The Deal
Tuesday, September 16, 
7:26 pm

[Posted on December 19, 2007 - 8:56 PM]
avvo_logo.gifAs I predicted six months ago, a class action lawsuit filed against lawyer review web site Avvo has been tossed out. The plaintiffs tried to get Avvo's web site shut down because the online service's users gave them low ratings. Those ratings are probably even lower now. The judge in the case wrote:

'Avvo's website contains numerous reminders that the Avvo rating system is subjective. The ratings are described as an "assessment" or "judgment," two words that imply some sort of evaluative process... Neither the nature of the information provided nor the language used on the website would lead a reasonable person to believe that the ratings are a statement of actual fact.'
So what does this mean? Avvo was compelled to spend a lot of money on legal fees but its $10 million second round of funding from Benchmark Capital and Ignition Partners that closed earlier this year will see it through this storm. As Avvo CEO Mark Britton notes, the decision allows the company to get back to business. And it's a business that could end up being lucrative.

Other online services that rely on user reviews such as Yelp, eBay and Yahoo also must be pleased with the verdict. The big losers aside from the plaintiffs and all the poorly rated lawyers on the site? Well, that's obvious. It's the venture capitalists gnashing their teeth at (and suing) The Funded. - Joshua Jaffe


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