Online Game Network Isn’t Company Town–Estavillo v. Sony
By Eric Goldman
Estavillo v. Sony Computer Entertainment America, 2009 WL 3072887 (N.D. Cal. Sept. 22, 2009)
Sony’s PS3 online network isn’t a company town or otherwise a state actor subject to First Amendment obligations. As a result, Judge Whyte of the Northern District of California dismissed pro se Estavillo’s First Amendment challenge against Sony for kicking him off its network.
Judge Whyte’s analysis is fairly terse because this was such an easy case. He says:
Sony’s Network is not similar to a company town. The Network does not serve a substantial portion of a municipality’s functions, but rather serves solely as a forum for people to interact subject to specific contractual terms. Every regulation Sony applies in the Network is confined in scope only to those entertainment services that Sony provides. Although the Network does include “virtual spaces” such as virtual “homes” and a virtual “mall” that are used by a substantial number of users (Pl.’s Reply in Supp. of Opp’n. to Dismiss 1), these “spaces” serve solely to enrich the entertainment services on Sony’s private network. In providing this electronic space that users can voluntarily choose to entertain themselves with, Sony is merely providing a robust commercial product, and is not “performing the full spectrum of municipal powers and [standing] in the shoes of the State.” Hudgens, 424 U.S. at 519 (quoting Lloyd Corp. v. Tanner, 407 U.S. 551, 568-69 (1972)).
Sony does not have a sufficient structural or functional nexus to the government. Plaintiff has not suggested that Sony is part of the state or federal government. The Network was not created to further government objectives. The government retains no permanent authority to appoint any directors of Sony or the Network, or any other private body associated with the Network. There is no indication that Sony has assumed functions traditionally reserved to the government, or that the government had any part in encouraging Sony to create the Network. Count one of the complaint does not state a plausible First Amendment claim for relief, and therefore must be dismissed. Iqbal, 129 S.Ct. at 1940.
This discussion is appropriately brief because we’ve known for many years that private online companies aren’t state actors, and at least a dozen precedential cases have reached this conclusion. For more on this, see my 2005 article Speech Showdowns at the Virtual Corral.
Nevertheless, this case could have significant import for academic discourse about the virtual worlds. I believe this is the first ruling to squarely conclude that an online game/virtual world isn’t a company town. As a result, this opinion emphatically rejects a meme that has become pretty popular among virtual world exceptionalists. Some exceptionalists have favored the company town analogy because it enable virtual world customers to reduce an operator’s ability to run its business capriciously.
At the same time, as I explain in my 2005 article, importing constitutional doctrines into paying vendor-customer relationships could have untold detrimental effects on the entire online industry. This efficient ruling will hardly be the last word in that debate, but it should take a little wind out of the sails of the virtual-world-as-company-town meme that gets invoked so frequently in virtual world exceptionalist circles.
For more on this opinion, see Rob Heverly’s blog post. Rob sees more merit in Estavillo’s argument than I do, but still he concludes that the case “was probably rightly decided.”