RipOffReport.com wins one in Florida

You may recall the 11th Circuit’s 2006 ruling in Whitney Information Network, Inc. v. Xcentric Ventures, LLC, et al, wherein the panel held that the defendants had not adequately rebutted WIN’s allegations that the defendants themselves were involved with certain postings on the RipOffReport.com (“ROR”) website. The Court concluded that the defendants failed to demonstrate they were entitled to Section 230 protection, and remanded to the district court for a determination of whether personal jurisdiction over the defendants was appropriate.

Last week, as previously noted by Eric Goldman and Ryan Dohrn, District Judge Marcia Morales Howard granted (after previously determining that personal jurisdiction was appropriate) the defendants’ motion for summary judgment as to WIN’s single claim of defamation per se of business reputation.

Judge Morales Howard initially considered whether defendant Ed Magedson himself is a provider or user of an interactive computer service. Noting that Magedson had declared that “he is the founder and managing member of Xcentric, the operator of the ROR website,” and that Magedson’s declaration also “establishes that even if Magedson did not qualify as a provider of an interactive computer service, Magedson, himself and as the managing member of Xcentric, is certainly a user of an interactive computer service, namely, the ROR website,” the court concluded that “Magedson is a provider or user of an interactive computer service as that term is defined by the CDA.” This reasoning seems to broaden what I would argue is the traditional understanding of the terms “provider” and “user” in this context. However, I suppose a contrary ruling may have had the effect of encouraging some future plaintiffs to target inappropriate officers and/or other natural persons actively involved with ICSs.

Next, the Court examined “whether the individuals submitting posts to the ROR website were the sole information content providers of the postings about WIN, or whether Defendants were responsible, in whole or in part, for the creation or development of the information contained in these postings.” On this issue, plaintiff noted that the defendants had created category names such as “con artists” and “corrupt companies.” The Court was not persuaded:

The plaintiff “has not presented any evidence demonstrating that Defendants participated in any way in the selection of these categories to describe WIN. . . . the mere fact that Xcentric provides categories from which a poster must make a selection in order to submit a report on the ROR website is not sufficient to treat Defendants as information content providers of the reports about WIN that contain the “con artists”, “corrupt companies”, and “false TV advertisements” categories . . . [r]ather, the authors of the postings made the decision to select these categories to describe WIN. . . . [m]oreover, Xcentric did not solely provide posters with a selection of categories that were negative and/or defamatory in nature.”

Kind of makes me wonder whether plaintiff alleged in its complaint that the category names themselves were defamatory.

Plaintiff’s also offered other Kozinskiesque-like arguments (no, the Ninth Circuit has not yet issued its en banc ruling in the Roommate.com case) that defendants were not eligible for Section 230 protections (i.e., “Defendants actively solicit visitors to post reports about companies that rip-off consumers,” and “Defendants take an active role in shaping the content of the postings on the ROR website by providing guidance to users regarding what to think about in preparing their reports and what type of reports are selected as “Top Rip Off Reports.”)

The Court rejected these arguments as well, noting that, as part of the submission process, the defendants require posters to “acknowledge that a report is valid”, “advise[s] users that reports should be honest, factual, and impartial” and “do not charge users a fee to post a report.” Thus “WIN simply has not provided the Court with any evidence to create a genuine issue of fact as to whether Defendants played a role in creating or developing the postings regarding WIN that are the subject of the instant action. . . . Defendants are entitled to immunity under the CDA from the instant action.”

It will be interesting to see whether the plaintiff decides to appeal this decision.

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Interested in efforts to mediate consumer disputes online? Check out this article from today’s New York Times.

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