The guys talk about UrbanSitter, the company that matches up parents with prospective babysitters in the area. They then answer the question, "Can I get in trouble for having my employees give our competitors negative reviews on review sites?"
Full Podcast Transcript
NASIR: Welcome to Legally Sound Smart Business.
This is Nasir Pasha.
MATT: And this is co-host, Matt Staub.
NASIR: Hey, can’t do that!
NASIR: Okay, it’ll be off but welcome to our business legal podcast where we cover business legal news – actually, business news and then we add our legal twist to it – and then also answer some of your business legal questions that you, the listener, can send in to email@example.com. And, oh, I did some research on dot-pizza.
NASIR: So, apparently, they’ve been taking applications in 2014 but I can – or whoever handles these domain names – hasn’t yet released any dot-pizzas yet to the public so I think we can put our application in but we still have to wait. But it’s weird. The application process just seems like you just say that you want one. It’s not like you have to prove that you’re a pizza shop or anything. So, I may do that. But, if anyone knows anything about that, then we could use some help in understanding how that works. That’d be great.
MATT: If worst comes to worse, I make pizzas all the time. So, I think we can justify it.
NASIR: I think we can just add a pizza to the end of the website somehow.
MATT: Or change the logo to just a pizza.
NASIR: Yeah, that’d be great.
All right, what do we have today?
MATT: This is a business that I had never heard of. Why would I have heard of it, I guess? It’s called UrbanSitter and it’s basically a way to – how would you describe this? Like a matchmaking way to find a sitter for your kids if you need one and it’s kind of like, at the same time, a mix between that and sort of reservations – like, dinner reservations.
NASIR: Yeah, I guess it’s that easy. To me, it’s kind of like an old tradition, right? I mean, you’ve had young babysitters being used for quite a while – since the dawn of time, I would say – and finding a way to easily find a babysitter for you – not that I have kids – I think is a great service. But it seems kind of weird to me because you’re trusting your kids with somebody. Finding someone that you can trust and using this third-party site, it reminds me of Uber, right? For whatever reason, we assume that, when we use Uber or Lyft or these other third-party services – or frankly even a taxi – that somehow the person that we’re getting in the car with is someone that we can trust. In general, I think you can trust most people. In this case, just because you’re using a third-party software doesn’t necessarily mean you can trust that babysitter.
MATT: That’s true, but it’s not like you just get matched with somebody and that’s that. I mean, there’s recommendations. I would assume that the company does some sort of background check on the possible sitters because I know other sites have done that.
What’s pretty interesting about this though, they actually tried to launch this before Facebook even existed.
NASIR: Oh, interesting.
MATT: You know, that’s a long time ago – at least that’s what this article says.
NASIR: At least in internet times. It looks like they do some background checks and it’s paid for by the actual sitter – which is interesting – but we all know that background checks, they’re not foolproof, obviously, right? Second is I think this UrbanSitter is going to go through the same, especially when they start to get really popular which looks like now they have more than 35,000 sitters and 75,000 parents nationwide. But the point is that that they’re going to have the same problems as all these other sharing economies – whether it’s Airbnb or Uber or what-have-you. What happens if that babysitter does something wrong? I think the law is pretty much all there but the question is, are they poised and ready for that kind of blowback? Do they have the proper insurance? Do they have the proper disclaimers on their website? Do they have the proper agreements with the babysitters themselves? That’s going to come down to whether or not they’re an entity having liability.
MATT: Yeah. I mean, those are all good points and then, like we talked about last week, the Airbnb squatter. You don’t want a babysitter squatter.
NASIR: Those are the worst kind of squatters.
MATT: Yeah. This is UrbanSitter. There’s no Rural. It’s really only hitting one of two markets. You have the urban area and the rural area. I guess, if you don’t live as close to a city, then I guess you can’t use this. I don’t know.
NASIR: That’s definitely elitist to exclude all the people in the rural areas.
MATT: I’ve never used it so I don’t know how it works.
NASIR: It’s interesting. I think many parents may be skeptical – not only at first but even if it gets popular I think there’s going to be a lot of parents that just don’t do that kind of thing. They’re going to go with babysitters that they know of or that’s a referral. But, at the same time, now that I think about, if it’s a referral plus they’re a part of UrbanSitter, I think that’s a plus because then it has a method of payment, it has some accountability and the scheduling is all there and even a babysitter can be like, “Oh, yeah, just go to my UrbanSitter profile,” – I assume that’s how it works – “and then you can schedule me here,” or whatever. I think, from that perspective, I think it’s a pretty good tool that parents may actually start using.
MATT: Yeah, it seems like it’s very user-friendly. I watched a little one-minute video and just the process is very easy to do, easy to follow, easy to find a sitter. A lot of the sitters are in their early twenties.
NASIR: Are the children in their early twenties, too? What if there’s an age limit?
MATT: Probably some of them. I don’t know. I know some people that were in their early twenties that probably needed a babysitter but I won’t name any names.
NASIR: Well, let’s keep track of this UrbanSitter. I think we should mark this because, you know, if this starts to get popular, six months from now, we’ll be talking about this again about some legal issues because some babysitter did something wrong or maybe even a babysitter had something done wrong to them and whether or not UrbanSitter is liable or not and how that affects it. I’d be interested to find out.
MATT: Yeah, one last thing, it is pretty interesting, you don’t get their full name so you can’t really do any kind of deep-dive into who they are because it talks about being linked to Facebook but they said that you can’t see their Facebook profiles based on what’s provided through the site.
MATT: That’s a little bit different. I don’t know if I would want that but, obviously, it’s worked. They’ve had a bunch of people – 75,000 parents – have signed up. I guess the numbers speak for themselves.
NASIR: Okay. Well, those listening to this a few months from now, make sure you send us an update if you see anything new about this company.
NASIR: Appreciate it, and we’ll update you guys.
NASIR: All right, let’s get to our question of the day of our Episode 77 from a person in Anaheim, California.
NASIR: Also home of the Anaheim Angels, right?
MATT: I think technically they’re the Los Angeles Angels of Anaheim.
NASIR: Oh, right, there’s a whole controversy about that.
MATT: Which is the dumbest name ever but they used to be the Anaheim Angels and then the Los Angeles Angels of Anaheim.
NASIR: I don’t think I can go with one episode without making a sports common mistake.
MATT: Well, there’s the Anaheim Ducks. They used to be the Anaheim Mighty Ducks which basically was the team.
NASIR: Like, from the movie?
MATT: Yeah, it was a team created solely for kids to like and I think it worked because every kid – I mean, I’ve never played hockey ever and everyone likes the Mighty Ducks.
NASIR: Oh, they’re my favorite team, for sure. I’ve never watched them play but, if someone would ask me, definitely.
MATT: Yeah. All right.
NASIR: All right. Should we still ask the question or are we good?
MATT: Yeah, this is from Goldberg in Anaheim.
“Can I get in trouble for having my employees give our competitors negative reviews on review sites?”
NASIR: Oh, I hate this guy – this person, man or woman. It’s like the worst person on earth. These are like the calls that we get from potential clients and clients where they’re complaining about competitors leaving fake reviews on their websites and they know that they’re competitors. What do you think?
MATT: Yeah. So, just speaking in general, you can’t do things like this in general. It’s not even just on review sites. You can’t say things about people – whether they’re on review sites or not – that are false. I mean, that’s just a general rule of thumb that I would advise people to live by. But, yeah, if you’re posting fake reviews on these review sites for your competitors, you’re going to run into some issues. I think there was recently a case that popped up in California. Hopefully it wasn’t this guy’s company.
NASIR: Probably. He should have learned his lesson.
NASIR: The California case you’re referencing, they brought a number of causes of action and I think they won because, when you do something like that, it’s not just about defamation but, if you’re a business and a competitor doing that, then there’s also unfair business practices, there’s the Lanham Act which basically prohibits defamation or trade liable by your competitors. Think about those commercials online. You can’t say that a competitor’s product is somehow bad in a way that’s not true, and I think they were able to say that even if you did it on someone else’s website or whatever, you’re pretty much doing the same thing. I’m just wondering how these guys got caught because, if your competitor is doing it, oftentimes, it’s done anonymously, right?
MATT: Yeah, I mean, it kind of depends what kind of business you’re running, too. If it’s a business where you, the business owner, see every customer – something like a dentist office or a doctor – then you’re going to know the people. But, if you just have a general retail store, you’re not going to know every person that walks through the door. I guess, if they’re complaining about – or a restaurant – even if it’s a restaurant, if they’re complaining about an experience, you probably will know what’s going on but I guess it’s possible too if they got a bad experience and they just didn’t…
NASIR: But, even then, you may think that it’s a competitor, but which competitor? Unless it’s just a small market or whatever, who knows?
MATT: I don’t know if we even mentioned fraud yet but, I mean, it’s going to get into these are fraudulent things that are happening if they’re untrue.
NASIR: If you’re the actual attorney on this case, filing a claim against this competitor that’s doing this, I would include a number of causes of action, including fraud, including unfair business practices under I think it’s Section 17200 of Business Professions Code of California. Don’t ask me why I know that but I think that’s the case. Also, a number of other claims – defamation and other statutory violations as well. I think you have a lot of other options there as well. And you only need one option.
I think the hard part is the proof aspect. It’s going to be easy to prove what they’re saying is not true. It’s going to be hard to actually make a connection between the identity of your competitor and the actual poster of the review.
MATT: Right. So, answer this person’s question, this was Goldberg or Gordon Bombay, whoever it is, can you get in trouble for having your employees give competitors negative reviews on review sites? Yes, unless it’s a situation where they actually went to the businesses and the actual reviews were bad and that’s what they gave.
NASIR: That’s true.
MATT: Assuming that’s not the case then, yes, you can definitely get in trouble for doing it so just make a better product, have a better service.
NASIR: I’m going to regret saying this but you make me think that there is a legitimate way – not legitimate – I should say a legal way to do it. Let’s say it’s a dentist or a restaurant. You have all your employees go there and then have them leave a negative review that reflects their actual opinion of their experience. So long as there’s no statements of fact that are not true, that opinion is fine. Also, I kind of regret saying that but that is one way to do. Also, I want to mention that this person asked, will the employer get in trouble for the employees doing it? Generally, we’ve talked about this in the past, if it’s an employee, an employer is vicariously liable of pretty much everything that an employee may do and that’s different for independent contractors.
MATT: That’s a good point, yeah. The worst part about this is Mighty Ducks is only a 6.4 out of 10 on IMDB which doesn’t seem possible.
NASIR: Well, IMDB, they’re pretty strict with the ratings.
MATT: I remember it as at least a 10 – if not higher.
NASIR: Maybe 11 out of 10.
MATT: But it did make the top 5,000 in movies so congrats to them.
NASIR: Very good.
All right. Well, thank you for joining us.
MATT: Yeah, keep it sound and keep it smart.