“Hidden epidemic”: Google faces class action after business owner wins right to probe negative review

Google is staring down the barrel of a class-action lawsuit from Australian entrepreneurs over claims the multinational technology giant has published and failed to prevent the spread of defamatory online reviews.

It’s a situation not unfamiliar to business owners. An anonymous internet user posts a negative, perhaps false, review about a company online, which then becomes a seemingly permanent affixture to their online presence on popular services such as Google Reviews.

Without a way to independently verify the authenticity of the reviewer, Aussie businesses have complained for years about their struggles trying to convince, or even contact, Google and other large digital platforms such as Facebook to take down negative and allegedly false reviews about their companies.

But now, in a case which one expert says could tip the scales back in favour of SMEs and startups, a Melbourne-based dentist was last week granted leave by the Federal Court to seek user details pertaining to an allegedly defamatory anonymous review on its platform.

The order, first reported by The Guardian, relates to a review posted to Google under the pseudonym “CBsm 23”, warning would-be customers of Matthew Kabbabe’s Northcote dental clinic to “stay away”, claiming they had undergone a botched procedure.

Kabbabe, who rejects the claim and alleges the comment is defamatory, has been fighting Google for removal, but has been unsuccessful in convincing the company to take it down.

That is, until this weekend, when Kabbabe’s lawyer, Mark Stanarevic, says he was made aware the technology giant had taken down the review following the Federal Court order.

While US-based Google has yet to provide any user details  — a request it has been asked to fulfil under the Hague Service Convention, an international agreement that enables courts to facilitate the service of legal proceedings on parties in signatory nations  Stanarevic says his client has no intention on dropping proceedings after the review was taken down.

The dentist intends to seek damages from Google for publishing the review, which he claims compromised his ability to market to potential customers online.

“Google has failed its duty of care,” Stanarevic tells SmartCompany.

“They’re quite happy to take people’s money … but when it comes to a bad review, which are clearly malicious … they [Google] won’t remove it in a lot of cases.”

Buoyed by last week’s ruling and several days of international media attention on the case, Stanarevic is now preparing a class action on behalf of Australian business owners, claiming Google has not done enough to prevent the spread of defamatory material on its platforms.

It comes after the South Australian Supreme Court awarded $750,000 in damages to barrister Gordon Cheng earlier this month over a 2018 review which he claimed included false information.

“This is a hidden epidemic,” Stanarevic says.

“Google and Facebook are monopolists, and they have over-proportionate power,” he continues.

“This is something businesses have put up with. We’ve thought there’s no capacity for change because of the size of the organisations.

“[But] we’ve got the power to make these changes … we’re very tolerant people, but when push comes to shove, we will stand up for ourselves.”

While funding for a potential class action has yet to be secured, Stanarevic says he’s already received lots of interest from business owners and is in the process of determining a lead plaintiff over the next “four to six weeks”.

“We’re solidifying funding arrangements, then we will file in the Federal Court,” he says.

Stanarevic, a defamation lawyer at Matrix Legal who has been working on similar cases for years, says he has a long list of clients who have suffered at the hands of false online reviews.

“I hope the outcome is Google pays damages to people affected by this,” he says.

“I’ve had countless people who have gone through mental breakdowns because of this.”

“A tipping point”

Angela Dobele, associate professor in marketing at RMIT University, says the case against Google has the potential to become a “tipping point” in the power dynamic between digital platforms such as Google and independent business owners.

“This is a tipping point of potentially massive proportions,” Dobele tells SmartCompany.

“A lot of online reviewers have been using anonymity as a potential shield, it’s called the online disinhibition effect,” Dobele says.

“We unleash exactly what we’re feeling, or what we want to say, or even make things up, when there’s no potential for repercussions because of our anonymity online.”

Dobele says the case illustrates a changing tide in regulator attitudes towards online review platforms globally, with a growing realisation that the popularity of online reviews creates a moral hazard that can stymie businesses.

“We know [reviews] are incredibly influential,” Dobele says.

“People make decisions on where to eat, what to order, based entirely on reviews.

“We’re making decisions on service providers, and we’re believing anonymous reviewers.”

NOW READ: From TripAdvisor to Amazon: How small businesses are dealing with fake reviews

NOW READ: When is a Google review considered defamatory?


Notify of
Inline Feedbacks
View all comments
SmartCompany Plus

Sign in

To connect a sign in method the email must match the one on your SmartCompany Plus account.
Or use your email
Forgot your password?

Want some assistance?

Contact us on: support@smartcompany.com.au or call the hotline: +61 (03) 8623 9900.