Topic: Legal

Legal side of Reputation Management

Message Board Operator Isn’t Liable for Highlighting User Comments–Ayyadurai v. Techdirt 0

[It’s impossible to blog about Section 230 without reminding you that it remains highly imperiled.]

I’m so far behind in my blogging that you’ve already heard about–and forgotten–this ruling. Ayyadurai claimed to have invented “email” because he developed a software program in the late 1970s called “Email.” Mike Masnick, in his inimitable way, repeatedly debunked Ayyadurai’s claim. Ayyadurai retained lawyer Charles Harder, famous for representing the plaintiff that helped Hulk Hogan kick Gawker out of the marketplace, to sue Techdirt for defamation in Massachusetts. The court granted Techdirt’s motion to dismiss.

The court says Ayyadurai is a public figure and the case involves a matter of public concern, and he can’t prove the requisite falsity. With respect to Techdirt’s denigration of his status as email’s inventor (including harsher statements like “fake,” “fraud” and “charlatan”), the court says those “statements are protected because they are not provably false, are subjective statements that do not imply knowledge of objective facts, or are statements involving figurative language or hyperbole.” Like many other recent online defamation rulings, this court credits the hyperlinks to source documents (“by providing hyperlinks to the relevant information, the articles enable readers to review the underlying information for themselves and reach their own conclusions”) and the freewheeling nature of the blogosphere.

It’s a good ruling, but it’s a reminder that Massachusetts’s anti-SLAPP law isn’t robust enough to cover lawsuits like this. Massachusetts is currently considering a much-needed amendment to its anti-SLAPP law, but what we really need is a federal anti-SLAPP law that sets a minimum free speech floor across the nation.

The case also discusses Section 230 immunity for a “roundup” post of user comments. The court describes:

The article at issue, authored by Beadon and entitled “Funniest/Most Insightful Comments of the Week at Techdirt,” includes re-postings of comments posted by Techdirt’s readers. The article includes hyperlinks to the original comments, which were all posted in the “Reader Comments” section of previous Techdirt posts, and also includes intermittent introductory and editorial comments written by Beadon. All of the allegedly defamatory comments identified in the complaint are contained within the re-posted user comments.

The court says Section 230 immunizes this roundup post:

it is clear that Beadon was neither the “creator” nor “developer” of the statements at issue. Beadon simply selected a user-submitted comment and re-posted it, without modifying the content of the comment. Republishing an already-existing user-submitted comment, without altering the content of that comment, does not materially contribute to its allegedly defamatory nature.

Section 230 applies even if Beadon “adopted” or “ratified” the third party comments by including them in the roundup post, per the Jones case.

In a footnote, the court says that the plaintiff alleged that Beadon may have authored anonymous comments included in the roundup. The court says this allegation doesn’t clear the Iqbal standard. (No discussion of the Huon v. Denton trainwreck).

Case citation: Ayyadurai v. Floor64, Inc., 2017 WL 3896668 (D. Mass. Sept. 6, 2017). Techdirt’s post about the ruling.


Source: Eric Goldman Legal

Esports Marketing: Nielsen Embraces Esports 0

esports marketing legalNielsen Media Research unveiled plans to assess esports viewership. The service is meant to help brands make better sponsorship decisions when it comes to professional gaming events.

Howard Appelbaum, president of Nielsen Entertainment, enthused:

“There’s a high demand for reliable, independent measurement of value in esports. We’re excited to enhance our client offerings and provide the industry with solutions that will help guide and optimize investment decisions in this exciting, growing space.”

Esports Marketing: Global Advertising Advantage

It’s little surprise that Nielsen is sidling up to the esports industry; because these days, professional gaming is all the rage. Major leagues, like FIFA and the NBA, are launching digital counterparts. Moreover, viewership numbers on portals like YouTube and Twitch continue to climb.

Plus, the global reach of esports — and related events — is attractive to big brands.

Craig Levine, CEO of ESL in North America, explained:

“The global, digital and young nature of esports fan base audience represents advertising’s most highly sought after segment, yet consistent and high-quality data has been a challenge to measure and define. We’re excited to partner with Nielsen and other industry leaders to guide the framework to measure esports sponsorships, shape the industry, and help further accelerate the esports industry overall.”

The VP of Nielsen Games, Nicole Pike, further clarified the draw of esports advertising:

“Showing the same content to different people all over the world; that becomes very attractive.”

Advertising Regulation Reminders

Since esports marketing is a global affair, it’s especially important to comply with promotional regulations. Rules vary by jurisdiction, but they all adhere to the same basic principles:

  • Don’t lie;
  • Don’t make unsubstantiated claims;
  • Do disclose material relationships; and
  • Don’t dupe consumers with design tricks.

Click here for a full list of advertising dos-and-don’ts.

Connect With An Esports Marketing Attorney

Our firm helps players, personalities, teams, and sponsors with various esports marketing and business issues. To learn more, please head to the esports law section of our site. Ready to chat? Please get in touch.

Article Sources

Khan, I. (2017, August 17). Nielsen announces esports analytics platform. Retrieved September 27, 2017, from http://www.espn.com/esports/story/_/id/20368526/nielsen-announces-esports-analytics-platform

The post Esports Marketing: Nielsen Embraces Esports appeared first on Kelly / Warner Law | Defamation Law, Internet Law, Business Law.


Source: Kelly Warner Law

The DOJ’s Busts of MyRedbook & Rentboy Show How Backpage Might Be Prosecuted (Guest Blog Post) 0

by guest blogger Cary Glynn

[Eric’s introduction: Backpage has defeated numerous efforts by civil litigants and state AGs to shut it down, with substantial help from Section 230. These unsuccessful enforcement efforts have fueled a key narrative for SESTA that, because of Section 230, it’s *impossible* to shut down Backpage.

This narrative is false, or more accurately, unproven. As we know, Section 230 expressly does not apply to federal prosecutions. So what will happen when the DOJ finally prosecutes Backpage? Section 230 will be irrelevant, so the legal battleground will shift to other doctrines. It’s likely the DOJ will use the SAVE Act, tailored by Congress as an anti-Backpage crime. However, the SAVE Act has a high scienter requirement. Will the DOJ find other applicable crimes?

The answer is yes, and the reason I can answer it so confidently is because the DOJ has already brought two analogous successful prosecutions against websites publishing online prostitution ads. These two cases–MyRedbook and Rentboy–are usually not mentioned in any policy circles, either because they are too obscure or because they contradict the narrative that Section 230 is broken. To bridge this gap, this post highlights what happened in these prosecutions and anticipates how they pose bad news for Backpage.

This guest post comes from Cary Glynn, a 3L at Harvard Law School. He emailed me offering to help with research, and he graciously and voluntarily created this post during his discretionary time.]

* * *

drudge sirenThis post explains the government’s prosecutions of MyRedbook and Rentboy for prostitution related offenses. It then addresses implications for Backpage. Based on limited information about those prosecutions and publicly available descriptions of Backpage, it appears that the government could pursue Backpage on similar charges. [Eric’s note: many of the factual characterizations below are allegations from government pleadings and may not have been admitted by the defendants or provable in court.]

Background for MyRedbook and Rentboy Prosecutions

MyRedbook: On June 24, 2014, the Department of Justice indicted Eric Omuro, operator of MyRedbook, a website that hosted prostitution ads. Indictment, United States v. Omuro, No. 3:14-cr-00336 (N.D. Cal. June 24, 2014), ECF No. 1. As explained in the Government’s Sentencing Memorandum (Government’s Sentencing Memorandum, United States v. Omuro, No. 3:14-cr-00336 (N.D. Cal. May 14, 2015), ECF No. 70.), the website hosted prostitution ads, searchable by location, that included physical descriptions, services, rates, and contact information. The website included a FAQ page that explained various terms used in ads for particular services. However, the website also explicitly reminded its users that “nothing on this website should be construed as a furtherance of or endorsement of any illegal act or practice,” and that prostitution is illegal in most jurisdictions. Advertisers could pay a fee to have MyRedbook “feature” their ad. While the ads were publicly viewable, users could also pay for membership, which included private forums and escort reviews. The website generated profits of over $5,000,000.

In arguing for its desired sentence, the government argued that “it is inevitable in the commercial sex industry that many of those advertised on MyRedbook were under the control of pimps, and many were minors,” and Omuro ignored this harm because “facilitating prostitution, which necessarily included facilitating the prostitution of trafficked persons and minors – was profitable.” Further, Omuro was not diligent in trying to remove these ads and declined to respond to an email from the National Center for Missing and Exploited Children (NCMEC). In a declaration from an FBI agent, the government noted over 50 minors advertised on the website. Finally, the indictment alleges that Omuro engaged in 24 transfers of money in order to launder his profits.

Rentboy: On January 28, 2016, the Department of Justice indicted Jeffrey Hurant, the CEO of Rentboy.com, a website that hosted prostitution ads. Indictment, United States v. Easy Rent Sys., Inc., No. 1:16-cr-00045 (E.D.N.Y. Jan. 28, 2016), ECF No. 68. As explained in the indictment, the website focused on male escort services. Escorts paid the website to display ads, and customers then contacted the escorts directly. The website included disclaimers stating that the ads were not for sexual services, but the indictment alleges that the website was “designed primarily for the advertisement of sexual services, and the advertisements on [it] plainly advertised sexual services.” Additionally, one page stated: “Make a profile, field calls and emails, count your money.” The website had account pages for escorts to manage their ads. For escort’s profiles, the website had fields for various rates. The website told users that ads could not include offers of sexual conduct in exchange for money. It gave a 15 percent discount to escort agencies that purchased three or more advertisements. The website generated revenue of over $10 million between 2010 and 2015.

Employees of the website reviewed all ads before posting. They generally rejected ones that explicitly offered sexual conduct in exchange for money. Upon rejection, an employee would tell the advertiser that they should not specify sexual acts to be exchanged for money because it could result in prosecution. The employees also sometimes advised advertisers on how to make their ads more appealing. In addition, employees warned escorts about specific enforcement actions by law enforcement.

The website did not report instances of advertisements for children. Employees complained to management about underage advertisements in Asia.

Travel Act: 18 U.S.C. § 1952(a)(3)(A) and (b)(i)(1)

The government indicted Omuro under the Travel Act, specifically, 18 U.S.C. § 1952(a)(3)(A) and (b)(i)(1), which read as follows:

(a)(3)(A): “(a) Whoever . . . uses the mail or any facility in interstate or foreign commerce, with intent to— . . . (3) otherwise promote, manage, establish, carry on, or facilitate the promotion, management, establishment, or carrying on, of any unlawful activity, and thereafter performs or attempts to perform—(A) an act described in paragraph (1) or (3) shall be fined under this title, imprisoned not more than 5 years, or both”

(b)(i)(1): “(b) . . . (i) “unlawful activity” means (1) . . . prostitution offenses in violation of the laws of the State in which they are committed or of the United States”

The indictment appears to suggest that Omuro “used the mail” and also used a “facility in interstate or foreign commerce,” the Internet, which the government refers to as a “communication facility.” The indictment also alleges that Omuro did so knowingly and “with the intent to promote, manage, establish, carry on, and facilitate the promotion, management, establishment, and carrying on of an unlawful activity.” Here, the unlawful activities were violations of various states’ prostitution offenses including California Penal Code Section 647(b). Omuro pleaded guilty to the charge under § 1952.

The government also indicted Hurant and Easy Rent Systems (the website) under (a)(3)(A). The indictment alleges that the defendants “did knowingly and intentionally use one or more facilities in interstate commerce, to wit: one or more telephones and the internet, with intent to distribute the proceeds of and promote, manage, establish, carry on and facilitate the promotion, management, establishment and carrying on of unlawful activity, to wit: a business promoting prostitution in the third degree,” in violation of various New York state laws prohibiting prostitution.

Money Laundering: 18 U.S.C. § 1957(a) and 1956

The government indicted Omuro for money laundering, under 18 U.S.C. § 1957(a), which reads as follows:

Whoever . . . knowingly engages or attempts to engage in a monetary transaction in criminally derived property of a value greater than $10,000 and is derived from specified unlawful activity, shall be punished as provided in subsection (b).

The indictment alleges that Omuro “knowingly engaged in [24] monetary transactions in criminally derived property of a value greater than $10,000, that was derived from specified unlawful activity, namely racketeering in support of prostitution offenses in violation [of 18 U.S.C. § 1952(a)(3)(A) and (b)(i)(1)].” The government provided a dated list of all the transactions, their amounts, and the related accounts.

The government indicted Hurant and Easy Rent Systems under 18 U.S.C. § 1956 which reads as follows:

(a)(1) Whoever, knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, conducts or attempts to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity—(A) (i) with the intent to promote the carrying on of specified unlawful activity…

(h) Any person who conspires to commit any offense defined in this section or section 1957 shall be subject to the same penalties as those prescribed for the offense the commission of which was the object of the conspiracy.

Application to Backpage

Both of the government’s successful theories in the MyRedbook and Rentboy prosecutions may apply to Backpage as well.

Travel Act: Backpage uses a facility in interstate commerce (the Internet, and likely telephones/mail). The closer question is whether it intended to and did “promote, manage, establish, carry on, or facilitate the promotion, management, establishment, or carrying on, of” prostitution offenses. Given the general focus on prostitution offenses, the specific question of Backpage’s involvement in underage prostitution and trafficking is less legally relevant here. Backpage recently removed its adult section, so this discussion focuses on its knowledge and actions before removal (although Backpage still could of course be guilty based on this new conduct and there is reason to believe the ads merely moved to other parts of the Backpage website).

Two sources are enlightening regarding Backpage’s involvement in prostitution offenses: (1) a Senate report, “Backpage.com’s Knowing Facilitation of Online Sex Trafficking,” by Senators Portman and McCaskill, and (2) a declaration in support of a California state arrest warrant for the CEO of Backpage. This post assumes that the factual assertions in those two documents are true. If these facts are true, it would have the following implications:

Backpage apparently had knowledge of the high volume of prostitution ads on its website. Like Rentboy and myRedBook, Backpage received various streams of information revealing that prostitution ads were on its website, including from NCMEC. The Senate Report explains that “Backpage is acutely aware that its website facilitates prostitution.” Backpage’s Michael Lacey reportedly said that while the website had tried to eradicate ads for minors, “adult prostitution is none of my business.” Backpage employees knew the website carried many prostitution ads. One former employee explained that “everyone” knew about the prostitutions ads and that denials are “bullshit.” Some employees apparently used the illegal services advertised on the website. Backpage even urged employees not to memorialize evidence of prostitution facilitation in writing. Its editing process, whereby employees remove terms that allude to prostitution, also suggests knowledge.

The poor quality of Backpage’s editing process provides evidence of its intent to facilitate prostitution. For instance, Backpage allowed the term “GFE” (i.e. “girlfriend experience”), which employees knew as referring to prostitution services. Like Rentboy, employees reviewed ads before posting but allowed ads for prostitution once shorn of objectionable terms. Backpage declined to block or exercise other measures to combat prostitution ads. Backpage’s moderation process may have had debatable effectiveness for combatting trafficking of minors, but it seems to have allowed an immense volume of prostitution ads.

In addition, Backpage materially benefited from prostitutions ads, like the other websites. As with Rentboy and MyRedbook, Backpage charged for prostitution ads and allowed advertisers to pay more to “feature” their ads. Like the other websites, Backpage made a large amount of money—hundreds of millions of dollars. The California warrant states that Backpage’s revenue reports revealed that in recent years 99% of revenue was attributable to “adult” ads. The Senate report claims that this was over “80% of all revenue from online commercial sex advertising in the United States.” Backpage also operated various websites only advertising escorts (Evil Empire, etc.). Admittedly, unlike Rentboy, Backpage does not appear to have offered agency discounts or helped make ads more appealing.

Backpage’s knowledge, poor moderation efforts, and materially benefiting from prostitution ads could be construed to suggest that Backpage intended to facilitate prostitution ads.

Backpage appears to have in fact facilitated the prostitution offenses. Backpage provided a platform, like Rentboy and MyRedbook, geared toward prostitution offenses. It was Backpage’s main source of income, and the adult section was the only section where Backpage charged fees for all ads. Backpage helped edit ads to conceal their true nature, while still posting ads that Backpage knew to be advertising prostitution. Backpage cleansed the majority of ads in the adult section of terms relating to prostitution. Backpage’s wide readership was a material contribution to advertisers. Admittedly, unlike MyRedbook, Backpage does not appear to have facilitated the prostitution offenses by providing explanations of prostitution-related terms. And, unlike Rentboy, Backpage does not appear to have fields for “rates.” However, the Senate Report alleges that Backpage occasionally “coached its users on how to post ‘clean’ ads for illegal transactions.”

Backpage may have done a better job than Rentboy or MyRedbook at screening trafficking and advertisements for minors (although some of course believe otherwise). However, efforts on that front are not specifically relevant to a charge related to prostitution. And Backpage’s potentially successful moderation in that area belies protestations of the difficulty of improved moderation against prostitution. Additionally, the other websites both included explicit reminders that prostitution was prohibited – any similar postings by Backpage would thus not be automatically immunizing.

Money Laundering: Backpage could also be prosecuted for money laundering offenses. However, both money laundering offenses that the government used to pursue the other websites require predicate unlawful activity. Therefore, the most difficult question for this offense seems to turn on the above analysis about the facilitation of prostitution. Unlike earlier money laundering charges against Backpage in California, the charges against Rentboy and MyRedbook do not seem related to misrepresentations to banks or payment processors. Assuming, however, that Backpage committed underlying unlawful acts, Backpage could likely be charged with money laundering.

More SESTA-Related Posts:

Problems With SESTA’s Retroactivity Provision (Guest Blog Post)
My Senate Testimony on SESTA + SESTA Hearing Linkwrap
Debunking Some Myths About Section 230 and Sex Trafficking (Guest Blog Post)
Congress Is About To Ruin Its Online Free Speech Masterpiece (Cross-Post)
Backpage Executives Must Face Money Laundering Charges Despite Section 230–People v. Ferrer
How Section 230 Helps Sex Trafficking Victims (and SESTA Would Hurt Them)
Sen. Portman Says SESTA Doesn’t Affect the Good Samaritan Defense. He’s Wrong
Senate’s “Stop Enabling Sex Traffickers Act of 2017”–and Section 230’s Imminent Evisceration
The “Allow States and Victims to Fight Online Sex Trafficking Act of 2017” Bill Would Be Bad News for Section 230
WARNING: Draft “No Immunity for Sex Traffickers Online Act” Bill Poses Major Threat to Section 230
The Implications of Excluding State Crimes from 47 U.S.C. § 230’s Immunity


Source: Eric Goldman Legal

Nigerians Phish a B2B Transaction & Steal $736k. Who Bears the Loss?–Beau Townsend Ford v. Don Hinds Ford 0

2011_Ford_Explorer_Limited_--_02-07-2011This case could be a law school exam. Beau Townsend Ford (the seller) was looking to unload Ford Explorers in bulk. Their sales guy connects with a person at Don Hinds Ford (the buyer). They had transacted with each other before. By email, they negotiate a sale of 20 Explorers for $736k. So far so good.

But then…the Nigerians had hacked sales guy’s email account and set up some automated rules. After the email deal was struck, all incoming emails from the buyer’s contact were filtered out of the sales guy’s email account and forwarded to the Nigerians. The Nigerians then responded to the buyer’s emails from a Gmail account that used the sales guy’s name. So when the buyer proposed paying by check, the fake Gmail account responded with wire transfer instructions. The instructions listed the destination accountholder as “K.B. KEY LOGISTICS L.L.C.,” but the buyer didn’t think that name was strange because car dealers often use DBAs. The wire transfers were sent (to the Nigerians), the buyer picked up the vehicles in stages, and the buyer emailed to confirm that the wire transfers were received, which the fake Gmail account confirmed. A week later, the seller reaches out to the buyer to find out where the money is, and everyone involved had a bad day.

The seller sued the buyer for non-payment of the 20 Ford Explorers. Who bears the risk of loss of the Nigerians’ theft?

The court says: “Both parties would each have the Court find that the other was in the best position to avoid the misfortune that occurred in this case.” The court responds: “both parties were negligent in their business practices” because the seller “should have maintained a more secure email system and taken quicker action upon learning that it might have been compromised,” and the buyer “should have ascertained that an actual agent of Beau Townsend Ford was requesting that it send money by wire transfer.”

As part of blaming the buyer, the seller pointed out that the Nigerians’ emails to the buyer had obvious spelling and grammatical mistakes. The court blithely responds: “the Court notes increases to to [sic] near ubiquity of errors due to voice recognition technology and auto-correct.” (Surprisingly, the court doesn’t blame millennials or texting for the death of grammar and spelling). Ironically (?), the opinion has a grammar error in a sentence acknowledging the ubiquity of grammar errors. Whoops…or clever? Cf. Billy Joel’s You’re Only Human.

Though the court isn’t sympathetic to either side, the court ultimately sides with the seller. The contract was valid, the buyer took delivery but didn’t pay the seller, so the seller deserves its money–all $736k. Oof.

So, what do you think about this outcome? What do you feel is more blame-worthy: not maintaining secure email accounts, or not noticing that emails are coming from strange accounts? Should the buyer have picked up the phone? Should the seller have confirmed payment before transferring possession? Perhaps we could try to point the fingers at other people, such as the email service providers or the bank? Would your feelings change if it’s ultimately an insurance company cutting the check? So who do you think should bear this risk of loss? I’d love to hear your thoughts.

Case citation: Beau Townsend Ford Lincoln Inc., D/B/A Beau Townsend Ford v. Don Hinds Ford, Inc. D/B/A Don Hinds Ford, 2017 WL 4237028 (S.D. Ohio Sept. 25, 2017)


Source: Eric Goldman Legal

Problems With SESTA’s Retroactivity Provision (Guest Blog Post) 0

by guest blogger Alex Levy

drudge sirenThe “Stop Enabling Sex Traffickers Act” (SESTA) is riddled with problems, discussed herehereherehere, and here. However, very little attention has been paid to Section 3(b), which proposes making the civil provision retroactive: “the amendment made by subsection (a)(2)(B) shall apply regardless of whether the conduct alleged occurred, or is alleged to have occurred, before, on, or after such date of enactment.” The provision would mean that civil plaintiffs could hold intermediaries liable for content they did not create, and they could sue intermediaries for past conduct. Both case law and fairness principles counsel against retroactive liability.

Ex post facto clause

The Constitution forbids Congress from creating criminal laws that punish acts predating the enactment of the law. U.S. Const. Art. I, §§ 9, 10. While courts have generally limited the Constitutional prohibition on ex post facto to the criminal context, laws may transcend obvious categories of criminal or civil. Calder v. Bull, 3 U.S. 386 (1798). Indeed, courts have noted that punitive civil damages may “share key characteristics of criminal sanctions, implicating the ex post facto clause.” Louis Vuitton S.A. v. Spencer Handbags Corp., 765 F.3d 966, 972 (2nd Cir. 1985). The Supreme Court asserted that “the mark of an ex post facto law is the imposition of what can fairly be designated punishment for past acts.” DeVeau v. Braisted, 363 U.S. 144, 160 (1960). Conceptually, “[r]etroactive imposition of punitive damages [may] raise a serious constitutional question.” Landgraf v. USI Film Prods., 511 US 244, 281 (1994).

The first question, then, is whether 18 U.S.C. §1595 “share[s] key characteristics of criminal sanctions.” Louis Vuitton S.A. v. Spencer Handbags Corp., 765 F.3d 966, 972 (2nd Cir. 1985). While the availability of punitive damages is not spelled out in the statute, courts have without exception held that punitive damages are available under the provision. See, e.g., Butigan v. Al-Malki, 1:13-cv-00514 (E.D.Va.) (awarding $400,000 in punitive damages), Carazani v. Zegarra, 1:12-cv-107 (D.D.C.) (awarding $543,041.28 in punitive damages), Doe v. Dabbagh, 15-cv-10724 (E.D.Mich.) (awarding $250,000 in punitive damages), Magnifico v. Villanueva (awarding $9,025,325.50 in punitive damages). Furthermore, the rationale articulated by these courts supports the notion that 18 U.S.C. 1595 is fundamentally punitive in nature. In Ditullio v. Boehm, for example, the Ninth circuit noted that “permitting punitive damages is consistent with Congress’ purposes in enacting the TVPA, which include increased protection for victims of trafficking and punishment of traffickers.” Ditullio 662 F.3d 1091, 1098 (9th Cir. 2011). The Tenth Circuit similarly asserted that “the traditional use of punitive damages is to punish and deter misconduct” in its holding that punitive damages are available under the TVPA. Francisco v. Susano, 525 Fed. Appx. 828, 834 (10th Cir. 2013). This case law shows that a key purpose of §1595 is punitive, raising possible ex post facto issues.

Fairness

In determining the constitutional validity of retroactive statutes, courts may consider the extent of the retroactive effect. In a 1998 case striking down a retroactive regulation as an unconstitutional taking, the Supreme Court indicated that “the magnitude of that liability raise substantial questions of fairness.” Eastern Enterprises v. Apfel, 524 U.S. 498, 501 (1998).

In SESTA’s case, the effect would be tremendous. SESTA would retroactively eliminate a longstanding defense to civil trafficking claims, namely, that Internet service providers cannot be treated as speakers of content they publish for purposes of establishing liability. In other words, SESTA creates new potential for liability for disseminating content created by others. Others have noted that this law, if passed, would likely force platforms to adopt new censorship procedures and automatic filtering techniques, and that the task of reducing potential liability could prompt an overhaul of basic operations, even potentially forcing smaller startups to shut down. But if SESTA’s prospective liability is excessive, the notion of retrospective liability for such content is downright staggering — and at odds with fundamental notions of fairness.

In any event, if SESTA passes the retroactivity provision, defendant intermediaries will have a strong argument that the presumption against retroactive application of 1595 prevents plaintiffs from holding them accountable under SAVE Act provisions for conduct predating its passage in 2015. See e.g. Adhikari v. Daoud, 15-20225 (5th Cir. Jan. 3, 2017) (holding retroactive application of the extraterritorial provision of the TVPA invalid).

More SESTA-Related Posts:

My Senate Testimony on SESTA + SESTA Hearing Linkwrap
Debunking Some Myths About Section 230 and Sex Trafficking (Guest Blog Post)
Congress Is About To Ruin Its Online Free Speech Masterpiece (Cross-Post)
Backpage Executives Must Face Money Laundering Charges Despite Section 230–People v. Ferrer
How Section 230 Helps Sex Trafficking Victims (and SESTA Would Hurt Them)
Sen. Portman Says SESTA Doesn’t Affect the Good Samaritan Defense. He’s Wrong
Senate’s “Stop Enabling Sex Traffickers Act of 2017”–and Section 230’s Imminent Evisceration
The “Allow States and Victims to Fight Online Sex Trafficking Act of 2017” Bill Would Be Bad News for Section 230
WARNING: Draft “No Immunity for Sex Traffickers Online Act” Bill Poses Major Threat to Section 230
The Implications of Excluding State Crimes from 47 U.S.C. § 230’s Immunity


Source: Eric Goldman Legal