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Online Service Providers are Immune to Suit Under Section 230 of the CDA if They Use an Algorithm to Re-Publish Third Party Content

DC Court of Appeals find Section 230 CDA Immunity From Algorithm Use by Service Providers


The Court of Appeals for the District of Columbia affirmed the lower court’s decision dismissing a complaint against Google, Microsoft, and Yahoo! (herein “Online Service Providers”) brought by fourteen locksmith companies (herein the “Locksmiths”) who alleged that these Providers conspired to “flood the market” of online search results with information about so-called “scam” locksmiths, in order to extract additional advertising revenue. The Locksmiths argued that scam artists where falsely providing geographic location data to the Online Service Providers which the Providers would algorithmically convert to geographically displayed maps and prioritize the location of these scam locksmiths, thereby bleeding off legitimate locksmiths. These scammers were sometimes miles away from the consumer’s location and nowhere near the false location data supplied to the Online Service Providers, and hence the location map data presented to the needy consumer. The Locksmith’s case was dismissed in the lower court and the Appeals Court because Section 230(c)(1) of the Communications Decency Act 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.” 47 U.S.C. § 230(c)(1). Hence, the Online Service Providers are immune to any legal claims by the Locksmiths. Marshall’s Locksmith Service Inc. v. Google, LLC, Case No. 18-7018 (D.C. Cir., June 7, 2019) (Copy of Order available here).

Fourteen locksmith companies alleges that the Online Service Providers, Google, Microsoft, and Yahoo!, conspired to “flood the market” of online search results with information about so-called “scam” locksmiths, in order to extract additional advertising revenue. The Online defendants furthered this scheme by publishing content from scamming locksmiths’ websites, translating street-address and area-code information on those websites into map pinpoints, and publishing these location proximity maps as the Online Service Providers’ own original content.

The district court dismissed the amended complaint as barred by the Communications Decency Act, which 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). The Appeals Court affirmed this dismissal of Locksmith’s claims alleging false advertising under the Lanham (Trademark) Act, 15 U.S.C. § 1125(a)(1)(B), abuse of the Online Service Providers’ monopoly power under § 2 of the Sherman Act, 15 U.S.C. § 2, (Providers have nearly 90% of the search market), and conspiring to engage in restraint of trade under § 1 of the Sherman Act.

Both the importance of proximity and the internet’s potential to create the facade of proximity are not lost on scam locksmiths. These scamming companies actively cultivate online presences that give the appearance of locality. Scam locksmiths “publish hundreds or thousands of unique websites targeting nearly every heavily populated geographic location all around the country.” These pages “display either a fictitious or no address, and include false claims that [scam locksmiths] are local businesses.” Moreover, scam locksmiths use call centers to generate “local-area phone number[s],” when in reality they may be located far away from the querying consumer. All of these efforts are designed to take advantage of the structure of the Online Service Providers’ search engines. By so doing, the scam locksmiths have “tricked Google into displaying [scam locksmiths] as physical stores in [the consumers’] neighborhoods, when in reality, they’re ghosts.”

Locksmiths allege (1) Online Service Providers publish “[t]hird-party websites created by scam locksmith[s] that Defendants know do not exist at the addresses stated thereon;” (2) Online Service Providers publish “[e]nhanced content that was derived from third-party content, but has been so augmented and altered as to have become new content;” and (3) Online Service Providers publish “original content, created out of whole cloth.”

Per the Appeals Court: “Section 230 of the Communications Decency Act is the statutory provision that controls this case. Section 230(c)(1) 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.’ 47 U.S.C. § 230(c)(1). Section 230(f)(3) goes on to define an ‘information content provider’ as ‘any person or entity that is responsible, in whole or in part, for the creation or development of information provided through the Internet or any other interactive computer service.’ Id. § 230(f)(3). As courts uniformly recognize, § 230 immunizes internet services for third-party content that they publish, including false statements, against causes of action of all kinds. See, e.g., Bennett, 882 F.3d at 1166; Klayman v. Zuckerberg, 753 F.3d 1354, 1356 (D.C. Cir. 2014).”

“To determine whether dismissal is appropriate, this circuit has adopted a three-pronged test that tracks the text of § 230(c)(1): ‘The Communications Decency Act mandates dismissal if (i) [the defendant] is a ‘provider or user of an interactive computer service,’ (ii) the information for which [the plaintiff] seeks to hold [the defendant] liable was ‘information provided by another information content provider,’ and (iii) the complaint seeks to hold [the defendant] liable as the ‘publisher or speaker’ of that information. Klayman, 753 F.3d at 1357 (quoting 47 U.S.C. § 230(c)(1)); accord Bennett, 882 F.3d at 1166.”

At oral argument, the Locksmith’s attorneys admitted that if the Online Service Providers got data from false, scamming websites, then the CDA gives them immunity.” Per the Court: “But it is ‘well established that notice of the unlawful nature of the information provided is not enough to make it the service provider’s own speech.’ Universal Commc’n Sys., Inc. v. Lycos, Inc., 478 F.3d 413, 420 (1st Cir. 2007); see Bennett, 882 F.3d at 1166 (noting that § 230 immunity applies regardless of whether the defendant acquired knowledge that the third-party content it published was false (citing Zeran, 129 F.3d at 331)).”

The Locksmiths primarily complain about “enhanced” content which is the creation of map pinpoints that display scam-locksmith locations near the needy consumer’s location (the consumer using the Provider’s search services). The search engine receives GPS data from the consumer’s device and converts that information into a map pinpoint showing the consumer’s geographic location.

Importantly, the Appeal Court stated: “The decision to present this third-party data in a particular format – a map — does not constitute the ‘creation’ or ‘development’ of information for purposes of § 230(f)(3). The underlying information is entirely provided by the third party, and the choice of presentation does not itself convert the search engine into an information content provider. They [the Locksmith’s counsel] acknowledged at oral argument that a search engine has immunity if all it does is translate a user’s geolocation into map form.”

The next question is whether the translation of somewhat less-exact location descriptions is protected by the CDA. In this sense, the Online Service Providers are publishing “information provided by another information content provider.” See Kimzey v. Yelp!, Inc., 836 F.3d 1263, 1270 (9th Cir. 2016) (holding that Yelp’s star rating system, which is based on receiving customer service ratings from third parties and “reduc[ing] this information into a single, aggregate metric” of one to five stars could not be “anything other than usergenerated data”).

Per the Court: “It is true that the location algorithm is not completely constrained, but that is merely a consequence of a website design that portrays all search results pictorially, with the maximum precision possible from third-party content of varying precision. Cf. Carafano v., Inc., 339 F.3d 1119, 1125 (9th Cir. 2003) (‘Without standardized, easily encoded answers, [] might not be able to offer these services and certainly not to the same degree.’).”

The Online Service Providers use a neutral algorithm to make that translation. “We have previously held that ‘a website does not create or develop content when it merely provides a neutral means by which third parties can post information of their own independent choosing online.’ Klayman, 753 F.3d at 1358; accord Bennett, 882 F.3d at 1167; see Kimzey, 836 F.3d at 1270 (holding that Yelp’s ‘star-rating system is best characterized as the kind of neutral tool[] operating on voluntary inputs that . . . [does] not amount to content development or creation’ (internal quotation marks omitted) (citing Klayman, 753 F.3d at 1358)). And the Sixth Circuit has held that the ‘automated editorial act[s]’ of search engines are generally immunized under the Act. O’Kroley v. Fastcase, Inc., 831 F.3d 352, 355 (6th Cir. 2016).”

The Online Service Providers use automated algorithms to convert third-party indicia of location into pictorial form. These algorithms are “neutral means” that do not distinguish between legitimate and scam locksmiths in the translation process. Because the Online Service Providers employ a “neutral means” and an “automated editorial act” to convert third-party location and area-code information into map pinpoints, those pinpoints come within the protection of CDA § 230.


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