Is the tide turning against TripAdvisor?

Posted: 11/12/2012

Mark Lee, head of Penningtons’ travel law team, considers the recent developments involving TripAdvisor and what their relevance is for hoteliers, agents and operators in Travel Trade Gazette:

‘Until recently there have been very few options for disgruntled hoteliers regarding potentially damaging reviews posted on TripAdvisor. Whilst they have a right of reply, they remain powerless to remove potentially damaging reviews, even if they are untrue, and potential litigation is difficult.

TripAdvisor’s influence is not solely limited to the hotel trade. A large number of travel agency and tour operator websites refer to TripAdvisor content, or link to it to help promote their products and improve their search engine ranking. They therefore have a vested interest in the TripAdvisor model and the implications of any possible changes resulting from litigation.

The tide started to turn in January of this year when UK-based reputation management company KwikChex secured a favourable ruling from the UK Advertising Standards Authority against TripAdvisor.

KwikChex sought a decision on behalf of the UK hotel industry, regarding unsubstantiated claims inTripAdvisor’s advertising, which suggested it ‘offers trusted advice from real travellers’, with ‘more than 50 million honest travel reviews and opinions from real travellers around the world’. It cited rules in the Committee of Advertising Practice (CAP) code that obliges marketers to show a review’s authenticity by proving it came from an identifiable and potentially contactable person.

The CAP allows third parties such as agents and operators to use testimonials from a ‘published source’ without the permission of the author. However, this places the onus back on the review’s originator - TripAdvisor - to authenticate it.

In its submission, KwikChex referred to alleged code breaches such as use of TripAdvisor content on hotel website Accor, Thomson’s tour operator site and tourism body VisitLondon.

The ASA concluded that the claims were misleading and advised TripAdvisor to remove any entries on the site that suggested reviews were from real travellers or were ‘honest, real, or trusted’.

Legal hurdles

While this was a step forward for the hotel industry, substantial hurdles remain for hoteliers wishing to recover damages for lost income and/or reputation resulting from a malicious posting. This is firstly because such claims often fall within the small claims court process and the legal costs cannot be recovered even for successful claims. The legal costs often exceed the damages sought and court proceedings are not necessarily an attractive remedy.

In addition, there is the obstacle of jurisdiction. TripAdvisor is a US firm and it argues the UK courts (and other EU-member state courts) do not have jurisdiction to determine any damages claims. This often acts as a strong deterrent when considered with the potential costs.

Landmark case

However, in October of this year, a hotelier in the Outer Hebrides won a landmark legal victory against TripAdvisor for lost bookings (estimated at £2,000) that resulted from ‘false and malicious’ criticisms of his guesthouse, which the site refused to remove. Although TripAdvisor’s lawyers raised the usual arguments, the hotelier’s lawyers persuaded it to concede that the Scottish courts should have jurisdiction for the claim.

Despite this initial success, it remains to be seen whether the hotelier will recover damages, since TripAdvisor persuaded the judge to transfer the action to a higher court. This means the hotelier will be liable for associated legal costs, which will be considerable should it fail. The hotelier has appealed against the decision and a further hearing is due to take place.

The outcome of this case could be significant for the industry, since a favourable judgment for the hotelier may set a useful precedent for other possible claims within the UK courts.’