Operator of major restaurant review site in Japan ordered to pay damages

A Japanese court on Thursday ordered the operator of Tabelog, a popular restaurant review website, to pay around 38.4 million yen ($286,000) in damages to a Korean barbecue chain, ruling that its scoring algorithm is unfairly designed for chain outlets.

Tokyo District Court found site operator Kakaku.com Inc. violated antimonopoly law, saying its algorithm, which consistently lowered scores for restaurant chains, was considered an “abuse of bargaining position dominant”.

Photo taken in Tokyo on June 16, 2022, shows the Tabelog app icon. (Kyodo)

But the court rejected an injunction sought by the restaurant chain to stop the operator from using the algorithm, saying its negative impact on sales may not continue as consumers choose restaurants taking into account the change in website algorithm.

The decision came as a number of restaurants raised concerns about opaque rating methods on one of the country’s most influential restaurant review sites.

In the ruling, the court said Tabelog, which had around 87.63 million monthly users in March, had a business advantage over the channel and would have to accept detrimental treatment if it ceased to be a member. paying from the website.

Speaking at a press conference in Tokyo, Katsumasa Minagawa, an attorney representing Hanryumura, based in Toyo, welcomed the ruling, saying, “The court accepted almost all of our demands. It’s extremely significant.”

The channel said it would appeal the decision, as its request for an injunction was denied.

In a statement posted on its website, Kakaku.com said it appealed the decision because it is “unfair”.

In the lawsuit, Hanryumura had claimed the scores of about 20 outlets of his Korean barbecue chain KollaBo dropped about 0.2 points on average on the 1.0 to 5.0 point rating scale when the site’s algorithm was changed in May 2019, with the biggest drop reaching 0.45. indicate.

Claiming around 639.05 million yen in damages, the chain argued that the number of customers at the restaurant dropped by more than 5,000 per month after the change.

Kakaku.com said the algorithm change was made for the benefit of its users and fluctuations in scores should naturally be assumed.

The methods for calculating the revision by the algorithm, which the operator kept secret for fear of score manipulation, were exclusively disclosed to the parties concerned by the lawsuit.

Tabelog is widely used in Japan when people are looking for a place to eat, with its scores calculated based on visitor reviews of establishments, often directly influencing the number of customers.

The online service, opened in 2005, offers more than 820,000 restaurants and bars, according to the Tokyo-based operator.

The decision is considered the first judicial judgment on the validity of Tabelog’s algorithm.

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