Meriton Suites fined $3m
for manipulating TripAdvisor Reviews
The long arm of the law has caught and fined Meriton Suites
for manipulating reviews posted by its guests on TripAdvisor,
a leading travel and hospitality website.
This is a significant extension of the Australian
Consumer Law because it prohibits misleading conduct not
only for guest testimonials posted on the hospitality
providerís own website, but also for guest reviews posted on
independent websites such as TripAdvisor, Expedia, Trivago,
Hotels.com and Travelocity.
The legal precedent was established on 31 July 2018, in
Australian Competition and Consumer Commission v Meriton
Property Services Pty Ltd (No. 2)  FCA 1125:
Justice Moshinsky of the Federal Court of Australia imposed
a penalty of $3 million upon Meriton Properties for
misleading the public by filtering, selecting or limiting
the guest email addresses it supplied to the TripAdvisor
website, by supplying only the email addresses of those
guests likely to post favourable reviews.
The TripAdvisor Review
Meriton Properties is a hospitality provider. It operates
serviced apartments, called Meriton Suites, in 13 properties
in Sydney, Brisbane and the Gold Coast. Each has their own
Meriton participated in Review Express, which is a guest
review collection tool offered by TripAdvisor free of charge
to hospitality businesses.
To use the tool, the accommodation provider creates an email
template, and provides TripAdvisor with the email addresses
of its guests at regular intervals. TripAdvisor sends the
email to the guests to prompt them to write reviews of their
The tool is used to generate more reviews on TripAdvisor,
which is the world's largest travel website. It attracts
millions of consumers each month who read the reviews
More reviews lead to more bookings. According to the Review
Express Guide webpage:
On average, regular Review Express users see an uplift of
28% in the amount of TripAdvisor Reviews for their property.
TripAdvisor recommends to the hospitality provider: Tell
your guests youíll be sending a Review Express email to
collect their feedback.
How did Meriton manipulate
Meriton adopted two practices to reduce the number of
The MSA-masking practice (MSA is for 'Meriton Serviced
Apartments'), was part of Meriton's standard operating
procedure for check out:
Ask guest if they enjoyed their stay. If positive
pass a Trip advisor feedback card to guest requesting
them to post feedback online and if negative mask guest
email by adding MSA to the beginning of guest email
address and discuss concerns.
The staff member who checks out the guest is
required to sign the form, indicating that they
understood that disciplinary action would occur if they
did not follow the standard operating procedure
The practice of adding MSA to the email address
improved the relative number of favourable reviews
compared with unfavourable reviews, because the emails
that TripAdvisor sent to guests who made complaints or
who were unhappy with their experience would not reach
them. Alternatively, Meriton did not forward the email
addresses of such guests to TripAdvisor at all.
Justice Moshinsky found that: Meriton created
an unduly favourable impression about the quality and
amenity of Meriton's serviced apartments.
The bulk withholding practice, was to withhold from
TripAdvisor the email addresses of all guests who had
stayed at a particular property during a period of time
when there had been a major service disruption (such as
the lifts not working, no hot water, etc).
The practice either eliminated or reduced negative
reviews for service disruptions.
Justice Moshinsky found that: Meriton's conduct had
the effect of reducing, in the mind of the consumers,
awareness of the prevalence of service disruptions at
the Meriton properties. In doing so, Meriton created an
impression that was incomplete and inaccurate.
Meriton was found liable because it engaged in conduct
that was liable to mislead the public as to the
characteristics and suitability for their purpose of the
accommodation services it provided, in breach of s 34 of
the Australian Consumer Law.
Refer to the liability judgment:
Australian Competition and Consumer
Commission v Meriton Property Services Pty Ltd
 FCA 1035.
What declarations and orders
were made by the Court?
The Court made declarations that during the period
November 2014 to October 2015, Meriton misled the public by
adopting the two practices outlined.
The Court ordered that Meriton be restrained, for 3
years from the date of order,
from filtering, selecting or limiting the guest email
addresses it supplies to TripAdvisor in relation to its use
of TripAdvisorís Review Express service, unless a guest
consents to Meriton withholding, or requests Meriton to
withhold, his or her email address from TripAdvisor, or such
conduct accords with TripAdvisorís own published rules or
guidelines for the submission of email addresses.
The Court ordered Meriton to pay a substantial pecuniary
penalty of $3 million, for the primary purpose of
deterrence (both specific to this case and generally)
The contravening conduct gave rise to loss and damage, by
way of the loss of opportunity for consumers to adequately
compare accommodation services and choose between them on a
fully-informed basis, and the loss of opportunity for
competitors (who were complying with the law) to gain custom
The Court took into account these factors:
The scale of the Meriton accommodation business was
large: over the relevant period (2015, 2016 & 2017
Financial Years), the gross revenue was approximately
$240 million. In the 2016 Financial Year it made a
profit of approximately $23 million.
The contravening conduct occurred on a large scale:
approximately 14,500 email addresses were masked.
The TripAdvisor website, where the misleading impression
was created, attracted a very large number of consumers.
Senior management was involved in approving the standard
operating procedure. The practice was not the conduct of
'rogue' employees - it was a requirement for frontline
staff to mask email addresses.
The calculation of $3 million was based upon 13
contraventions of s 34 of the Australian Consumer Law,
one for each Meriton property, for each of which the maximum
penalty was $1.1 million ($14.3 million in total). The Court
rejected both the ACCC proposal of $20 million penalty and
the Meriton proposal of $330,000 to $440,000.
The Court ordered Meriton to establish and maintain a
Specifically, during the period of 3 years from the date of
order, Meriton is required to provide to the ACCC:
a Compliance Policy;
a Risk Assessment Report;
an outline of the Complaints Handling System;
staff training materials and induction materials;
copies of reports to the Board and senior management.
The Court knew of the commercial dimension:
The very purpose of the contravening conduct was to produce
a commercial benefit for Meriton by way of increased sales
(with a corresponding detriment, at least in most cases, for
With an annual profit of approximately $23 million, Meriton
could well consider the penalty of $3 million to be an
inconvenience, as the 'cost of doing business'.
To counter this perception, the Court ordered a restraint on
the conduct and a strict Compliance Program, for the next 3
TripAdvisor also took action. It suspended Meriton
properties from its website in the period from 19 December
2015 to 11 March 2016. No reasons are available as to this
suspension or why it was lifted, but it is relevant to note
that on the Review Express Guide webpage this warning
TripAdvisor takes fraud and privacy very seriously Ö
avoid selectively emailing only the guests you believe will
write positive reviews. Review Express emails should be
consistently sent to all guests.