Mr Bartlett, who advises media companies including Nine (owner of this masthead), described the case a potential “colossal cost on business”.
“It means any company, whether media or otherwise that allows comment on its social media pages can be liable for defamation in circumstances where it may not have read or even known that the post was there,” he said.
But some online businesses such as RateMyAgent, which verifies reviewers on its site, welcomed the decision.
RateMyAgent chief executive Mark Armstrong said there is an “imbalance” between the power of reviewers and the person or business being reviewed.
“With Google Reviews and Yelp in America, [someone] gets a negative review and the first thing they say is: ‘I don’t know who wrote that, how do I address it? I’ve got no recourse’,” Mr Armstrong said.
“(For) keyboard warriors their anonymity is their greatest strength and they [can write a bad review] without fear of defamation,” Mr Armstrong said.
The Supreme Court granted an urgent injunction requiring Google to remove the reviews and not allow any new ones to be uploaded. A spokesperson for Google said on Saturday that “when we receive court orders we take them seriously and respond in a timely manner”.
Google would not comment further on Sunday but does remove content when directed by a court or other official parties.
The US tech giant received 393 requests from government agencies to remove content in Australia since 2009. When a court order was included, Google complied in 43 per cent of cases.
A spokeswoman for online recruitment company Seek said they moderate all their reviews and do not hold a “high level of alarm” about the ruling because their reviews are about a company or role broadly and not specific people.
Airtasker, which has more than two million verified reviews, takes action on feedback from members when problematic comments are flagged, CEO Tim Fung said.
The platform “tends not to have a problem” with fake or defamatory reviews written by competitors, he said.
“The trust and reputation that Airtasker service providers build with their customers are absolutely critical to our marketplace so we take transparency and accountability for these reviews very seriously,” Mr Fung said. “We take action immediately when a review is deemed by the courts to be defamatory.”
“Whenever such an allegation is brought to our attention, we review the content in question, and if it is deemed to be in breach of our guidelines, we will remove it,” the spokeswoman said.
For most defamation cases involving online comments, damages barely cover legal costs, averaging about $15,000, so there was no incentive for lawyers to pursue them, Slater and Gordon senior associate Daniel Stojanoski said.
“Suing third-party publishers makes it extraordinarily viable to start bringing claims,” Mr Stojanoski, who practises in defamation law said. “Whereas before if an ex-husband is suing an ex-wife the damages a court might award doesn’t make it viable to get a lawyer on board.
“If we have a society that’s inclined to make these knee jerk comments, I suspect (big defamation cases) will shake the way society interacts online.”
Tradesperson review site Tradecritic founder Guy Muller said his website would “not be credible unless negative reviews are allowed to be posted” and businesses were required to agree to accept bad reviews when they signed up.
“It seems … Google listings are lacking the consent of the business owners which leaves them exposed to potential negative reviews and therefore opens the door to potential law suits,” he said.
“It’s a detriment to our business that we don’t just list every business but we feel it’s important that they understand the risk of receiving negative reviews.”
Nigel Gladstone is The Sydney Morning Herald’s data journalist.
Jennifer Duke is a media and telecommunications journalist for The Sydney Morning Herald and The Age.