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Communications Decency Act – Part II

In general, Section 230 of the Communications Decency Act is not only one for defamation, but entails a few exceptions where liability can be imposed on an interactive computer service (e.g., Facebook, Twitter, Tumblr).  So, there are situations where an online business may be held responsible for another individual’s actions.  How can we know whether we will be held liable for a third party’s actions?  How can we avoid potential liabilities?

What can an interactive computer service be held liable for?

From a practical perspective, Section 230 is not an absolute shield for interactive computer services.  There are certain cases where an exception has been applied by the courts.  First, there is an exception for certain types of information.  Specifically, there is an exception for intellectual property.  For example, Section 230(e) determines the effect on other laws, including, an explicit omission of coverage for intellectual property protections.  In essence, liability for defamation may not carry over, but liability for any copyright infringement may carry over, as well as any issue of criminal law, such as obscenities.  Similarly, this can be demonstrated in Gucci America Inc. v. Hall & Associates, where the court determined, from the plain meaning of the statute, that it would not bar plaintiff’s trademark infringement claims against defendants.

The second issue is one of estoppel.  Promissory estoppel occurs when someone makes a promise, which causes another person to rely on that promise to his/her detriment.  In essence, someone does (or refrains from) something in reliance of another party’s promise.  This theory was demonstrated in Barnes v. Yahoo!   In that case, the plaintiff contacted Yahoo asking that her profile, that was set up in her name, be taken down by Yahoo.  After some coverage, Yahoo agreed to do so, and ultimately promised her that the take down would happen promptly.  It did not, prompting Barnes to file her lawsuit.  Ultimately, the judge found that promissory estoppel applied due to her reliance on Yahoo’s promise to take down the offending profile.

How can we avoid potential liability?

Of the ways to avoid liability, one is particularly important to keep in mind.  As we discussed Barnes v. Yahoo!, the interactive computer service may voluntarily promise that the online comments will be taken down.  This is the promissory estoppel theory we discussed last week.  So, the easiest way to avoid potential liability is to avoid making a promise towards the claimant or victim.

Furthermore, there may be other issues related to intellectual property, which may be more complicated.  In essence, there may be certain ways to limit damages. For example, formalizing user agreements may be helpful, but ultimately it may become a question of vigilance over those who use your online services, as well as, compliance with the law (e.g., Digital Millennium Copyright Act) or working with intellectual property right holders who have suffered violations.

At our law firm, we assist clients with legal issues related to business, technology, and e-commerce transactions.  You may contact us to set up an initial consultation.