Bloomberg liable for United Airlines’ stock nosedive?

Interesting post today on one of Wired’s blogs (links to a recent post at The Volokh Conspiracy) relating to the potential applicability of Section 230 to Bloomberg’s “role” in United’s free fall earlier this week.

Lots of juicy issues here, but time constraints force me to simply take this opportunity to quickly vent on a longstanding pet peeve of mine.  Why don’t all “news” articles on the web contain a static publication date in or very near the article text?  I’m not necessarily sympathetic to all of Google’s positions on this matter, but one thing I will agree with is that I find it terribly annoying when I view a news article on the web, whether following a search or while browsing a media outlet’s website, and find myself struggling to determine when the article was written.  How difficult can it be for online publishers to get this right?  Maybe there is some SEO, advertiser and/or “staleness” issue out there that is beyond my comprehension.  But they should all take a backseat to including critical information such as a publication date when disseminating “news” articles.

Kudos to the New York Times, which in my experience not only consistently lets you know the date an article was published, but whether, when, and where the article appeared in the hard copy version of the newspaper.

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A note to my faithful readers (if there are any of you left):  It’s been an unusually busy summer for me.  I won’t bore you with any of the details, but I do hope to get back on the horse here soon and resume regular postings.  If that proves to be impossible, I may accept the invitation (if it’s still outstanding when the time comes) of one of my favorite technology bloggers to submit occasional posts on his blog.  In the meantime, I hope you’ll continue to subscribe/stop by here.

-Michael

Fifth Circuit issues its first Section 230 opinion

Last month the Fifth Circuit issued its first (to my knowledge) ruling that turned on Section 230. Affirming the lower court in Doe v. MySpace Inc., Circuit Judge Clement, writing on behalf of herself and Judges Garwood and Elrod, ruled that the statute protected MySpace from claims that it was negligent for not “instit[uting] and enforc[ing] appropriate security measures and policies that would substantially decrease the likelihood of danger and harm that MySpace posed to” the minor-plaintiff.

The minor had lied about her age, enabling her to create a public MySpace profile. A nineteen year old male MySpace user (“Pete”) subsequently discovered her profile and initiated contact with her. The minor eventually shared her phone number with Pete and agreed to meet him in person, at which time he sexually assaulted her. Plaintiffs believe that had MySpace been utilizing age verification software, the assault never would have occurred.

The Court ruled that the plaintiffs’ negligence claims are barred by Section 230,

notwithstanding [plaintiffs’] assertion that they only seek to hold MySpace liable for its failure to implement measures that would have prevented [the minor] from communicating with [her assailant]. Their allegations are merely another way of claiming that MySpace was liable for publishing the communications and they speak to MySpace’s role as a publisher of online third-party-generated content. . . . [plaintiffs’] negligence and gross negligence claims are barred by the CDA, which prohibits claims against Web-based interactive computer services based on their publication of third-party content.

Read here about MySpace’s commitment earlier this year to forty-nine state AGs to make the site safer for minors.

RipOffReport.com owner back in court

I understand that earlier this week Ed Magedson and XCentric Ventures filed suit in an Arizona (Maricopa County) state court against Whitney Information Network and the law firm Rothstein Rosenfeldt Adler P A, as well as a number of individuals – Russell Whitney, Ronald Simon, Christopher Sharp, Shawn Birken, Scott Rothstein and Steven Lippman (Case Number: CV2008-011196).  I’m thinking it’s related to a dispute/suit Eric Goldman recently wrote about here and here, but unfortunately I’m not going to have a chance to dig into this one anytime soon (sorry for the radio silence as of late by the way).

Anybody care to enlighten us?

YouTube wins on personal jurisdiction, venue arguments in Washington state

My partner John Leonard, an avid fan of quirky YouTube videos, couldn’t resist penning a summary of this recent decision involving the website.

In an unremarkable but informative decision from the Federal Court sitting in the Western District of Washington at Tacoma, Judge Franklin Burgess, on April 15 of this year, declined to subject YouTube to the Court’s jurisdiction in that State merely because YouTube appears on the Internet in Washington.

In the case, Victoria S. Bowen vs. YouTube, Inc., the plaintiff, Ms. Bowen, a YouTube registered user, alleged that certain YouTube users posted harassing comments on YouTube directed at her. She also alleged that her “intellectual property rights have been repeatedly violated,” and that YouTube had engaged in negligent affliction of emotional distress upon her. She also, apparently, alleged that YouTube violated her civil rights under Section 1983 of Federal law.

The Court summarily disposed of her emotional distress claim stating that it was barred by Section 230 of the Communications Decency Act. The Court also dismissed her civil rights claim, saying that it could not proceed because YouTube was not acting under color of State law. As to her intellectual property rights claim, the Court similarly dismissed it because of its “infirmities,” without going into detail.

Most of the opinion, however, was devoted to a discussion of whether, under the facts as alleged in the Complaint, YouTube is subject to jurisdiction in the State of Washington.

The Court noted that in order for Washington State jurisdiction to attach, the defendant must have: (1) committed an act or transaction with the State; (2) the claim must have arisen out defendant’s activities in the State; and (3) the exercise of jurisdiction must be reasonable. Citing several Ninth Circuit cases as precedent, the Court ruled that there was no personal jurisdiction over YouTube in Washington because YouTube’s “presence” in the State was merely passive, and that the plaintiff’s use of YouTube in the State was not enough to render YouTube subject to Washington State jurisdiction.

The Court further found that under YouTube’s “terms of use,” to which plaintiff, by virtue of her being a registered user, had agreed, YouTube “shall be deemed to be a passive website that does not give rise to personal jurisdiction over [it]…in jurisdictions other than California,” and that, “any claim between you [the user] and YouTube that arises in whole or in part from the YouTube website shall be decided exclusively by a court…located in San Mateo County, California.” Therefore, said the Court, Ms. Bowen could not maintain a suit against YouTube in the State of Washington.

Interestingly, after YouTube had filed its motion to dismiss, the plaintiff, probably recognizing that her attempt to keep the case in Washington was doomed, moved to transfer the case to California. The Court, however, ruled that dismissal, not transfer, of the case was the proper way to go. Whether the plaintiff can get another shot at YouTube by re-filing the case in California was not discussed, but the success of any such subsequent case seems unlikely, absent any new facts or legal theories alleged, given the apparent substantive infirmities in plaintiff’s case.

The lesson of this case is clear and simple. If you, as a user, especially a registered user, of a website agree to that site’s posted terms of use, and you later wish to make a claim or file suit against the site, you most likely will be bound by the site’s designated forum where claims may be made and lawsuits can be brought. Furthermore, even in the unlikely event that the site’s terms of use do not designate a state or states where claims and suits must be brought, there is a chance you will be required to make an affirmative showing that the website had more than just a passive presence in the state where you choose to sue.

Ninth Circuit: Roommates.com largely unprotected by Section 230 (en banc ruling)

Earlier today the U.S. Court of Appeals for the Ninth Circuit, in Fair Housing Council of San Fernando Valley, et al v. Roommate.com, LLC, issued an en banc ruling that rejects the majority of the website’s assertions of Section 230 immunity. For purposes of this (lengthy) post, I will assume you are familiar with the facts of the case and previous rulings. If not, check out my summary of the three judge panel’s May 2007 decision reversing the District Court’s application of Section 230 immunity.

The en banc panel here consisted of eleven Circuit Judges: Alex Kozinski, Stephen Reinhardt, Pamela Ann Rymer, Barry G. Silverman, M. Margaret McKeown, William A. Fletcher, Raymond C. Fisher, Richard A. Paez, Carlos T. Bea, Milan D. Smith, Jr. and N. Randy Smith.

The Court’s opinion was authored by Chief Judge Kozinski, and a partial Concurrence/partial Dissent was issued by Judge McKeown, who was joined by Judges Rymer and Bea.

The bottom line you ask? Jump to page 28 of the slip opinion, wherein the Court advises that “[t]he message to website operators is clear: If you don’t encourage illegal content, or design your website to require users to input illegal content, you will be immune.” Now for the loooong version, which excludes any consideration of the partial concurrence/dissent (maybe later).

We are of course dealing with a statute here, and the Court appropriately begins by asking what Congress had in mind when it enacted the law.

In passing section 230 . . . Congress sought to immunize the removal of user generated content, not the creation of content: “[S]ection [230] provides ‘Good Samaritan’ protections from civil liability for providers . . . of an interactive computer service for actions to restrict . . . access to objectionable online material.” (quoting from a 1996 Conference Report)

I’m not so sure the “Good Samaritan” phrase is properly applied to Section 230(c)(1), but I think the point being made here is valid: In the online context, acting as an editor is generally protected. Acting as an author is not.

The Court proceeds to consider the challenged portions of the Roommates.com website. As to the questions asked of prospective subscribers during registration (disclosure of sex, family status, and sexual orientation), including the choice of answers provided by Roommates.com and offered in pull-down menus, the Court opines that

Roommate created the questions and choice of answers, and designed its website registration process around them. Therefore, Roommate is undoubtedly the “information content provider” as to the questions and can claim no immunity for posting them on its website, or for forcing subscribers to answer them as a condition of using its services. . . . The CDA does not grant immunity for inducing third parties to express illegal preferences. Roommate’s own acts—posting the questionnaire and requiring answers to it—are entirely its doing and thus section 230 of the CDA does not apply to them. Roommate is entitled to no immunity.”

Although it is purportedly just focused on the question of whether immunity applies, the Court further notes that “asking questions certainly can violate the Fair Housing Act and analogous laws in the physical world.” More on this apparent divergence from the topic at hand (immunity) later.

The Court considers Roommates.com’s role as a developer when considering its subscribers’ profiles:

Although it is the subscriber that has answered the questions that are ultimately displayed in his or her profile, same “does not preclude Roommate from also being an information content provider by helping “develop” at least “in part” the information in the profiles. . . . By any reasonable use of the English language, Roommate is “responsible” at least “in part” for each subscriber’s profile page, because every such page is a collaborative effort between Roommate and the subscriber.

In other words, according to the Court, Roommates.com has again crossed the Section 230 line:

By requiring subscribers to provide the information as a condition of accessing its service, and by providing a limited set of pre-populated answers, Roommate becomes much more than a passive transmitter of information provided by others; it becomes the developer, at least in part, of that information. And section 230 provides immunity only if the interactive computer service does not “creat[e] or develop[]” the information “in whole or in part.”

The Court also declines to extend immunity to Roommate.com’s operation of its search system and email notification system. Observing that “Roommate designed its search system so it would steer users based on the preferences and personal characteristics that Roommate itself forces subscribers to disclose[,]” the Court addresses head-on the key question of when does a website create or develop information:

We believe that both the immunity for passive conduits and the exception for co-developers must be given their proper scope and, to that end, we interpret the term “development” as referring not merely to augmenting the content generally, but to materially contributing to its alleged unlawfulness. In other words, a website helps to develop unlawful content, and thus falls within the exception to section 230, if it contributes materially to the alleged illegality of the conduct.” [I think this language explains the Court’s interest in the underlying legality of some of Roommate.com’s alleged actions here].

The preceding paragraph is a significant, uh, development in Section 230 jurisprudence, and merits close attention. What it seems to be saying is that for purposes of determining whether Section 230 immunity applies, we don’t just look at whether the site created the subject content. We must also examine whether the website “contributed materially to the alleged illegality of the conduct.”

Based upon this new standard, the Court rules that Roommate.com “is sufficiently involved with the design and operation of the search and email systems—which are engineered to limit access to housing on the basis of the protected characteristics elicited by the registration process—so as to forfeit any immunity to which it was otherwise entitled under section 230.” Rejected again.

However, the Court does rule that Roommate.com is immune to claims based upon third party submissions under the “Additional Comments” section of the site.

The case concludes with what could be construed as both a warning to the plaintiffs’ bar and an encouraging word (?) to website operators:

[T]here will always be close cases where a clever lawyer could argue that something the website operator did encouraged the illegality. Such close cases, we believe, must be resolved in favor of immunity, lest we cut the heart out of section 230 by forcing websites to face death by ten thousand duck-bites, fighting off claims that they promoted or encouraged—or at least tacitly assented to—the illegality of third parties . . .. [I]n cases of enhancement by implication or development by inference—such as with respect to the “Additional Comments” here—section 230 must be interpreted to protect websites not merely from ultimate liability, but from having to fight costly and protracted legal battles.

The Court remands the case to the District Court for a consideration of the claims not immunized by Section 230.

I’m still digesting this thing (and may alter some of this post upon further reflection), but will say that I definitely anticipate a certiorari petition in the not too distant future. In the meantime, I recommend you give the opinion a read. Check out the favorable language directed at search engines and sites that, like Roommate.com and the one in Carafano, classify user data. Also look for several generic examples offered by the Court of situations where immunity would and would not apply, and “clarifications” of two prior Ninth Circuit rulings (Carafano and Batzel).

I’m looking forward to getting through Judge McKeown’s accompanying opinion and hearing what others have to say about the case.