November 20, 2012

By Oliver Herzfeld, Forbes IP Counsel

In general, publishers of books, newspapers and magazines are legally liable for the content of the materials they publish, while book stores, newsstands and other distributors of publications are immune from liability for such content. The rationale behind the legal principle is that publishers can research, review and edit the content they publish whereas distributors often cannot easily do so for the content they distribute. With the advent of the Internet, however, the line between publisher and distributor became blurred. For example, if a company encourages users to submit content to its website, comments to its Facebook page or videos to its YouTube channel, is it deemed to be a publisher or a distributor? Early court decisions in this area arrived at unintuitive results. In particular, a company that made no effort to filter defamatory content submitted by its users was held to be an immune distributor, but another company that actively filtered and edited defamatory content in good faith was held liable as a publisher for failing to screen and remove all such unlawful content.

The Communications Decency Act

In response to the early court decisions, to avoid the chilling effect of potential liability in a medium of prolific speech, and to encourage the active monitoring, editing and removal of unlawful content online without the disincentive of having such actions lead to claims of liability for being a publisher, Congress enacted Section 230 of the Communications Decency Act. It essentially states “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” It also explicitly preempts any inconsistent state or local laws. To determine the applicability of the CDA, courts have applied a three prong test:

1.       the defendant must be a provider or user of an interactive computer service such as a website, blog, customer review or other online forum, YouTube or other video sharing site, Facebook page, LinkedIn group or other social network;

2.       the plaintiff must treat the defendant as the publisher of the offending content; and

3.       the offending content must be provided by a third party.

Claims Covered By The CDA

The CDA has most frequently been used as a defense against claims of defamation, but the broad immunity provided by the mighty CDA has also barred claims of false information, negligence, gross negligence, misrepresentation, invasion of privacy, misappropriation, fraud, breach of contract, unfair competition, emotional distress, nuisance, tortious interference with business relations, tortious interference with business expectancy, violation of civil rights, money laundering, threats, discriminatory statements, waste of public funds, nuisance, premises liability and denial of substantive due process. Nonetheless, the CDA does not cover claims of criminal conduct, electronic communications privacy and intellectual property infringement.

Activities Covered By The CDA

Courts have held that the scope of the CDA includes immunizing liability for soliciting, facilitating and/or paying for the submission of content; selecting, correcting and editing content; deciding whether to publish or remove content; and even failing to remove content after receipt of notice that the material is defamatory. However, the CDA will not protect people or companies from publishing their own unlawful content, editing content in a manner that substantially alters its meaning as to make it defamatory or otherwise unlawful, explicitly soliciting the submission of unlawful content, or promising to remove specific content after receipt of notice that the material is defamatory and then failing to do so. And the CDA may or may not protect companies from selecting content that was not “provided” by a third party as required by the statute. In other words, selecting from among content expressly submitted by users for publication is covered by the CDA but courts have not yet ruled on whether collecting and publishing content that was not submitted for publication would be similarly covered.

What Should Companies Do?

Companies should consult competent legal counsel to prepare appropriate terms of use for each website, blog and other online service they provide. Although such published rules and guidelines are not required by the CDA, they are a best practice in establishing and communicating expectations and standards for acceptable behavior. Since the key to avoiding liability under the CDA is that the unlawful information at issue must be provided by a third party, companies should ensure they do not themselves (i) publish any unlawful content (including unlawful commentary on content submitted by third parties), (ii) materially alter user-submitted content to make it unlawful, or (iii) generate forms, surveys, multiple choice questions or other online devices that require or actively encourage the submission of discriminatory, defamatory or otherwise illegal content. Of course, companies should also never make promises and then fail to keep them without a good reason because doing so is just asking for trouble.