YouTube Isn’t a Company Town (Duh)–Prager University v. Google

Prager University produces videos designed to convert teenagers into conservatives. It has posted over 250 videos to YouTube. YouTube has placed some of those videos into “restricted mode,” which blocks the videos’ availability to YouTube users who voluntarily operate in that mode. Prager University claimed that YouTube censored its videos due to anti-conservative discrimination. Actually, YouTube routinely places videos from major producers of all stripes into restricted mode, so Prager University’s discrimination claim rings hollow.

In a highly publicized case,  Prager University sued YouTube to override YouTube’s editorial classification decision. Though this case could have been resolved on YouTube’s Constitutionally protected free speech/free press rights or Section 230, Judge Koh says Prager University fails to make its prima facie case.

YouTube as Company Town. Prager University argued that YouTube was a state actor, which would have the legal consequence of subjecting YouTube’s handling of user content to First Amendment limitations. Arguing that private Internet services are state actors is a venerable one; many virtual world academics made this argument a decade ago, for the same reason as Prager University–they sought a legal tool allowing virtual world participants to override the service’s editorial discretion (indeed, I wrote a counter-narrative to the state action argument back in 2005). Unfortunately for plaintiffs, the argument was completely devoid of merit then, and it remains devoid of merit now.

The court first rejects the general claim that YouTube performs traditional government functions:

Plaintiff does not point to any persuasive authority to support the notion that Defendants, by creating a “video-sharing website” and subsequently restricting access to certain videos that are uploaded on that website have somehow engaged in one of the “very few” functions that were traditionally “exclusively reserved to the State.”

The court then rejects Prager University’s more specific argument that YouTube is like a company town like Marsh v. Alabama:

Marsh does not compel the conclusion that Defendants are state actors that must comport with the requirements of the First Amendment when regulating access to videos on YouTube. Unlike the private corporation in Marsh, Defendants do not own all the property and control all aspects and municipal functions of an entire town. Far from it, Defendants merely regulate content that is uploaded on a video-sharing website that they created as part of a private enterprise.

The court acknowledges that Marsh contains broader language that might help Prager University, but the court does a detailed analysis explaining how subsequent Supreme Court jurisprudence overturned the broader language.

The court also rejects the currently-chic argument that the Supreme Court’s ruling in Packingham v. North Carolina restricts Internet services’ editorial discretion. The Packingham opinion had several broad statements about the social importance of social media, but the court correctly reads Packingham as limiting state restrictions on access to social media, not social media providers’ discretion:

Packingham did not, and had no occasion to, address whether private social media corporations like YouTube are state actors that must regulate the content of their websites according to the strictures of the First Amendment.

The court summarizes its conclusion:

Plaintiff has not shown that Defendants have engaged in one of the “very few” public functions that were traditionally “exclusively reserved to the State.” Defendants do not appear to be at all like, for example, a private corporation that governs and operates all municipal functions for an entire town, or one that has been given control over a previously public sidewalk or park, or one that has effectively been delegated the task of holding and administering public elections. Instead, Defendants are private entities who created their own video-sharing social media website and make decisions about whether and how to regulate content that has been uploaded on that website….The Court likewise declines to find that Defendants in the instant case are state actors that must regulate the content on their privately created website in accordance with the strictures of the First Amendment.

Cites to Howard v. AOL, Nyabwa v. Facebook, Shulman v. Facebook, Kinderstart v. Google, Langdon v. Google. and Cyber Promotions v. AOL. The court also could have (but didn’t) cited Estavillo v. Sony Computer Entertainment.

This is a district court ruling, so it’s not the final word on whether online services can be treated like company towns. Still, the court’s analysis is cogent, well-cited, and persuasive. I’m sure it won’t kill the online-services-are-company-towns meme because it’s too irresistible to plaintiffs, but those who continue to advance the arguments will increasingly look like judicial activists.

False Advertising. Prager University also tried to cite YouTube’s words against it via Lanham Act false advertising claims. This fails too.

Prager University argued that putting its videos in restricted mode falsely implied the videos were “inappropriate.” The court says that any message communicated by YouTube via the restricted mode characterization wasn’t really commercial (“Plaintiff alleges no facts that remotely suggest that Defendants restricted access to Plaintiff’s videos for any ‘promotional purpose'”) and didn’t have sufficient consumer reach to qualify as advertising.

Prager University also cited various statements in YouTube’s policies and guidelines, but the court says those don’t count as advertising; “Defendants’ policies and guidelines are more akin to instruction manuals for physical products.” Also, any injury Prager University wasn’t attributable to YouTube’s statements but instead to YouTube’s technical configuration of the restricted mode.

Prager University also cited various public statements by YouTube about how it enables everyone’s voices to be heard (and similar remarks). The court dismisses all of those statements as puffery because the statements aren’t quantifiable. Also, like the prior point, the court says that any injury is due to YouTube’s technical configuration, not the statements.

Finally, Prager University cited various statements in YouTube’s TOSes, such as YouTube “help you grow,” “discover what works best for you,” and “giv[e] you tools, insights and best practices for using your voice and videos,” which caused Prager University to choose to transact with YouTube. The court responds that these statements fall “well short” of false advertising because they are puffery. Also, Prager University lacks Lanham Act standing for these claims because it’s claiming to be a consumer of YouTube, not a competitor or other market participant in the relevant standing zone.

Implications. The court dismisses the case with leave to amend and releases jurisdiction over the state court claims. This means Prager University could try again in federal court and potentially appeal to the Ninth Circuit, or it could give up some claims and switch the battle back to state court. (It could alternatively give up entirely, but I doubt that). I’ll be interested to see what they choose.

There are a spate of other similar lawsuits making similar arguments, including Johnson v. Twitter and Taylor v. Twitter. I expect all of these conservative-voices-hardship cases to meet a similarly hostile reception. Perhaps these cases collectively form a solid wall of precedent that will discourage further plaintiffs from seeking to strip Internet services of their editorial discretion.

Case citation: Prager University v. Google LLC, 2018 WL 1471939 (N.D. Cal. March 26, 2018)

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[The remainder of this post was intended as a separate blog post, but I decided to combine the two given the 100% topical overlap.]

The Knight First Amendment Institute at Columbia University is running an essay series called Emerging Threats, which it says “invites leading thinkers to identify and grapple with newly arising or intensifying structural threats to the system of free expression.” I initially thought the papers would actually identify, and advocate against, threats to free speech. Instead, several of the series papers gleefully champion censorious agendas, so I now realize that the series papers themselves may be the titular “emerging threats” to free speech.

See, for example, Heather Whitney’s Search Engines, Social Media, and the Editorial Analogy from a few weeks ago. It tries to show that Google’s search engine and Facebook’s newsfeed are not best analogized to newspapers for First Amendment purposes. Instead, it stretches other analogies (including the company town analogy and Packingham language, both of which Judge Koh just rejected) to show how regulators can advance censorious agendas.

I don’t like writing response essays–it’s more fun to advance my own writing agenda than to critique others–but I decided it was time to coalesce some of my views in a short and easy-to-read response piece, Of Course the First Amendment Protects Google and Facebook (and It’s Not a Close Question). It makes two main points: (1) Google, Facebook and other UGC services publish third party content, so of course they are covered by the First Amendment’s protections for free speech and press, and (2) if Google, Facebook and other UGC services are state actors, the legal consequences will destroy their value proposition, so I’m a little hard-pressed to see how the pro-censorship champions have a winning endgame (unless the annihilation of the Internet is their goal, which is possible). In any case, I hope you’ll check it out.