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[Federal Register Volume 89, Number 222 (Monday, November 18, 2024)]
[Notices]
[Pages 90691-90694]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-26711]

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FEDERAL TRADE COMMISSION

[File No. 232 3060]

Sitejabber; Analysis of Proposed Consent Order To Aid Public 
Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement; request for comment.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of Federal law prohibiting unfair or deceptive acts or 
practices. The attached Analysis of Proposed Consent Order to Aid 
Public Comment describes both the allegations in the complaint and the 
terms of the consent order--embodied in the consent agreement--that 
would settle these allegations.

DATES: Comments must be received on or before December 18, 2024.

ADDRESSES: Interested parties may file comments online or on paper by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Please write ``Sitejabber; 
File No. 232 3060'' on your comment and file your comment online at 
https://www.regulations.gov by following the instructions on the web-
based form. If you prefer to file your comment on paper, please mail 
your comment to the following address: Federal Trade Commission, Office 
of the Secretary, 600 Pennsylvania Avenue NW, Mail Stop H-144 (Annex 
J), Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT: Joyce Dela Pe[ntilde]a (202-326-2722), 
Attorney, Division of Advertising Practices, Bureau of Consumer 
Protection, Federal Trade Commission, 600 Pennsylvania Avenue NW, 
Washington, DC 20580.

SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule Sec.  2.34, 16 CFR 
2.34, notice is hereby given that the above-captioned consent agreement 
containing a consent order to cease and desist, having been filed with 
and accepted, subject to final approval, by the Commission, has been 
placed on the public record for a period of 30 days. The following 
Analysis to Aid Public Comment describes the terms of the consent 
agreement and the allegations in the complaint. An electronic copy of 
the full text of the consent agreement package can be obtained at 
https://www.ftc.gov/news-events/commission-actions.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before December 18, 
2024. Write ``Sitejabber; File No. 232 3060'' on your comment. Your 
comment--including your name and your State--will be placed on the 
public record of this proceeding, including, to the extent practicable, 
on the https://www.regulations.gov website.
    Because of heightened security screening, postal mail addressed to 
the Commission will be subject to delay. We strongly encourage you to 
submit your comments online through the https://www.regulations.gov 
website. If you prefer to file your comment on paper, write 
``Sitejabber; File No. 232 3060'' on your comment and on the envelope, 
and mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Mail 
Stop H-144 (Annex J), Washington, DC 20580.
    Because your comment will be placed on the publicly accessible 
website at https://www.regulations.gov, you are solely responsible for 
making sure your comment does not include any sensitive or confidential 
information. In particular, your comment should not include sensitive 
personal information, such as your or anyone else's Social Security 
number; date of birth; driver's license number or other State 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. You are also 
solely responsible for making sure your comment does not include 
sensitive health information, such as medical records or other 
individually identifiable health information. In addition, your comment 
should not include any ``trade secret or any commercial or financial 
information which . . . is privileged or confidential''--as provided by 
section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule Sec.  
4.10(a)(2), 16 CFR 4.10(a)(2)--including competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with FTC Rule Sec.  4.9(c). In 
particular, the written request for confidential treatment that 
accompanies the comment must include the factual and legal basis for 
the request and must identify the specific portions of the comment to 
be withheld from the public record. See FTC Rule Sec.  4.9(c). Your 
comment will be kept confidential only if the General Counsel grants 
your request in accordance with the law and the public interest. Once 
your comment has been posted on the https://www.regulations.gov 
website--as legally required by FTC Rule Sec.  4.9(b)--we cannot redact 
or remove your comment from that website, unless you submit a 
confidentiality request that meets the requirements for such treatment 
under FTC Rule Sec.  4.9(c), and the General Counsel grants that 
request.
    Visit the FTC website at https://www.ftc.gov to read this document 
and the news release describing the proposed settlement. The FTC Act 
and other laws the Commission administers permit the collection of 
public comments to consider and use in this proceeding, as appropriate. 
The Commission will consider all timely and responsive public comments 
it receives on or before December 18, 2024. For information on the 
Commission's privacy policy, including routine uses permitted by the 
Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Analysis of Proposed Consent Order To Aid Public Comment

    The Federal Trade Commission (``Commission'') has accepted, subject 
to final approval, an agreement containing a consent order from GGL 
Projects, Inc., which does business as Sitejabber (``Sitejabber''). The 
proposed consent order (``proposed order'') has been placed on the 
public record for thirty days for receipt of comments by interested 
persons. Comments received

[[Page 90692]]

during this period will become part of the public record. After thirty 
days, the Commission will again review the agreement and the comments 
received and will decide whether it should withdraw from the agreement 
and take appropriate action or make final the agreement's proposed 
order.
    This matter involves consumer reviews and ratings of businesses and 
products that Sitejabber collected on behalf of its clients' 
businesses. It collected these ratings and reviews from consumers at 
the time of purchase, before consumers had an opportunity to actually 
experience the product or service purchased. According to the FTC, 
Sitejabber used these point-of-purchase results to inflate the ratings 
and review counts of its clients on the Sitejabber.com review platform 
and in Google and other search results. The complaint explains that 
Sitejabber also provided its clients with product review widgets that 
allowed them to publish, on their own websites, product-specific 
ratings and reviews that Sitejabber collected.
    The complaint alleges that Sitejabber violated section 5(a) of the 
FTC Act by misrepresenting that point-of-sale ratings and reviews 
reflected the experiences of consumers who had actually received and 
had the opportunity to experience the product or services purchased. 
The complaint further alleges that Sitejabber provided its business 
clients with the means and instrumentalities to deceive consumers that 
product reviews and ratings collected at the time of purchase and 
displayed on the clients' websites were from consumers who had received 
and had the opportunity to experience the product being reviewed.
    The proposed order contains provisions designed to prevent 
Sitejabber from engaging in these and similar acts and practices in the 
future. Provision I prohibits Sitejabber from misrepresenting or 
assisting others in misrepresenting that the average customer rating or 
total number of ratings or reviews of a product, service, or business 
reflects the views of customers who had received the product or service 
purchased and had the opportunity to experience it, or that any rating 
or review collected at the time or point of purchase was collected from 
a customer who received the product or service purchased or had the 
opportunity to experience the product or service purchased. The 
provision also prohibits misrepresentations about any ratings, average 
ratings, or reviews that Sitejabber collects, moderates, or displays. 
Provision II prohibits Sitejabber from providing others with the means 
or instrumentalities to misrepresent that product or service ratings or 
reviews collected at the point of purchase were collected from 
customers who had the opportunity to experience the product or service 
purchased.
    Provisions III through VII of the proposed order contain reporting 
and compliance provisions. Provision III mandates that Sitejabber 
acknowledge receipt of the order, distribute the order to principals, 
officers, and certain employees and agents, and obtain signed 
acknowledgments from them. Provision IV requires Sitejabber to submit 
compliance reports to the Commission one year after the order's 
issuance and submit notifications when certain events occur. Under 
Provision V, Sitejabber must create certain records for ten years and 
retain them for five years. Provision VI provides for the FTC's 
continued compliance monitoring of Sitejabber's activity during the 
order's effective dates. Finally, Provision VII provides the effective 
dates of the order, including that, with exceptions, the order will 
terminate in 20 years.
    The purpose of this analysis is to facilitate public comment on the 
proposed order. It is not intended to constitute an official 
interpretation of the complaint or proposed order, or to modify in any 
way the proposed order's terms.

    By direction of the Commission.
April J. Tabor,
Secretary.

Concurring Statement of Commissioner Melissa Holyoak

    I support today's settlement with Sitejabber, an online review 
platform that collected customer ratings and reviews about shopping 
experiences and products through surveys displayed on the checkout 
screen. The crux of the Complaint is that Sitejabber allegedly (1) 
misrepresented that customer ratings and reviews displayed on its 
website and in internet search results were from consumers who had the 
opportunity to experience the products or services purchased, and (2) 
provided its clients using the embeddable web widget with the ``means 
and instrumentalities'' to misrepresent that the displayed customer 
reviews and ratings were from customers who had actually purchased or 
experienced the product or service. I write in brief to note our proper 
use of the ``means and instrumentalities'' doctrine here, a form of 
primary liability appropriate where the defendant itself engages in 
deception.\1\
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    \1\ See, e.g., In re Shell Oil Co., 128 F.T.C. 749, 764 (1999) 
(majority statement) (``It is well settled law that the originator 
is liable if it passes on a false or misleading representation with 
knowledge or reason to expect that consumers may possibly be 
deceived as a result.'') (citing Regina Corp. v. FTC, 322 F.2d 765 
768 (3d Cir. 1963) (affirming liability under means and 
instrumentalities theory where defendant distributed its own 
misrepresentative price lists that were used, in turn, to deceive 
consumers)); id. at 766 (Commissioner Swindle, dissenting) (``Means 
and instrumentalities is a form of primary liability, and a 
respondent is primarily liable only for its own misrepresentations 
to consumers.'').
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    The Complaint alleges that Sitejabber's embeddable web widget, 
which displayed Instant Feedback Product Reviews (``IFPRs''), was, as 
designed, an inherently deceptive tool. While Sitejabber collected real 
feedback about customers' shopping choices at the point-of-sale,\2\ 
Sitejabber's widget displayed it on customer-facing websites as 
``star'' ratings of products themselves. According to the Complaint, 
Sitejabber built a mismatch into IFPRs, limiting real customer reviews 
to one aspect (shopping choices), while displaying those reviews about 
an entirely different aspect (the product itself).\3\ Importantly, 
there is no suggestion that Sitejabber's clients had the ability to 
control or customize the output from the embeddable web widget. Thus, 
Sitejabber allegedly designed, distributed, and deployed IFPRs for its 
clients, in short, to mislead consumers about what product ratings 
signified.
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    \2\ Compl. ] 22.
    \3\ Id. ]] 23-25.
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    Unlike the Commission's Complaint against review writing platform 
Rytr,\4\ this Complaint properly alleges that Sitejabber provided the 
``means and instrumentalities'' to deceive consumers. Whereas Rytr 
provided a neutral review-writing tool that may have been used 
deceptively in some instances,\5\ we allege here that the only function 
of Sitejabber's embeddable web widget, as designed, was to enable its 
clients to display a deceptive description of its instant ratings and 
reviews on their own websites.
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    \4\ Dissenting Statement of Comm'r Melissa Holyoak, Joined by 
Comm'r Andrew N. Ferguson, In re Rytr, LLC, FTC Matter No. 2323052 
(Sept. 25, 2024), https://www.ftc.gov/system/files/ftc_gov/pdf/holyoak-rytr-statement.pdf.
    \5\ See generally id.; see also Dissenting Statement of Comm'r 
Andrew N. Ferguson, Joined by Comm'r Melissa Holyoak, In re Rytr 
LLC, Matter No. 232 3052 (Sept. 25, 2024), https://www.ftc.gov/system/files/ftc_gov/pdf/ferguson-rytr-statement.pdf.
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    Of course, there is nothing inherently deceptive about the 
collection, use, and display of consumer reviews, where the output 
accurately reflects the input. Indeed, such products could be highly 
valuable to both consumers and the market, enabling businesses to tout 
real customer reviews about their products

[[Page 90693]]

or services and facilitating more informed consumer decisions about 
their shopping experience or the product itself. But design choices 
matter when developing these types of products. And Sitejabber's design 
choice here conflated real customer feedback about shopping choices 
with an actual rating for a product, harming its clients and consumers.

Concurring Statement of Commissioner Andrew N. Ferguson

    Today, the Commission issues an administrative complaint and 
accepts a proposed consent agreement with Sitejabber.\1\ Sitejabber 
provided its clients, e-commerce stores, with the ability to collect 
instant shopping-experience and product reviews from customers on order 
confirmation screens--immediately after placing an order but before the 
customer could have received or used the products. For posting these 
reviews and average ratings on its clients' profile pages on 
Sitejabber.com, and misrepresenting that the reviews were from 
customers who had actually received and used the products, the 
complaint accuses Sitejabber of deceiving consumers in violation of 
section 5 of the FTC Act.\2\ For giving its clients the ability to 
embed those same product ratings on their own websites, the complaint 
accuses Sitejabber of a further section 5 violation for furnishing its 
clients with the means and instrumentalities to deceive consumers. I 
concur in both counts.
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    \1\ In re GGL Projects, Inc., a corporation, also d/b/a 
Sitejabber, Complaint & Decision and Order.
    \2\ 15 U.S.C. 45(a).
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    This case presents some of the same issues presented in the 
Commission's recent action against the artificial-intelligence platform 
Rytr, from which I dissented.\3\ The Commission raises the same means-
and-instrumentalities theory of section 5 liability that it deployed 
against Rytr for offering an AI-powered consumer review generator. 
Sitejabber's alleged business practices, however, are very different 
from Rytr's. Although someone could have used Rytr's tool to deceive 
consumers, the tool also had substantial lawful uses. Sitejabber's 
instant product reviews and the widgets by which its clients displayed 
them on their own websites, however, served no purpose other than to 
deceive consumers. Indeed, it appears that Sitejabber's very purpose in 
offering the widgets was to assist its clients in deceiving consumers.
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    \3\ Dissenting Statement of Commissioner Andrew N. Ferguson, 
Joined by Commissioner Melissa Holyoak, In the Matter of Rytr LLC, 
Matter No. 2323052 (Sept. 25, 2024) (``Ferguson Rytr Dissent'').
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    Sitejabber collected two types of reviews from consumers. Instant 
Feedback Surveys (IFSs) asked customers to comment on their shopping 
experience immediately after concluding a purchase, and to rate that 
experience on a scale of one-to-five stars. Instant Feedback Product 
Reviews (IFPRs) also took the form of a written response and a one-to-
five-star rating, but asked customers why they chose the product they 
had just purchased. Sitejabber would collect these reviews from the 
consumer on the retailer's web page. Prompts to collect the reviews 
would pop up on the retailer web page almost immediately after the 
consumer had finalized a purchase.
[GRAPHIC] [TIFF OMITTED] TN18NO24.003

    Sitejabber maintained a public profile page on Sitejabber.com for 
each of its retail clients showing their average rating and individual 
reviews, including IFS-derived ratings and reviews. Additionally, on a 
``Products'' tab on that same page, Sitejabber listed the products sold 
by that client alongside the average IFPR ratings for each.\4\ 
Consumers browsing these profile pages would reasonably believe that 
all these reviews and ratings were from customers who had received and 
had a chance to use the products sold by the retailers. The Commission 
alleges that Sitejabber did not adequately disclose that these reviews 
and ratings were obtained at the point of sale, before the customers 
could have received, let alone used, the purchased products. For 
misrepresenting IFSs and IFPRs as

[[Page 90694]]

authentic reviews from customers who had received and had a chance to 
use the products, the complaint charges Sitejabber with deceptive 
conduct in violation of section 5.
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    \4\ For some of Sitejabber's clients, the ratings would also 
incorporate reviews from consumers who had a chance to receive and 
use the products. Such reviews are not inherently deceptive, and 
nothing in the Commission's proposed consent order would prohibit 
Sitejabber from displaying those reviews, and the average ratings 
derived from them, on its own site or through widgets. See Decision 
& Order at 5-6 (prohibiting Sitejabber from misrepresenting that 
reviews collected at the point of sale were from customers who had 
an opportunity to receive and use the product, from misrepresenting 
that ratings were derived only from reviews left by customers who 
had such an opportunity, and from providing the means and 
instrumentalities to make such misrepresentations). But comingling 
such reviews with reviews collected at the point-of-sale, before the 
consumer could have received and used the product, renders the 
entire star rating deceptive. See United States v. Phillip Morris 
USA Inc., 566 F.3d 1095, 1128 (D.C. Cir. 2009) (``[E]ven partially 
true statements can be actionable fraud if intentionally misleading 
as to facts.'').
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    Sitejabber is also accused of having provided its retail clients 
with widgets by which the retailers could embed the IFPR-derived 
product ratings on their own websites. These widgets had no purpose 
other than to represent that those product ratings were derived from 
the reviews of consumers who had received and had a chance to use the 
product in question. This representation was false given that the 
ratings were obtained from consumers who had not received the product 
when they provided the rating. For offering this widget, the complaint 
charges Sitejabber with a further section 5 violation for providing the 
means and instrumentalities for the commission of deceptive acts and 
practices.
    Sitejabber's condemned business practices are very different from 
Rytr's. Rytr provided an AI-powered writing tool which could be used to 
generate draft consumer reviews.\5\ Although a consumer or business 
could have used Rytr's tool to generate a false product review, and 
that false product review could in some circumstances violate section 
5's prohibition on deceptive acts or practices, that was not 
necessarily the case.\6\ Indeed, the Commission did not supply a single 
example of someone having used Rytr's tool to violate section 5.\7\ A 
consumer also could have used Rytr's tool to generate an initial draft 
of a perfectly honest consumer review.\8\ The mere fact that someone 
could use a product to commit fraud does not make that product the 
means and instrumentalities to commit fraud.\9\ In my view, the 
provision of a product or service with potential unlawful uses is not 
the provision of the means and instrumentalities to violate section 5 
unless (1) the instrumentality in question ``has no or de minimis legal 
use''; \10\ (2) the provider of the instrumentality had the purpose of 
facilitating the section 5 violation; \11\ or (3) the provider ``knows, 
or has reason to know, that the person to whom the product or service 
was supplied will use it to violate section 5.'' \12\
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    \5\ Ferguson Rytr Dissent at 1-2.
    \6\ Id. at 6-7.
    \7\ Id. at 2.
    \8\ Id. at 7.
    \9\ Id. at 5-6.
    \10\ Id. at 6.
    \11\ Id. at 7-9.
    \12\ Ibid.
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    Whereas Rytr's review generator tool satisfied none of those 
requirements, the allegations in the complaint here show that 
Sitejabber's product satisfies all three. First, there is no legitimate 
purpose for a widget displaying an instant product review rating. No 
reasonable consumer would be interested in a one-to-five-star product 
rating derived from reviews left by other consumers who had not yet 
received or used the product.\13\ When a consumer views a product 
rating, he reasonably assumes that the rating is based on reviewers' 
experiences with the product, not with the purchasing process. Second, 
because the widgets had no use other than to deceive consumers, we can 
reasonably infer that Sitejabber knew that every single one of its 
clients was using them for that purpose. Finally, there is ample 
evidence that Sitejabber's very purpose in offering the widgets was to 
assist in the deception of consumers. The widgets were nothing but an 
extension of the same deception that Sitejabber was carrying out on its 
own website using the same deceptive ratings and on behalf of the same 
clients.
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    \13\ FTC Policy Statement on Deception, 103 F.T.C. 174, 175 
(1984), https://www.ftc.gov/legal-library/browse/ftc-policy-statement-deception, appended to In Re Cliffdale Assocs., Inc., 103 
F.T.C. 110 (1984) (in determining whether a practice is deceptive 
``we examine the practice from the perspective of a consumer acting 
reasonably'').
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    I therefore concur in the Commission's complaint and proposed 
consent order against Sitejabber.

[FR Doc. 2024-26711 Filed 11-15-24; 8:45 am]
BILLING CODE 6750-01-P
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