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NJ Content Liability Law Ruled Inconsistent with Sec. 230 (just like in Washington and Tennesse)

Robert Cannon

Unfortunate problems give rise to unfortunate solutions.

Back in a time before most members of Congress or prosecutors knew that there was an Internet, there was Prodigy. Prodigy, as part of its service, ran family-friendly chat rooms that it moderated in an effort to keep kids protected from unfortunate content. In a different Prodigy chat room, some unknown third party said something apparently bad about an investment firm Stratton-Oakmont. Stratton-Oakmont didn't like that very much, and sued. But not able to reach out and touch the third party, Stratton-Oakmont sued the intermediary Prodigy. The court observed Prodigy taking discretion with what could and could not be posted in the family-friendly chat room, and determined that Prodigy was acting in an editorial capacity, was a publisher, and was therefore responsible for all content published on its service — including the negative third-party comment about Stratton-Oakmont.

Congress didn't like that very much. Congress had been warned that there was unfortunate content on the Internet. And Congress had been told that Prodigy, as a result of ifs efforts to make the Internet safer, was punished with liability. Congress was also told that it was next to impossible for online services to monitor the massive amounts of content that flowed through its pipes or is hosted on its servers. Therefore, Congress passed the Good Samaritan Provision, 47 U.S.C. § 230 (an amendment to the Communications Decency Act, which was in turn an amendment to the Telecommunications Act of 1996).

The Good Samaritan Provision established two principles: First, interactive online services (broadly defined) are not liable for third party content. Second, interactive services are not liable for actions taken to make the Internet safer. Sec. 230 has been wildly successful, has been described as the greatest Internet law, and as the necessary legal condition to make the interactive Internet possible (of course, back in the real good old day, when the communications networks were not liable for the content it carried, this was a tenant of 'common carriage.').

Unfortunately, as Miss Texas Teen USA observed in 1998*, "There's a lot of weirdos on the Internet." The Attorneys' General job is to fight those weirdos and the unfortunate things they do. In order to promote their unfortunate behavior, weirdos place ads on services like Craiglist, Backpage, and other online advertisement services. The Attorneys General want this unfortunate activity stopped, and since they have trouble sometimes reaching out and touching those weirdos, the Attorneys General reach out and touch the intermediary online services. The Attorneys General have tried very hard to change the rules, to change Sec. 230, and to make online services liable for the unfortunate content of third-party weirdos, out of the belief that this will somehow make things better.

The Attorneys General reached out to state legislatures and convinced them that something needed to be done. And therefore several states passed laws that would make online services liable for third-party weirdo advertisements of unfortunate things. These states include Washington, Tennessee, and New Jersey. Online Services didn't like that very much — and they sued.

The Attorneys General lost in Washington and they lost in Tennessee. And now the Attorneys General have lost in New Jersey. And they lost big. In Washington, Backpage.com sued and a temporary injunction was immediately granted. Its request for a permanent injunction was granted after a hearing. The state of Washington agreed not to pursue the matter further and agreed to pay Backpage.com's attorneys fees.

Tennessee passed similar legislation. Backpage.com again sued and again received an injunction. The trial court wrote:

The Constitution tells us that when freedom of speech hangs in the balance — the state may not use a butcher knife on a problem that requires a scalpel to fix. Nor may a state enforce a law that flatly conflicts with federal law. Yet, this appears to be what the Tennessee legislature has done in passing the law at issue.

Tennessee agreed not to pursue the matter further and the entered into a final judgment invalidating the law.

But we're not done. In early 2013, New Jersey enacted legislation making a crime if,

the person knowingly publishes, disseminates, or displays, or causes directly or indirectly, to be published, disseminated, or displayed, any advertisement for a commercial sex act, which is to take place in this State and which includes the depiction of a minor;

This NJ law was modeled after the Washington law. And while the unfortunate content in question makes the heart cry of anyone who reads it, it does not mean that making interactive online services liable for the unfortunate content of third parties is coherent, feasible, effective, or consistent with the First Amendment.

Once again a federal court in Backpage.com v. John Jay Hoffman, Acting Attorney General of the State of New Jersey (D.N.J. Aug. 20, 2013) struck down the law. There are multiple problems with the NJ law.

First, when a state law and a federal law conflict, the federal law preempts the state law pursuant to the Constitution's Supremacy Clause. The state law would make interactive services liable for the content of third parties; the federal law 47 U.S.C. § 230 states that interactive services are not liable for third party content. The Federal law preempts the state law.

But there is a further Sec. 230 problem that the court highlights. Sec. 230 was designed to protect interactive services that seek to make their services safer. The NJ law would have made it a crime to knowingly publish unfortunate content. This creates an unintended and unwanted incentive on the part of interactive services to not know what they are publishing - or in other words, to take no steps toward making their services safe. Again, this is a conflict between the state law and the federal law, and the federal law trumps.

The NJ statute also runs afoul of the First Amendment. According to the First Amendment, to the extent that you actually can be liable for publishing content, you must knowingly publish that content. The statute as written, in addition to knowing publications, would make an online service liable if it, without knowledge, directly or indirectly, causes the content to be published, disseminated, or displayed. As Congress concluded with the passage of Sec. 230, interactive services have little ability to monitor, review, or know all the content that flows over, is hosted on, or is posted to their services. The NJ statute is unconstitutional to the extent that it would make interactive services liable for the posting of content of which they have no knowledge.

Second, the law is not the least restrictive means of achieving a compelling government interest (going after individuals engaged in abuse of children would be more effective and less restrictive, than indirectly going after intermediary communications services). Third, the NJ statute is filled with vague terms and overbroad requirements. Finally, the Court finds that the NJ statute would violate the Commerce Clause.

Unfortunate problems give rise to unfortunate solutions. Too often when confronted with unfortunate problems, those in authority feel that they must do "something," regardless of whether that "something" is such a good idea. Frequently the "something" is a thing that is immediate and visible, and gives a false sense of security. It gives the feeling that the government has acted, where in fact it has not - and it may have even made things worse.

There is no denying that there is darkness out there that needs to be confronted. But as Congress rightly determined almost 20 years ago, attacking communications intermediaries for third party content is not the solution.

By Robert Cannon, Cybertelecom. More blog posts from Robert Cannon can also be read here.

Related topics: Access Providers, Cybercrime, Law, Policy & Regulation, Web

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