Section 230 Applies to Defend Trade Secret Act Claims–Craft Beer Stellar v. Glassdoor

Glassdoor is a consumer review site for employees reviewing employers. The plaintiff in this case is a franchisor. Purported employees of a franchisee posted six negative reviews about the franchisee on Glassdoor. The reviews mentioned the francishor’s CEO,  Suzanne Schalow, by name. Schalow sent removal demands. Glassdoor removed one of the reviews, but someone (the author?) revised and resubmitted the review. Glassdoor refused to remove the edited review because it met Glassdoor’s standards. The franchisor sued Glassdoor for numerous claims. Glassdoor defended on Section 230 grounds.

This is an easy Section 230 case, especially in light of the First Circuit’s Jane Doe 1 v. Backpage ruling. The plaintiff complained about third party reviews, so Section 230 presumptively applied. The plaintiff argued that Glassdoor created/developed the reviews because it removed a review and then allowed it to return. The court disagreed: “Glassdoor’s decisions to remove the ‘review,’ and to permit an updated version to be re-posted, constituted the exercise of a traditional editorial function. Without more, Glassdoor cannot be deemed responsible for creating or developing the content.”

The case broke some interesting new ground with respect to the plaintiff’s Defend Trade Secrets Act (DTSA) claim. As far as I know, this is the first time a court has discussed the intersection between Section 230 and the DTSA. The DTSA expressly made its claims subject to Section 230 despite Section 230(e)(2)’s exclusion for “intellectual property” claims:

The initial question here is whether the Defend Trade Secrets Act (“DTSA”), 18 U.S.C. § 1836, et seq., is such an “intellectual property law.” Although perhaps counterintuitive—trade secrets are generally characterized as intellectual property (including even, at times, by Congress)—the DTSA itself plainly provides that it “shall not be construed to be a law pertaining to intellectual property for purposes of any other Act of Congress.” When the language of a statute is plain, the Court’s “sole function” is to enforce the law “according to its terms.” Because Congress has clearly dictated that the DTSA should not be construed to be a law “pertaining to intellectual property” for the purposes of any other Act of Congress, the DTSA is clearly not such a law for the purposes of § 230(e)(2). The DTSA claim is thus subject to the immunity provisions of § 230, and accordingly that claim will be dismissed.

I published a law review article EXACTLY addressing this point: “The Defend Trade Secrets Act Isn’t an ‘Intellectual Property’ Law.” The article explains why Congress made such a “counterintuitive” declaration. Yay for practical articles coming from academia’s ivory tower! Boo that I didn’t get cited!

Case citation: Craft Beer Stellar, LLC v. Glassdoor, Inc.,  2018 WL 5084837 (D. Mass. Oct. 17, 2018)