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.

Wikileaks updates

Here are two up to the minute posts, one at Declan McCullagh’s “the iconoclast” blog, the other at Wired’s Threat Level blog, both indicating that wikileaks.org will soon be back online.

I may update this post at a later time/date, particularly when the Court enters a written ruling.

3/4/08 UPDATE: Here is Judge White’s order, entered last Friday, dissolving the permanent injunction.

3/6/08 UPDATE: According to the EFF, the plaintiff has asked the Court to dismiss its case.

Developments in Wikileaks.org lawsuit

I finally got around to looking over a New York Times article that my law partner Ron Teeple recently shared with me. The article describes, essentially, as inept, an attempt earlier this month by U.S. District Judge Jeffrey S. White to shut down Wikileaks.org, a website that encourages people to post “leaked” information for the purported purpose of deterring corporate and governmental misbehavior. According to the article, the site has previously posted some particularly sensitive military documents and other closely-held materials.

Judge White’s shut down order (the permanent injunction) was directed at the website’s domain name registrar, defendant Dynadot, and not the website itself, and is apparently full of workarounds for determined fans of the site. The Court also entered a temporary restraining order pertaining to the specific documents at issue in the lawsuit.

Earlier today I came across this article in the Los Angeles Times, highlighting efforts to persuade Judge White to reconsider his prior orders. Counsel for the Electronic Frontier Foundation is described in the article as expressing disappointment with Dynadot’s actions, noting that Section 230 protects the company from the plaintiffs’ claims here. Beyond simply complying with a court order (an order which clearly does more than just provide for the preservation of evidence), it would appear that Dynadot first entered into a stipulation with the plaintiff (the proposed order referred to in Paragraph 4 thereof, a/k/a the permanent injunction, was entered by the Court on February 15th and is linked to above), then became bound by the court’s permanent injunction, and, finally, was voluntarily dismissed from the case this past Monday. It would be interesting to know whether the Court would have entered the permanent injunction if Dynadot had not first stipulated to its terms.

We should know more about where this case is headed after a hearing scheduled for this Friday. In the meantime, here’s a copy of the plaintiffs’ six count complaint, filed earlier this month in the Northern District of California (link does not include exhibits).

On a related note, does anybody know whether the Second Circuit has ruled yet on the defendant’s appeal in a somewhat similar dispute involving givemeliberty.org?

 See my 2/29/08 Update post

Court: Section 230 is an affirmative defense, thus it’s (generally) not an appropriate basis for a Motion to Dismiss

Erik Curran, who apparently served in combat (Iraq? Afghanistan?) as part of the West Virginia National Guard, filed a two count complaint for invasion of right of publicity and invasion of right of privacy against several defendants, among them CaféPress.com, Inc. (“CafePress”). Curran alleged that his image appeared, without his consent, on a book cover and related t-shirts, toys and dolls. CafePress sells t-shirts which have Curran’s image printed on them, and includes his image on its website.

Last week District Judge John T. Copenhaver Jr. of the Southern District of West Virginia ruled on several motions to dismiss filed in the case, Curran v. Amazon.com, et al. CafePress asserted in its motion that Section 230 grants it federal immunity from tort liability and preempts both counts of the complaint. In response, Curran argued that Section 230 is an affirmative defense, and “is not an appropriate basis for dismissal on a Rule 12(b)(6) motion.” The Court agreed that CafePress was asserting an affirmative defense, which the plaintiff is not obligated to plead around. However, Judge Copenhaver devoted most of his Section 230 discussion to the issue of whether CafePress could nonetheless proceed with the Section 230 defense at this stage of the litigation.

The Court referred to cases where “either the parties did not dispute that the defendant was an interactive computer service or there were allegations in the complaint upon which the court could reasonably conclude that the defendants were interactive computer services.” Noting that no such consensus exists here, and that the complaint “states merely that CaféPress sold t-shirts featuring plaintiff’s likeness,” the Court was left to consider CafePress’s assertion that it own terms of service agreement, posted on its website, demonstrates its ICS status.

If we accept the Court’s supposition (which it backs up with several citations) that establishing ICS status is a prerequisite to ruling on a Section 230 affirmative defense in this procedural posture, I’m not sure what the problem is. Is there any dispute that CafePress.com, an Internet website, is, at the least, a provider of an Interactive Computer Service? Perhaps its role as such is irrelevant here, and/or perhaps CafePress acted in more than one capacity here. But if ruling today on the Section 230 issue necessitates an initial finding that CafePress is an ICS/provider of an ICS, what’s the hold up? I’m curious whether the Court is under the impression that one is either an ICS or an Information Content Provider, but one cannot be both, and that such determination is outcome determinative. Note the following paragraph taken from the opinion:

Section 230 of the CDA creates a distinction between “interactive computer services,” which merely transmit information and “information content providers” that create or develop, in whole or in part, information eventually transmitted. See 47 U.S.C. § 230(f)(2) and (3). The former may be exempt from tort liability by the CDA, whereas the latter is not. See id. §§ 230(c)(1), (e)(3), (f)(2) and (3).

Regardless, after considering caselaw on the procedural point of whether the Court may properly consider CafePress’s TOS agreement on this issue, the Court declined to so consider it. Instead the Court directed that “CDA immunity is a question awaiting discovery and exploration, though plaintiff faces an uphill battle given the broad grant of immunity conferred by § 230, as interpreted in the seminal case of” Zeran.

It is not clear to me that Section 230 is even applicable in this case, but if it is, it sounds like the plaintiff is in for a fight.

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.