Court finds Meriton misled and deceived consumers on TripAdvisor

10 November 2017

The Federal Court has found that Meriton Property Services Pty Ltd, trading as ‘Meriton Serviced Apartments’ (Meriton), engaged in misleading or deceptive conduct in connection with the posting of reviews of its properties on the TripAdvisor website.

The Court found that from November 2014 to October 2015, Meriton engaged in misleading or deceptive conduct by taking steps to prevent guests it suspected would give an unfavourable review from receiving TripAdvisor’s ‘Review Express’ prompt email. Meriton did so by:

  • inserting additional letters into guests’ email addresses provided to TripAdvisor so that the prompt email never reached the guest, or
  • not sending guest email addresses to TripAdvisor. 

“The Court found that Meriton, at the direction of management, deliberately implemented a strategy to minimise the number of negative reviews its guests posted on TripAdvisor,” ACCC Commissioner Sarah Court said.

“In reducing the chances of a customer posting a negative review, Meriton created a created a more positive or favourable impression of the quality or amenity of the Meriton properties on the TripAdvisor website.”

“Many consumers base their purchasing decisions on reviews they get through sites like TripAdvisor. It’s therefore vital the reviews on these review sites are not manipulated and accurately reflect all customers’ opinions – the good and the bad,” Ms Court said.

The Court found that on several occasions Meriton engaged in this conduct in respect of the majority of guests staying at one of its hotels during periods when there were infrastructure or service problems, such as no hot water or a lift not working.

The Court also held that Meriton’s conduct was liable to mislead the public as to the nature, characteristics and suitability of purpose of its accommodation services.

“This decision sends a strong message  that businesses must not undermine the integrity of third party review processes in order to mislead or deceive consumers, as this conduct risks breaching the Australian Consumer Law,” Ms Court said. 

A hearing on relief against Meriton will be held on a date fixed by the Court.

Notes to editors

TripAdvisor offers a service called ‘Review Express’. Participating accommodation providers provide TripAdvisor with email addresses of recent customers who have consented to their details being passed on. TripAdvisor then emails the customers, prompting them to submit a review of their recent experience with that business.

Background

Meriton offers accommodation under the brand Meriton Serviced Apartments. During the relevant period, Meriton offered serviced apartment accommodation in at least 13 properties in New South Wales and Queensland. Meriton is part of the Meriton Group of companies.

TripAdvisor operates a website in Australia which provides free online reviews of accommodation services and other travel-related content generated by travellers.

TripAdvisor states that accommodation providers that regularly use the ‘Review Express’ service see an uplift of 28 to 33 percent in TripAdvisor reviews for their properties.

On 24 November 2016, the ACCC instituted proceedings against Meriton alleging that Meriton engaged in misleading or deceptive conduct in connection with the posting of reviews of its properties on the TripAdvisor website.

See: ACCC takes action against Meriton over online reviews

Release number: 
MR 202/17
ACCC Infocentre: 

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