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47 U.S.C. § 230 and State Intellectual Property Rules:

In late March, the Ninth Circuit handed down an important holding about 47 U.S.C. § 230. This statute immunizes Internet Service Providers, Web site operators, and others from being held liable for what their users post. Thus, for instance, if you post something defamatory in the comments, we won't be liable for it to the defamed party, though you would be liable, and though we would be liable for content we ourselves originate.

The statute, though, exempts "intellectual property." That clearly means the provider or operator could be liable for copyright infringement by its users (subject to the separate rules provided by the Digital Milennium Copyright Act, 17 U.S.C. § 512), and likely for federal trademark infringement. But it's not clear whether it covers state law rules that are sometimes characterized as intellectual property laws, for instance the state law right of publicity. The Ninth Circuit held that the § 230 exemption covers only federal intellectual property laws, not state ones.

Bruce Wessel reports that yesterday the Ninth Circuit amended the opinion to justify its conclusion further:

In its petition for rehearing, Perfect 10 claims that our decision on this point conflicts with Universal Communication Systems, Inc. v. Lycos, Inc., 478 F.3d 413 (1st Cir.2007). But neither party in that case raised the question of whether state law counts as “intellectual property” for purposes of § 230 and the court seems to simply have assumed that it does. We thus create no conflict with Universal Communication.

We note that Universal Communication demonstrates the difficulties inherent in allowing state laws to count as intellectual property for CDA purposes. In that case, the district court struggled with the question of whether the “trademark dilution” claim brought under Florida Law counted as intellectual property for purposes of the CDA, and concluded that it was more like a defamation claim than a trademark claim. Id. at 423 n. 7. Rather than decide how to draw the line between defamation and trademark, the First Circuit held that “because of the serious First Amendment issues that would be raised” if Lycos were found liable, defendant had not violated the Florida statute. Id. at 423.

The First Circuit was able to sidestep the question of what counted as intellectual property on First Amendment grounds. But we cannot do so here. States have any number of laws that could be characterized as intellectual property laws: trademark, unfair competition, dilution, right of publicity and trade defamation, to name just a few. Because such laws vary widely from state to state, no litigant will know if he is entitled to immunity for a state claim until a court decides the legal issue. And, of course, defendants that are otherwise entitled to CDA immunity will usually be subject to the law of numerous states. An entity otherwise entitled to § 230 immunity would thus be forced to bear the costs of litigation under a wide variety of state statutes that could arguably be classified as “intellectual property.” As a practical matter, inclusion of rights protected by state law within the “intellectual property” exemption would fatally undermine the broad grant of immunity provided by the CDA.

Respondent (mail):
At some point, Congress or the courts are going to have to mandate that website operators be exempt from all state laws other than those of the state in which they are registered. (Of course the same argument holds true for laws of foriegn countries, and I think the US needs to get tough on Australia until they overturn their Supreme Court decision subjecting American websites to their libel laws). The internet cannot operate freely if every provider and user has to worry about federal law, the laws of all 50 states, DC, and every town and precinct that wants to stick its nose into private communication.
6.1.2007 2:22pm
Respondent (mail):
"Get tough on Australia"- too bad that can't happen as long as we still need Australia's help in foreign affairs.
6.1.2007 2:24pm