We've written extensively about the problem of non-disparagement clauses in consumer contracts, and we've discussed the possibility of a legislative fix in California, proposed by former Assembly Speaker John A. Pérez. Public Citizen has supported and assisted in this and other ongoing legislative efforts to address the problem.
I'm pleased to report today that the bill we helped craft and promote in California passed the legislature over the summer and was signed into law yesterday by Gov. Brown. It bans non-disparagement clauses in consumer contracts, and imposes a $2,500 fine for threatening or seeking to enforce one or for otherwise penalizing a consumer for speech about a business. The fine rises to $5,000 for subsequent violations, plus an additional $10,000 fine for willful, international or reckless violations. Enforcement is allowed both by public authorities and by consumers themselves.
You can read the text here.
The Washington Post takes note with the clever headline, "California protects the right to Yelp without penalty," and observes that the bill was inspired by our case against KlearGear.