If you fine a customer for a negative review, California will fine you $10,000 in return!

In my latest book, Repped, I outline a number of different ways to handle negative reviews about your business. Fining the customer is not one of them.

You’d think that would be a no-brainer, but that hasn’t stopped some companies from inserting language that essential results in a “fine” for any negative reviews posted online. Well, under a new law, just signed by California governor Jerry Brown, consumers are now protected from so-called non-disparagement clauses:

This bill would prohibit a contract or proposed contract for the sale or lease of consumer goods or services from including a provision waiving the consumer’s right to make any statement regarding the seller or lessor or its employees or agents, or concerning the goods or services.

The initial fine would be $2,500, but that quickly jumps to $10,000 if proven to be “willful, intentional, or reckless” – which you’d have to think covers 99% of all companies inserting such clauses in their customer agreements.

The bill was introduced by Assemblyman John A. Pérez, who is clearly going to get a lot of goodwill from the measure:

“No consumer should ever face penalties for voicing their opinions on the services or products they have purchased, and California law is now clear that no company has the ability to silence consumers,” he said in a statement.

Do you think this is a good idea? Or is California sticking its nose in the business of two parties?