Gag Clauses Chill Consumer Rights

Modern-day snake oil peddlers may have found a way to keep consumers quiet about their ineffective products: non-disparagement clauses, also known as gag clauses. These clauses, slipped into the fine print of form contracts, can restrict a consumer's ability to post negative reviews of a product online. Non-disparagement clauses, which can vary in scope, generally prevent consumers from publicizing negative reviews of a product or company. This restriction includes comments made on online forums like Yelp or even complaints to the Better Business Bureau. When a consumer violates the gag clause, the company often will enact punitive measures, like charging the consumer a financial penalty. As long as companies can get away with including hidden terms like non-disparagement clauses in their contracts, consumers will not be operating in a fair marketplace. Fortunately, the federal government has demonstrated its willingness to step in to protect consumers against non-disparagement clauses and more.