Section 230 does not shield website from state IP claims

Guest blogger John Leonard is at it again, this time summarizing a recent federal court decision construing Section 230 in the “adult website” context.    

An interesting decision came down last week from the United States District Court for the District of New Hampshire, Doe vs. Friendfinder Network, et. al. In that case, Judge Joseph LaPlante, in a well-reasoned opinion, replete with common sense, upheld the concept of CDA tort immunity for owners and operators of websites, as to information provided by other information content providers, while extending the intellectual property immunity exemption to state intellectual property laws.

The plaintiff Doe, unwilling, for obvious reasons, to use her real name in the lawsuit, filed a multi-count complaint based upon the appearance on the defendant’s website of her name, purported information, and a purported nude photo of her, for purposes of showing her availability for dating, and, presumably, sexual relationships and activities. In her complaint charging, among other things, invasion of privacy, defamation, infliction of emotional distress, and violations of the New Hampshire Consumer Protection Act and the Federal Lanham Act, the plaintiff denied that she had ever provided any information to the website, that some of the information included in her profile on the website was false, and that the nude photo accompanying the information was not of her.

Interestingly, among the plaintiff’s charges were allegations that the defendants caused portions of the allegedly bogus profile to appear on search engines and as advertisements, or “teasers”, on other unaffiliated sites. Plaintiff’s bogus profile also allegedly appeared on similar websites that are operated by the defendants. She also alleged that, in response to her request that the profile be removed from the website, the defendants then posted the statement that, “this member has removed her profile,” thereby implicitly, if not actually, stating that the allegedly bogus profile was of the plaintiff.

The judge began his analysis by affirming the principle, adopted by most Federal Circuits, that, stemming from Zeran v. America Online, Inc., 129 F.3d 327 (4th Cir. 1997), sections [47 U.S.C.] 230(c)(1), (f)(3), and (e)(3) of the CDA bar state law claims (except those relating to intellectual property) against interactive computer services for publishing content provided by another information content provider. This immunity, according to the judge, applied even to the complaint that the website operator posted the allegedly bogus profile of the plaintiff on other websites. As to this charge, citing the First Circuit decision of Universal Comm’n. Sys. v. Lycos, 478 F.3d 412 (2007), the judge held that the mere re-posting or repetition of information received from another did not render the defendants “information content providers” on their own behalf so as to subject them to state and common law liability.

As to the charge that the defendants, in their statement regarding the removal of the profile, affirmatively acknowledged that the profile was in fact that of the plaintiff, the judge opined that because the association of the plaintiff with the profile originally came from another content provider, the defendants (in repeating that association) were not responsible for creating the association, and therefore “cannot be considered an ‘information content provider’ under the statute because no profile has any content until a user [here, someone other than the defendants] actively creates it.”

Judge La Plante did, however, rule in favor of the plaintiffs on two not insignificant counts of her complaint, one complaining of a violation of her right to publicity, another charging a violation of the Federal Lanham Act (the statute generally concerned with trademark and trade name issues). As to her invasion of privacy claim, the judge noted that insofar as one of the plaintiff’s four invasion of privacy sub-claims involved the violation of plaintiff’s right to publicity, that sub-claim was one concerning intellectual property, and was therefore exempt from the immunity provision of the CDA. In so holding, the judge explicitly rejected the decision of the Ninth Circuit Court of Appeals in Perfect 10 v. CC Bill, LLC, 488 F.3d 1102 (2007) which held that the intellectual property exemption to CDA immunity applied only to Federal and not to state, intellectual property claims. As Judge LaPlante explained, that interpretation was contrary to the express language of the statute, and in effect constituted a judicial re-writing of the CDA.

Finally, the judge held that the plaintiff’s Lanham Act claims, asserting false advertising and false designation, could proceed because they also were subject to the intellectual property exemption. The judge emphasized that the defendants’ use of the plaintiff’s allegedly false and bogus profile as unauthorized “teasers” for marketing (advertisement) purposes “falls directly” with the language of the Lanham Act preventing such unauthorized use. The judge rejected outright the defendants’ argument that such “false endorsement” claims can only be made by celebrities and did not apply to the common folk, as being totally unsupported by any authority.

In the introduction to this short review, I praised Judge LaPlante’s decision as being well-reasoned and consistent with common sense. I must here, however, add one exception, perhaps just a minor quibble over language but nonetheless, I believe, important. This relates to that portion of his ruling where he found that the defendants’ statement that “this member has removed her profile.” Given that this statement was made after the plaintiff had contacted the defendants and told them that the profile was in fact false, and that she was not a member, were the defendants out-of-bounds when they then affirmatively created the statement that she was a member and that this was in fact her profile? I wonder if this conduct by the defendants did not go beyond the mere repeating of information provided by another, and in effect constituted an affirmative statement authored by the defendants themselves. While the defendants may not have been under an obligation to launch an investigation into who, the original provider of the profile or the plaintiff, was telling the truth, surely they did not have to phrase the removal language in such a way as to continue to identify the plaintiff as “a member” of the service and the subject of the profile. Neutral words such as “this profile removed upon request” would certainly have been sufficient to satisfy the defendants’ need for an explanation without specifically referring to the plaintiff’s person. In this author’s humble opinion, in this specific and limited situation, the court may have extended the CDA tort immunity a little too far.

Victory for ZeroBrokerFees.com in New Hampshire

Yesterday Magistrate Judge James Muirhead ruled in favor of ZeroBrokerFees.com in the website’s suit challenging the applicability of the New Hampshire Real Estate Practice Act – specifically the licensure requirement – to the operation of ZeroBrokerFees.com. The court ruled that pursuant to a statutory exemption for newspapers, ZeroBrokerFees.com was not obligated to obtain a brokerage license in New Hampshire before advertising real estate online.

For a refresher, see my post from last May.

Here is a copy of ZBF’s lawyers’ announcement, and a copy of the court’s 33 page order.

7th Circuit rules in favor of Craigslist

Here’s the decision. It looks like my prediction was pretty much on the mark.

In an opinion by Judge Easterbrook, the 7th Circuit has affirmed Judge St. Eve’s grant of Craigslist’s motion for judgment on the pleadings. In other words, the Court ruled that Section 230 protects Craigslist from the Fair Housing Act claims contained in plaintiff’s complaint.

In emphasizing that Section 230(c)(1) does not grant absolute immunity, though, Judge Easterbrook takes the opportunity to cite some of his dictum in Doe v. GTE. This did not seem necessary, particularly given the fact that today’s ruling does not adopt the ‘definitional’ reading of Section 230(c)(1) that was first presented in Doe.

Instead the Court concedes that “subsection (c)(2) does not deal with the liability of speakers and publishers, the subject of subsection (c)(1). We read each to do exactly what it says.” Noting that “‘information’ is the stock in trade of online service providers,” the opinion concludes that “given §230(c)(1) [appellant] cannot sue the messenger just because the message reveals a third party’s plan to engage in unlawful discrimination.” In other words, appellant sought to treat Craigslist as a publisher of third party content, and Section 230(c)(1) forbids such treatment.

What I found most interesting was the fact that, in the course of rejecting appellant’s argument that Craigslist ’caused’ the discriminatory ads (a term that appears in the Fair Housing Act provision at issue in this case), the Court alluded to a scenario where a website may indeed become a ’causer’ (not just a publisher) and thus expose itself to liability:

Nothing in the service craigslist offers induces anyone to post any particular listing or express a preference for discrimination; for example, craigslist does not offer a lower price to people who include discriminatory statements in their postings.

While the statement was made in reference to the FHA, this sentence suggests that website inducement combined with certain statutory language could result, in some cases, in website liability. We’ll probably hear more about this point in the Ninth Circuit’s much anticipated en banc Roommate.com decision.

RipOffReport victorious (again) in Arizona

Last October I wrote about Global Royalties’ suit against RipOffReport (a website operated by Xcentric Ventures), which was dismissed on Section 230 grounds. The plaintiffs subsequently amended their complaint (still alleging defamation), Xcentric filed a motion to dismiss (still arguing Section 230 immunity), and, again, District Judge Frederick J. Martone, just last week, granted the motion, notwithstanding the Court’s belief that “[i]t is obvious that a website entitled RipoffReport encourages the publication of defamatory content.”

Plaintiffs made multiple attempts in their motion papers to neutralize Section 230’s protections here. First, relying on Batzel, plaintiffs argued that once the non-party poster requested removal of the allegedly defamatory content, “the statements were no longer ‘provided for publication,’ and defendants’ CDA immunity ceased at that point.” But as Judge Martone explained (recall that Mr. Sullivan is the non-party poster):

in Batzel, the court did not interpret “provided” as an ongoing process. The focus was on expectations regarding communications when they are made. The court was concerned that technology users would be discouraged from sending e-mails if website operators have no incentive to evaluate whether the content they receive is meant to be broadcast over the internet or kept private. [] There are no similar concerns in this action; Sullivan obviously meant his messages to appear on the website. Whether website operators have a duty to withdraw content when an author later changes his mind is another question-one that is not addressed by Batzel.

On the subject of notice, the Court, citing Zeran, also reminded plaintiffs that

[w]ebsite-operator liability based on notice has been rejected, because each “notification would require a careful yet rapid investigation of the circumstances surrounding the posted information, a legal judgment concerning the information’s defamatory character, and an on-the-spot editorial decision whether to risk liability by allowing continued publication. . . . We conclude that liability based on an author’s notice, workable or not, is without statutory support and is contrary to well-settled precedent that the CDA is a complete bar to suit against a website operator for its “exercise of a publisher’s traditional editorial functions-such as deciding whether to publish, withdraw, postpone or alter content.

Judge Martone added that the notice argument remained moot, notwithstanding the fact that the poster of the allegedly defamatory post himself was purportedly the person requesting its removal.

Next, plaintiffs claimed that “defendants themselves constitute an “information content provider” with respect to the posted content.” The Court was not persuaded. “Plaintiffs allege only the most minor participation by defendants in actually composing the allegedly defamatory postings: Defendants provided a list of categories from which Sullivan selected the title “Con Artists” for his post. As in our order dismissing the original complaint, we conclude that this participation is insufficient as a matter of law to make defendants information content providers with respect to the postings.”

Plaintiffs also made the related argument that “defendants encourage defamatory postings from others for their own financial gain and, therefore, are partly responsible for the “creation or development” of the messages.” The Court dismissed this argument as not supported by the law (“[u]nless Congress amends the statute, it is legally (although perhaps not ethically) beside the point whether defendants refuse to remove the material, or how they might use it to their advantage”) or plaintiffs’ allegations (“plaintiffs have not alleged that defendants solicited Sullivan’s postings in particular, or that they specifically solicited any postings targeting Global. Nor have they alleged that defendants altered Sullivan’s comments, or had any more than the most passive involvement (providing a list of possible titles) in composing them”).

The Court was unwilling to stay the case to await the Ninth Circuit’s en banc Roommate.com decision. Fair enough. But it sure will be nice to get some more guidance on the implications of the use and content of material produced by a website operator.

Feds make a call to a domain name registrar, websites go dark

Last week it was a federal judge ordering a controversial website’s domain name registrar to effectively pull the plug on its customer.

This week it’s somebody at the U.S. Treasury Department directing a DNR to cut the cord to websites operated by an Englishman living in Spain, according to a piece by the New York Times’ Adam Liptak.

Website operators, civil liability obviously isn’t the only thing you need to be thinking about on the legal front. Given any thought recently to the arrangement you have with your domain name registrar?

UPDATE: Check out this timely post from an Irish IT law blog on the subject of domain name registrars.