We’ve previously discussed the importance of mobile-local strategies. For many businesses, mobile channels are a primary driver of new business. Yelp, for instance, is a service that allows users to discover and discuss local businesses based on reviews by other users. The impact that these reviews have on businesses is already very significant. Because a bad review can literally stop the flow of income for a business, the reviews themselves, and the people who write them, draw the attention of both Yelp and the local businesses in addition to prospective new customers. This has resulted in real-world ramifications in some cases.

In January of this year, Forbes reported that a Virginia woman was sued for $750,000 for “Defamation of Character” based on a review she left on Yelp. In that specific case, the plaintiff and defendant were rumored to be former high school classmates, and the review left against the business levied some serious allegations in its own right, including accusations of theft and work left incomplete.

It is obvious how such a review can have a devastating impact on business, particularly those that deal in low volume, high cost contract work and the like. The flip side, of course, is that if the review is true it can save potential customers a major headache. The lesson here isn’t that reviews should be withheld, but rather that users should not write an exaggerated or damaging review without just cause. Also, if you are going to make serious accusations, it would probably be best to have some form of proof to back your claims.

Yelp has had to involve itself legally against some businesses as well. Recently, Yelp discovered a law firm that had employees create fake accounts to leave (fake) positive reviews on Yelp. In response, Yelp has filed suit against the firm for violating their terms of service. Now, this is an uncommon case (and one with further complications, such as the fact that that very law firm sued Yelp in small claims court for lost advertising money), but the precedent is clear.

These reviews are important, and it is the responsibility of both the users and the businesses to ensure their accuracy. Negative reviews can severely damage a business’s reputation, particularly among a mobile clientele, and may have legal consequences in the case of exaggerated or falsified content.