Defamation Liability on the Internet After the Communications Decency Act
The CDA was designed to encourage self-regulation by permitting Internet service providers (ISPs) to exercise their editorial powers in regulating offensive material without incurring strict liability for defamation as publishers of third-party content. This was achieved through § 230(c)(1), which granted ISPs and users immunity from treatment as "the publisher or speaker of any information provided by another information content provider."
Congress's effort to encourage ISPs to self-regulate offensive material provided through their services eventually produced, through the courts, a broad immunity for ISPs that extended well beyond the intended scope of the CDA. Interestingly, the most influential court decision interpreting § 230, Zeran v. America Online, Inc., did not address the dissemination of generally offensive material on the Internet, but rather a dispute over the defamation liability of an ISP for third-party content. The Zeran court granted ISPs and their users virtually complete immunity from defamation liability for third-party content, a decision intended to safeguard the continued development of "the new and burgeoning Internet medium." The Zeran court's broad interpretation of § 230 immunity produced some troubling results.
Zeran v. America Online, Inc.
Just six days after the Oklahoma City bombing of April 19, 1995, an anonymous individual posted a message on an America Online (AOL) bulletin board describing the sale of shirts featuring offensive and tasteless slogans related to the tragedy. The message instructed those interested in purchasing the shirts to call Kenneth Zeran's home phone number. As a result of this malicious prank, Zeran began receiving a large number of hostile calls, including numerous death threats. Zeran contacted AOL and informed a representative of the company of his predicament. AOL promised to remove the posting but refused to post a retraction as a matter of policy. The postings continued and eventually reached an Oklahoma City radio station, which encouraged its listeners to call Zeran's phone number. By this time, Zeran was completely inundated with death threats. After repeated calls to AOL, Zeran was told that the company would soon close the accounts under which the defamatory messages had been posted. The flood of violent phone calls subsided only after a local newspaper exposed the defamatory prank and after the local radio station made an on-air apology. The ugly episode vividly demonstrated the muscular and robust power of the Internet as a medium for rapidly spreading harmful lies.
Zeran eventually filed a suit against AOL, arguing in the district court that once he had notified AOL of the unidentified third-party's defamatory hoax, AOL had a duty to remove the defamatory message promptly, post retractions, and screen for similar defamatory postings. AOL responded by citing § 230 immunity as an affirmative defense and moved for judgment on the pleadings, which the district court granted. Zeran appealed to the Fourth Circuit, arguing that § 230 immunity eliminated only publisher liability, leaving notice-based distributor liability intact. The Fourth Circuit disagreed, declaring that distributor liability was "merely a subset, or a species, of publisher liability, and is therefore also foreclosed by § 230." The Zeran court further stated that interpreting § 230 as denying immunity for distributor liability "would defeat the two primary purposes of the statute," namely, maintaining the robustness of Internet communication by minimizing government interference and encouraging ISP self-regulation of offensive content.
The Zeran court concluded that "Congress' desire to promote unfettered speech on the Internet must supersede conflicting common law causes of action." In doing so, the Fourth Circuit deduced that Congress had chosen to protect the "new and burgeoning Internet medium" from the "specter of tort liability" over providing legal redress for victims of serious defamation. Many disagreed with this assessment. In holding that distributor liability is a subset of publisher liability, the Zeran court effectively granted providers and users of interactive computer services virtually complete immunity from defamation liability for third-party content. As discussed above, it is far from clear that Congress intended such a dramatic break from the past with the passage of § 230(c)(1).
The Post-Zeran World: Some Troubling Results
Several courts reached troubling results by following Zeran. For example, in Blumenthal v. Drudge, a district court held that AOL could not be held liable for the false and defamatory statements written by a third party, Internet news columnist Matt Drudge, despite the fact that AOL: (1) had made monthly payments to Drudge for his electronic publication under a licensing agreement; (2) could have chosen, under the licensing agreement, to remove content that it reasonably determined violated its standard terms of service; (3) knew that Drudge specialized in rumor and gossip; and (4) made editions of Drudge's publication available to its subscribers after first receiving them from Drudge by e-mail. Following Zeran, the Blumenthal court concluded that "Congress made no distinction between publishers and distributors in providing immunity from [defamation] liability." The Blumenthal court apparently was troubled by its own holding, declaring that if "it were writing on a clean slate, this Court would agree with plaintiffs." The court noted that while AOL promoted Drudge as a new source of "unverified instant gossip," AOL took no responsibility for any damage his gossip may have caused.
II. DEFAMATION LIABILITY IN TWO RECENT CASES
Recent cases illustrate two markedly different approaches to the immunity enjoyed by ISPs and users under § 230. In Batzel v. Smith, the Ninth Circuit continued the pattern established in other courts by setting a low bar and broadening § 230 immunity in defamation cases involving third-party content, despite the court's clear misgivings in doing so. In contrast, the California Court of Appeals in Barrett v. Rosenthal became perhaps the first court in the nation to explicitly reject the Zeran court's broad interpretation of § 230.
Batzel v. Smith
In Batzel v. Smith, the Ninth Circuit examined the question of whether a moderator of a listserv and operator of a website who posts an allegedly defamatory e-mail authored by a third party can be held liable for doing so. In addressing this question, the Ninth Circuit tackled the more specific issue of when a third party may be deemed to have provided information for possible distribution within the meaning of § 230(c)(1). In holding that a service provider or user is shielded from liability when that provider or user reasonably perceived that the third party provided the information for the purpose of publication or distribution, the Batzel court established yet another standard promoting irresponsibility on the Internet.
1. Facts and Procedural History
During the summer of 1999, handyman Robert Smith was performing some contract work at the North Carolina home of Ellen Batzel, an attorney. For various reasons, Smith became concerned that Batzel was in possession of artwork looted from European Jews during World War II. After a search for websites concerning stolen art work, Smith came upon the Museum Security Network ("the Network"), which was solely operated by Ton Cremers, then-Director of Security at Amsterdam's Rijksmuseum. Smith then sent an e-mail message to Cremers, stating that Batzel possessed art that Smith believed had been looted during World War II.
Cremers eventually distributed Smith's e-mail message, with some minor wording changes, through the Network listserv and published the listserv with Smith's message on the Network website. After viewing the posting, Smith explained in an e-mail to a subscriber that he had no idea that his e-mail would be posted to the listserv or placed on the Network website.
Several months later, Batzel discovered the e-mail message and complained to Cremers about it. Cremers then contacted Smith, who insisted on the truth of his statements. However, Smith told Cremers that if he had known that his e-mail message would be posted, he would never have sent it in the first place. To support his contention that he intended to have kept the message from publication, Smith pointed out that he sent the e-mail message to an address that was different from the one used by listserv subscribers to send messages for inclusion in the listserv.
Batzel disputed Smith's account and believed that Smith defamed her because she had refused to pass on an amateur screenplay written by him to her contacts in Hollywood. Claiming injuries to her social and professional reputation, she filed suit against Smith and Cremers in federal court in Los Angeles. The district court denied Cremers's motions to dismiss the case and declined to extend the immunity conferred under § 230(c), holding that Cremers's Network was not an ISP. Cremers appealed to the Ninth Circuit Court of Appeals.
2. The Ninth Circuit's Analysis
After disposing of the procedural issues that Cremers had raised, the Ninth Circuit focused on the heart of the case: whether Cremers qualified for the immunity provided under § 230(c)(1). The court first determined that Cremers's Network website and listserv qualified as a "provider or user of an interactive computer service" under § 230(c)(1). The Ninth Circuit then noted that § 230 limits immunity to information "provided by another information content provider." The court determined that because "Cremers did no more than select and make minor alterations to Smith's e-mail, Cremers cannot be considered the content provider of Smith's e-mail for purposes of § 230." The key question, therefore, was whether Smith had actually provided his e-mail within the meaning of § 230.
This issue was not a simple matter because Smith insisted that he never "imagined his message would be posted on an international message board." Cremers claimed that § 230(c)(1) immunity should be available simply because Smith was the author of the e-mail and nothing more. But the Ninth Circuit rejected this interpretation, noting that users and providers of interactive computer services could then post with impunity material that they knew was never meant to be published on the Internet. However, the Ninth Circuit also declined to place the primary focus on the information provider's intentions--fearing that free speech would be chilled (and Congress's purpose thwarted) if service providers or users could not tell whether a posting was contemplated.
Instead, the Ninth Circuit placed the focus squarely on the service provider's or user's "reasonable perception of those intentions or knowledge." The court held that a service provider or user is immune from liability under § 230(c)(1) when a third person or entity . . . furnished information to the provider or user under circumstances in which a reasonable person in the position of the service provider or user would conclude that the information was provided for publication on the Internet or other 'interactive computer service.'
In a vigorous dissent, Judge Gould objected to shifting the inquiry away from the defendant's conduct. Judge Gould claimed that, by providing immunity for parties that disseminate writings whose authors intend to have published, the court had developed a rule that not only "encourages the casual spread of harmful lies" ] but also "licenses professional rumor-mongers and gossip-hounds to spread false and hurtful information with impunity." He further stated that the "problems caused by the majority's rule all would vanish if we focused our inquiry not on the author's intent, but on the defendant's acts."
Barrett v. Rosenthal
In Barrett v. Rosenthal, a case with some factual similarities to Batzel, the California Court of Appeals examined the central question of "the extent to which [§ 230] abrogated the common law of defamation." In so doing, the Barrett court explicitly rejected Zeran's construction of § 230, believing that "Zeran's analysis of section 230 is flawed, in that the court ascribed to Congress an intent to create a far broader immunity than that body actually had in mind or is necessary to achieve its purposes." The Court of Appeals concluded that § 230 of the CDA "cannot be deemed to abrogate the common law principle that one who republishes defamatory matter originated by a third person is subject to liability if he or she knows or has reason to know of its defamatory character."
The court noted that the trial court had relied on Zeran, acknowledging that the "effect of Zeran is to confer on providers and users of interactive computer services complete immunity from liability for transmitting the defamation of a third party." However, the court emphatically declined to follow Zeran on two critical points. First, the Barrett court disagreed that the word "publisher" in § 230(c)(1) included not only primary publishers, but distributors as well. Second, the Barrett court challenged the Zeran court's conclusion that leaving distributor liability intact would not accomplish the policies that § 230 was designed to effectuate.
On the textual issue of whether distributors fall within § 230(c)(1), the Barrett court noted that in "order to abrogate a common-law principle, the statute must 'speak directly' to the question addressed by the common law." It challenged the Zeran court's assertion that "Congress has indeed spoken directly to the issue by employing the legally significant term 'publisher,' which has traditionally encompassed distributors and original publishers alike." The Barrett court deemed it "entirely reasonable to assume Congress was aware of the significant and very well-established common law distinction" between primary publishers and distributors. Citing Stratton Oakmont as an example, the Barrett court also noted that courts commonly used the word "publisher" to refer only to primary publishers and not distributors. The court also reasoned that if, "as Zeran says, Congress's use of the word 'publisher' covers distributors as well as [primary] publishers, and therefore reflects an intent to create absolute immunity, it would not have been necessary for Congress to specifically protect providers and users who monitor content; [§ 230(c)(2)] would be mere surplusage." Finally, the court stated that the legislature's express desire to overturn Stratton Oakmont, while remaining silent on Cubby, was "consistent with exclusion of distributor liability from the statutory immunity."
On the second critical issue--whether imposing distributor liability would defeat § 230's purpose--the Barrett court began by challenging the Zeran court's assertion that § 230 was designed to promote unfettered speech on the Internet. Specifically, the Barrett court questioned "whether a statute that encourages the restriction of certain types of [offensive] online material [can] fairly be said to reflect a desire 'to promote unfettered speech."' The Barrett court also was not convinced that "[distributor] liability would actually have an unduly chilling effect on cyber speech"; it cited authorities that praised the benefits of defamation law on public discourse. Furthermore, the Barrett court concluded that if "ISPs are granted absolute immunity for disseminating third-party defamatory material, then ISPs will not bother to screen their content for offensive material because they will never be subject to liability."
III. DISCUSSION
Batzel and Barrett present two dramatically different approaches to addressing the problem of defamation on the Internet. Batzel seems to follow the more recent trend of courts granting ever-broader immunity to ISPs and their users against defamation liability for the transmission of third-party content, driving common law defamation tort further into the legal background. The Barrett court, in contrast, seems intent on leading a retreat from this brave new world, commanding a return of distributor liability under § 230 and completely rejecting the direction towards absolute immunity pioneered by the Zeran court. By so doing, the Barrett court was taking action in response to the "overarching theme of Zeran's critics that the Zeran court's analysis is unbalanced" and had created a significant imbalance between promoting the growth of the Internet and protecting individuals against defamation.
The difference between the two approaches becomes readily apparent upon comparing the level of responsibility demanded by each court from individuals distributing third-party messages. The Batzel majority would grant an ISP or user immunity from defamation liability merely because that provider or user reasonably perceived that the third-party information was provided for publication on the Internet. In stark contrast, the Barrett court demanded a certain level of adult responsibility from intermediaries, proclaiming that one could infer "malice and reckless disregard for the truth" when a party failed "to conduct a reasonable investigation regarding the truth of an accusation of criminal conduct and relied on obviously biased sources."
It has been suggested that the virtually complete immunity conveyed to providers and users of interactive computer services in § 230(c)(1) resulted in part after heavy lobbying by the online industry. This would not be the first time that a communications industry has lobbied for broad protection against defamation liability for third-party content. Indeed, more than five decades ago, the National Association of Broadcasters encouraged broad immunity for radio and television broadcasters through proposed model legislation that would have imposed defamation liability only if a broadcaster had failed to exercise "due care" to prevent the distribution of defamatory material.
The provisions in § 230 originated in the House of Representatives as the Cox-Wyden Amendment, and its supporters clearly believed that the Internet and other interactive computer services were somehow unique in the legislative challenges that they posed. As Representative Wyden noted during House discussions on the Cox-Wyden Amendment, "the new media is simply different. We have the opportunity to build a 21st century policy for the Internet employing the technologies and the creativity designed by the private sector." However, as this discussion has shown, some of the characteristics of this latest "new medium," such as the transmission of vast quantities of information, have been seen before. Some of the proposed legal solutions also echo those proposed in the past for other then-new media; radio broadcasters proposed broad immunity from defamation liability for third-party content, an idea that resembles § 230 immunity. The Internet, while unique in many respects, is probably not so unique as to require the formulation of a truly novel approach to defamation liability.
Applying an Old Approach to a New Medium
1. Debating the Return of Distributor Liability Under § 230(c)(1)
A number of commentators have advocated the retention of distributor liability for ISPs and users. After all, traditional defamation doctrine has been successfully adapted for the "new" media of the past The Stratton Oakmont court implicitly bound the Internet to traditional defamation doctrine in stating that interactive computer services "should generally be regarded in the same context as bookstores, libraries and network affiliates"--that is, traditional "brick and mortar" distributors.
The Batzel Court Implicitly Followed Zeran's Approach to § 230(c)(1)
Immunity
It is worthwhile now to revisit the Batzel case to see how the result might have been different had the court applied more traditional common law tort doctrine. The Batzel court implicitly accepted Zeran's approach to § 230(c)(1) immunity. Furthermore, Cremers would likely have been liable for defamation under a more traditional common law approach.
The Batzel court claimed that it had made no decision on whether § 230(c)(1) encompasses both publishers and distributors. It noted that Ellen Batzel's complaint had referred to Cremers as the publisher of Smith's e-mail and that Batzel had not argued that Cremers should have been treated as a distributor, so the court claimed to have had no need to address the issue. In any case, the Batzel court seemed wary of challenging the Zeran court's reasoning, noting that "so far, every court to reach the issue [of § 230(c)(1) immunity has decided that Congress intended to immunize both distributors and publishers." This statement suggests that the holding in Batzel would not have changed even if the court had classified Cremers as a distributor.
Despite its denial of having addressed the issue, the Ninth Circuit implicitly followed the Zeran court's holding that distributor liability was a subset of publisher liability, and therefore also barred by § 230. Publishers generally take an active role in the development of published content, but the Ninth Circuit determined that Cremers's "minor alterations of Smith's e-mail prior to its posting or his choice to publish the e-mail [did not] rise to the level of 'development."' However, the Batzel court also refused to view Cremers as a mere conduit of Smith's message, rejecting Cremers's contention that "§ 230(c)(1) immunity should be available [to Cremers] simply because Smith was the author of the e-mail, without more." If Cremers's role in the matter is somewhere between that of a publisher and a mere conduit of Smith's third-party content, then his role must have been similar to that of a distributor. Therefore, if the district court on remand held that it could reasonably be perceived that Smith provided his message for use on the Internet or an interactive computer service, then Cremers presumably would enjoy § 230(c)(1) immunity in his role as a distributor.
Batzel v. Smith Analyzed Under a Traditional Distributor Liability Approach
In order to impose liability on a distributor of information for distributing allegedly defamatory content, the plaintiff must show that the distributor knew or had reason to know of the defamatory content. This requirement is firmly rooted in First Amendment protections for freedom of speech and freedom of the press. This standard of liability also reflects a pragmatic concern that is wholly relevant to providers and users of interactive computer services: it is unreasonable to expect distributors, whether they be traditional booksellers or ISPs, to inspect the contents of all the information that they distribute. As the Supreme Court wrote in Smith v. California, "if the contents of bookshops and periodical stands were restricted to material of which their proprietors had made an inspection, they might be depleted indeed." Because of these First Amendment concerns, Batzel would have to show that Cremers knew or had reason to know of the defamatory content of Smith's e-mail message in order for Cremers to be held liable as a distributor of Smith's message.
To begin an analysis of Batzel v. Smith under a traditional distributor liability analysis, it is worthwhile to distinguish Cremers's role as a distributor of the Network's listserv from CompuServe's role as a distributor of Rumorville USA in the Cubby case. The Cubby court determined that once CompuServe had decided to carry Rumorville USA, it had "little or no editorial control over [Rumorville's] contents." In contrast, Cremers had absolute editorial control over Smith's e-mail message, even though Cremers largely elected not to exercise his editorial privileges. Furthermore, the Cubby court determined that the plaintiffs had failed to show that CompuServe even knew or had reason to know of Rumorville's contents. There is no question that Cremers knew of the contents of Smith's message. Clearly, Cremers played a much more active role in the distribution of Smith's e-mail message than CompuServe did in its distribution of Rumorville USA.
A key question in assessing Cremers's liability as a distributor of Smith's e-mail message was whether he knew or had reason to know that Smith's message contained defamatory content. A close examination of Smith's e-mail message shows that Cremers, an art security expert, should have known that some of the information in Smith's message was probably false. First, Smith identified himself as a "building contractor," which is not a profession that suggests expertise in art history. Second, Smith admitted that he had been distracted, "concentrating on performing [his remodeling] tasks," when he allegedly heard Batzel claim that she was the descendant of Heinrich Himmler. Finally, Smith reported seeing "hundreds of older European paintings on [Batzel's walls," which, if true, strongly suggests that Batzel was the owner of a sizable museum rather than a private home in the mountains of North Carolina. Some of the Network's subscribers apparently had their doubts too, since a number of them criticized Cremers for forwarding Smith's message. From these facts, it seems reasonable to believe that Cremers should have known that Smith's message possibly contained defamatory information. Under a traditional (pre-CDA, pre-Zeran) distributor liability analysis, Cremers might be held liable for the allegedly defamatory content of Smith's message.
The Internet in Adolescence
One of the clearly stated goals of § 230 is "to promote the continued development of the Internet." The Zeran court seemed determined to protect ISPs from the specter of tort liability, fearing that ISPs "would face potential liability each time they receive notice of a potentially defamatory statement." Others have questioned the danger, noting that "t is not at all clear that being exposed to distributor liability would be a disaster for online services." Certainly, some of the impetus for "protecting" the Internet must arise from the perception of the Internet as a medium in its infancy. Congress has nurtured and subsidized the growth of the young medium by, for example, instituting a moratorium on taxing Internet services.
But the Internet is no longer in its infancy, having grown into a vigorous and muscular adolescent. This is certainly the case when it comes to commerce. Indeed, U.S. consumers spent an estimated $8.5 billion online in November 2003 alone, a 55% increase over the previous year. It is questionable whether the Internet continues to need such subsidies as the Internet access tax ban or, as relevant here, broad protection from defamation liability.
Nevertheless, other commentators argue against a return to distributor liability because of the potentially "heavy burden on free speech." This was certainly one of the main concerns of the Zeran court. However, the Barrett court was clearly skeptical, stating that it thought it "debatable whether notice liability would actually have an unduly chilling effect on cyberspeech" and describing the Zeran court's concerns as "speculative." The Barrett court supported this position by noting how even traditional defamation cases are difficult to prove. For example, a plaintiff must show that an allegedly defamatory statement is "not an opinion or satire or mere hyperbole and even then knowledge and the requisite degree of fault must be shown." The difficulty of prevailing as a plaintiff in defamation cases is likely to prevent a flood of such suits, and the Zeran court probably "overstated the danger such claims present to Internet intermediaries."
It is important to emphasize that distributor liability would not require ISPs to review individual messages before they are posted on the Internet. Instead, ISPs would only be required to take reasonable measures after receiving notice that a particular message is defamatory. This liability regime would be analogous to the notice-based system established under the Digital Millennium Copyright Act, which requires an ISP to take certain measures only when it receives adequate notice of potential copyright infringement. This limited duty is not likely to be a heavy burden on free speech. After all, with an estimated 500 billion documents on the Internet already (and counting), speech on the Internet appears to be in no immediate danger. Indeed, as Ellen Batzel and Kenneth Zeran can attest, the Internet can be an undisciplined, adolescent brute with respect to its power in disseminating speech. Even free speech advocates should be a little wary of the hulking lad roaming the neighborhood.
Revisiting the Communications Decency Act
The district court that initially heard the Zeran case concluded that "the Internet is a rapidly developing technology [and that] Congress is likely to have reasons and opportunities to revisit the balance struck in the CDA." If it does, Congress should consider amending § 230 to explicitly impose notice-based distributor liability for third-party content. But Congress would not have to act at all if the courts adhered to the narrower construction of § 230 advocated by the Barrett court.
IV. CONCLUSION
Batzel v. Smith is the latest in a series of court decisions that have broadly interpreted the immunity from defamation liability granted under § 230. The broad construction of § 230 by the courts is not entirely consistent with the intent of Congress and has produced a number of troubling results. The Internet has matured into a strong and vigorous adolescent, and a return to more traditional standards of defamation liability, including distributor liability, is unlikely to hinder its continuing growth. Congress should consider revising the Communications Decency Act in order to restore some of the balance between fostering the growth of the Internet, encouraging self-regulation of undesirable content, and protecting individuals from the harm of defamation. Congressional action may not be necessary if the courts adhere to the narrower construction of § 230 developed in Barrett v. Rosenthal --a construction of § 230 that is probably more consistent with the original intent of Congress.
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