II 

114TH CONGRESS 

2D SESSION H. R. 5111 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 13, 2016 

Received 

AN ACT 

To prohibit the use of certain clauses in form contracts 

that restrict the ability of a consumer to communicate 

regarding the goods or services offered in interstate commerce that were the subject of the contract, and for 

other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Consumer Review 

3 Fairness Act of 2016’’. 

4 SEC. 2. CONSUMER REVIEW PROTECTION. 

5 (a) DEFINITIONS.—In this section: 

6 (1) COMMISSION.—The term ‘‘Commission’’ 

7 means the Federal Trade Commission. 

8 (2) COVERED COMMUNICATION.—The term 

9 ‘‘covered communication’’ means a written, oral, or 

10 pictorial review, performance assessment of, or other 

11 similar analysis of, including by electronic means, 

12 the goods, services, or conduct of a person by an in13 dividual who is party to a form contract with respect 

14 to which such person is also a party. 

15 (3) FORM CONTRACT.— 

16 (A) IN GENERAL.—Except as provided in 

17 subparagraph (B), the term ‘‘form contract’’ 

18 means a contract with standardized terms— 

19 (i) used by a person in the course of 

20 selling or leasing the person’s goods or 

21 services; and 

22 (ii) imposed on an individual without 

23 a meaningful opportunity for such indi24 vidual to negotiate the standardized terms. 


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1 (B) EXCEPTION.—The term ‘‘form con2 tract’’ does not include an employer-employee 

3 or independent contractor contract. 

4 (4) PICTORIAL.—The term ‘‘pictorial’’ includes 

5 pictures, photographs, video, illustrations, and sym6 bols. 

7 (b) INVALIDITY OF CONTRACTS THAT IMPEDE CON8 SUMER REVIEWS.— 

9 (1) IN GENERAL.—Except as provided in para10 graphs (2) and (3), a provision of a form contract 

11 is void from the inception of such contract if such 

12 provision— 

13 (A) prohibits or restricts the ability of an 

14 individual who is a party to the form contract 

15 to engage in a covered communication; 

16 (B) imposes a penalty or fee against an in17 dividual who is a party to the form contract for 

18 engaging in a covered communication; or 

19 (C) transfers or requires an individual who 

20 is a party to the form contract to transfer to 

21 any person any intellectual property rights in 

22 review or feedback content, with the exception 

23 of a non-exclusive license to use the content, 

24 that the individual may have in any otherwise 

25 lawful covered communication about such perVerDate Sep 11 2014 23:23 Sep 15, 2016 Jkt 059200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H5111.RDS H5111

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1 son or the goods or services provided by such 

2 person. 

3 (2) RULE OF CONSTRUCTION.—Nothing in 

4 paragraph (1) shall be construed to affect— 

5 (A) any duty of confidentiality imposed by 

6 law (including agency guidance); 

7 (B) any civil cause of action for defama8 tion, libel, or slander, or any similar cause of 

9 action; 

10 (C) any party’s right to remove or refuse 

11 to display publicly on an Internet website or 

12 webpage owned, operated, or otherwise con13 trolled by such party any content of a covered 

14 communication that— 

15 (i) contains the personal information 

16 or likeness of another person, or is libel17 ous, harassing, abusive, obscene, vulgar, 

18 sexually explicit, or is inappropriate with 

19 respect to race, gender, sexuality, ethnicity, 

20 or other intrinsic characteristic; 

21 (ii) is unrelated to the goods or serv22 ices offered by or available at such party’s 

23 Internet website or webpage; or 

24 (iii) is clearly false or misleading; or 


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1 (D) a party’s right to establish terms and 

2 conditions with respect to the creation of photo3 graphs or video of such party’s property when 

4 those photographs or video are created by an 

5 employee or independent contractor of a com6 mercial entity and solely intended for commer7 cial purposes by that entity. 

8 (3) EXCEPTIONS.—Paragraph (1) shall not 

9 apply to the extent that a provision of a form con10 tract prohibits disclosure or submission of, or re11 serves the right of a person or business that hosts 

12 online consumer reviews or comments to remove— 

13 (A) trade secrets or commercial or finan14 cial information obtained from a person and 

15 considered privileged or confidential; 

16 (B) personnel and medical files and similar 

17 information the disclosure of which would con18 stitute a clearly unwarranted invasion of per19 sonal privacy; 

20 (C) records or information compiled for 

21 law enforcement purposes, the disclosure of 

22 which would constitute a clearly unwarranted 

23 invasion of personal privacy; 

24 (D) content that is unlawful or otherwise 

25 meets the requirements of paragraph (2)(C); or 


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1 (E) content that contains any computer vi2 ruses, worms, or other potentially damaging 

3 computer code, processes, programs, applica4 tions, or files. 

5 (c) PROHIBITION.—It shall be unlawful for a person 

6 to offer a form contract containing a provision described 

7 as void in subsection (b). 

8 (d) ENFORCEMENT BY COMMISSION.— 

9 (1) UNFAIR OR DECEPTIVE ACTS OR PRAC10 TICES.—A violation of subsection (c) by a person 

11 with respect to which the Commission is empowered 

12 under section 5(a)(2) of the Federal Trade Commis13 sion Act (15 U.S.C. 45(a)(2)) shall be treated as a 

14 violation of a rule defining an unfair or deceptive act 

15 or practice prescribed under section 18(a)(1)(B) of 

16 the Federal Trade Commission Act (15 U.S.C. 

17 57a(a)(1)(B)). 

18 (2) POWERS OF COMMISSION.— 

19 (A) IN GENERAL.—The Commission shall 

20 enforce this section in the same manner, by the 

21 same means, and with the same jurisdiction, 

22 powers, and duties as though all applicable 

23 terms and provisions of the Federal Trade 

24 Commission Act (15 U.S.C. 41 et seq.) were in25 corporated into and made a part of this Act. 


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1 (B) PRIVILEGES AND IMMUNITIES.—Any 

2 person who violates this section shall be subject 

3 to the penalties and entitled to the privileges 

4 and immunities provided in the Federal Trade 

5 Commission Act (15 U.S.C. 41 et seq.). 

6 (e) ENFORCEMENT BY STATES.— 

7 (1) AUTHORIZATION.—Subject to paragraph 

8 (2), in any case in which the attorney general of a 

9 State has reason to believe that an interest of the 

10 residents of the State has been or is threatened or 

11 adversely affected by the engagement of any person 

12 subject to subsection (c) in a practice that violates 

13 such subsection, the attorney general of the State 

14 may, as parens patriae, bring a civil action on behalf 

15 of the residents of the State in an appropriate dis16 trict court of the United States to obtain appro17 priate relief. 

18 (2) RIGHTS OF FEDERAL TRADE COMMIS19 SION.— 

20 (A) NOTICE TO FEDERAL TRADE COMMIS21 SION.— 

22 (i) IN GENERAL.—Except as provided 

23 in clause (iii), the attorney general of a 

24 State shall notify the Commission in writ25 ing that the attorney general intends to 


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1 bring a civil action under paragraph (1) 

2 before initiating the civil action against a 

3 person described in subsection (d)(1). 

4 (ii) CONTENTS.—The notification re5 quired by clause (i) with respect to a civil 

6 action shall include a copy of the complaint 

7 to be filed to initiate the civil action. 

8 (iii) EXCEPTION.—If it is not feasible 

9 for the attorney general of a State to pro10 vide the notification required by clause (i) 

11 before initiating a civil action under para12 graph (1), the attorney general shall notify 

13 the Commission immediately upon insti14 tuting the civil action. 

15 (B) INTERVENTION BY FEDERAL TRADE

16 COMMISSION.—The Commission may— 

17 (i) intervene in any civil action 

18 brought by the attorney general of a State 

19 under paragraph (1) against a person de20 scribed in subsection (d)(1); and 

21 (ii) upon intervening— 

22 (I) be heard on all matters aris23 ing in the civil action; and 

24 (II) file petitions for appeal of a 

25 decision in the civil action. 


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1 (3) INVESTIGATORY POWERS.—Nothing in this 

2 subsection may be construed to prevent the attorney 

3 general of a State from exercising the powers con4 ferred on the attorney general by the laws of the 

5 State to conduct investigations, to administer oaths 

6 or affirmations, or to compel the attendance of wit7 nesses or the production of documentary or other 

8 evidence. 

9 (4) PREEMPTIVE ACTION BY FEDERAL TRADE

10 COMMISSION.—If the Federal Trade Commission in11 stitutes a civil action or an administrative action 

12 with respect to a violation of subsection (c), the at13 torney general of a State may not, during the pend14 ency of such action, bring a civil action under para15 graph (1) against any defendant named in the com16 plaint of the Commission for the violation with re17 spect to which the Commission instituted such ac18 tion. 

19 (5) VENUE; SERVICE OF PROCESS.— 

20 (A) VENUE.—Any action brought under 

21 paragraph (1) may be brought in— 

22 (i) the district court of the United 

23 States that meets applicable requirements 

24 relating to venue under section 1391 of 

25 title 28, United States Code; or 


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1 (ii) another court of competent juris2 diction. 

3 (B) SERVICE OF PROCESS.—In an action 

4 brought under paragraph (1), process may be 

5 served in any district in which the defendant— 

6 (i) is an inhabitant; or 

7 (ii) may be found. 

8 (6) ACTIONS BY OTHER STATE OFFICIALS.— 

9 (A) IN GENERAL.—In addition to civil ac10 tions brought by attorneys general under para11 graph (1), any other consumer protection offi12 cer of a State who is authorized by the State 

13 to do so may bring a civil action under para14 graph (1), subject to the same requirements 

15 and limitations that apply under this subsection 

16 to civil actions brought by attorneys general. 

17 (B) SAVINGS PROVISION.—Nothing in this 

18 subsection may be construed to prohibit an au19 thorized official of a State from initiating or 

20 continuing any proceeding in a court of the 

21 State for a violation of any civil or criminal law 

22 of the State. 

23 (f) EDUCATION AND OUTREACH FOR BUSINESSES.— 

24 Not later than 60 days after the date of the enactment 

25 of this Act, the Commission shall commence conducting 


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1 education and outreach that provides businesses with non2 binding best practices for compliance with this Act. 

3 (g) RELATION TO STATE CAUSES OF ACTION.— 

4 Nothing in this section shall be construed to affect any 

5 cause of action brought by a person that exists or may 

6 exist under State law. 

7 (h) SAVINGS PROVISION.—Nothing in this section 

8 shall be construed to limit, impair, or supersede the oper9 ation of the Federal Trade Commission Act or any other 

10 provision of Federal law. 

11 (i) EFFECTIVE DATES.—This section shall take ef12 fect on the date of the enactment of this Act, except 

13 that— 

14 (1) subsections (b) and (c) shall apply with re15 spect to contracts in effect on or after the date that 

16 is 90 days after the date of the enactment of this 

17 Act; and 

18 (2) subsections (d) and (e) shall apply with re19 spect to contracts in effect on or after the date that 

20 is 1 year after the date of the enactment of this Act. 

Passed the House of Representatives September 12, 

2016. 

Attest: KAREN L. HAAS, 

Clerk. 


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