

of the reason
why I was sick.

Her and the front-desk lady,
Cindy, are AA members.

I will never go back to this office,
they nearly killed me."

Just because
the grammar and syntax

had her fingerprints all over it,
we knew who it was.

This person has zero friends,
one review.

This was the first review
that had no pictures,

but... And one star.

So it was allowed
to be put on our page.

I sent an email
to feedback@yelp.com.

Oddly, that afternoon
I received a call

from someone
named Terry at Yelp.

Um, I thought it was
regarding the review,

but it was
regarding advertising.

[Rossmann] We fix Apple
products, primarily laptops.

My business
focuses on the products

that other businesses
and Apple don't want to fix.

First sales call that I got,
they did what they usually do,

which is flatter you for what you're presently doing,

and then try to talk
about the benefits.

And this just went
on and on and on.

And eventually, I just said,

"Listen, I have a friend who pays almost
$2,000 a month for your advertising

and he has not gotten increased business due to Yelp."

Then I get an email.

It says, "I don't understand

why you think Yelp isn't helping your friend's business.

Here are his back-end stats."

So because I claimed
to be friends with somebody,

you now see fit to send me
all their personal statistics,

so I can know
how many deals they sold.

I could see
how many views he had,

I could see how many
calls to action he had.

It's not information
that I should be able to see.

So, I uploaded
a video about it.

Just in case you can't see,
it says, "Hey, Louis,

here is the business
Sunny has seen from us

since he began to advertise.

I am a little confused to why you think this isn't working for him.

Please let me know when you can speak for a few minutes about this.

Best, Erica."

When you give away confidential
customer information,

why would I ever feel inclined
to be your client?

I upload that video and a few days later she is fired.

I had no idea
that this woman was fired

until I received a phone call.

[Man over phone]
I wanna congratulate you.

You put a little stuff on the Internet last night about that Yelp.

You ruined a 23-year-old's life.
You got her fired.

You know what happens to people
that are shitbags like you?

Bad karma.

- [Rossmann] "Bad karma"?
- [Man] You get paid...

Bad karma. God will pay you back,
you piece of shit.

- [Rossmann] Coal for Christmas is fine.
- [Line disconnects]

I thought it was a joke that's why I said "Coal for Christmas is fine."

And that's when I decided,
let me Google this phone number

and that's when I realized that that person works for a law firm

called Sperber Denenberg
& Kahan, PC.

And I said, "Oh, you've got
to be kidding me!"

I really wasn't expecting
Yelp stuff to go this far.

So, then I did a second video.

The name of that salesperson
that was contacting me,

I believe, was Erica Sperber.

I wind up getting these calls,
calling me a shitbag,

and, "God is gonna
get you back,"

and blah, blah, blah,

from members
of that person's family.

And they were
actually calling me

from their work telephone.

After that video
is when I realized

I had a negative review
on my page.

The fake review
was left by somebody

who said that we took
their laptop,

we didn't have
the part to fix it,

we gave it back to them
in pieces,

far worse than it was,
and that was that.

The first fishy part of this was that we
have 600 parts for that specific machine.

The machine that
was mentioned is...

You literally are tripping,
walking through the store

because I bought
600 of that part.

Second thing that was fishy
was that your profile says

that you're in,
I believe, Chicago,

which is very, very
far away from New York.

So I looked this user up
on Yelp

and I see that they're friends
with Erica Sperber.

This is my Yelp salesperson.

This is Jordan K.
This is Erica's friend.

This is the person
that left the bad review

at my local business.

So, what happened here
is simple.

Uh, I told
the Yelp salesperson

I don't wanna pay
for advertising.

I told them why I didn't
wanna pay for advertising.

I hung up,
and when they refused to stop contacting me,

I posted a video about it.

That person decided
to tell their friends,

that are Yelp Eliters,

"Hey, you should leave bogus bad reviews on this guy's page."

And then bogus bad reviews
were left on my page.

That is extortion.

Once we went IPO,
so much changed so fast.

The company was expanding
so quickly, globally.

I was, you know,
sensitive to the stress,

and I ended up getting shingles a couple times,
I couldn't get rid of it.

There was
an increased awareness

of the money being
the most important thing,

instead of the values
being the most important thing.

Instead of the local business owners being the most important thing.

[Rossmann] Yelp endorses
this type of culture.

It's, you know,
this boiler room sales environment

with a lot of young people
who have a low base pay,

who are really encouraged
to get results or get out.

And what do you think
they're going to do?

Yelp's management clearly doesn't believe that the buck stops with them,

because what they are doing
is they're saying,

"Well, that person
was acting independently.

That's not our policy
and, you know,

we fired them. So, there."

And no, that's not
fixing anything.

Erica Sperber
is not the problem,

she was just
following a company culture.

She worked there
for several years,

she was young,
in her early 20s,

probably one of her
first experiences in sales.

And that's the company culture
she worked in.

It's the 30, and the 40,
and the 50-year-olds,

and the higher-ups in the company that are hiring these people,

that should realize
it's their responsibility

to influence the company culture so people don't do that.

They're not fixing anything.
They're avoiding liability.

[Reporter 1] Recently,
Yelp has been on the war path,

cracking down
on small businesses

who offer incentives
in exchange for Yelp reviews.

[Reporter 2] They display
the evidence for all to see,

a kind of scarlet letter
of the Internet age.

You know, this is an ongoing
cat-and-mouse game.

People are always gonna try
to game the system.

[Reporter 2]
A very powerful system.

Yelp gets more than
71 million visitors a month.

[Sollitto] This is not
acceptable behavior.

And frankly,
it's not just unethical,

but it's probably illegal.

[Teran] So a few days after telling a sales representative

I don't want to use
their service,

our Yelp page got spammed

with 15 of the same reviews,
stating the same exact thing.

We had great steak and we had
the best secret sauce.

And we don't carry a steak,
and we don't have a thing called secret sauce.

I reached out
to our sales representative.

And rather than the algorithm
detecting that as spam,

they saw it as if the owner
or someone from the business

was putting up those reviews.

A couple of weeks after that spam hit our account,

they put up a large pop-up

saying that someone
from the business

could be artificially
inflating reviews.

We identified
a number of businesses

that we had caught red-handed
in this activity.

And we put up a big, you know,

a very large alert
on their page

to let consumers know
that something was awry.

Of course, you know,
we're building a review filter,

so it's taking off

this content
in general, anyway.

But we wanted
to make the statement

out there for consumers

that they could know
that this business owner

might have not been acting
in their best interest,

and they might want
to patronize other businesses.

And on top of that, you know,

we wanted them to see
for themselves

what exactly we had found,

so we can be as transparent
about it as possible.

Now they're naming and shaming
businesses who do that,

which is really ridiculous.

I mean, you're a multi-million,
publicly traded company.

What are you doing,
naming and shaming anybody?

That's playground antics,
like, grow up.

Like, honestly. [Laughing]

It feels like it's being operated by a two-year-old child

having a temper tantrum,
sometimes.

To top it off, the 15 reviews
that were spam

got hidden
in the unrecommended.

So, when people would see
the consumer alert

that came up on our page,
they don't understand it.

Because they don't see the 15 reviews that got spammed.

People were asking me,

"Why do you have this consumer block on your page?"

I would wake up every morning,

just hopeless
and in a dark place.

Because there is
nothing you can do

and that's how
they make you feel.

I would call the representatives that I could from Yelp,

because those were the only numbers I would have.

Once it got to that point
where I needed help,

they basically just shunned me.

They told me that there was
no one to talk to here.

They said, "You're on your own.

You can email
the tech services

that they have
on the Yelp page."

Which I did, consistently.

He told me that only Yelpers were the reviews

that, if written,
wouldn't be filtered

because a number
of the negative reviews

was the only review
they had written.

And so, obviously
someone went on to Yelp,

created an account just to write a negative review about my business.

So, if they're writing a negative review about my business,

and it's their only review ever,
it didn't get filtered out.

But if we had customers
that were really happy

and we told them,
"Hey, you're really happy.

You know how you can help us
with your really happy self?

Go write a review on Yelp

because most of the reviews
that we have on there

that are showing up
aren't positive."

But when those people wrote their first review about our business

and it was positive, it got
filtered out within a day.

I had made up my mind that I was going to advertise with them,

but they had
two different programs.

They basically explained that I could try to manage it myself,

and probably waste a lot of money in the process as I was figuring it out.

Or, you know, sign up with them
for six months,

spend a little bit more,

but have a professional
team of experts,

advertising experts,
do it for me.

Um, to me, that sounded
like a great deal, you know?

To have, like, a whole team of ad execs, like,
working on my...

My profile or my campaign.

I've spoken to sales reps.

And they reached out to me,
and I played...

I just wanted to kinda see
what their sales pitch is.

They don't know much
about what they're selling.

They really don't.

They don't know the distinction between clicks and impressions.

As a marketer,
my job is to watch out for my client's businesses.

I want them to grow,
that's how we win.

Let's take a look
at this chart.

Our client bought
1,100 impressions per month

for 486 bucks per month.

Between July 1st and July 6th,
they delivered 1 %.

Well, 1 % of 1,100 is 11.

So, in six days,
they got 11 impressions.

Now, remember,
impressions are just,

"Hey, Yelp showed our ad."

July 28, they delivered 47 %

of the promised
1,100 impressions.

That is just three days left.

They haven't hit half
of what was promised.

Red flags are going off.

I'm thinking,
"How are they going to deliver

the rest of those impressions

in the next three days?"

By the 30th, they jump to 89 %

and it's a miracle!

By the 31st,
they cram everything in.

[Vitol] They manage
the impressions in a way

to either speed up the clicks
or slow down the clicks,

so that it would last
approximately three weeks.

We always met our budget,

their algorithm makes sure that you spend every penny of your budget.

Regardless of the amount
that I was paying per click,

they always managed to get every single last dollar out of that budget.

But it always lasted
exactly three weeks.

It never went over three weeks,

it never went
under three weeks,

and that was something
they never explained to me.

This is where I got really annoyed on behalf of my client.

'Cause what this means is,

in two days, it delivered 43 %,
which is 473 impressions.

That's 236.5 impressions
per day.

One-point-eight,
and it jumped to 236.5.

That's a factor of ten right there.
That's ridiculous.

It's horrible,
because what this is telling me is,

all they care about is,
"I wanna deliver these impressions.

I don't care how,
I don't care to whom,

I don't care where."

[Vitol] I asked them,
"How is this done?

Like, how specific can you narrow down the customer base?

Because my customer base would be within a half-mile of me.

Is that something you can do?
Is that a demographic you can do?"

And they said, "Absolutely.

We can make sure that viewers within a half a mile or a mile of you

can find your business
whenever they do a search."

And it would also appear
on "local businesses" as well.

They were very specific
in their promises,

but once I signed up with them,
their answers were vague.

All of a sudden, it became...

A lot less specific,
let's just say.

I had ads not only
in this area,

but in Manhattan, Queens,

Westchester, New Jersey...

Nobody is going
to wake up in the morning,

and take their dog for day care
across state lines

or even across from Manhattan to Queens or Brooklyn.
No.

I got exactly zero increased business from advertising on Yelp.

[Fong] Ad one and two, that's a good,
high quality location for ads.

As soon as somebody
clicks on there,

they don't have
to scroll anywhere.

As you scroll down the page,
there will be lower quality ad positions.

Keep going down,
keep going... Boom. Right here.

These two ads, lower quality.

Because not everybody
scrolls down the page.

Keep scrolling down,
keep scrolling down,

keep going, keep going,
keep going, look at this.

There are two more ads
down here. Gutter ads.

Few people ever see
these two ads.

And yet, guess what?
They still count as impressions.

Whether people see them or not,
it doesn't matter.

They're still impressions.

My suspicion is my client's
getting garbage impressions.

Meaning their ad's really not doing anything.
They're paying for garbage.

It's just so Yelp
can make their quota

and continue charging my client their monthly fee.

I'm not okay with that, and you,
as a business owner, shouldn't be, I think.

Many of the bad reviews
that we've seen come on

and be featured prominently
on our page,

like, within
the top five reviews,

would be after we've had
some kind of "no sale"

with one of the high-pressure
salespeople that calls us.

It seemed like a lot of the time the ads that would be placed

would be outside
of your key demographic.

So I'm in Arlington, Virginia,

I have a computer
services business

and yet my ad might be
featured 100 miles away

in a non-related category,
say plumbing or baby clothing or something like that.

And that led me to believe

that this was not a good investment for my company.

You're paying an exorbitant cost for very little visibility.

[Roger McManus] Once they see what they get for their money,

they realize it wasn't
necessarily a good deal.

The salespeople say,
"You're gonna get 1,500 impressions."

Now, the problem
is that business people

who are in the business
of doing pizzas or dentistry

or auto repair, or whatever,

are not sophisticated
buyers of advertising.

So when they hear
the number 1,500,

they think they're gonna get
1,500 new customers.

That's not even remotely close.

I cannot say that we pay
and we have better rating.

"Nothing changed, everything's cool,
didn't work for us."

So we end up with the...
We end up the contract,

we say we're not gonna renew it,
and we finish.

The problem starts when they start to call you again

after a couple of months.

And, "You wanna
do advertising with us?"

And, "Why you stop?"
And everything...

My suggestion is, like,
never do advertising with Yelp

because the problem is not when you
do advertising or when you don't do it,

the problem is when you do it and then you stop.

Now, uh, you are in their target,
you can't get out.

[Sollitto] But I can
guarantee you

that, uh, no one is required
to buy advertising on Yelp.

[Owens] Well, yeah,
and that is the genesis

of the extortion idea,

that if you buy,
all of a sudden you get the good reviews,

you don't buy,
you get the bad reviews.

[Sollitto]
That is the accusation--

[Owens] But how can
every single person

who makes that comment
be wrong?

[Sollitto] They are.
It's pretty simple.

There's three things
I could tell you.

Every single claim
to that effect

has been dismissed
by courts five times.

Uh, it's been investigated
by the FTC twice, and closed.

And frankly, there's a Harvard
Business School study

that did an academic study,
that found that our software algorithm

treats advertisers and non-advertiser reviews exactly the same.

I think they're
clearly misinterpreting

the significance of the FTC
closing their investigation.

There are many reasons
why an investigation is closed

and it does not mean

that they've received
a clean bill of health.

Over 2,000 complaints
were filed by businesses

that their rankings
were diminished

because they refused
to advertise with Yelp.

When I was the policy director
of the FTC,

I used to be in charge
of the complaint intake unit.

And I know what's
a lot of complaints,

and 2,000 complaints is an astronomical number of complaints.

Usually, in most matters,

you're talking about
five, ten complaints.

This was a real groundswell
of concern by businesses

about the way Yelp
was running its business.

[Sollitto] It's been investigated by the FTC twice,
and closed.

So, I've killed
the thing dead

six different ways
from Sunday.

The closing of an
investigation does not mean

that a company has received
a clean bill of health.

The FTC actually brings a relatively small number of cases.

Maybe something
like 15 to 20 a year.

Maybe they saw
a law violation there,

but said that they don't
have enough information

to go to court
and prosecute Yelp.

This might be an area
where the FTC is looking for,

perhaps, the perfect case.

So, even though Yelp's conduct could harm businesses

and could be
anti-competitive,

they could still choose
not to bring that case.

There have certainly
been many cases

in which the FTC
has failed to take action,

which I thought that enforcement of action was appropriate.

I find it really
difficult to believe

that Yelp didn't know
about the investigation

until they read about it
in the press.

Then the staff believes that there's a problem in the market,

they contact the parties
as soon as possible.

When the Google
investigation was going on,

they tried to be somewhat transparent about the algorithm.

I don't think
Yelp's doing that.

I think that's a suggestion

that there's problematic
conduct there.

Where there's smoke,
there's fire.

Is there a concern
on your part

that there
is a perception even

that there are unethical
practices going on?

Well, we're not here
out of fear.

We're here out of facts,
and making sure

that they transcend
this conversation.

Um, dismissing the FTC,
dismissing five federal judges

who all found no wrongdoing.

Dismissing an exhaustive
Harvard Business School study.

Though dismissing all of that
seems a little weird,

when all of it has very exhaustively debunked the claims.

[Inaudible]

I looked over
the Harvard Business study,

and, in fact, I also looked
at a previous study

done by one of
the same co-authors,

also concerning Yelp.

It's merely saying that there are some aspects of filtering

that are predictable

on the basis
of the economic position

of the Boston restaurant
that's involved.

But it's a limited study.
It's only restaurants.

It's only in Boston.
It's only at a certain point in time.

To argue that such a study
debunks anything is

to jump to far more
of a conclusion

than is really warranted

from the amount of data,
and the breadth,

and the findings even,

of such a study.

It's a working paper
at the moment.

A working paper has not yet really been reviewed by peers,

whereas a journal article is something that has been reviewed by peers,

and gotten their
seal of approval.

The focus was on reputation.

They hypothesized that
restaurants that were

in greater need of reputation
would have greater incentives

to create fraudulent reviews.

More or less, that's
what they found, as well.

That chain restaurants,
for example,

had very few reviews
that were filtered out,

whereas restaurants that
were one-person operations

and had very few reviews,
or bad reviews,

were much more likely to have many reviews that were filtered out.

The authors don't actually know whether they're fraudulent.

They just know that
they're filtered by Yelp.

So your research shows
whether you advertise or not

has no bearing on how your reviews are filtered.

What we're able to say is,

something I would say
is slightly less strong.

There could be some very complicated
process through which this happens.

But there's so little transparency into what goes into these filters.

And they said that they
didn't have any access

to the algorithm
that Yelp uses.

Yelp makes the algorithm

difficult to reverse-engineer,

for fairly obvious reasons,

so not only did they
not have access to it,

but they had no real means
of guessing

as to what the algorithm,
in fact, was.

[Sollitto] Frankly,
there's a Harvard Business School study

that did an academic study that found that our software algorithm

treats advertisers and non-advertiser reviews exactly the same.

The study doesn't say
anything like that.

It doesn't really even look at who advertises and who doesn't advertise.

And, moreover, it really
can't make a judgement

as to whether
any of the filters

are fraudulent or not.

It has to just take
Yelp's word for it.

In fact, the study notes
that there are almost

certainly errors
in the filtering,

both false positives,
reviews that were perfectly

reasonable and legitimate
that were filtered,

and fraudulent reviews that made it through the system.

But they can't tell.

There are alternatives

that are quite the opposite
of debunking this,

that are also
completely consistent

with the findings
of the authors.

[Ramzi Abadou] There are various investigations into Yelp,
and have been.

The Levitt case, which a lot
of people know about.

There's another securities fraud class action that's pending,

here in the Northern district of California,
called Curry v. Yelp.

The allegations against Yelp
had to do with extortion.

Every one of the clients

had been threatened with harm if they didn't pay money.

Cases were filed in Chicago
and LA, in Florida,

and they all got consolidated
in San Francisco.

So I ended up
with all the cases.

This is not
a smoking gun case.

This is about a company
who, they admit,

forced people to pay money
at the threat of harm.

Now, that's extortion.

If the mafia had done
what Yelp is doing,

they'd be thriving
in every county,

in every jurisdiction
in the United States,

by doing it over the Internet.

The Ninth Circuit said,

"Under California law,
you can't win this case."

The California Supreme Court
has already ruled

that this kind of conduct
is extortion.

[Abadou] Much has been made
for the Levitt v. Yelp case.

The Levitt case

brought claims against Yelp
for civil extortion.

Civil extortion claims are very,
very difficult to bring.

It's important to really
look behind the veil,

and read the decisions,

as opposed to just saying,
"Levitt v. Yelp was dismissed,

which means
we did nothing wrong."

That's certainly one way
to look at it.

But when you
read the decision,

there are certain
striking things,

which is really
the court's sympathy

for these small
business owners.

"We emphasize
that we are not holding

that no cause of action exists

that would cover conduct
such as that alleged,

if adequately pled."

It's another way of the court saying,
"There's something here,

it's not civil extortion.
It may be breach of contract,

it may be a misrepresentation claim,
but there's something here."

Now, the court
didn't have to say that.

But the court does
mention its sympathy

for the plaintiff's complaint.

It just said, "You brought
a cause of action

that is extremely
difficult to bring.

Because you have to demonstrate wrongful misconduct."

In the Levitt case,

Yelp was represented by
a very big, powerful law firm,

called Gibson, Dunn & Crutcher.

The chairperson,
Edith Ramirez, of the FTC,

was a former attorney
of Gibson, Dunn & Crutcher.

I'm not saying that
anything untoward happened,

but certainly the public raises an eyebrow, justifiably,

when they see
the cozy relationships

between federal regulators,
like the FTC,

uh, and the private
defense bar.

[Owens] You're seeing more and more of these stupid people

who somehow get
a bad rating on Yelp,

and decide they're gonna sue the person that actually wrote the rating.

How does Yelp deal
with something like that?

[Sollitto] Well, we try
to help our consumers

who do end up on the wrong end of these lawsuits.

Um, I think many
small businesses

kind of look for anything they can do, and, unfortunately,

trying to sue your customers
is not the best approach.

Consumers do have
free speech rights

to express themselves
and their opinions.

My name is Chris Brody,
President of Crescendo Designs,

located in Southampton,
New York.

We were hired by Matt Apfel,

who is married
to Jackie Reses,

to, uh, install...

a control system
in their house.

Did some audio, some TV,

and, uh, speakers throughout.

We put the system in.
They really had no problems.

Later on, um...

With no cause of concern,

or no call to us
of a problem,

I noticed a review on Yelp,

that, um, was a one-star
review for our company.

Yelp had to reveal to us
who the reviewer was,

and it turned out
to be Jackie Reses,

who was married
to Matt Apfel.

[Reses on phone]

[Brody on phone] Hi, Jackie.

[Playing classical music]

[Kassman] In 2010,
somebody posted something

that I felt was slander,
on Yelp,

and so, I sued
in small claims court,

to have the particular terminology removed from the review.

I subpoenaed records

for all of the one-star
reviews between a certain day,

because then his identity
would have been revealed.

So they, of course,
rejected that,

and wrote to the court
and said,

"No, you know, we won't comply
with the subpoena."

And, further, they locked me
out of my Yelp account.

I can't respond to any review
that's on Yelp.

I can't edit our hours.

I can't say we're on vacation.
I can't do anything.

I can't access it in any way,
shape or form.

And I'm sure Yelp's
response to that would be,

"Well, people shouldn't
have to, you know,

endanger their privacy
to leave a review."

Yeah, they should.
If you're putting someone's job on the line,

if you're putting someone's
reputation on the line,

you should have
accountability at that.

It shouldn't be
a free-for-all.

It shouldn't be like,
"I can write whatever I want

and you're never gonna know
it's me, ha-ha!"

Even though I'm locked
out of my account,

and I can't respond
to reviews,

they still called me to ask me if I would advertise with them.

Hey, good morning.
This is Jocelyn over here at Yelp.

I'm calling in regards
to your Yelp needs.

I would love to talk
to the owner,

in terms of the activity that's been going on in your current success.

So go ahead... Go ahead
and give me a call back.

I'm excited to chat with you.

I've used Yelp reviews.

I've contributed any number
of Yelp reviews.

I'm a certifie...
Registered Yelp user.

And up until my experience

with you, Russell,
I trusted Yelp.

It did not occur to me that anybody would be manipulating that

to lead someone
to think that,

you know, the actual tide
of public opinion

said something other than
what was really the case.

I sat down and typed
a really long review

talking about the care that you took,
and I so appreciated it.

It's not abusive. It's not...
You didn't pay me to do it.

I was a genuine customer,
and I was offended.

[Chuckles] I felt like somebody had questioned my credibility.

I started calling law firms
up in the city,

because there are a bunch of them that take class-action suits,

and I started saying,
"This has got to be wrong."

And one lawyer said,

"Well, they are going to
hide behind the immunity

provided to online
review providers,

under the
Communications Decency Act."

[McManus] The Communications
Decency Act

was actually passed in 1995.

When Congress protected

Internet service providers through Section 230 of the CDA,

they meant to protect people who were just passing information through.

In other words,
like Prodigy or...

currently, like Verizon
or Time Warner,

they can't know what's
going through their pipeline,

and Congress
very reasonably said,

"You can't be
responsible for that."

What Congress meant
was to protect people

who were just sending
things through a pipeline.

What's happened now
is that people like Yelp,

and other service providers,
have been redefined

not by Congress,
but by the courts,

as being Internet
service providers.

People who are
access providers...

are simply people who allow people to get online.

Those who moderate
the content of their sites

have more responsibility.

The courts are not
making that distinction,

and that's the challenge
CDA presents for people today.

False speech
is protected by CDA

as the law
is currently interpreted.

They made such an enemy
of their businesses.

Instead of saying,
"Hey, we're hearing you.

We understand
you're having problems,"

they created a problem with businesses trying to protect themselves

and then punish
the businesses for doing it.

In the Nielsen Report,

they say that 41 % of the people are
more likely to leave a negative review.

So we have to ask people

to leave positive reviews.

If we don't ask them
to leave positive reviews,

they're just gonna
come on and complain.

In the real world,
before Yelp,

we had comment cards on tables.

We had surveys,
we would send newsletters out and ask,

"Please let us know what we're doing right or wrong."

And I think
the misconception with Yelp

is that they feel,

"We just don't want
any negative reviews."

That's not true.
Businesses will tell you,

"We don't mind
the negative reviews.

We want to hear
what we're doing wrong."

What we don't like is that
that's all that's there.

[Abadou] The company
went public

to much hype
and fanfare in 2012.

Insiders between 2013
and 2014 at the company,

including the CEO,
sold $81 million worth of stock,

at prices as high as $100.

I think the stock is
currently trading at $45.

So this is a company,
that, for whatever reason,

is struggling right now.

And rather than embracing people who criticize the company,

perhaps justifiably,

and engaging in
a dialogue with them,

what they do is they take
their victories in court,

which I view as very limited,

and say,
"See, we haven't done

and we're not doing
anything wrong."

One of the problems, I think,
with what Yelp is doing

is the way they criticize
people who criticize Yelp.

Calling people
who criticize the company,

"fringe commentators,"

that's specifically from Aaron Schur,
the head of litigation.

I don't think that's fair.
I don't think it's constructive.

And I think it's a mistake
to call small business owners

who are trying
to make a living,

despite Yelp's influence,
"fringe commentators."

- [Barking]
- [Vitol] I'm really curious what percentage

of Yelp's revenues came
from small businesses.

I mean, if they're willing
to treat us so poorly,

maybe we didn't represent a significant amount of revenue for them,

and I looked up
their public company,

I looked up their financials,
85 % of their revenues come from small businesses.

Fifty-three percent of
their total expenses, yearly,

are spent on sales people,

specifically to target
the small business segment.

They're a sales company.

They're a marketing company.

They're not a review company.

They're just out
to make sales.

[Teran] What I decided to do to take orders into my own hand,

I created a blog
to let people know

what was happening
to our Yelp page.

Where you can insert the name of your restaurant on your Yelp page,

I would delete that,

and insert it
with the website.

People would read it,

'cause people who would come into the restaurant later in the week

would say, "Hey, I saw
what happened to your page.

It's really a shame."

A writer from Fortune.com
decided to write an article

about what was
going on with Yelp,

and use my blog

on her write-up that
she did for the magazine.

It made me feel good that
my voice was being heard,

because, at that point,
no one was listening to me.

And I decided to use that
as leverage

towards my sales
representative from Yelp,

and let them know like,
"Hey, listen,

you guys have done
nothing for me.

You guys let me suffer here
for a while now,

and nothing's being done.

It's time for me
to do something

if you guys
are not gonna help."

Legit, three days after

posting that I was
on Fortune.com,

everything was gone
from my account.

After four or five months
of this being on my page,

the alert wasn't there
anymore.

Our account was clean again.

Emergency!
I would like a table,

inside the area with all the little plastic balls please,

and make it snappy,
I'm a food critic for Yelp.

That does it!
I've had enough!

All you Yelp reviewers
get the hell out of here!

I don't care what happens
to my business.

I ain't kissing
your asses no more!

- [Chair scraping]
- Go on.

Every Yelper,
get the [bleep] out of here!

Whistlin' Willy,
he stand up to the Yelpers!

We don't have to kiss
their asses anymore!

Look, everybody
doing the same!

[Laughs] It's over! It's over!

Hey, Skeeter,
you hear the news?

It's a miracle.

It's a miracle!

[Cerretini] What I did is start a percent off for one-star review,

for the only reason,
to screw them.

There was no other
reason to do it.

I'd much rather
to pay my customer,

it's gonna cost me more
than $300 a month,

but I much rather to give
my customer a discount,

to give them
the middle finger,

than be forced to pay
a protection fee to them.

We could not even imagine

the success that had the campaign of the one-star review.

We got the attention
of the media.

We went in
Time magazine, USA Today,

Important people in Italy,
France, Spain, Qatar,

the response was great.

We got 2,300 reviews
in just a few days.

The success was unbelievable.

Well, I gave the middle finger to them,
and I got one star only,

and increased
the business for 40 %.

[Reporter] Business is booming.

They racked up eight pages
of new reviews

in less than 48 hours,

most of them one-star ratings

with snarky
or positive comments,

ranging from, "My food
arrived before I wanted it,"

to, "Love the campaign,"

and, "You earned
a new customer."

[Lane] There has to be
some accountability

for what you're gonna
put on Yelp,

and what you're not
gonna put on Yelp.

It seems to be

there's some secret
mystical algorithm

that's on, like, Dr.
Moreau's island in the middle of nowhere,

and they're the only ones
who know about it,

but it's totally legit.

Well, that's not working,

and if it means that
you have to hire people

to sit down and read reviews

that people flag
as offensive or whatever,

there's obviously some kind
of inherent failure

in the way that it's set up,

and it would be
responsible for them

to really understand
the impact

that their reviews have
on people, on businesses,

on consumers, because
consumers have changed

the way that they approach
restaurants since Yelp.

And, yes,
it's good that there's somewhere we can go,

and we can say that, you know,
"The service was really rude,

I found a cockroach in my food,
this is really bad."

But at the same time,

if you give people so much
of a sense of entitlement,

there's gonna be abuse.

And it's your responsibility,

you created the monster,
you need to contain the monster.

I think the biggest thing
that Yelp could do

is to issue a formal public apology basically saying,

"Look, guys, we messed up.

We didn't necessarily create the product that we had hoped to,

we're gonna go back
to the drawing board

and we're gonna start
adding some validation."

So that when someone comes in and does business with a company,

and they're ecstatic
or they're aggravated,

they can go and validate that that was a legitimate transaction

and post their feedback.

Without that,
I feel like Yelp is misleading the public,

because they're saying,
"These are real reviews by real people,"

but on the other hand,
on the back end,

they don't require you
to have a real identity,

a transaction,
or have ever gone to that business establishment.

Yelp, right now, operates
as an advertising company

and not a review company,

and if they shifted gears
into a review company,

I think that would be...
Priority number one

is making sure
we actually have reviews.

Real reviews by real people.

It's like Yelp
has created a fire,

and they're selling the water
to put it out.

Thousands, and I mean it,

thousands of businesses,

they reach out to us,

through e-mail,
through phone call, uh,

it's unbelievable
what I heard from people.

Not many people
can do what we do.

You need the right attitude,

you need the right customers,

and you need to be
established for many years.

Yelp knows that.

All you have to do is get the right champion in Congress

to be able to carry it through

and do the right thing.

That's where the law
can be changed,

very slightly,
very incrementally,

it doesn't have
to be cataclysmic,

it doesn't have to go
to the Supreme Court.

Just take this law,

look back and see where
Congress intended it to be.

Protecting the pipeline,

not the people who are at the other end of that pipeline,

and then manipulating it
to make a profit.

The importance of this film

is to build awareness
that it's happening.

And if it hasn't happened
to you yet, it may.

It's up to you to decide.

You wanna be Botto Bistro,

or you wanna be a coward
that pay their protection fee?

[Vitol] If every
small business in America

decided to boycott
Yelp tomorrow...

it might get their attention.

[Cerretini] We became
a voice for the people

that, actually, until now,
they didn't have it.

'Cause nobody listen
to the business. Nobody.

We are glad
that we did our part

to open their eyes.
Nobody like to see

a $10 billion corporation
controlling this little guy.

Here, we have ten tables.
We are hard-working people.

And our intention is not to pay a penny for a better rating.

If tomorrow,

hundreds of business,
they start to do what we do,

Yelp will last two days,

because they have
no power over you.

Excuse me...

We have questions for you.

We could have lunch.

Oh, fabulous.

[Woman 1] Vince,
could you answer a few questions?

[Woman 2] I don't think
he wants to talk to us.

[Man] There's a guy
recording us right there.

- [Woman] There is?
- [Man] Through that door.

[Woman] Yeah, it's through
the door to the left.

Excuse me,
do you guys work for Yelp?

Hi, excuse me.
Do you work for Yelp?

Uh, yeah.

- Would you mind answering a couple of questions?
- No, I can't. Sorry.

Hi, do you guys
work for Yelp?

Uh...

- Hi, I see you work for Yelp.
- Yeah.

Would you mind answering
a few questions?

- Uh, sure.
- Oh, awesome.

- Thank you.
- Oh.

- What do you do for Yelp?
- I can't talk.

- Okay.
- Thank you.

Thanks.

So, around the corner,
you see him telling people to go away.

We'd love to have the chance
to speak with Yelp?

Uh, if you guys would be willing to answer some questions

regarding the claims made
by business owners.

Yeah, I don't think anyone's gonna come down and talk to anybody today.

Okay, could you talk to us?

- No, I can't. I can't do that, sorry.
- Why is that?

- Huh?
- Why not?

Because it's not my job.

What is your job?

You're not just
a door holder, are you?

[Man] Yes.