Oregon Attorney General Dan Rayfield has sued a Portland-area siding and dry rot repair contractor, claiming the company's standard customer contract was built to keep unhappy homeowners from posting bad reviews (via the Oregon Department of Justice). The suit against SFW Construction was filed Oct. 20 in federal court.
Everything in the case so far is an allegation. The company hasn't had its day in court, and no judge has ruled on whether the contract language breaks any law.
According to the complaint, filed in the U.S. District Court for the District of Oregon in Portland, the defendants are SFW Construction LLC and Somerset Hills Construction LLC. Both are Oregon companies headquartered in Tualatin, and both operate under the SFW Construction name and the same Construction Contractors Board license. KVAL in Eugene reported that the company also runs locations in Eugene doing siding and dry rot repair.
The clause at the center of the case doesn't simply say "no bad reviews." The complaint says it sits in the contract specifications customers accept through an online service agreement, and it requires any dispute to go first to private mediation. Any settlement reached that way, per the quoted language, "will include a non-disclosure agreement and a non-disparagement agreement." The state says that wording has been in place, materially unchanged, since 2022.
The state's argument is that this setup steers dissatisfied customers into deals that keep them quiet, while the company's website shows off positive reviews. The DOJ release says prospective customers weren't told about the restriction.
"Before you let someone work on your home, you read the reviews," Rayfield said in the release. "But reviews only mean something if customers are free to tell the truth, good or bad." He also said the setup is "not fair to the honest contractors who earn their reputations the right way."
The lawsuit makes two claims. The first is under the federal Consumer Review Fairness Act, which bars businesses from using form contracts that restrict customers' ability to review them. The second is under Oregon's Unlawful Trade Practices Act, over alleged misrepresentations about consumer reviews.
The state wants a court order stopping SFW from using the language and a ruling that the review-limiting terms are void. It also asks the court to void non-disclosure and non-disparagement terms in settlements that came out of the contract, and to make the company tell affected customers they aren't bound by them. Civil penalties, disgorgement and attorney fees are on the list too, though the complaint doesn't name a dollar figure.
The Federal Trade Commission's guide to the Consumer Review Fairness Act spells out what's off limits. A business can't use a contract provision that bars or restricts a customer's review, charges a fee or penalty for one, or makes reviewers sign over rights to what they wrote. The FTC says the law gives enforcement power to the FTC and to state attorneys general, which is the route Oregon is taking here.
Homeowners who think a business used a form contract to block an honest review can file a complaint at oregonconsumer.gov or call 1-877-877-9392, according to the DOJ.
Why it matters for Contractors
Pull up your contract template this week and read it like a regulator would. Look for anything labeled non-disparagement, confidentiality or "no negative reviews," and check dispute and mediation sections too, since that's where the language in this case lives. The FTC tells businesses to remove provisions that restrict honest reviews, even ones they've never enforced.
The law still leaves you some room. Under the FTC guidance, a business can remove or restrict reviews that are defamatory, harassing, unrelated to its work or clearly false, or that expose confidential information. A review you simply disagree with isn't likely to fall in those categories.
If you bought a template or had one drafted years ago, it's worth an hour of a lawyer's time to check it against this case. The Construction Contractors Board already requires written contracts for jobs over $2,000 in Oregon, so the paper is there either way. Making sure it can't be read as a gag order is cheap insurance.