Backpage Executives Defeat Pimping Charges Per Section 230–People v. Ferrer

When Kamala Harris’ office filed pimping charges against three Backpage executives, I wondered: why now? why pimping? After all, in 2013, California AG Kamala Harris signed a letter to Congress saying that Section 230 “prevents State and local law enforcement agencies from prosecuting” Backpage, and California’s pimping crime was available to Harris’ office in 2013. So when the California AG’s office nevertheless prosecuted Backpage’s executives, surely the office lawyers had some clever tricks up their sleeves to get around Section 230…right?

Nope. A California Superior Court confirmed that Harris was right in 2013, and indeed Section 230 clearly prevents the prosecution. I’m not a malicious prosecution expert, but how should we handle a situation where an AG’s office publicly declares that it cannot successfully win a prosecution, brings it anyway, and the court dismisses the prosecution for exactly the reason the AG’s office publicly predicted?

The Sister Sites

The AG’s biggest “reveal” was that Backpage’s executives were implementing two sister sites, Big City and Evil Empire, both of which republished information from listings placed at Backpage. I still don’t fully understand either site, but I believe one site sought to optimize ad searchability by cellphone number (apparently a popular way to find prostitutes), and the other was intended to sanitize Backpage ads enough to get an iPhone app approved by Apple. Both efforts suggest that the Backpage executives sought to expand their monetization of Backpage’s database of prostitution ad listings (indeed, the email conversations included in the state’s exhibits read like typical dot com entrepreneurial chatter), a move that clearly aggravated the prosecutors.

But from a legal standpoint, these sites were just another syndication outlet for the third party ads, and the court flatly says “Republication is entitled to immunity under the CDA,” citing the California Supreme Court case of (Barrett v. Rosenthal). Moreover, the court reiterates that third party content always retains that status, no matter where or how it is republished. Citing Kimzey, the court adds “courts have repeatedly held that an online service provider is protected whether he publishes third‐party content for the first time, or republishes it for the nth time. To find the source of the liability for the unlawful or actionable content, one must trace the pedigree of the statement.”

If the AG’s office thought Backpage’s syndication to its sister sites was its big “gotcha,” I question how well it critically assessed the weaknesses of its case.

Reframing the Big City/Evil Empire republications as a slicing-and-dicing/remixing of third party ads would not change the outcome:

the only “manipulation” would be in the act of extracting the content from the original ad and/or from the act of physically posting the extracted content on a new site. This is not prohibited activity. Indeed, it generally falls within the scope of protected editorial functions. [cites to Doe v. Backpage, Fields v. Twitter, Jones v. Dirty World]

Backpage’s addition to the ads

The fact that Backpage added one line to each Big City profile (“Interested in men,” “Interested in women” or “Interested in everyone”) “was not a material contribution to the offensive nature of the material.” [cites to Phan v. Pham and Kimzey v. Yelp]. The court adds:

assuming that the People’s assertion is true; that the ad went from expressing intent to advertise prostitution to express a desire to “date,” the People are essentially complaining that Backpage staff scrubbed the original ad, removing any hint of illegality. If this was the alleged content “manipulation,” the content was modified from being illegal to legal. Surely the AG is not seeking to hold Defendants liable for posting a legal ad; this behavior is exactly the type of “good Samaritan” behavior that the CDA encourages through the grant of immunity.

I like where the judge is going, but the reasoning seems almost too clever. If Backpage converts prostitution ads into ads for “legal” dating, then Backpage added falsity to the ads and is sending interested daters unwittingly into a network of prostitutes. Perhaps that creates a claim for false advertising, not pimping, but the court seems to be saying that Backpage created “false legal ads,” which should be an oxymoron.

Other Arguments

Scienter

Let’s assume everyone, including the Backpage executives, “knew” that prostitution ads were on Backpage with Backpage’s encouragement. The court says knowledge is irrelevant to Section 230 (cites to Barrett and Jones v. Dirty World), and there is no “encouragement” exception to Section 230 (cite to Jones, Ascentive v. Opinion, Roommates.com and Black v. Google).

Publicity Rights

To get around Section 230, the AG’s office tried a mockable argument that Backpage violated the victims’ publicity rights, so Section 230 didn’t protect Backpage. I can’t believe the AG’s office tried this argument; it’s so specious that it should have been left on the cutting room floor. Among other obvious problems, the AG’s office wasn’t prosecuting the defendants for publicity rights violations or a crime where publicity rights violations are a predicate. It was prosecuting for pimping, which has nothing to do with publicity rights. The court says that the AG’s office lacks standing to assert the victims’ publicity rights, and Section 230 protects efforts to expand the reach of third party content (cite to the Asia Economics v. Xcentric case, and there are several other cases in this line, such as Obado v. Magedson and Roca v. Opinion).

Profiting from Prostitution Ads

Backpage’s advertising revenue from the illegal ads does not affect the Section 230 analysis:

Providing a forum for online publishing is a recognized legal purpose that is generally provided immunity under the CDA. This immunity has been extended by the courts to apply to functions traditionally associated with publishing decisions, such as accepting payment for services and editing….In fact, the People acknowledge that the mere act of accepting money for postings is permissible.

The Bollaert case

I previously mentioned that this summer’s ruling in the Bollaert revenge porn operation case might have contributed to the AG’s decision to sue now. Not surprisingly, the AG’s office made a big point about the Bollaert case in its briefing. The court distinguished it:

Bollaert required the entry of unlawful information by the user, which fell into the narrow exception to immunity recognized by Roommates….Here, there are no allegations that Backpage required a third‐party user to provide any protected information when the original ad is placed. As the information posted on EvilEmpire and BigCity is mostly taken from the original ad, Defendants did not “design to solicit” protected content as a condition to placing the ad. In fact, according to the exhibits attached by the People, Backpage moderators were instructed to look for offending material and remove it.

Implications

Fundamentally, the AG’s office failed to persuade the judge that it was prosecuting Backpage for its first party conduct rather than for the third party ads. The court concludes:

the prostitution took place as a result of an advertisement placed by a third party. Backpage’s decision to charge money to allow a third party to post content, as well as any decisions regarding posting rules, search engines and information on how a user can increase ad visibility are all traditional publishing decisions and are generally immunized under the CDA. In short, the victimization resulted from the third party’s placement of the ad, not because Backpage profiting from the ad placement.

This court doesn’t discuss the Airbnb v. San Francisco ruling, but it dealt with similar issues. That case also addressed ads for illegal services, but San Francisco imposed liability only when Airbnb takes a cut of the illegal transaction. The court said imposing liability there successfully regulated Airbnb’s first party conduct rather than holding Airbnb liable for third party ads, so Section 230 didn’t protect Airbnb. (We’ll see how that ruling fares on appeal to the Ninth Circuit). In this case, the analogy would be if Backpage acted as the payment service provider for the illegal prostitution transaction and kept a cut for itself. In contrast, the Airbnb court implies that running a classified ad service that contains illegal ads is still covered by Section 230 (Airbnb “may consider charging fees for publishing listings, rather than for facilitating transactions — a measure San Francisco concedes is lawful”), and that reasoning seems to help Backpage.

The Backpage court reaches essentially the same result by concluding that the AG’s office is seeking to hold the defendants liable for third party ads, no matter how the AG’s office articulates the pimping complaint:

This Court finds it difficult to see any illegal behavior outside of the reliance upon the content of speech created by others. The whiff of illegality is detected only when considering the alleged content of the statements contained in the ads. Indeed, the theory of prosecution requires the presumption that illegal content was contained in the ads, i.e., that the ads were explicitly for prostitution.

The court summarizes its holding:

The People of the State of California have a strong and legitimate interest in combating human trafficking by all available legal means. Moreover, any rational mind would concur that the selling of minors for the purpose of sex is particularly horrifying and the government has a right and a duty to protect these most vulnerable victims. The State’s legitimate interest is not absolute, however, and must be constrained by the interests and protections of the First Amendment to the U.S. Constitution….By enacting the CDA, Congress struck a balance in favor of free speech by providing for both a foreclosure from prosecution and an affirmative defense at trial for those who are deemed an internet service provider.

Kamala Harris issued a statement in response to the ruling:

I am extremely disappointed and disagree with the court’s ruling. The Communications Decency Act was not meant to be a shield from criminal prosecution for perpetrators of online brothels. The evidence is clear — these defendants are responsible for personally creating and publishing the content that was used to pimp and traffic victims on their websites. I remain undeterred in my commitment to fight human trafficking and pursue every avenue under the law to hold them accountable. We will not turn a blind eye to the defendants’ exploitative behavior simply because they conducted their criminal enterprise online rather than on a street corner. To all those who have been victimized by pimps online and trafficked through ‪Backpage.com, you are not alone and the fight for justice is not over. We are exploring all legal options and will continue to advocate for all victims and to aggressively prosecute those who prey on and exploit the vulnerable.

Disappointed? Sure. But undoubtedly not surprised, and definitely embarrassed. I’m thrilled that Kamala Harris and the AG’s office remains committed to fighting sex trafficking. I’m less thrilled that prosecuting Backpage’s executives was probably a diversion of resources from that goal. Still, as the statement strongly suggests, I anticipate the AG’s office will appeal the ruling before Harris’ departure. (Indeed, it would only make sense that, when the AG’s office decided to bring the prosecution, they anticipated they would appeal an adverse lower court ruling). We’ll have to see how zealously Harris’ replacement, Xavier Becerra, pursues the appeal he inherits.

Meanwhile, incoming U.S. Senator Kamala Harris now has the power to attempt a direct modification of Section 230, just as she requested in 2013. Congress already passed the SAVE Act to shut down Backpage. Will that be enough for her? Or will she prioritize Section 230 reform, even if that jeopardizes the Silicon Valley economic engine that supports a large percentage of her constituents?

Case citation: People v. Ferrer, Case No. 16FE019224 (Cal. Super. Ct. Dec. 9, 2016)

Case library:

* Defendant’s motion to enforce dismissal and alternative demurrer; prosecutors’ opposition.
* Complaint for the second set of felony criminal charges
* Trial court’s final ruling granting the demurrer. Blog post.
* California’s Supplemental Brief in Opposition to Defendants’ Demurrer to Felony Complaint and defendants’ response
* Trial court’s tentative ruling dismissing the charges
* Reply to the opposition to the demurrer
* California’s opposition to the demurrer
* Demurrer, statement of Lacey and Larkin, and letter to AG Harris
* Criminal Complaint
* Declaration in support of arrest warrant and warrant
* Press Release, Attorney General Kamala D. Harris Announces Criminal Charges Against Senior Corporate Officers of Backpage.com for Profiting from Prostitution and Arrest of Carl Ferrer, CEO
* Press Release, AG Paxton: Arrest of Backpage.com CEO Shows Texas Doesn’t Tolerate Human Trafficking
* My blog post: Some Comments on the CA/TX Attorneys’ General Prosecution of Backpage’s Executives