PUBL258.PS

130 STAT. 1355 PUBLIC LAW 114–258—DEC. 14, 2016

Public Law 114–258

114th Congress

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.

Be it enacted by the Senate and House of Representatives of

the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

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

Act of 2016’’.

SEC. 2. CONSUMER REVIEW PROTECTION.

(a) D

EFINITIONS

.—In this section:

(1) C

OMMISSION

.—The term ‘‘Commission’’ means the Fed-

eral Trade Commission.

(2) C

OVERED COMMUNICATION

.—The term ‘‘covered commu-

nication’’ means a written, oral, or pictorial review, performance

assessment of, or other similar analysis of, including by elec-

tronic means, the goods, services, or conduct of a person by

an individual who is party to a form contract with respect

to which such person is also a party.

(3) F

ORM CONTRACT

.—

(A) I

N GENERAL

.—Except as provided in subparagraph

(B), the term ‘‘form contract’’ means a contract with

standardized terms—

(i) used by a person in the course of selling or

leasing the person’s goods or services; and

(ii) imposed on an individual without a meaningful

opportunity for such individual to negotiate the

standardized terms.

(B) E

XCEPTION

.—The term ‘‘form contract’’ does not

include an employer-employee or independent contractor

contract.

(4) P

ICTORIAL

.—The term ‘‘pictorial’’ includes pictures,

photographs, video, illustrations, and symbols.

(b) I

NVALIDITY OF

ONTRACTS

HAT

MPEDE

ONSUMER

EVIEWS

.—

(1) I

N GENERAL

.—Except as provided in paragraphs (2)

and (3), a provision of a form contract is void from the inception

of such contract if such provision—

(A) prohibits or restricts the ability of an individual

who is a party to the form contract to engage in a covered

communication;

15 USC 45b.

15 USC 58 note.

Consumer

Review Fairness

Act of 2016.

Dec. 14, 2016

[H.R. 5111]

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130 STAT. 1356 PUBLIC LAW 114–258—DEC. 14, 2016

(B) imposes a penalty or fee against an individual

who is a party to the form contract for engaging in a

covered communication; or

to the form contract to transfer to any person any intellec-

tual property rights in review or feedback content, with

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

that the individual may have in any otherwise lawful cov-

ered communication about such person or the goods or

services provided by such person.

(2) R

ULE OF CONSTRUCTION

.—Nothing in paragraph (1)

shall be construed to affect—

(A) any duty of confidentiality imposed by law

(including agency guidance);

(B) any civil cause of action for defamation, libel, or

slander, or any similar cause of action;

publicly on an Internet website or webpage owned, oper-

ated, or otherwise controlled by such party any content

of a covered communication that—

(i) contains the personal information or likeness

of another person, or is libelous, harassing, abusive,

obscene, vulgar, sexually explicit, or is inappropriate

with respect to race, gender, sexuality, ethnicity, or

other intrinsic characteristic;

(ii) is unrelated to the goods or services offered

by or available at such party’s Internet website or

webpage; or

(iii) is clearly false or misleading; or

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

with respect to the creation of photographs or video of

such party’s property when those photographs or video

are created by an employee or independent contractor of

a commercial entity and solely intended for commercial

purposes by that entity.

(3) E

XCEPTIONS

.—Paragraph (1) shall not apply to the

extent that a provision of a form contract prohibits disclosure

or submission of, or reserves the right of a person or business

that hosts online consumer reviews or comments to remove—

(A) trade secrets or commercial or financial information

obtained from a person and considered privileged or con-

fidential;

(B) personnel and medical files and similar information

the disclosure of which would constitute a clearly

unwarranted invasion of personal privacy;

ment purposes, the disclosure of which would constitute

a clearly unwarranted invasion of personal privacy;

(D) content that is unlawful or otherwise meets the

requirements of paragraph (2)(C); or

(E) content that contains any computer viruses, worms,

or other potentially damaging computer code, processes,

programs, applications, or files.

ROHIBITION

.—It shall be unlawful for a person to offer

a form contract containing a provision described as void in sub-

section (b).

(d) E

NFORCEMENT BY

OMMISSION

.—

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130 STAT. 1357 PUBLIC LAW 114–258—DEC. 14, 2016

(1) U

NFAIR OR DECEPTIVE ACTS OR PRACTICES

.—A violation

of subsection (c) by a person with respect to which the Commis-

sion is empowered under section 5(a)(2) of the Federal Trade

Commission Act (15 U.S.C. 45(a)(2)) shall be treated as a viola-

tion of a rule defining an unfair or deceptive act or practice

prescribed under section 18(a)(1)(B) of the Federal Trade

Commission Act (15 U.S.C. 57a(a)(1)(B)).

(2) P

OWERS OF COMMISSION

.—

(A) I

N GENERAL

.—The Commission shall enforce this

section in the same manner, by the same means, and

with the same jurisdiction, powers, and duties as though

all applicable terms and provisions of the Federal Trade

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

into and made a part of this Act.

(B) P

RIVILEGES AND IMMUNITIES

.—Any person who vio-

lates this section shall be subject to the penalties and

entitled to the privileges and immunities provided in the

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

(e) E

NFORCEMENT BY

TATES

.—

(1) A

UTHORIZATION

.—Subject to paragraph (2), in any case

in which the attorney general of a State has reason to believe

that an interest of the residents of the State has been or

is threatened or adversely affected by the engagement of any

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

such subsection, the attorney general of the State may, as

parens patriae, bring a civil action on behalf of the residents

of the State in an appropriate district court of the United

States to obtain appropriate relief.

(2) R

IGHTS OF FEDERAL TRADE COMMISSION

.—

(A) N

OTICE TO FEDERAL TRADE COMMISSION

.—

(i) I

N GENERAL

.—Except as provided in clause (iii),

the attorney general of a State shall notify the Commis-

sion in writing that the attorney general intends to

bring a civil action under paragraph (1) before initi-

ating the civil action against a person described in

subsection (d)(1).

(ii) C

ONTENTS

.—The notification required by clause

(i) with respect to a civil action shall include a copy

of the complaint to be filed to initiate the civil action.

(iii) E

XCEPTION

.—If it is not feasible for the

attorney general of a State to provide the notification

required by clause (i) before initiating a civil action

under paragraph (1), the attorney general shall notify

the Commission immediately upon instituting the civil

action.

(B) I

NTERVENTION BY FEDERAL TRADE COMMISSION

.—

The Commission may—

(i) intervene in any civil action brought by the

attorney general of a State under paragraph (1) against

a person described in subsection (d)(1); and

(ii) upon intervening—

(I) be heard on all matters arising in the civil

action; and

(II) file petitions for appeal of a decision in

the civil action.

(3) I

NVESTIGATORY POWERS

.—Nothing in this subsection

may be construed to prevent the attorney general of a State

Records.

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130 STAT. 1358 PUBLIC LAW 114–258—DEC. 14, 2016

from exercising the powers conferred on the attorney general

by the laws of the State to conduct investigations, to administer

oaths or affirmations, or to compel the attendance of witnesses

or the production of documentary or other evidence.

(4) P

REEMPTIVE ACTION BY FEDERAL TRADE COMMISSION

.—

If the Federal Trade Commission institutes a civil action or

an administrative action with respect to a violation of sub-

section (c), the attorney general of a State may not, during

the pendency of such action, bring a civil action under para-

graph (1) against any defendant named in the complaint of

the Commission for the violation with respect to which the

Commission instituted such action.

(5) V

ENUE

;

SERVICE OF PROCESS

.—

(A) V

ENUE

.—Any action brought under paragraph (1)

may be brought in—

(i) the district court of the United States that

meets applicable requirements relating to venue under

section 1391 of title 28, United States Code; or

(ii) another court of competent jurisdiction.

(B) S

ERVICE OF PROCESS

.—In an action brought under

paragraph (1), process may be served in any district in

which the defendant—

(i) is an inhabitant; or

(ii) may be found.

(6) A

CTIONS BY OTHER STATE OFFICIALS

.—

(A) I

N GENERAL

.—In addition to civil actions brought

by attorneys general under paragraph (1), any other con-

sumer protection officer of a State who is authorized by

the State to do so may bring a civil action under paragraph

(1), subject to the same requirements and limitations that

apply under this subsection to civil actions brought by

attorneys general.

(B) S

AVINGS PROVISION

.—Nothing in this subsection

may be construed to prohibit an authorized official of a

State from initiating or continuing any proceeding in a

court of the State for a violation of any civil or criminal

law of the State.

(f) E

DUCATION AND

UTREACH FOR

USINESSES

.—Not later than

60 days after the date of the enactment of this Act, the Commission

shall commence conducting education and outreach that provides

businesses with non-binding best practices for compliance with this

Act.

(g) R

ELATION TO

TATE

AUSES OF

CTION

.—Nothing in this

section shall be construed to affect any cause of action brought

by a person that exists or may exist under State law.

(h) S

AVINGS

ROVISION

.—Nothing in this section shall be con-

strued to limit, impair, or supersede the operation of the Federal

Trade Commission Act or any other provision of Federal law.

(i) E

FFECTIVE

ATES

.—This section shall take effect on the

date of the enactment of this Act, except that—

(1) subsections (b) and (c) shall apply with respect to con-

tracts in effect on or after the date that is 90 days after

the date of the enactment of this Act; and

Applicability.

Deadline.

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130 STAT. 1359 PUBLIC LAW 114–258—DEC. 14, 2016

LEGISLATIVE HISTORY—H.R. 5111:

HOUSE REPORTS: No. 114–731 (Comm. on Energy and Commerce).

CONGRESSIONAL RECORD, Vol. 162 (2016):

Sept. 12, considered and passed House.

Nov. 28, considered and passed Senate.

(2) subsections (d) and (e) shall apply with respect to con-

tracts in effect on or after the date that is 1 year after the

date of the enactment of this Act.

Approved December 14, 2016.

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