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ISP Immunity Provision Is Broadly Interpreted; but One Exception Exists When a Violation of Trademark Law Is Allegedby Laurin H. Mills and Leslie Paul Machado 4/15/2002 Recent decisions applying §230 of the Communications Decency Act of 1996 (the "CDA") have properly extended §230 immunity to Internet service providers ("ISPs") providing services beyond traditional access services, to individuals, to commercial and governmental entities, and to interactive Web-site operators. This article discusses these recent decisions and the reasons why the extension of §230 immunity beyond traditional access services is supported by the statute. It also addresses two decisions denying §230 immunity to ISPs that allegedly participated in violations of trademark law as well as a recent decision that restrictively defined "interactive computer service." Background Section 230 states that "[n]o 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." 47 U.S.C. §230(c)(1). Section 230 was passed in response to Stratton Oakmont, Inc. v. Prodigy Services, Co., 1995 N.Y. Misc. LEXIS 229 (Nassau Cty. 1995). There, a Following its passage, §230 immunity was principally invoked by ISPs that were sued for content posted by other individuals, usually on Internet bulletin boards or in "chat rooms." See, e.g., Zeran v. America Online, Inc., 129 F.3d 327 (4th Cir. 1997) (AOL immune from liability for messages posted by individual); Doe v. America Online, Inc., 783 So. 2d 1010 (Fla.), cert. denied, 151 L. Ed. 2d 148 (2001) (AOL immune from liability arising from use of chat room for distribution and marketing of pornographic videotape and photographs of minor child). Recent Decisions Several recent decisions have applied §230 immunity to defendants that were either not providing traditional Internet access services or were not ISPs. These courts have reasoned that the defendants are entitled to §230 immunity because the defendants are providers or users of an interactive computer service, they did not create the material at issue and imposing liability on them would treat them as the publisher or speaker. Additional ISP Services The first case to address the applicability of §230 to Internet services that were not purely access related was John Does 1 through 30 v. Franco Productions, 2000 U.S. Dist. LEXIS 8645 (N.D. Ill. June 22, 2000). There, the ISP defendants were alleged to have "hosted" Web sites that offered for sale surreptitiously-taken photographs and videos of major college athletes in various stages of undress. The court held that ISPs who merely "host" Web sites are not liable for material posted on their sites by their customers. "The Court reiterates its previous holding finding GTE, and now similarly PSINet, service providers whose immunity or status as service providers under the CDA is not vitiated because of their web hosting activities, whether viewed in combination with their roles as service providers or in isolation." The court also rejected plaintiffs’ theory that they were intended third-party beneficiaries, finding that there was no identification of the plaintiffs in the contract between the ISPs and the sites they were hosting. In 1996, when §230 was enacted, Web hosting was an infant industry. It is by no means clear that Congress was even aware of its existence when it enacted the CDA. By 2000, when Franco Productions was decided, Web hosting had become a major source of revenue for ISPs and a central part of their business models. Thus, even though Congress was likely ignorant of Web hosting in 1996, it would have made no sense for the court to hold that §230 immunized ISPs in one area of their operations but not in others. For that reason, the broad interpretation that the court gave to the term "interactive computer service" to encompass Web hosting services was entirely warranted and perfectly consistent with the intent of Congress. Other courts have also declined to interpret §230 narrowly. In Green v. America Online, Inc., Civ. No. 00-3367 (JAG) (D.N.J. Individuals, Commercial and Governmental Entities Section 230 immunity has also been extended to individuals, to governmental entities and to brick-and-mortar companies. In Marczeski v. Law, 122 F. Supp. 2d. 315 (D. Conn. 2000), the court held that individual defendants who allegedly created a chat room where the plaintiff was libeled were entitled to immunity under §230. This is the first case extending §230 immunity to individuals. "A careful reading of plaintiff’s complaint and deposition indicates that she is not claiming that defendants actually made these statements. Her charge is that they created ‘# legaltalk’ where the subject of plaintiff’s alleged e-mail could be discussed publicly. . . . [T]here is no basis for imposing any liability on either defendant for any defamatory statements made by others." Similarly, Barrett v. By contrast, in Batzel v. Smith, 2001 U.S. Dist. LEXIS 8929 (C.D. The court denied §230 immunity apparently based upon the second argument. It held that Museum Security Network and the individual creator/operator were not "an internet service provider within the meaning of the Act. . . . Although several cases have held that, by virtue of the Act, internet service providers cannot be sued for defamation, none are applicable here because, unlike MSN/Cremers, the qualifying entities were true internet service providers, like America Online, that provided individuals with access to the internet. MSN, in contrast, is clearly not an internet service provider, as it has no capability to provide internet access. To the contrary, it is plainly an ‘information content provider’ within the meaning of the Act." Batzel, 2001 Barrett represents an exceptionally broad, but completely justified, interpretation of §230. The decision provides "reposters" of information with complete immunity, even if it is alleged that the reposter knew the information was false or acted in reckless disregard of the truth. In words familiar to libel lawyers, even if the reposter acted with actual malice, he or she is still immune. That is an immunity that goes well beyond most immunities accorded to traditional media. The reason that Barrett is correct is that in enacting §230 Congress expressly intended to create in cyberspace immunities that go well beyond those available in other contexts. Thus, there is nothing surprising about the fact that an immunity granted under §230 conflicts with the law outside of cyberspace. Moreover, an actual malice exception would largely eviscerate §230 protection because plaintiffs could merely plead malice and thereby keep ISP defendants in cases for very long periods of time. With all due respect to the plaintiffs’ bar, the potential mischief that this incentive would create far outweighs the costs of letting an occasional malicious reposter escape civil liability. Batzel, on the other hand, is wrong. The Batzel court incorrectly focused on one part of the definition of "interactive computer service." In so doing, it failed to realize that defendant Cremers and his Web site are a service or system that provides or enables computer access by multiple users to a computer server. At a minimum, the Batzel defendant was entitled to immunity as a user of an interactive computer service, like the defendant in Barrett. As demonstrated by the cases discussed in this article, courts have recognized that Congress broadly defined "interactive computer service." The Batzel court’s restrictive definition improperly denied defendant Cremers and his Web site §230 immunity. In Kathleen R. v. City of Livermore, 87 Respondent provides an "interactive computer service" in this case because its library computers enable multiple users to access the Internet. Respondent is not an "information content provider" in this case because it is not "responsible, in whole or in part, for the creation or development" of any of the harmful matter accessible through its computers. The next logical extension of §230 immunity was to a brick-and-mortar company that provided access to the Web. In PatentWizard, Inc. v. Kinko’s, Inc., 163 F. Supp. 2d 1069 (D.S.D. 2001), the plaintiff, the owner of a software company, claimed that he and his company were defamed during a chat room session. Instead of suing the person who made the allegedly defamatory comments ("Jimmy"), the plaintiff sued Kinko’s, whose computers Jimmy used to log onto the Internet. The parties agreed that Kinko’s was a provider of an "interactive computer service," and that Jimmy was an "information content provider." The only question before the court was whether the plaintiff’s complaint sought to treat Kinko’s as a publisher or speaker of information that Jimmy posted on the Internet. The court held that the complaint sought to treat Kinko’s as a publisher for purposes of §230 in two different ways: "[f]irst, it seeks to treat Kinko’s as a distributor by imposing liability upon Kinko’s for its conduct in disseminating Jimmy’s statements. . . . Second, the Complaint seeks to place Kinko’s in Jimmy’s shoes, by holding Kinko’s responsible for alleged defamatory matter that was published by Jimmy." Interactive Web-Site Operators A trio of decisions in the past year have extended §230 immunity to commercial Web sites that post content developed by others. These cases are similar in many ways to the Zeran and Doe decisions in that they immunize companies that provide a forum for the exchange of messages, but do not themselves create the messages. In Schneider v. Amazon, Inc., 31 P.3d 37 (Wash. Ct. App. 2001), the court held that §230 immunized Amazon from liability for allegedly defamatory comments posted by third parties on Amazon’s Web-site. The plaintiff alleged that Amazon posted visitors’ comments about him and his books that were allegedly defamatory. The plaintiff further alleged that Amazon agreed to remove the offensive comments because it violated Amazon’s guidelines, but failed to do so. Although the court noted that there were no decisions discussing whether an interactive Web site operator, like Amazon, was entitled to immunity under the statute, it held that Amazon was an interactive computer service: "Amazon’s web site postings appear indistinguishable from AOL’s message board for §230 purposes. Schneider points out that web site operators do not provide access to the Internet, but this is irrelevant. . . . According to Schneider’s complaint, Amazon’s web site enables visitors to the site to comment about authors and their work, thus providing an information service that necessarily enables access by multiple users to a server. This brings Amazon squarely within the definition." The court additionally found that Schneider’s claim attempted to impose liability for Amazon’s failure to remove the posting—an editorial decision that §230 is intended to guard against. Finally, the court rejected plaintiff’s arguments that because Amazon had the right to edit the posting, and because Amazon claimed licensing rights in the posted material, it should be construed as an information content provider: "[t]here is no allegation that Amazon was responsible for creating or developing the negative comments. Amazon was not a content provider under the allegations in Schneider’s complaint." Similarly, in Stoner v. eBay, Inc., No. 305666 (Cal. Sup. These cases make clear that courts will reject attempts by plaintiffs to avoid §230 by arguing that defendants should be treated as content providers because they provided services that were ancillary to the creation of content. Denial of §230 Immunity—The Trademark Cases Two recent cases that have refused to grant §230 immunity to ISPs both concern trademark law. In Gucci America, Inc. v. Hall & Assoc., 135 F. Supp. 2d 409 (S.D.N.Y. 2001), the complaint alleged that Mindspring hosted another defendant’s Web page, that Mindspring was informed that the other defendant was using Mindspring’s services to aid in trademark and unfair competition, and that Mindspring failed to take any action to stop it. Mindspring maintained that §230 immunized it from liability for information posted on the Web site because it was an interactive computer service and the other defendant was the information content provider of the content at issue. The plaintiff agreed that Mindspring was an interactive computer service and the other defendant was the information content provider of the content at issue. It argued, however, that Mindspring was not immune because §230 specifically provided that "[n]othing in this section shall be construed to limit or expand any law pertaining to intellectual property." These cases arguably conflict with the broad interpretations given §230 by other courts. Moreover, it makes little sense to immunize ISPs from virtually every other tort claim while keeping them potentially liable as publishers for trademark claims. Nevertheless, §230 specifically carved out intellectual property claims. Given that express statutory language, these cases may have been correctly decided. Unfortunately, these holdings are certain to inspire numerous strained trademark claims as creative plaintiffs’ attorneys attempt to circumvent the §230 immunities in search of deep pockets. There is, however, an argument that was either overlooked by the parties or ignored by the court. That argument is that trademark claims are not "intellectual property" claims. While the cases are legion grouping trademark under the rubric of intellectual property, and there is a United States Patent and Trademark Office, trademarks are, in many respects, fundamentally different from intellectual property. Patent and copyright laws are designed to foster and reward innovation and invention. Aronson v. Quick Point Pencil Co., 440 They also differ historically. Congress’s power over patents and copyrights is derived specifically from Art. I, §8, cl. 8 of the Constitution (the "Intellectual Property Clause"), which authorizes Congress to "promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their inventions and discoveries." Trademark, however, is merely a branch of unfair competition law and was recognized by the common law prior to the Constitution. Moreover, federal legislation with respect to trademarks is authorized under the Commerce Clause, not the Intellectual Property Clause. United States v. Steffens, 100 Congress did not define "intellectual property" in §230 or elsewhere in the CDA. In at least one major statute, however, where Congress did define the term, it specifically defined it to exclude trademark. See, e.g., 11 U.S.C. §101(35A) (excluding trademarks from the definition of Intellectual Property for purposes of the Bankruptcy Code); accord In re Gucci, 126 F.3d 380, 394 (2d Cir. 1997) (noting that "protection of trademarks [was] deliberately not conferred" by Congress when it defined "intellectual property" in the Bankruptcy Code; but see 15 U.S.C. §4711(7) (defining intellectual property to include trademark); 19 U.S.C. §§2411 & 2901 (same). The bottom line is that trademark was not lumped under the rubric of "intellectual property" either at common law or in the Constitution. Congress has inconsistently defined the term in other statutes. Thus, the most that can be said is that it is unclear whether Congress intended to include or exclude trademark from §230 protection. It is, nevertheless, clear that Congress did intend §230 to have a very broad sweep with respect to other causes of action. The Gucci decision would appear to leave ISPs with a Hobson’s choice when notified of a client that is allegedly violating trademark laws: take down the Web site containing the allegedly offensive material, and risk inviting a lawsuit from the client if the material did not violate trademark laws, or leave the Web site running and risk being forced to defend a lawsuit alleging violations of trademark law. Albeit in a different context (defamation), the Fourth Circuit’s reasoning in Zeran is equally applicable to claims of trademark infringement: Whenever one was displeased with the speech [or products] of another party over an interactive computer service, the offended party could simply "notify" the relevant service provider, claiming the information to be legally [actionable]. In light of the vast amount of speech [or products] communicated through interactive computer services, these notices could produce an impossible burden for service providers, who would be faced with ceaseless choices of suppressing controversial speech [or products] or sustaining prohibitive liability. Zeran, 129 F.3d at 333. Indeed, the Zeran court noted "[e]ach notification would require a careful yet rapid investigation of the circumstances surrounding the posted information, a legal judgment concerning the information’s [actionable] character, and an on-the-spot editorial decision whether to risk liability by allowing the continued publication of that information." Given the historical and constitutional underpinnings of trademark law, and Congress’ intent that ISPs should not be forced to make on-the-spot decisions that could expose them to potential liability, there is more than sufficient justification to include trademark claims within the coverage of §230. Conclusion The clear trend in the law is toward increasingly expansive interpretations of §230 to encompass new applications of Internet technology, new "interactive computer services" and increasingly novel factual scenarios. Unless expressly required by the statute to do so, courts have been uniformly reluctant to carve "backdoors" into §230 to circumvent its immunities. All this is good. Despite the hype it received in the late 1990s, the Internet is still a very immature technology, albeit with immense promise. The applications of the Internet are even less mature. The immunities granted by §230 will be instrumental in helping the Internet to achieve its full potential.
This article is reprinted with permission from the April 15th edition of the National Law JournalŠ 2002 NLP IP Company. All rights reserved. Further duplication without permission is prohibited.
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