Australia's corporate watchdog is taking Meriton Serviced Apartments to the Federal Court for "misleading or deceptive conduct in connection with the posting of reviews of its properties on TripAdvisor".
The Australian Competition and Consumer Commission (ACCC) alleges Meriton selectively targetted guests for TripAdvisor's 'Review Express' program it believed would post favourable reviews.
Meanwhile it ignored those it thought would write a negative assessment of their stay.
Meriton has denied the allegations and will defend them.
Following is an edited version of the ACCC's statement released yesterday:
"The ACCC alleges that from November 2014 to October 2015, Meriton took steps to prevent guests it suspected would give a negative review from receiving TripAdvisor’s ‘Review Express’ email to avoid them posting potentially negative reviews," said ACCC Commissioner Sarah Court.
"It is alleged that this was done by inserting additional letters into guests’ email addresses provided to TripAdvisor so that the email addresses were ineffective, and not sending other guest email addresses to TripAdvisor.
"On several occasions Meriton engaged in this conduct in respect of the majority of guests that stayed at one of its hotels during periods where infrastructure or services failed, such as no hot water or a lift not working, in an attempt to ensure that guests would not receive TripAdvisor’s ‘Review Express’ prompt email in case they left an unfavourable review.
“We allege that Meriton’s conduct was a deliberate practice, undertaken at the direction of Meriton’s senior management, aimed at minimising the number of negative reviews.
"This practice was likely to create a more positive or favourable impression of the standard, quality or suitability of accommodation services provided by Meriton.
“Consumers rely on independent review platforms like Trip Advisor when making purchasing decisions.
"If reviews are manipulated to falsely create a more favourable impression about a provider, consumers may choose that provider on the basis of that falsehood over another accommodation provider who has not engaged in misleading conduct.”
The ACCC is seeking pecuniary penalties, declarations, injunctions, corrective publication orders, orders for the implementation of a consumer law compliance program and costs.
Meriton faces a fine of up to $1.1 million for each breach of Australian Consumer Law if found guilty.