Kiwi toy giant Zuru speaks out after US court victory

NZ Herald ,
Publish Date
Wed, 20 Jul 2022, 11:38am
Zuru co-founder Nick Mowbray surrounded by the company's wares. Photo / Supplied
Zuru co-founder Nick Mowbray surrounded by the company's wares. Photo / Supplied

Kiwi toy giant Zuru speaks out after US court victory

NZ Herald ,
Publish Date
Wed, 20 Jul 2022, 11:38am

Zuru has slammed what it describes as "fraudulent" reviews on US employee review site Glassdoor following the Kiwi toy giant's California court victory.

But a Zuru spokesman won't comment on whether it still intends to take court action in New Zealand against the anonymous users it says defamed the company.

Earlier this year Zuru, founded and run by the prominent Mowbray siblings, took legal action against Glassdoor, a US review site.

Users on Glassdoor post reviews of their experience working at companies.

Zuru's page featured a number of negative reviews and documents filed in a United States District Court in California show the toy company wants Glassdoor to reveal the names and contact details of people who posted purported negative experiences.

The company then intends to sue the users for defamation in New Zealand, the court documents said.

In public statements, Zuru has described the negative reviews as "spam".

On Wednesday, a Zuru spokesman again described the Glassdoor reviews as fake and fraudulent, saying that was why the review site had removed them following complaints from the company.

In a statement supplied to the Herald, the spokesman said the company believed it was important to hold Glassdoor to account.

"Zuru believes the purpose of Glassdoor is to be a source of credible information on companies for prospective employees.

"Unfortunately, we were alerted to fraudulent reviews being posted on our site. This is against Glassdoor policy. We worked with Glassdoor directly to resolve the issue, but it was not until we took legal action that Glassdoor removed the fake reviews.

"We think it's important that reviews are honest and regulated for legitimacy. So, we asked Glassdoor to uphold its standards around fraudulent activity and to follow its policy in this case."

The spokesman said the company did not have any comment at this stage on whether it still intended to pursue defamation action in New Zealand against the review authors.

An order from United States Magistrate Judge Alex Tse released earlier this month shows the court ruled in Zuru's favour.

The lengthy judgment from Tse said Glassdoor did not convince his court that the review site's interest in preserving the anonymity of its users outweighed Zuru's interest in protecting its reputation through defamation action in New Zealand.

"Because Glassdoor hasn't made that showing, and because Zuru's defamation claim is plausible, the Court will require Glassdoor to reveal who wrote the reviews," said Tse's judgment, which was first reported by journalist David Farrier.

"Zuru's defamation claim, while plausible, almost surely won't make it off the ground without Glassdoor's help.

"Glassdoor knows who wrote the reviews, Zuru doesn't. And if Glassdoor doesn't identify the reviewers, Zuru can't sue them and will be left without a means by which to 'vindicate [its] good name'."

Zuru's co-founders said their company has had to spend time and money fighting the negative publicity arising from the reviews, the judgment said.

"As an example, the co-founders explain that after the reviews were published, they extended a job offer to a candidate for a management position, but the candidate declined the offer and cited the reviews as a reason for doing so."

A statement from Glassdoor via a New York public relations firm said the company was dismayed by the court's decision and fights to protect the identities of users.

"We are deeply disappointed in the Court's decision, which was effectively decided under New Zealand law," the statement said.

"We note that, contrary to Zuru's contentions, the unflattering workplace experience reviews describing working at Zuru were authored by multiple former Zuru employees."

The statement said the company had won the majority of similar cases brought against it. It did not address questions regarding whether it intended to appeal.

"We typically prevail in the vast majority of these types of cases. To date, we have succeeded in protecting the anonymity of our users in more than 100 cases filed against our users."

The company aimed to "empower job seekers in New Zealand and around the world to have access to information from those who know companies best", Glassdoor said.

Zuru was started by the Mowbrays in a Waikato Shed nearly two decades ago.

It is now among the world's biggest toy makers and is headquartered in Shenzhen, China.

Siblings Anna, Matt and Nick Mowbray remain directors, Companies Office records show.