Rip-off Report Wins Dismissal–GW Equity v. Xcentric

By Eric Goldman

I’m thinking about renaming this blog the “Rip-off Report Blog.” After all, I blog about them frequently, and there seems to be a never-ending supply of new legal developments. Plus, I know readers are interested in them based on my in-box; emails related to Rip-off Report may be the single largest topic of private blog-related emails I get.

I am being partially facetious, but it is telling (and consistent with my past experience) that my Friday post on the Rip-off Report generated a few emails about yet more Rip-off Report litigation. I promise not to turn this into the Rip-off Report Blog, but the recent court dismissal of a case warranted an update.

GW Equity, LLC v. Xcentric Ventures, LLC, 3:07-cv-00976-O (N.D. Tex. Oct. 8, 2008)

This is a fairly “representative” lawsuit against Rip-off Report. The plaintiff trots out the standard arguments that have bubbling in numerous other cases, including:

1) The Rip-off Report created some of the content at issue because it offers pull-down tagging choices to consumers. The court cites to Roommates.com and others to conclude that the users are responsible for those choices, not the website.

The court does struggle a little with the 2004 MCW v. Rip-off Report precedent, also from the N.D. Tex., which is one of the few remaining “pure” 230 wins for a plaintiff. The court distinguishes MCW based on the prior defendant’s failure to introduce rebuttable evidence that it didn’t create the content at issue, as well as the defendant specifically telling the user to prepare content according to its specifications, which meant that “defendants in MCW had gone substantially beyond the traditional publisher’s editorial role and had participated in the process of developing information.” I think the more recent caselaw is now pretty clear that soliciting user content doesn’t convert third party content into first party content, so we’d all be better served if MCW were expressly overturned as precedent (which this court couldn’t do). For now, fortunately the archaic MCW precedent is being drowned out by the chorus of subsequent more defense-favorable precedent.

2) Rip-off Report employees write some of the titles/headings and other content in a user report. Parsing the evidence, the court concludes that none of the evidence is competent enough to create a material factual dispute sufficient to survive summary judgment. This is a pretty significant win for Rip-off Report because these factual allegations are being repeated in a lot of cases (like the Barnes case below), so now the Rip-off Report can cite this ruling in those other cases.

3) The Rip-off Report’s Corporate Advocacy Program is a racket that strips the company of 230 protection. The court quickly dismisses this argument, saying “it is not a bar to immunity for an Internet provider to refuse to remove defamatory material created by a third party, or to otherwise use it to their advantage, even though the Internet provider’s conduct may be considered reprehensible and offensive.”

This opinion was just a magistrate’s recommendation, and unsurprisingly GW Equity has filed objections to the recommendation. I suspect this case has plenty more gyrations.

Barnes v. Xcentric Ventures, LLC, GC041766 (Cal. Superior Ct. complaint filed Nov. 3, 2008)

This is a “garden-variety” complaint against Rip-off Report that doesn’t break any new ground. Its most striking feature is its juxtaposition to the GW Equity case, because that ruling rejects most of the significant factual allegations in the complaint. If this court follows the GW Equity precedent, I smell summary judgment for the defense.

One more thing about the Barnes complaint. The plaintiff is affiliated with the Law Crossing website, which itself has attracted some criticism throughout the blogosphere. Indeed, Cathy Gellis reports that Law Crossing may have launched an attack campaign using Amazon’s mTurk to flood a negative blog post with positive comments.

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