Massachusetts Supreme Court Says Turo Doesn’t Qualify for Section 230…Sometimes…–Massport v. Turo

Turo facilitates peer-to-peer car rentals. It provided an option for users to pickup/dropoff at Logan Airport, but Turo took the position that it wasn’t a car rental service pursuant to the applicable regulations. The airport authority (Massport) sued Turo and got an injunction despite Turo’s Section 230 defense. Turo appealed. The Massachusetts Supreme Court affirms the injunction, but with an important modification.

With respect to Section 230, everyone agrees that Turo qualifies as an ICS provider. However, the court says Section 230 doesn’t protect Turo’s first-party content, which includes “the portion of the content on Turo’s website advertising Logan Airport as a desirable pick-up or drop-off location….[including] a dedicated search button for vehicles specifically available at Logan Airport.” Furthermore, “rather than seeking to hold Turo liable as the publisher or speaker for its users’ content, Massport’s claims sought to hold Turo liable for its own role in facilitating the online car rental transactions that resulted in its customers’ continuing trespass.”

The court adds this confusing statement: “‘Features . . . [that] reflect choices about what content can appear on the website and in what form’ are ‘editorial choices that fall within the purview of traditional publisher functions’ [quoting Doe v. Backpage] but more concentrated involvement in the transaction may fall outside that purview.” What does “more concentrated involvement in the transaction” mean? This is law professor slippery-slope territory.

Citing Airbnb v. Boston, the court tries to explain:

Turo serves a dual role as both the publisher of its users’ third-party listings and the facilitator of the rental transactions themselves, and in particular the rental transactions that occur on Massport’s Logan Airport property. Rather than focusing on what Turo allows its hosts to publish in their listings, Massport’s claims pointedly focus on Turo’s role as the facilitator of the ensuing rental transactions at Logan Airport, which is far more than just offering a website to serve as a go between among those seeking to rent their vehicles and those seeking rental vehicles. Indeed, as the judge observed, in addition to allowing hosts to list their vehicles for rent, Turo also provides substantial ancillary services to its hosts, such as collecting and remitting payments, offering (and mandating) liability insurance and roadside assistance that is available twenty-four hours per day and seven days per week, and screening guests before permitting them to rent a motor vehicle from a host.

I’m confused. Did Section 230 not protect Turo: (1) because of Turo’s first-party content, such as advertising Logan Airport and providing a search button to find cars there, or (2) because Section 230 does not apply to facilitating any e-commerce transactions (the basic holding of the HomeAway 9th Circuit ruling)? The rationale makes a difference! Turo can stop referring to Logan Airport and remove the search button, but users could still self-designate Logan Airport as the pickup/dropoff location on their own initiatives. If the court’s opinion turns only on theory #1, Section 230 will protect Turo in this revised scenario. If the court’s opinion turns on theory #2, then Turo is liable for booking transactions at Logan Airport, even if Turo didn’t do anything to designate Logan Airport as an option. The court favorably cites the Turo v. Los Angeles decision, which follows the HomeAway precedent and supports theory #2.

With respect to the underlying substantive claim, the court says that Massport could successfully show that Turo aided and abetted its customers trespassing on Logan Airport property. We don’t ordinarily see a claim like this against Internet services, because Section 230 has mooted claims like this. The court says that Turo could have the requisite scienter:

Turo certainly knew that its website heralded hundreds of host vehicles available at Logan Airport and that it featured a button on its website that allowed its guests to specifically search for vehicles available at Logan Airport….since at least April 2016, Turo knew that Massport regarded these rental transactions as unauthorized violations of its rules and regulations, culminating in Massport sending Turo several cease and desist letters after Turo refused to execute a vehicle rental agreement. Nonetheless, Turo persisted in facilitating the unauthorized transactions — steadily growing its business in the ensuing years…Turo’s broadcasting of airport handoffs along with its facilitation of these transactions when it knew or had reason to know that those actions offended Massport’s rules and regulations…

Turo shared the mental state of the trespassing defendants based on the communications between Turo and Massport and on Turo’s clear knowledge of the continuing and increasing use of Logan Airport as a desirable pick-up and dropoff location by its users.

The court adds that “the utilization of search functionality by a provider does not categorically either secure or forfeit immunity under the CDA…An Internet service provider remains liable for its own speech, as Turo does here by creating speech through the language of this search feature advocating for Logan Airport as a preferable location for its users to transact.”

Again, I’m confused. Did Turo “aid & abet” because it publicized the options at Logan, or because it booked the resulting transactions? Turo can cure the first concern but not the second.

The court’s modification of the injunction exacerbates my confusion. The district court’s injunction prohibited:

Listing or permitting motor vehicles to be listed on Turo’s website, or by means of any other Turo application, as available for pickup or drop-off at Logan Airport

On appeal, the court says “the language ‘or permitting motor vehicles to be listed’ could be understood to obligate Turo to monitor and potentially to remove its hosts’ noncompliant content, an obligation that would appear to be prohibited by the CDA.” Thus, the court strikes that language, leaving the following injunction in place:

Listing motor vehicles on Turo’s website, or by means of any other Turo application, as available for pickup or drop-off at Logan Airport.

What does this injunction mean? Turo can’t “list” Logan Airport itself, but it apparently can “permit motor vehicles to be listed” as available at Logan, and Turo cannot be required to “monitor” or “remove” those listings. But can Turo book those listings? If Turo removes all references to Logan Airport in its service, but users choose on their own to designate Logan Airport as the pickup/dropoff location, what is Turo obligated to do or not do then? ¯\_(ツ)_/¯

Under HomeAway, Turo could allow those listings on its site because the listings are protected by Section 230, but not accept bookings because Section 230 doesn’t apply at that point. But that outcome would require Turo to “monitor” the listings to make sure it doesn’t accept those bookings, and it raises the second-order concern (as I’ve raised with HomeAway and all similar rulings) that having listings in Turo’s databases that Turo cannot actually book seems like a standard bait-and-switch for advertising law purposes.

So what exactly is the outcome here? I’m not sure how this ruling will change the behavior of Turo and its customers in the field. But given the shadow of HomeAway, Turo’s business model–and those of all online marketplaces–remains in significant peril.

Case citation: Massachusetts Port Authority v. Turo Inc., 2021 WL 1556298 (Mass. Supreme Ct. April 21, 2021)