Constitutional Challenge Against Section 230. Lewis didn’t have standing to challenge Section 230’s constitutionality because any “injury” he suffered did not relate to Section 230. YouTube took its action as a private actor, not a state actor; and Section 230 provides an immunity from suit, not a cause of action.

First Amendment Violations. YouTube is not a state actor (cite to PragerU v. Google).

Title II of Civil Rights Act. “YouTube’s websites are not a ‘place of public accommodation.’…To conclude Google or YouTube were places of public accommodation under Title II ‘would obfuscate the term ‘place’ and render nugatory the examples Congress provides to illuminate the meaning of that term.'”

Lanham Act False Advertising. Lewis lacked standing because he sued as a consumer, not a competitor.

Fraud by Omission. Lewis didn’t allege any duty to disclose that YouTube failed to honor. Plus, “YouTube disclosed that it reviews flagged content to determine whether it violates the Community Guidelines, which in turn prohibit ‘Hateful content.’ YouTube’s monetization policies elaborate that ‘Hateful content’ is ineligible for monetization.”

Covenant of Good Faith and Fair Dealing. YouTube’s contract expressly gave it the right to act, which eliminates any overlapping implied claim.

Tortious Interference. Lewis didn’t allege that YouTube knew of any affected third party.

What a bogus lawsuit. Maybe Lewis will find a more enthusiastic reception on Parler. Plaintiff’s counsel was Andrew Martin of Martin and Peters PLLC.  

Case citation: Lewis v. Google LLC, 2021 WL 1423118 (9th Cir. April 15, 2021)

Selected Related Posts About State Action Claims

• When It Came to @RealDonaldTrump, Twitter Couldn’t Please Everyone–Rutenberg v. Twitter
• Another Must-Carry Lawsuit Against YouTube Fails–Daniels v Alphabet
• Newspaper Isn’t State Actor–Plotkin v. Astorian
• An Account Suspension Case Fails Again–Perez v. LinkedIn
• Are Social Media Services “State Actors” or “Common Carriers”?
• Google and Twitter Defeat Lawsuit Over Account Suspensions/Terminations–DeLima v. Google
• More Plaintiffs (and Lawyers) Need To Be Reminded That YouTube Isn’t a State Actor–Divino v. Google
• Facebook Isn’t a Constructive Public Trust–Cameron Atkinson v. Facebook
• Google and YouTube Aren’t “Censoring” Breitbart Comments–Belknap v. Alphabet
• LinkedIn Isn’t a State Actor–Perez v. LinkedIn
• Section 230 Preempts Another Facebook Account Termination Case–Zimmerman v. Facebook
• Section 230 Ends Demonetized YouTuber’s Lawsuit–Lewis v. Google
• Court Rejects Another Lawsuit Alleging that Internet Companies Suppress Conservative Views–Freedom Watch v. Google
• Another Suspended Twitter User Loses in Court–Wilson v. Twitter
• First Voters Reject Tulsi Gabbard, Then a Judge Does–Gabbard v. Google
• YouTube Isn’t a State Actor (DUH)–PragerU v. Google
• Facebook Still Isn’t Obligated to Publish Russian Troll Content–FAN v. Facebook
• Vimeo Defeats Lawsuit for Terminating Account That Posted Conversion Therapy Videos–Domen v. Vimeo
• Russia Fucked With American Democracy, But It Can’t Fuck With Section 230–Federal Agency of News v. Facebook
• Private Publishers Aren’t State Actors–Manhattan Community Access v. Halleck
• Your Periodic Reminder That Facebook Isn’t a State Actor–Williby v. Zuckerberg
• Section 230 Protects Facebook’s Account and Content Restriction Decisions–Ebeid v. Facebook
• Court Tosses Antitrust Claims That Internet Giants Are Biased Against Conservatives–Freedom Watch v. Google
• Twitter Isn’t a Shopping Mall for First Amendment Purposes (Duh)–Johnson v. Twitter
• YouTube Isn’t a Company Town (Duh)–Prager University v. Google
• Facebook Defeats Lawsuit By User Suspended Over ‘Bowling Green Massacre’–Shulman v. Facebook
• Yelp, Twitter and Facebook Aren’t State Actors–Quigley v. Yelp
• Facebook Not Liable for Account Termination–Young v. Facebook
• Online Game Network Isn’t Company Town–Estavillo v. Sony
• Third Circuit Says Google Isn’t State Actor–Jayne v. Google Founders
• Ask.com Not Liable for Search Results or Indexing Decisions–Murawski v. Pataki
• Search Engines Defeat “Must-Carry” Lawsuit–Langdon v. Google
• KinderStart Lawsuit Dismissed (With Leave to Amend)
• ICANN Not a State Actor

The post YouTube (Again) Defeats Lawsuit Over Content Removal–Lewis v. Google appeared first on Technology & Marketing Law Blog.

This case involves actor Michael Rapaport, who has appeared in many popular TV shows and movies. Apparently he’s edgy in real life, which he demonstrated through a CBS Radio show.

Barstool Productions “has cultivated its brand around providing ‘unfiltered,’ ‘controversial,’ crass, and sometimes humorous views on” sports and pop culture. Barstool poached Rapaport from CBS, and they entered into a “talent agreement.”

8 months into the relationship, it melted down. Rapaport took the bait from a Twitter user and disparaged Barstool’s fanbase for embracing the nickname “stoolies”:

(Remarkably, Rapaport didn’t pick on the “pole” misspelling. It pains me every time I see it).

Barstool fired Rapaport the next day by text (classy).

Rapaport escalated the matter. He still had the login credentials to Barstool’s Twitter account (oops–if you fire someone, IMMEDIATELY terminate their login credentials) and posted a video there calling Portnoy (Barstool’s founder) a “dumb motherfucker,” a “dumb fuck,” and a “bitch.”

In response to that and other provocations, “the Barstool Defendants published dozens of tweets, blog posts, online articles, videos, podcasts, and radio shows that accused Rapaport of being racist, a fraud, a hack, a wannabe, and a liar, having herpes, and stalking and beating his former girlfriend.”

[Unsurprisingly, the judge ran out of patience for these clowns. For example, she writes: “Rapaport’s [evidentiary] objections extend to documents that Rapaport himself produced in discovery. These objections are not well taken and, quite frankly, are borderline sanctionable.” ]

Talent Agreement Breach

The Talent Agreement contained a morals clause. Dafuq? Barstool hired Rapaport to sling garbage, yet the contract provides an immediate out if Rapaport brings himself or Barstool “into public disrepute”? (See a dispute over a similar clause). I wonder how aggressively Rapaport’s counsel negotiated that clause. At minimum, the clause should have established a baseline level of permitted disrepute. After all, Barstool built its brand around “controversial” and “crass” content, and Rapaport’s controversial and crass content is exactly why Barstool poached him. In any case, the court holds the issue of whether Barstool could exercise that termination basis over to trial.

Rapaport also alleged that Barstool didn’t try hard enough to procure advertisers for his “rant videos” (seriously, that’s what the court called them), as required by the contract. Again, dafuq? How many advertisers want to be associated with rant videos? (If you are such an advertiser, please contact me–I’d happily take your money). Barstool responded that advertisers weren’t interested because Rapaport was “very unpredictable” and used the C-word “incessantly.” This issue gets kicked to trial too.

Also…Rapaport used the C-word all the time and Barstool didn’t think that violated the morals clause? Instead, Barstool only became upset when Rapaport insulted the “intelligence” of an audience that was loyal to someone who routinely drops C-bombs?

Defamation

Rapaport claimed that the Barstool team said Rapaport is “racist,” a “fraud,” a “hack,” a “wannabe,” and a “liar.” (They also called Rapaport a “loser,” one of Trump’s favorite insults).  The court says “these labels represent nothing more than the Barstool Defendants’ subjective evaluations of Rapaport that are incapable of being objectively proven true or false.”

Accusations that Rapaport had herpes and engaged in criminal conduct are capable of a defamatory meaning. The court responds:

audiences would readily recognize the challenged statements as representing the (often overtly biased) viewpoints of the Barstool Defendants…the statements were largely laden with epithets, vulgarities, hyperbole, and non-literal language and imagery; delivered in the midst of a public and very acrimonious dispute between the Barstool Defendants and Rapaport that would have been obvious to even the most casual observer; and published on social media, blogs, and sports talk radio, which are all platforms where audiences reasonably anticipate hearing opinionated statements.

For example, Barstool did a “diss track” where they said terrible things about Rapaport. The court says:

The tone and apparent purpose of the diss track reinforce for audiences that the video is not intended to reflect an accurate factual assessment of Rapaport. Exaggerated, vitriolic words and imagery pervade the six-minute-plus video to attack all aspects of Rapaport’s life, including his career, popularity, relationships, appearance, age, and legal troubles. For example, alongside the obviously hyperbolic statements that Rapaport identifies as defamatory are similarly sensational assertions that Rapaport is a “fucking 10 gallon drum of curdled milk,” a “walking blob of jizz,” a “snake-oil salesman with nothing to sell,” and a “puddle of pudding,” and that he looks like “Larry Bird’s mom’s sister,” or a “chemo Yertle the Turtle.” The video also suggests that Rapaport has such poor rap skills that the speaker would rather “get a spinal tap” or “go out to Neverland Ranch and sit in Michael’s lap” than listen to him rap.

I’m not sure why the comparison t0 Larry Bird and his family was unflattering. Larry Bird is a basketball hall-of-famer and a good-looking man. Plus, he has more class in his pinky finger than all of the litigants in this case combined. Also, Barstool fired Rapaport for bringing public disrepute onto them, but they are also fine calling someone a “walking blob of jizz”….seriously?

The diss track also included several photoshopped images:

(Some background on the term “cracker”).

The court says:

the context of this “diss track” video reasonably signals to viewers that the challenged statements are the prejudiced, opinionated viewpoints of the Barstool Defendants, not accurate factual assessments of Rapaport.

The court also says the Barstool team disclosed the basis of their “herpes” statement by showing these images:

Several times, the court vacillates between saying that the statements aren’t capable of defamation and saying the statements provided adequate support. To me, these photos suggest the Barstool team made a factual claim that Rapaport had herpes, but they provided their evidence supporting that claim, and that turned their characterization of the situation into non-actionable interpretation of the source data. It also negates actual malice. The court could have been more doctrinally precise here.

The Barstool team also made a “Fired Up” video. The court’s evaluation is similar to the diss track:

Just as no reasonable viewer would interpret the cartoon as asserting for a fact that Rapaport died as a result of having “Ding Dongs for Brains,” those same viewers would not understand the cartoon as factually asserting that Rapaport has herpes or that a lesion on his face speaks and serves as his producer.

The following t-shirt, offered for sale, didn’t claim Rapaport had herpes:

This is very close to the facts I tested in my Fall 2020 Internet Law exam. I really can’t make up exam facts crazier than real life. I kept thinking of the clown emoji while working on this blog post. This image reinforced why. Judy Collins’ song from the mid-1970s kept playing in my mind: “Send in the clowns. Don’t bother, they’re here.”

With respect to subsequent tweets, the court says “courts interpreting New York law have generally found that comments made on Twitter are more likely to be understood by audiences as statements of opinion than statements of fact” (citing, among others, Jacobus v. Trump). For example, the court says “Given that the escalating quarrel was apparent to anyone who came across the tweet, Clancy’s rejoinder that Rapaport is a ‘creepy herpes riddled failure’ is best understood as an intemperate epithet delivered in the heat of a series of charged personal attacks rather than as an objective factual observation that Rapaport is a failure, is creepy, and has herpes.” The court similarly says blog posts are viewed as typically the author’s opinion, citing Wexler v. Dorsey & Whitney.

Defamation Implications. I think the court’s approach reflects the modern jurisprudence of Internet defamation. Courts adjust their evaluation of fact-like statements to reflect the rough-and-tumble nature of online discourse. The more outrageous the claim, the more obvious that it’s hyperbolic. Other examples include LeBlanc v. Skinner (“terrorist”) and Finkel v. Dauber (bestiality accusations). In the heat of Internet beefs, courts apparently will let people say pretty much anything. See also Higgins v. Kentucky Sports Radio.

I’m glad that defamation claims are hard to win online. I see too many thin-skinned plaintiffs using defamation to suppress truthful information. However, I wonder if defamation-free zones online have enhanced the coarseness of our discourse across our society. People say terrible things online and, sadly, find a market for it. I don’t think more law is the solution to that problem, but we can and should vote with our eyeballs to not reward people who produce trash content.

Closing note. Covering a beef like this brings me zero joy. I wanted all of the litigants to lose. Maybe they were actually well-matched for each other. As the maxim goes, you lie with dogs, you’re going to get fleas.

Case citation: Rapaport v. Barstool Sports, Inc., 1:18-cv-08783-NRB (S.D.N.Y. March 29, 2021)

The post Internet Feuds Are Basically Defamation-Free Warzones–Rapaport v. Barstool appeared first on Technology & Marketing Law Blog.

(Tip: credit cards often provide insurance to cover these damage claims by rental car companies. I used it successfully when I got a windshield crack on a recent vacation. The tendering process worked quite smoothly and insurance paid everything, so I didn’t care what ridiculous fees the rental car company might have buried into the damages estimate. Unfortunately, my primary credit card has canceled this insurance coverage, so now I have to choose another card for my rental car bookings. Of course, there’s been no urgency for this during the pandemic shutdown).

It appears the dispositive contract formation process occurred through the online reservation booking process, which included this mandatory screen:

The court says this “online booking process involves a modified or hybrid clickwrap agreement.” As I’ve told you before, the online contract formation field is overrun by junk terminology, including the fact that a “clickwrap” (what the court calls a “pure” clickwrap) could be a “modified or hybrid” clickwrap. FFS. Personally, I think Sixt used a “sign-in wrap,” but who am I to quibble with the wrap characterizations when I want to burn all of them to a crisp?

[Jargon watch: I checked in Westlaw this morning and there are 16 case references to “modified clickwrap” and 13 to “pure clickwrap.” ]

The court says this formation process works because “Sixt’s website contained an ‘explicit textual notice’ that clicking the “BOOK NOW” button would manifest Charnis’s intent to be bound by Sixt’s Rental Jacket, including the arbitration provision.” The court could have, and should have, said this without getting into any of the wrap garbage.

The court also addresses the evidence Sixt introduced to demonstrate formation. This was on a motion to compel arbitration, not a motion to dismiss, so Sixt could provide evidence and the court evaluates it like on summary judgment. Sixt’s key evidence comes from a declaration from Dennis Boehringer, its director of corporate development. Boehringer claimed personal knowledge of the reservation booking process and that he had personally made some test reservations at the relevant time period. The court says this is good enough:

Boehringer manages projects for Sixt and tests the reservation process himself for those projects.  He personally made reservations on Sixt’s website on November 11 and 25, 2019—around the same time as Charnis—and attests that the current website layout and booking process is the same as it was back then. The screenshot in Boehringer’s declaration shows that, by clicking the “BOOK NOW” button to complete the booking, customers confirm that they have read and accept the “terms and conditions.” Clicking the “terms and conditions” hyperlink sends the customer to the general “Terms and Conditions Rental Jacket,” a copy of which Boehringer attached to his declaration; that version was in effect in November 2019 and contains an arbitration provision.

The plaintiff didn’t introduce sufficient contrary evidence. “For example, Charnis does not assert that the layout of Sixt’s website was not as Boehringer described or that he did not actually click the ‘BOOK NOW’ button.”

Your periodic reminder: having a strong contract formation process is good; having credible evidence to convince the judge of that process without a fact trial is priceless.

Case citation: Calderon v. Sixt Rent a Car, LLC, 2021 WL 1325868 (S.D. Fla. April 9, 2021)

The post There Are Multiple Types of “Clickwrap.” They Should All Be Enforceable–Calderon v. Sixt appeared first on Technology & Marketing Law Blog.

[BONUS: Prof. Ochoa will be speaking on this case April 13, 6pm Pacific. Free registration.]

On April 5, the U.S. Supreme Court held 6-2 that Google’s copying of 11,500 lines of code from the Java SE Application Programming Interface (API) in creating its Android operating system was a fair use.  Google LLC v. Oracle America, Inc., No. 18-956.  Writing for the majority, Justice Breyer declined to answer the first question presented in the petition for certoriari: “Whether copyright protection extends to a software interface,” defined narrowly as “lines of computer code that allow developers to operate prewritten libraries of code to perform particular tasks.”  “[W]e assume, for argument’s sake, that the material [copied] was copyrightable.”  (Slip op. at 1)  Instead, the majority held that even if the entire API was protected, Google’s use of the declaring code, defining the names of the methods and their organization into packages, classes, and methods, was fair: “where Google reimplemented a user interface, taking only what was needed to allow users to put their accrued talents to work in a new and transformative program, Google’s copying of the Sun Java API was a fair use of that material as a matter of law.”  (Slip op. at 35)

The ruling ends a decade-long battle between Google and fellow software giant Oracle, which purchased Java developer Sun Microsystems in 2010.  It also overturns the Federal Circuit’s 2018 ruling in favor of Oracle, which could have led to a multi-billion dollar award against Google.  If the Federal Circuit’s opinion had been affirmed, it likely would have been highly disruptive to the software industry.  Ever since the Lotus v. Borland case in the 1990s (affirmed without opinion by an equally divided Supreme Court, 4-4, with Justice Stevens recused), the software industry has assumed that interface specifications of this type were not protected by copyright.  A concurring opinion in the Lotus case (by Judge Boudin) suggested that some kind of privileged use was an alternative path to the same result.  Justice Breyer cited Judge Boudin’s opinion in his majority opinion, and the holding that Google’s use was fair follows Judge Boudin’s alternative path.  (In the interests of full disclosure, I should note that I was one of 65 intellectual property scholars that signed an amicus brief in favor of Google in this case.)

Facts and Procedural Posture

To someone familiar with the basics of computer programming, the facts of this case are relatively straightforward; but to the layperson, the facts are complicated and may be difficult to understand.  Justice Breyer’s opinion does a good job of laying out the facts (slip op. at 1-9) and the procedure posture (slip op. at 9-11).  I will summarize the facts briefly here.  If you are already familiar with the facts, you can skip to my analysis of the opinion below.  (If you are interested in a longer in-depth explanation of the facts and legal background, you may listen to my one-hour lecture, presented to Santa Clara students before the oral argument.)

In the 1990s, Sun Microsystems developed the Java programming language and invited all programmers to use it.  To facilitate its use, Sun also developed the Java SE (Standard Edition) Application Programming Interface (API).  The Java API consists of a large number of prewritten programs that execute certain routine tasks, such as adding numbers, calculating an average, etc.  Instead of having to write every piece of computer code from scratch, the Java API allows programmers to simply memorize the names (or “method calls”) associated with those basic tasks, which the programmer can then incorporate into more complex programs.  “In this way, the [“method calls”] are similar to a gas pedal in a car that tells the car to move faster or the QWERTY keyboard on a typewriter that calls up a certain letter when you press a particular key.”  (Slip op. at 6)  In other words, they are “part of an interface between human beings and a machine.”  (Id.)

The Java API is organized into 166 packages, thousands of classes, and tens of thousands of methods.  The majority opinion notes that “No one claims that the decisions about what counts as a task are themselves copyrightable—although one might argue about decisions as to how to label and organize such tasks (e.g., the decision to name a certain task ‘max’ or to place it in a class called ‘Math’).”  (Slip. op. at 21)  The Java API consists of both declaring code and implementing code.  “The declaring code both labels the particular tasks in the API and organizes those tasks, or ‘methods,’ into ‘packages’ and ‘classes.’ We have referred to this organization, by way of rough analogy, as file cabinets, drawers, and files.”  (Slip op. at 22)  The implementing code then “actually instructs the computer on the steps to follow to carry out each task.”  (Id.)  Finally, each of the names specified in the declaring code becomes a “method call,” the words that a computer programmer uses to invoke the program that executes the method or task.  For example, to compare two numbers and determine which is the larger, the programmer would invoke (or “call”) the method by using the name “java.lang.math.max” (which indicates the “lang” package, the “math” class, and the “max” method).

In 2005, Google acquired Android, Inc., with the intention of developing a software platform for smartphones.  Google negotiated with Sun for a license to customize the Java API in creating Android.  (Both Apple and Microsoft paid Sun a license fee to customize the Java API.)  The advantage to Google was that programmers already familiar to Java would not have to learn new names (or “method calls”) in order to create new programs for the Android platform.  Talks broke down, however, over Sun’s insistence that any application programs (“apps”) written for Android must follow its “write once, run anywhere” philosophy.  Google wanted to leave software developers relatively free and unconstrained in writing apps for Android.

After talks with Sun broke down, Google decided to create its own Android platform, and it took 100 programmers more than three years to do so.  (Slip op. at 3)  In order to attract Java programmers to the platform, however, Google copied 11,500 lines of declaring code from the Java API, which defined and named about 6,000 methods in about 600 classes in 37 of the 166 packages.  Google then “reimplemented” the Java API by writing all of its own implementing code.  The amount of declaring code that Google copied comprised about 3% of the code in the 37 packages, and about 0.4% of the code in the 166 packages in the entire Java API.  Because of the copying, Google obtained the advantage that programmers already familiar with Java would be able to program easily in Android without having to learn new method calls.

As an aside, almost any trial lawyer will tell you that it is a “bad fact” that Google sought a license, and despite not getting one, went ahead and copied a portion of what it had sought to license anyway.  Most people see the negotiations as an implicit concession that the material is protected by copyright (or by some other type of intellectual property).  As the U.S. Supreme Court explained in Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569 (1994), however, involving an alleged rap parody of the popular song “Pretty Woman”:

[W]e reject Acuff-Rose’s argument that 2 Live Crew’s request for permission to use the original should be weighed against a finding of fair use. Even if good faith were central to fair use, 2 Live Crew’s actions do not necessarily suggest that they believed their version was not fair use; the offer may simply have been made in a good-faith effort to avoid this litigation. If the use is otherwise fair, then no permission need be sought or granted. Thus, being denied permission to use a work does not weigh against a finding of fair use.  (Id. at 585 n.18)

Moreover, the majority discounted the Google-Sun negotiations, noting that a large part of the perceived value of a license was the ability to use the trademarked term “Java” (“branding and cooperation,” slip op. at 33), which Google had to forego when it decided not to license Java and instead to develop Android on its own.  Google also had to write all of its own implementing code, an expensive and time-consuming endeavor that is inconsistent with Oracle’s theme that Google was merely a pirate.

Android was released in November 2007, and within a few years it became wildly successful.  Android-based smartphones and devices have captured a large share of the U.S. market, and as of 2015, they earned Google about $42 billion in revenue.  (Slip. op. at 9)  At the time, Sun’s CEO, Jonathan Schwartz, publicly congratulated Google, and he later testified that he didn’t think Google needed Sun’s permission to use the declaring code of the Java API in this manner.  After Oracle purchased Sun in 2010, however, Oracle sued Google for both patent and copyright infringement.

At the initial trial, a jury found that Google had copied 11,500 lines of code, but it could not reach a verdict on the issue of fair use.  (In a separate trial, the jury also rejected the patent infringement claims.  That decision was not appealed.)  The trial judge then held that the lines of code that were copied were not protected by copyright.  872 F. Supp. 2d 974 (N.D. Cal. 2012).  Because the original case had included patent claims, the appeal went to the Federal Circuit instead of the Ninth Circuit, even though the patent claims were no longer part of the case.  [For commentary on this jurisdictional loophole, see Peter Menell, API Copyrightability Bleak House: Unraveling and Repairing the Oracle v. Google Jurisdictional Mess, 31 Berkeley Tech. L.J. 1515 (2016).]  The Federal Circuit reversed and remanded, holding that the Java API, including the declaring code, was protected by copyright; and it remanded for a new trial on fair use.  750 F.3d 1339 (Fed. Cir. 2014).  The Supreme Court denied Google’s first petition for a writ of certiorari.  576 U.S. 1071 (2015).

On remand, the jury found that Google’s use was a fair use.  (The jury was asked to render a general verdict in favor of one party or the other, rather than using a special verdict form with interrogatories.)  Oracle moved for judgment as a matter of law (notwithstanding the verdict), which the trial judge rejected.  On appeal, the Federal Circuit again reversed.  886 F.3d 1179 (Fed. Cir. 2018). It rejected three of the jury’s implicit findings in favor of Google, and instead held that no reasonable jury could find the work transformative; no reasonable jury could find the portion used was qualitatively insignificant; and no reasonable jury could find that there was no market harm.  The Supreme Court granted certiorari (despite the negative recommendation of the Solicitor General).  Oral argument was originally scheduled to be held on March 24, 2020; because of the pandemic, oral argument was postponed to this term (October 7, 2020).

Standard of Review

The most important part of the majority opinion for future fair use cases is the brief section on the standard of review (slip op. at 18-21).  As the Supreme Court paraphrased it, the Federal Circuit held “that the ‘fair use’ question was a mixed question of fact and law; that reviewing courts should appropriately defer to the jury’s findings of underlying facts; but that the ultimate question whether those facts showed a ‘fair use’ is a legal question for judges to decide de novo.”  (Slip. Op. at 18-19)  The Supreme Court agreed with this approach.  (Of course, the Federal Circuit gave only lip service to the jury’s implicit factual findings supporting the verdict, reversing those implicit findings on three of the four fair use factors.  The Supreme Court corrected that error by expressly noting the substantial evidence on which the jury found in Google’s favor, in addition to its ultimate holding in Google’s favor.)

The Supreme Court also rejected two arguments based on the Seventh Amendment.  The Seventh Amendment provides:  “In Suits at common law … the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law.”  In practice, this means that a right to jury trial attaches to factual questions that would have been tried by a jury in 1791, while questions of law and questions that would have been decided in courts of equity do not carry a right to jury trial.  The Supreme Court noted that it has described fair use as “an equitable rule of reason” (slip op. at 13), and it held that “the right of trial by jury” does not include “the right to have a jury resolve a fair use defense.”  (Slip op. at 20).  In addition, “[i]t does not violate the Reexamination Clause for a court to determine the controlling law in resolving a challenge to a jury verdict, as happens any time a court resolves a motion for judgment as a matter of law.”  (Slip op. at 20)

Thus, the fact that a jury ruled in Google’s favor does not preclude a court from determining for itself whether a particular use is or is not “fair.”  Courts already play a large role in fair use determinations, since many of them arise on a motion for a preliminary injunction, a purely equitable remedy that is decided by a judge.  But the majority opinion means that fewer fair use cases will survive summary judgment to reach a trial; and those that do likely will utilize a special verdict form asking specific factual questions, rather than a general verdict simply asking who wins or loses (as in this case).  The ruling also gives appellate judges even more power than they already exercise to overturn lower court rulings on the issue of fair use.  (That’s a bit ironic, since the opinion was announced in a case in which the Federal Circuit exercised its power, only to have the Supreme Court agree with the principle but overrule the result.)

Question One: Are Interface Specifications Protected by Copyright?

There are many different kinds of interface specifications.  Most courts agree that software-to-computer or software-to-software interface specifications, which must be followed in order for software to interoperate with the computer or with other software, are not protected by copyright.  See, e.g., Computer Assocs. Int’l, Inc. v. Altai, Inc., 982 F.3d 693, 709-10 (2d Cir. 1992) (filtering out “mechanical specifications of the computer on which a particular program is intended to run”; “compatibility requirements of other programs with which a program is designed to operate in conjunction” and “computer manufacturers’ design standards”); Sega Enterprises, Ltd. v. Accolade, Inc., 977 F.2d 1510, 1522-25 (9th Cir. 1993) (approving reverse engineering “in order to discover the functional requirements for compatibility with the Genesis console — aspects of Sega’s programs that are not protected by copyright”); Sony Computer Ent’mt, Inc. v. Connectix Corp., 203 F.3d 596 (9th Cir. 2000) (same for Sony Playstation).  More controversial are human-to-computer interface specifications.  Those can be further subdivided into human-to-computer interface specifications for ordinary users or consumers, such as the menu command structure in Lotus Development Corp. v. Borland Int’l, Inc., 49 F.3d 807 (1st Cir. 1995) (not protected by copyright), aff’d by an equally divided Court, 516 U.S. 233 (1996); and the human-to-computer interface specifications for programmers involved in Google v. Oracle.

In the lower courts and on appeal, Google argued that the Java API’s interface specifications — the lines of declaring code that named the various methods, defined their inputs and outputs, and organized them into classes and packages — were not protected by copyright.  It cited 17 U.S.C. 102(b), which denies copyright protection to “any idea, procedure, process, system, [or] method of operation.”  The district court agreed and held that even though the command structure was original and creative, it was nonetheless part of the program’s “system” or “method of operation.”  872 F. Supp. 2d 974 (N.D. Cal. 2012).  The Federal Circuit reversed and remanded, holding that “Section 102(b) does not … automatically deny copyright protection to elements of a computer program that are functional.”  750 F.3d 1339 (Fed. Cir. 2014).

As noted above, the majority purports to remain agnostic on the question of whether the Java API software interface specifications at issue were copyrightable.  “Given the rapidly changing technological, economic, and business-related circumstances, we believe we should not answer more than is necessary to resolve the parties’ dispute. We shall assume, but purely for argument’s sake, that the entire Sun Java API falls within the definition of that which can be copyrighted.”  (Slip op. at 15)  Nonetheless, in discussing the second fair use factor, “the nature of the copyrighted work,” the majority opinion strongly suggests that, at a minimum, such interface specifications should receive very little, if any, protection under copyright law.  (See the Court’s discussion of the second fair use factor, below.)

Justice Breyer famously began his career as a law professor with a provocative article, The Uneasy Case for Copyright: A Study of Copyright in Books, Photocopies, and Computer Programs, 84 Harv. L. Rev. 281 (1970), in which he “warn[ed] against any headlong rush to provide computer programs with [copyright] protection.” Id. at 348.  Breyer was also the newest Justice of the Supreme Court when the Lotus v. Borland case was argued before the Court in January 1996.  That case involved the “menu command structure” (human interface specifications) for the popular Lotus 1-2-3 spreadsheet software; competitor Borland designed its own software to respond to the Lotus menu commands and user-created shortcuts (macros) to take advantage of the user base that had already learned how to use Lotus.  The First Circuit had held that the menu command structure was an uncopyrightable method of operation, and its decision was affirmed by an equally divided Court, with Justice Stevens recused.  516 U.S. 233 (1996).  Given his voting history in copyright cases, it is virtually certain that Justice Breyer voted to affirm the judgment in Lotus v. Borland.

My suspicion is that in Google v. Oracle, Justice Breyer wanted to hold that interface specifications were not protected by copyright as “systems” or “methods of operation,” but that he couldn’t garner a majority of justices willing to do so.  Some justices were probably uncomfortable with the possible implications of a broad ruling, and preferred to rule on narrower grounds.  Nonetheless, Justice Breyer wrote an opinion describing the Java API as a “system” and strongly suggesting that the declaring code deserved little, if any, copyright protection. (Slip op. at 24)

Dissenting, Justice Thomas (joined by Justice Alito), took the majority to task for declining to address the question of whether the software was copyrightable.  Justice Thomas rejected any distinction between declaring code and implementing code:

Google’s argument … cannot account for Congress’ decision to define protected computer code as “a set of statements or instructions to be used directly or indirectly in a computer in order to bring about a certain result.” §101 (emphasis added)….  Implementing code orders a computer operation directly. Declaring code does so indirectly ….  (Diss. op. at 6)

This argument is off the mark.  All human-readable source code is used “indirectly” in a computer, because it first has to be compiled into object code or binary code (1s and 0s) in order for the computer to “directly” read it and execute it.  The “directly or indirectly” language in the statute undoubtedly refers to the distinction between source code and object code, rather than to any distinction between two different types of source code (declaring code and implementing code).

Nonetheless, Justice Thomas is correct in one of his conclusions: “By skipping copyrightability, the majority gets the methodology backward, causing the Court to sidestep a key conclusion that ineluctably affects the fair-use analysis….  The result … is an opinion that makes it difficult to imagine any circumstance in which declaring code will remain protected by copyright.”  (Diss. op. at 7-8)  I fully agree; but since I signed an amicus brief arguing that the declaring code was not and should not be protected by copyright, I am entirely comfortable with that result.

The names of each individual method are not likely to be terribly original (a program to add numbers is probably called either “add” or “sum” rather than something truly original, like “Cathcart”); and individual names are not protected by copyright in any event. [37 C.F.R. § 201.1(a)]  Instead, only a selection and arrangement of names can be protected.  Java’s selection and arrangement was undoubtedly original under Feist.  But programmers don’t use the names for their expressive content; they use the names in order to accomplish functional tasks.  The result is very much like a QWERTY keyboard that uses names instead of letters for each key; the value lies in standardization, or network economic effects, rather than in the expressive value of the words chosen.  From the point of view of economic policy, it makes much more sense to allow everyone to use the “standardized” method of operation, and to let them compete on different implementations of it.

In his concurring opinion in the Lotus v. Borland case, Judge Boudin described and confronted the standardization problem directly.  His conclusion, altered minimally to fit this case, provides as good an explanation as any for what is ultimately a policy-driven decision:

But if a better [platform] comes along, it is hard to see why customers who have learned the [Java method calls] should remain captives of [Oracle] because of an investment in learning made by the users and not by [Oracle]. [Sun/Oracle] has already reaped a substantial reward for being first; assuming that the [Google Android platform] is now better, good reasons exist for freeing it to attract old [Java] customers: to enable the old customers to take advantage of a new advance, and to reward [Google] in turn for making a better product. If [Google] has not made a better product, then customers will remain with [Oracle] anyway.

49 F.3d 807, 821 (1st Cir. 1995) (Boudin, J., concurring).  Judge Boudin concurred in the holding that the menu command structure in Lotus was not copyrightable as a “method of operation”; but he also suggested an alternative path to the same result: a type of privileged use.  “The difference is that such a privileged use approach would not automatically protect [Google] if it had simply copied the [Java API], contributed nothing of its own, and resold [Java] under the [Android] label.”  Id.  He also recognized that “fair use” could be used to implement such a “privileged use” approach.  Id.  That is the route that the majority in Google v. Oracle chose to take.

Question Two: Was Google’s Use of Code from the Java API a Fair Use?

As readers familiar with copyright law are aware, the Copyright Act states simply that “the fair use of a copyrighted work … is not an infringement of copyright.”  [17 U.S.C. § 107]  The statute leaves it to courts to determine whether a particular use is fair on a case-by-case basis, with two sources of statutory guidance:  six illustrative purposes (“for purposes such as criticism, comment, news reporting, teaching …, scholarship, or research”); and four factors to consider:

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;

(2) the nature of the copyrighted work;

(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and

(4) the effect of the use upon the potential market for or value of the copyrighted work.

Unusually, the majority began its discussion of fair use with the second factor.  In an empirical study, scholar Barton Beebe found that “the outcome of factor two typically has no significant effect on the overall outcome of the fair use test.”  Barton Beebe, An Empirical Study of U.S. Copyright Fair Use Opinions, 1978-2005, 156 U. Pa. L. Rev. 549, 610 (2008).  More recently, he found that “[f]air use opinions continue routinely to denigrate factor two as unimportant to the overall fair use analysis,” and that factor two “typically has a relatively minimal impact on the outcome of the overall four-factor test.” Barton Beebe, An Empirical Study of U.S. Copyright Fair Use Opinions Updated, 1978-2019, 10 N.Y.U. J. Intell. Prop. & Ent. L. 1, 30 (2020).  Yet factor two occasionally can be quite important.  For instance, in Harper & Row Publishers, Inc. v. Nation Enterprises, 471 U.S. 539 (1985) the Supreme Court repeatedly emphasized the previously unpublished nature of the material quoted from President Gerald Ford’s soon-to-published memoir, which overcome its otherwise factual nature and weighed heavily against fair use.  Likewise, in Google v. Oracle, the majority opinion thought factor two sufficiently important that it began its fair use analysis with it.

Factor Two: The Nature of the Copyrighted Work

In discussing the second fair use factor, the majority noted testimony that Sun “sought to make the API ‘open’ and ‘then . . . compete on implementations.’” (Slip op. at 23).  Thus, “Java’s creators … tried to find declaring code names that would prove intuitively easy to remember,” and the declaring code was “designed and organized in a way that is intuitive and understandable to developers so that they can invoke it.”  (Id.)  Moreover,

Unlike many other programs, [the declaring code’s] value in significant part derives from the value that … computer programmers … invest of their own time and effort to learn the API’s system. And unlike many other programs, its value lies in its efforts to encourage programmers to learn and to use that system so that they will use (and continue to use) Sun-related implementing programs that Google did not copy.  (Slip op. at 24, emphasis added)

Thus, “for the reasons just described, the declaring code is, if copyrightable at all, further than are most computer programs (such as the implementing code) from the core of copyright.”  (Id., emphasis added).

Justice Thomas’ dissenting opinion argued that “if anything, declaring code is closer to the ‘core of copyright.’ Developers cannot [or at least generally do not] even see implementing code. Implementing code thus conveys no expression to developers. Declaring code, in contrast, is user facing.”  (Diss. op. at 10, citations omitted and bracketed comment inserted)  In one sense, Justice Thomas is correct:  if one was simply trying to decide which code was more “functional” and which code was more “expressive,” the answer would be that implementing code is more functional and declaring code is more expressive.  (Justice Breyer attempts to debate this point by quoting record evidence describing the implementing code as “magic,” but the passage fails to convince.) But by Justice Thomas’ reasoning, object code or binary code (the 1s and 0s that actually interact with the computer) would be even more functional than implementing (source) code.  The result would be difficult to square with Congress’ decision to protect software by copyright rather than by a sui generis intellectual property regime.

Instead, the ultimate policy question is: who should benefit from the investment that users have made in learning the names that Sun devised to organize and invoke the methods in its API?  The majority believed that software programmers should not be “locked into” using Java simply because they had learned those names; instead, others should be free to use the names and to compete on their implementation of those names.  (Slip op. at 34-35)  The dissent believed that each new software platform should have to come up with its own names in order to compete for users.  (Diss. op. at 14)  I agree with the majority, for the reasons already discussed in my commentary on the first question presented, the one that the majority chose to avoid.

Factor One: The Purpose and Character of the Use

With regard to the first fair use factor, the central inquiry remains whether and to what the extent the defendant’s use is “transformative,” or “whether the copier’s use ‘adds something new, with a further purpose or different character, altering’ the copyrighted work ‘with new expression, meaning or message.’” (Slip op. at 24, quoting Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 579 (1994)).  The majority also quoted Judge Leval, who invented the “transformative” use concept, asking “whether the copier’s use ‘fulfill[s] the objective of copyright law to stimulate creativity for public illumination.’” (Slip op. at 24, quoting Leval, Toward a Fair Use Standard, 103 Harv. L. Rev 1105, 1111 (1990)).

Although “Google copied portions of the Sun Java API … for the same reason that Sun created those portions, namely, to enable programmers to call up implementing programs that would accomplish particular tasks” (slip op. at 25), the majority nonetheless held that “[t]o the extent that Google used parts of the Sun Java API to create a new platform that could be readily used by programmers, its use was consistent with that creative ‘progress’ that is the basic constitutional objective of copyright itself.”  (Id.)  The majority explained:

The record here demonstrates the numerous ways in which reimplementing an interface can further the development of computer programs. The jury heard that shared interfaces are necessary for different programs to speak to each other. It heard that the reimplementation of interfaces is necessary if programmers are to be able to use their acquired skills. It heard that the reuse of APIs is common in the industry. It heard that Sun itself had used pre-existing interfaces in creating Java. And it heard that Sun executives thought that widespread use of the Java programming language, including use on a smartphone platform, would benefit the company.  (Slip op. at 26 (citations to the record omitted))

The statutory text also instructs courts to consider “whether such use is of a commercial nature or is for nonprofit educational purposes.”  [17 U.S.C. § 107(1)]  The majority acknowledged that Google’s use was commercial, but it brushed this consideration aside, noting that “many common fair uses are indisputably commercial,” including at least one statutory example, “news reporting.”  (Slip op. at 27)  This is consistent with the Campbell Court’s de-emphasis on the commercial nature of the use.  The majority also gave some deference to “the jury finding in Google’s favor on hotly contested evidence,” and concluded that, on balance, factor one weighed in Google’s favor.

The difficulty with the “transformative” concept is that it substantially overlaps with one of the exclusive rights of the copyright owner: the exclusive right “to prepare derivative works based upon the copyrighted work.”  [17 U.S.C. § 106(2)]  A “derivative work” is defined as “a work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted.”  [17 U.S.C. § 101 (emphasis added)]  Courts continue to struggle with the overlap and the distinction between derivative works that “transform” an original work of authorship and “transformative” purposes or uses that are entitled to greater consideration in a fair use analysis.

For a recent example, see the recent Second Circuit decision in Andy Warhol Foundation for the Visual Arts v. Goldsmith (decided March 26, 2021), in which the Second Circuit held that Warhol’s “Prince Series” of 16 artworks, based on a photograph of Prince taken by Goldsmith, was not a fair use.  That court said: “It does not follow … that any secondary work that adds a new aesthetic or new expression to its source material is necessarily transformative” (op. at 19), and it suggested that “there exists an entire class of secondary works that add ‘new expression, meaning, or message’ to their source material but are nonetheless specifically excluded from the scope of fair use: derivative works.” (Op. at 20)  That statement is clearly incorrect; there is nothing to suggest that either Congress or the Supreme Court intended to exclude all derivative works from the scope of fair use.  To the contrary: in Campbell v. Acuff-Rose Music, Inc., for example, a unanimous Supreme Court held that a derivative rap version of the song “Pretty Woman” with altered lyrics could qualify as a “fair use” as a parody.  510 U.S. 569 (1994).  The Warhol case might be ripe for rehearing (or even a cert. petition), in light of dicta in Google v. Oracle stating: “An ‘artistic painting’ might, for example, fall within the scope of fair use even though it precisely replicates a copyrighted ‘advertising logo to make a comment about consumerism.’” (Slip. op. at 25, quoting Netanel, Making Sense of Fair Use, 15 Lewis & Clark L. Rev. 715, 746 (2011).)  (On the other hand, there may be good reasons to treat an advertising logo very differently from an artistic portrait photograph.)  Perhaps the Warhol case is one of those instances in which courts should withhold an injunction and grant only a reasonable royalty as damages, as now-retired Ninth Circuit Judge Alex Kozinski suggested more than two decades ago.  See Kozinski and Banner, What’s So Fair About Fair Use?, 46 J. Copyr. Soc’y USA 513 (1999).

Justice Thomas’ dissenting opinion makes the same mistake as the Warhol opinion when it complains that “the majority wrongly conflates transformative use with derivative use…. A work that simply serves the same purpose in a new context [smartphones instead of laptops and desktops] … is derivative, not transformative.”  (Diss. op. at 17)  A use can be both derivative and transformative; but some transformative uses will not be fair uses.  The Supreme Court in Campbell suggested one way to distinguish fair uses from ordinary derivative uses was to look at market harm:  “The market for potential derivative uses includes only those that creators of original works would in general develop or license others to develop.”  510 U.S. at 592.  That’s a problem in this case, because there is evidence that Sun/Oracle was actively trying to license others to develop a compatible version of Java SE for smartphones.  (See Factor Four)  Perhaps Justice Thomas is correct when he opines in a footnote:  “Because the majority’s reasoning would undermine copyright protection for so many products long understood to be protected, I understand the majority’s holding as a good-for-declaring-code-only precedent.”  (Diss. op. at 17 n.11)

Factor Three: The Amount and Substantiality of the Portion Used in Relation to the Copyrighted Work as a Whole

As noted in the facts, the 11,500 lines of declaring code that Google copied comprised about 3% of the 37 Java packages at issue, and about 0.4% of the 166 packages in the entire Java API.  (The District Court used the former number, the Supreme Court majority used the latter.  Slip op. at 28)  As the majority acknowledged, the third factor is heavily dependent on the first factor: “The ‘substantiality’ factor will generally weigh in favor of fair use where, as here, the amount of cop­ying was tethered to a valid, and transformative, purpose.”  (Slip op. at 29)  The majority held that this standard was satisfied:

Google copied those lines not because of their creativity, their beauty, or even (in a sense) because of their purpose. It copied them because programmers had already learned to work with the Sun Java API’s system, and it would have been difficult, perhaps prohibitively so, to attract programmers to build its Android smartphone system without them….

We do not agree with the Federal Circuit’s conclusion that Google could have achieved its Java-compatibility objective by copying only the 170 lines of code that are “necessary to write in the Java language.” 886 F.3d at 1206. In our view, that conclusion views Google’s legitimate objectives too narrowly. Google’s basic objective was not simply to make the Java programming language usable on its Android systems. It was to permit programmers to make use of their knowledge and experience using the Sun Java API when they wrote new programs for smartphones with the Android platform. In principle, Google might have created its own, different system of declaring code. But the jury could have found that its doing so would not have achieved that basic objective. In a sense, the declaring code was the key that it needed to unlock the programmers’ creative energies. And it needed those energies to create and to improve its own innovative Android systems.  (Slip op. at 29-30)

Justice Thomas’ dissenting opinion tries to play with the numbers by saying that “the proper denominator is declaring code, not all code.”  (Diss. op. at 18, emphasis in original)  Of course, even if that is true, it is still the case that Google copied the declaring code from only 37 Java packages, rather than all of the 166 packages.  (That’s about 22% of the declaring code if one assumes that each package is roughly the same size, which is probably not the case.)  But again, the real dispute between the opinions is the policy one: who is entitled to take advantage of the investment that programmers have made in learning the Java method calls?  As I have already discussed, the majority and the dissent differed on that fundamental issue.

Factor Four: The Effect of the Use upon the Potential Market for or Value of the Copyrighted Work

Under the fourth factor, the majority says that a court must consider not only “the amount of money that the copyright owner might lose,” but also “the source of the loss” (harms from substitution are “cognizable” while harms from criticism are not) and “the public benefits the copying will likely produce.”  (Slip op. at 30-31)  Having said that, it immediately disclaimed any universality to this analysis: “We do not say that these questions are always relevant …, [n]or do we say that these questions are the only questions that a court might ask.” (Slip op. at 31)  In answering those questions here, the majority (unlike the Federal Circuit) deferred to the jury’s implicit findings of fact in Google’s favor:

[T]he jury could have found that Android did not harm the actual or potential markets for Java SE. And it could have found that Sun itself (now Oracle) would not have been able to enter those markets successfully whether Google did, or did not, copy a part of its API. First, evidence at trial demonstrated that, regardless of Android’s smartphone technology, Sun was poorly positioned to succeed in the mobile phone market…. It also heard that Sun’s many efforts to move into the mobile phone market had proved unsuccessful…. When Sun’s former CEO was asked directly whether Sun’s failure to build a smartphone was attributable to Google’s development of Android, he answered that it was not. Given the evidence showing that Sun was beset by business challenges in developing a mobile phone product, the jury was entitled to agree with that assessment.

Second, the jury was repeatedly told that devices using Google’s Android platform were different in kind from those that licensed Sun’s technology…. [The] record evidence demonstrates that, rather than just “repurposing [Sun’s] code from larger computers to smaller computers,” [Diss. op.] at 16, Google’s Android platform was part of a distinct (and more advanced) market than Java software.  (Slip op. at 31-32)

In addition, “Google’s economic expert told the jury that Android was not a market substitute for Java’s software,” and “the jury also heard evidence that Sun foresaw a benefit from the broader use of the Java programming language in a new platform like Android, as it would further expand the network of Java-trained programmers.”  (Slip op. at 32)  Although “Sun presented evidence to the contrary,” “the jury’s fair use determination means that neither Sun’s effort to obtain a license nor Oracle’s conflicting evidence can overcome evidence indicating that, at a minimum, it would have been difficult for Sun to enter the smartphone market, even had Google not used portions of the Sun Java API.”  (Slip op. at 33)

The majority then once again returned to the central policy question: who is entitled to take advantage of programmer’s investment in learning the names and method calls in the Java API?  The majority’s answer to that question is clear:

When a new interface, like an API or a spreadsheet program, first comes on the market, it may attract new users because of its expressive qualities, such as a better visual screen or because of its superior functionality. As time passes, however, it may be valuable for a different reason, namely, because users, including programmers, are just used to it. They have already learned how to work with it. See Lotus Development Corp., 49 F.3d at 821 (Boudin, J., concurring).

The record here is filled with evidence that this factor accounts for Google’s desire to use the Sun Java API. This source of Android’s profitability has much to do with third parties’ (say, programmers’) investment in Sun Java programs. It has correspondingly less to do with Sun’s investment in creating the Sun Java API. We have no reason to believe that the Copyright Act seeks to protect third parties’ investment in learning how to operate a created work.  (Slip op. at 33-34, emphasis added)

Justice Thomas again criticizes the majority, noting that a theater company can’t refuse to pay a copyright owner just because it has already memorized and rehearsed an existing work.  (Diss. op. at 11) But a play or musical, of course, is used entirely for aesthetic and entertainment purposes.  The dissenting opinion fails to grasp the important distinction between software and other works:  software is functional, and therefore it is not only subject to section 102(b) (“In no case shall copyright protection extend to any idea, procedure, process, system, [or] method of operation”) (emphasis added), but it is also entitled to a narrower scope of protection under the second factor in the fair use doctrine.  As the majority acknowledges, “[t]he fact that computer programs are primarily functional makes it difficult to apply traditional copyright concepts in that technological world.”  (Slip op. at 35).

Commentary

I was pleasantly surprised that the Court ruled for Google, as I didn’t think the oral argument had gone particularly well for Google.  The procedural posture, and the 6-2 vote, means that Justice Ginsburg’s death and Justice Barrett’s absence likely did not affect the outcome.  (A 4-4 vote would have left the Federal Circuit’s rulings in favor of Oracle intact; and had Justice Ginsburg still been on the Court, she almost certainly would have voted to affirm.)  Justice Breyer’s opinion was joined not only by Justices Kagan and Sotomayor, but also by Chief Justice Roberts and Justices Gorsuch and Kavanaugh, demonstrating once again that intellectual property cases rarely are decided along conventional political lines.  I am somewhat disappointed that Justice Alito joined Justice Thomas in dissent, as Justice Alito authored one of the leading cases denying copyright protection to parts numbers:  Southco, Inc. v. Kanebridge Corp., 390 F.3d 276 (3d Cir. 2004) (en banc) (even though Southco had devised an original “system” for numbering its parts, the application of that system to any particular part lacked any originality or creativity).

The issues presented in this case could have been (and should have been) decided 25 years ago, when the Court granted certiorari in the Lotus v. Borland case.  Instead, Justice Stevens was recused, and the remaining judges split 4-4, affirming the result by an equally divided Court.  But perhaps because observers believed that Justice Stevens would have voted against copyrightability in Lotus, the entire software industry accepted the First Circuit’s opinion that human-computer interface specifications were not copyrightable.  It has operated on that assumption for the past two-and-a-half decades.  Had the Supreme Court held in favor of Oracle, it would have had an incredibly disruptive influence on the entire software industry, a clear majority of whom thought Google should win the case.  I imagine that some of the justices in the majority were at least somewhat influenced by the large number of amicus briefs from the software industry that supported Google.

When the Federal Circuit initially ruled that the Java API was copyrightable, it was a shock to the software industry: an issue that everyone thought had been settled in the 1990s was suddenly alive and well again.  [See Peter Menell, Rise of the API Copyright Dead? An Updated Epitaph for Copyright Protection of Network and Functional Features of Computer Software, 31 Harv. J.L. & Tech. 305 (2018).]  But the possibility of fair use on remand left most in the software industry cautiously optimistic.  The jury’s ruling in favor of Google caused the majority of the software industry to exhale a sigh of relief: fair use was just an alternative route to the same result (albeit one that promised higher litigation costs).  When the Federal Circuit reversed again, things looked bleak for developers:  would they have to get permission to write any kind of interoperable software in the future?  The Supreme Court’s ruling in favor of Google restores the status quo.  I would have preferred that the majority had ruled instead on section 102(b) grounds; but at least it reached the right result.

The case also highlights the absence of any kind of laches doctrine in copyright law, a result of the Supreme Court’s opinion in Petrella v. MGM, in which Justice Ginsburg (writing for a 6-3 majority, with Justice Breyer, joined by Chief Justice Roberts and Justice Kennedy, dissenting) held that laches could not be invoked during the three-year statute of limitations period, which begins anew with each act of infringement.  As noted above, when Google released Android in 2007, Sun Microsystems, the developer of the Java SE API, apparently didn’t think Google had done anything wrong.  It was only after Oracle purchased Sun in 2010 that Oracle filed suit for copyright infringement.  Had laches been available, Oracle might very well have been bound by its predecessor-in-interest’s implicit admission.  As it was, the testimony of Sun’s former CEO likely influenced the jury’s decision in favor of Google.

Any Supreme Court opinion is important, and this one no doubt will be quoted often in future briefs and opinions.  But other than clarifying the standard of review, I doubt the decision will have much impact on fair use cases that do not involve software.  The economic and functional considerations that led the majority to rule in favor of Google simply don’t apply to most cases involving ordinary copyrighted works.  For software developers and the software industry, however, the decision is momentous.  Not only does it resolve a multi-billion dollar dispute between two Silicon Valley tech giants, but it finally settles a question that was only implicitly decided in 1996.

Finally, I am struck by how many times Google has taken an aggressive fair use position that led to expensive litigation, only to be ultimately vindicated in the end.  It has happened at least four times.  First, there was the extensive automated copying of text posted on the Internet in implementing Google’s search engine. See Field v. Google, Inc., 412 F. Supp. 2d 1176 (D. Nev. 2006) and Parker v. Google, Inc., 422 F. Supp. 2d 492 (E.D. Pa. 2006), aff’d, 242 Fed. Appx. 833 (3d Cir. 2007), cert. denied, 552 U.S. 1156 (2008). Then there was the extensive automated copying of photographs posted on the Internet in implementing Google’s image search engine.  Although the Ninth Circuit initially ruled (in a case involving a different search engine) in favor of fair use for image thumbnails and against full-size display through inline linking, see Kelly v. Arriba Soft Corp., 280 F.3d 934 (9th Cir. 2002), it later withdrew the ruling on full-size display, see Kelly v. Arriba Soft Corp., 336 F.3d 811 (9th Cir. 2002), and it ultimately affirmed the propriety of Google’s conduct.  Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 1146 (9th Cir. 2007).  Then there was the wholesale copying (but only limited public display) of books from several libraries in implementing Google Book Search.  See Authors Guild v. HathiTrust, 755 F.3d 87 (2d Cir. 2014) and Authors Guild v. Google, Inc., 804 F.3d 202 (2d Cir. 2015).  It is difficult to remember now that when the Google Books project was first announced in 2004, it was incredibly controversial; and Google was vindicated only after a tentative settlement to which the Justice Department objected, and a decade of litigation involving two appeals to the Second Circuit.  Google v. Oracle likewise required a decade of litigation, two appeals to the Federal Circuit, and a trip to the Supreme Court.  Only Google’s accumulated wealth enabled it to litigate all of those cases to their ultimate conclusion in its favor, instead of settling on less-favorable terms. Its efforts have permanently shaped the landscape of fair use as applied to new technologies.

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ICS Provider. We get an unusually extended discussion of the ICS provider prong:

Twitter is clearly an interactive computer service provider. As an online microblogging and social media platform, it allows its users to post messages on the platform for the public to see. Every decision the Court has seen to consider the issue has treated Twitter as an interactive computer service provider, even at the motion to dismiss stage….The fact that Twitter ‘generates revenue as an advertising agency and a data broker’ does not change the fact that Twitter ‘provides or enables computer access by multiple users to a computer service.’…Morton suggests that Section 230 no longer applies to Twitter because Twitter now “operates its own Content Delivery Network.” But that fact is irrelevant. The exact mechanism by which Twitter delivers content to its users does not change the fact that Twitter is a social media platform and provides the “prototypical service entitling it to protections of [Section 230].”

So long as Twitter performs the ICS functions, the fact it might perform other functions is irrelevant. That isn’t rocket science.

Publisher/Speaker of Third-Party Content. (The court seems to collapse the two factors into one). “The objectionable content at issue here are tweets posted by SpyIRL. While the tweets are posted on Twitter’s platform, it is clear that it was SpyIRL – not Twitter – that chose to post the offending tweets containing photographs of Morton.” Morton made the bare allegation that Twitter and SpyIRL were the same entity (or close enough), but the court says it’s “common sense” that Twitter isn’t.

The court then cites numerous cases rejecting the specific claims Morton made, including J.B. v. G6 (FOSTA); Ripple v. YouTube (publicity rights/UCL); 924 Bel Air Rd. v. Zillow (false light); Herrick v. Grindr (emotional distress claims); and Parker v. PayPal (unjust enrichment). When the court puts it that way, it’s pretty clear that this case was never really close.

The court says: “The only claim for which the Court has not seen a prior ruling find barred by Section 230 is Morton’s false advertising claim based upon the Lanham Act.” That’s an odd statement because the Ninth Circuit expressly addressed this issue in Enigma v. Malwarebytes. There, the 9th Circuit said that Section 230’s IP “exception does not apply to false advertising claims brought under § 1125(a) of the Lanham Act, unless the claim itself involves intellectual property.” The Enigma case involved 230(c)(2)(B), not 230(c)(1), but no big diff because the exclusion applies equally to both provisions. If for some reason the Enigma case wasn’t close enough, there are other 230(c)(1) cases on point too, including Marshall’s Locksmith v. Google. Despite the court’s perceived lack of precedent, “the Court dismisses [the Lanham Act false advertising] claim as well because Section 230 clearly reaches the allegedly false advertising statements here, i.e., SpyIRL’s tweets.”

Regarding the “contractual fraud” claim, Morton sought to weaponize Twitter’s non-consensual nudity policy (which says Twitter will immediately and permanently suspend accounts for violations), on the theory that Twitter promised to enforce it and didn’t. Yes, it’s 2021, and we’re seeing the exact same arguments that failed in cases like Noah v. AOL from 2004. Unsurprisingly, they fail again.

First, Twitter never promised to suspend offending accounts. Instead, it contractually reserved its discretion. Cite to Caraccioli v. Facebook. That makes Twitter’s policy “merely aspirational statements.”

Second, “a breach of contract claim premised solely on Twitter’s failure to suspend those accounts would be barred by Section 230. This is because the actions that Morton alleges Twitter failed to take – thereby breaching its duty – are suspending a user’s account. ‘But removing content is something publishers do, and to impose liability on the basis of such conduct necessarily involves treating the liable party as a publisher of the content it failed to remove.’” Cite to Barnes v. Yahoo. The court distinguishes Barnes’ handling of promissory estoppel and 230, saying “liability for promissory estoppel is not necessarily for behavior that is identical to publishing or speaking (e.g., publishing defamatory material in the form of SpyIRL’s tweets or failing to remove those tweets and suspend the account).” I didn’t fully understand the nuanced point the court was trying to make here.

Still, I’m going to bold this language again because it’s central to many cases nowadays: “a breach of contract claim premised solely on Twitter’s failure to suspend those accounts would be barred by Section 230.” Yes, Section 230(c)(1) can support a motion to dismiss contract breach claims. That’s why the contract/230 discussion in Daniels v. Alphabet was weird.

Note that Twitter’s alleged failure to comply with its announced policy is exactly the kind of thing that the PACT Act and many other bills are targeting for greater enforcement activity. This ruling previews the kind of litigation activity that some legislators hope to see more of.

The plaintiffs will get a chance to file an amended complaint (but they haven’t done so, at least not yet), and the copyright claim weren’t challenged and remain unresolved.

Case citation: Morton v. Twitter, Inc., 2021 WL 1181753 (C.D. Cal. Feb. 19, 2021). I’m not sure why the online databases took several weeks to index the case. The complaint. This lawsuit has its own microsite, but it hasn’t been maintained.

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Daniels, a/k/a “Young Pharoah,” posted videos to YouTube, apparently of the #MAGA genre. YouTube removed some videos, allegedly “shadowbanned” him (again, I raise questions whether that’s the appropriate term here), and allegedly kept money it should have paid to him. (This looks like a situation where YouTube applied overlapping content moderation remedies). He sued YouTube for a variety of claims, all of which fail.

Personnel note: the plaintiff’s lawyers are Maria Cristina Armenta and Credence Elizabeth Sol, and this isn’t their first appearance on the blog. They will always hold special status in Internet Law for their ultimately-unsuccessful censorial efforts to force YouTube to remove the Innocence of Muslims video. Now, they are working–again unsuccessfully–to impose censorial must-carry obligations on Internet services.

The opinion covers the standard ground. A couple things to note:

State Action. Daniels claimed that censorial exhortations from Reps. Pelosi and Schiff turned YouTube into a state actor. I discussed this issue in this post about AAPS v. Schiff. TL;DR: it’s terrible when members of Congress ask Internet services to censor, but their garden-variety jawboning doesn’t convert the Internet services into state actors.

Section 230. The court says the defense admitted that Section 230(c)(1) wouldn’t preempt a breach of contract claim. We know this isn’t true. I’ve blogged many cases where Section 230(c)(1) did apply to contract breach claims (and I’ll blog another one soon), including Murphy v. Twitter, a California appellate court that made it 100% clear that Murphy’s contract claims didn’t get around Section 230(c)(1). I believe the court was trying to say that Google wasn’t pressing the Section 230 claim against the plaintiff’s efforts to collect withheld payouts; but the court’s wording was broader, and it makes no sense why the court discussed the contract limits only with respect to Section 230(c)(1) but then turned around and immediately discussed Section 230(c)(2)(A).

Indeed, the court says that Section 230(c)(2)(A) preempts all of the state law claims other than YouTube’s failure to pay. Daniels made the standard argument that YouTube’s removals were in bad faith, but the court says that bare assertion wasn’t enough. Unlike Enigma v. Malwarebytes, “Mr. Daniels does not allege that he is in direct competition with defendants, or that defendants’ removal of his videos stemmed from an anticompetitive animus.” And unlike Song Fi v. Google, “Mr. Daniels does not allege that YouTube removed or restricted access to his videos for a reason unrelated to their content.”

It’s great, but a bit surprising, to see the court’s muscular application of Section 230(c)(2)(A), which parallels the (uncited) Second Circuit Domen v. Vimeo ruling. So long as courts push back on plaintiffs’ weak pleading–like this court did–Section 230(c)(2)(A) could have a valuable role to play in the account termination/content removal space. Instead, I fear other judges will not consistently pushback on weak allegations of bad faith, which is the primary reason why Internet services have avoided relying on Section 230(c)(2)(A) defenses. Still, I’m adding Domen v. Vimeo to the next edition of my Internet Law casebook because I think it’s time to teach 230(c)(2)(A) more seriously.

The plaintiff can replead the contract breach claim for failure-to-pay, but the case has lost all of its ideological implications about must-carry obligations and instead has devolved into a routine collections case (that will likely fail anyways).

Case citation: Daniels v. Alphabet Inc., 2021 WL 1222166 (N.D. Cal. March 31, 2021). The complaint.

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Is Zoom an ICS?

The court says the definition of “ICS” is “expansive.” Zoom qualifies as an “access software provider” because its software “transmits and displays video, audio, and written content.” This conforms with the 9th Circuit’s ruling that Kaspersky qualified as an access software provider, and I think it’s well-accepted that apps get full Section 230(c)(1) protection. Still, this is a relatively rare ruling on what constitutes an access software provider, especially in the Section 230(c)(1) context.

The court says Zoom also qualifies as an ICS provider because it enables multiple users to access computer servers. This means “Zoom is the video equivalent of an online messaging board. Users converse in real-time—and may use Zoom’s built-in chat feature too.” The fact that some Zoom rooms may be restricted to invited participants doesn’t affect this conclusion. “Factually, many Zoom meetings are open to the public. Legally, the public/private nature of a meeting is immaterial to whether Zoom is an ‘interactive computer service.’…the case law does not recognize a public/private distinction.” (Cite to Fields v. Twitter). The court summarizes:

it is irrelevant whether a message is directed at one recipient (like in Direct Messaging); a small group (like in an AOL chat room); or the public (like in messaging boards). The relevant question is whether an “interactive computer service” transmitted that message. The statutory text and case law show that Zoom is an interactive computer service.

Do the Claims Treat Zoom as a Publisher/Speaker?

Having concluded that the Zoombombing claims are based on third-party content, and Zoom qualifies as an ICS provider, the remaining Section 230(c)(1) question is whether the Zoombombing claims are “publisher/speaker” claims. The court summarizes: “Section 230(c)(1) largely bars Plaintiffs’ claims. For instance, Plaintiffs cannot hold Zoom liable for injuries stemming from the heinousness of third-party content…However, § 230(c)(1) otherwise allows Plaintiffs’ claims. For instance, Plaintiffs may claim that Zoom breached contractual duties because these duties are independent of Zoom’s role as ‘publisher or speaker.'”

To distinguish between preempted claims over third-party content and unpreempted claims over security breaches, the court starts with the proposition that Section 230(c)(1) protects content moderation decisions. Section 230’s “caption underscores that § 230(c) immunizes affirmative, good-faith acts,” and per Section 230(c)(1), “an interactive computer service can moderate third-party content without fear that it will be treated as the ‘publisher or speaker of’ that content.” Furthermore, “Section 230(b) declares the policy of the United States is to encourage content moderation—not to provide immunity so broad that content moderation becomes disincentivized.”

This statutory analysis shows that Congress did not provide “any intention to immunize conduct unrelated to content moderation, such a failure to protect users from a security breach.” Thus, a publisher/speaker claim occurs when:

First, these claims challenge the harmfulness of “content provided by another.” Second, these claims allege violations of a duty that does not “derive[] from the defendant’s status or conduct as a ‘publisher or speaker.’” Thus, § 230(c)(1) allows two types of claims: claims that either (1) are content-neutral; or (2) do not derive from defendant’s status or conduct as a publisher or speaker

The court explains these two categories:

Content-Neutral Claims. “It is irrelevant to these [content-neutral] claims whether third-party content on defendant’s platform is good or bad, displayed or hidden. Rather, liability stems from a content-neutral rule.” The court cites three examples of Ninth Circuit cases involving content-neutral claims:

• HomeAway v. Santa Monica because banning rental bookings did not impose liability for the listings’ content. While the court correctly recounted the holding, I still disagree with it. I believe the 9th Circuit’s distinction is 100% illusory, because any listings that lead to illegal or unbookable bookings are bait-and-switch false advertising.
• Nunes v. Twitter (note: the Nunes here is not Devin) because the TCPA bans unsolicited texts, regardless of the text’s content. In my blog coverage of the Nunes ruling, I described it as “bizarre because it gets the analysis precisely backwards.”
• Doe v. Internet Brands because “failure to warn” claims are based on the service’s alleged omissions.

Claims Not Deriving from Publisher/Speaker Status. The court says contract claims are one such example, citing Barnes and Green v. AOL. Yet, this discussion doesn’t engage with the many cases where, in fact, Section 230(c)(1) has applied to contract claims that try to work around the Section 230 immunity–including Judge Koh’s own ruling in FAN v. Facebook and the recent and carefully drafted opinion in Murphy v. Twitter. So this part of the opinion leaves open some key questions about the interplay between contract claims and Section 230.

Section 230(c)(1) Mostly Protects Zoom from Zoombombing Claims

The court concludes: “The bulk of Plaintiffs’ Zoombombing claims lie against the “Zoombombers” who shared heinous content, not Zoom itself. Zoom merely ‘provid[ed] neutral tools for navigating’ its service” (cite to Roommates.com). That means the following claims survive the Section 230 analysis:

The Court denies Zoom’s motion to dismiss Plaintiffs’ contract claims. These claims do not derive from Zoom’s status or conduct as a “publisher” or “speaker.” The Court also denies Zoom’s motion to dismiss Plaintiffs’ claims to the extent they are content-neutral

The plaintiffs can amend their complaint to fit their claims into these standards.

Case citation: In re Zoom Video Cmmunications Inc. Privacy Litigation, 2021 WL 930623 (N.D. Cal. March 11, 2021). The complaint.

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Assurance’s site included this screen display:

(Screenshot note: you see the hatted-A, which is normally an indicator of some formatting problem with the page. This suggests that the page didn’t load properly or this isn’t an authentic screenshot of what Javier saw. The court doesn’t address this defect with the screenshot, but I would have wanted to know more if I had been the judge).

Assurance took the position that the linked privacy policy adequately disclosed its conduct, and thus Javier consented to it and negated the privacy claims. Javier challenged it in 3 ways:

Retroactive Consent. Javier claimed that ActiveProspect’s tracking started before he purportedly consented, so his consent came too late. The court responds:

the Court has found no case addressing retroactive consent in the privacy context. However, outside of privacy law, California courts frequently uphold retroactive consent as valid…The privacy policy here is phrased in present tense—“we collect” data when “you use our Services,” not “we will collect”—and thus gives fair notice that Javier consents to actions that may have already taken place.

The court adds in a footnote: “The data collection here occurred mere minutes and seconds before Javier gave consent during a single website visit. The Court does not address facts not before it, such as where data was collected months or weeks before.”

I’m not sure if this issue has been addressed in the literature. If not, writing about retroactive privacy consent sounds like a good paper topic. There are other scenarios to address. Could Assurance/ActiveProspect have cured the lack of consent if they immediately flushed the tracked data at the session end if Javier hadn’t asked to view his quote? Would a cookiewall or similar pop-up notification have provided sufficient consent to permit tracking immediately?

Insufficient Notice. The court says that the privacy policy constituted a “clickwrap.” This seems to be a misnomer, because typically now a clickwrap requires a second click. Assurance’s process is closer to the abysmal “sign-in-wrap” term. I’m OK with the misnomer because I think Assurance’s formation process here should be legally indistinguishable from the two-click “clickwrap.” Javier unsuccessfully challenged the UI of Assurance’s clickthrough:

the webpage on which Javier provided consent was uncluttered, with only a few entry fields followed by the disclosure on a single page; the text placed hyperlinks in a different color to indicate their selectability; and there were no additional features, such as a dark background or additional links having different formatting, that would have obscured the notice….Viewed holistically, the clean and uncluttered page by which Javier affirmatively consented, while having full ability and immediate opportunity to read the privacy policy, shows that he had sufficient notice

Privacy Policy Terms. Javier claimed the privacy policy disclosures didn’t adequately disclose the specific tracking method. The court responds:

The policy clearly indicates that Assurance tracks activity on its website and may use third party vendors to do so. The policy as a whole is only two pages long, which means that none of the terms are buried or obscured. That the privacy policy also discusses other types of tracking, such as data collection for purposes of personalization, does not detract from its plain disclosures elsewhere

This ruling does not address the situation where a prospective customer visits the site but never clicks through the screenshot above. It appears Assurance and its vendor will still track and record the user, but the user won’t have consented via the “clickwrap,” but also wouldn’t receive any unsolicited phone calls because the user didn’t enter a phone number. What happens in that case? I wonder if Article III standing would pose a barrier there.

Case citation: Javier v. Assurance IQ, LLC, 2021 WL 940319 (N.D. Cal. March 9, 2021)

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The Court’s Ruling

The Second Circuit affirms the dismissal, relying solely on Section 230(c)(2)(A) (Domen didn’t pursue the CA Constitutional claim on appeal). This is unexpected, because many courts have recently used Section 230(c)(1) to protect content removal/account termination decisions. In comparison, Section 230(c)(2)(A) has languished because it requires the defendant act in “good faith,” which plaintiffs can often plead around to survive a motion to dismiss. However, the appeals court applies Section 230(c)(2)(A) on a motion to dismiss in this case, perhaps revitalizing Section 230(c)(2)(A)’s utility as a defense.

The court doesn’t expressly say why it relied only on Section 230(c)(2)(A) instead of Section 230(c)(1). Still, the court says Section 230(c)(2)(A) a “broad provision” which “provide[s] platforms like Vimeo with the discretion to identify and remove what they consider objectionable content from their platforms without incurring liability for each decision.” In particular, Section 230(c)(2)(A) protects the removal of content that the service subjectively considers “objectionable.” Accordingly, “Vimeo is statutorily entitled to consider SOCE content objectionable and may restrict access to that content as it sees fit.” The court says this protection extends to the decision to delete the entire account, not just remove specific videos, especially because Vimeo warned Domen of this possibility.

But what about the precondition that Vimeo make its removal decision “in good faith”? Distinguishing the Ninth Circuit’s (terrible) Malwarebytes decision (a Section 230(c)(2)(B) case, but that detail apparently doesn’t matter to this court), the court says:

Vimeo’s deletion of Appellants’ account was not anti-competitive conduct or self-serving behavior in the name of content regulation. Instead, it was a straightforward consequence of Vimeo’s content policies, which Vimeo communicated to Church United prior to deleting its account.

Domen pointed to other unmoderated videos that allegedly violated its SOCE policy as evidence of bad faith. The court replies:

the mere fact that Appellants’ account was deleted while other videos and accounts discussing sexual orientation remain available does not mean that Vimeo’s actions were not taken in good faith. It is unclear from only the titles that these videos or their creators promoted SOCE…Given the massive amount of user-generated content available on interactive platforms, imperfect exercise of content-policing discretion does not, without more, suggest that enforcement of content policies was not done in good faith.

Elsewhere, the court says “Section 230(c)(2) does not require interactive service providers to use a particular method of content restriction, nor does it mandate perfect enforcement of a platform’s content policies.” Finally, the court endorses the Nemet Chevrolet language that Section 230 is an immunity that “is effectively lost if a case is erroneously permitted to go to trial.”

Implications

In the short run, Internet services have a lot to celebrate about this ruling. First, the court revitalizes Section 230(c)(2)(A) as a tool in the defense toolkit, which increases the odds of a successful defense. Second, the court accepts that content moderation will never be perfect, so plaintiffs aren’t going to win simply by pointing out examples of imperfect content moderation. Third, the court grants Section 230(c)(2)(A) on a motion to dismiss, emphasizing that it’s an immunity and not just a safe harbor. This ruling isn’t novel, but a clean and decisive statement from the Second Circuit about Section 230(c)(2)(A) applicability to motions to dismiss will surely encourage future courts to do the same. Fourth, though not explicitly addressed, the court held that Section 230(c)(2)(A) preempted claims that the services had violated anti-discrimination laws–a critical issue given that majority communities are weaponizing anti-discrimination laws to perpetuate their majority status.

Unfortunately, all of the defense gains from this case could be easily wiped away through one of three developments: Congressional amendment, bad court interpretations, and different pleading tactics.

Amendments to Section 230. Both Democrats and Republicans have proposed amendments that would overturn this result.

Some Democrats have proposed bills that would categorically remove anti-discrimination claims from Section 230. Counterproductively, that would benefit Domen, who is posting content that harms minority communities that should normally should be helped by anti-discrimination laws. Also, the SAFE TECH Act would expressly say that Section 230 is an affirmative defense, not an immunity, overturning the central procedural benefit of this ruling.

Meanwhile, several Republican bills have proposed that services can only remove “unlawful” content, not “objectionable” content, under Section 230(c)(2)(A). That single-word change would overturn this case, because it’s unlikely that Domen’s content was illegal. In fact, it’s almost certainly constitutionally protected, no matter how odious it may be.

Thus, when Congress is done mucking with Section 230, I wonder how much of this ruling will be left. Indeed, I wonder if this opinion will spur countermoves on both sides of the Congressional aisle.

Court Interpretations. The opinion sidesteps the role, if any, of Section 230(c)(1) for this fact pattern. Though it would be a misreading of this opinion, courts might nevertheless conclude that only Section 230(c)(2)(A) applies to content removals or account terminations. That would be a net strategic loss for defendants, because Section 230(c)(1) has been so effective in those cases and Section 230(c)(2)(A) may not be as effective.

Furthermore, the court repeatedly says that Vimeo had an express anti-SOCE policy, that it warned Domen of the violation before taking action, and that it took action only when Domen didn’t correct the alleged policy violations. Future courts might misread this opinion to say that all three of those steps are preconditions to Section 230(c)(2)(A). In that case, it would add more grounds for future litigation battles over Section 230(c)(2)(A) and possibly disqualify defendants who didn’t follow these three steps even if their decisions were appropriate.

Pleading Tactics. The opinion lays out some breadcrumbs for plaintiffs to plead around Section 230(c)(2)(A), at least for purposes of a motion to dismiss. Some of the allegations that seemed most promising:

• allege anti-competitive animus. Virtually every content producer can claim indirect competition with every content distributor. After all, they are both in the content business. We’ve seen many allegations like this in the antitrust space, especially with respect to Google’s search engine indexing decisions.
• allege “self-serving behavior,” whatever that means. Every removal/termination decision by a for-profit company is necessarily self-serving because they want to increase profits in the end.
• provide better evidence of inconsistent policy decisions. The court said Domen couldn’t just rely on the titles of other videos, but that could be easily fixed through more careful review of the videos still up. The court also says that imperfect moderation, “without more,” isn’t evidence of bad faith. Plaintiffs could do more to raise suspicions about the imperfections, such as the kinds of statistical analyses that we routinely see in employment discrimination cases that provide circumstantial evidence of discriminatory animus.
• identify other statements made by the defendant that suggest a lack of good faith. This could be in statements made to the plaintiff or in published materials.

In the end, I fear this opinion will still produce far more wasted litigation motion than a clean and decisive Section 230(c)(1) dismissal would have produced.

Case citation: Domen v. Vimeo, Inc., 2021 WL 922749 (2d Cir. March 11, 2021)

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When Parler sued initially, it asserted a federal antitrust claim. Although it sought injunctive relief, it had not formally served AWS with the lawsuit papers. Although Parler lost the initial round in federal court, Parler was free to dismiss the case because AWS had not answered the complaint.

The state court lawsuit did not include any federal claims. Thus, the only basis to be in federal court was if AWS properly removed the dispute based on diversity jurisdiction. The bar to removal was the so-called “forum defendant rule,” which says that a lawsuit that may be otherwise removable due to diversity jurisdiction cannot be removed if “any of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.” To get around this rule, AWS tried a “snap removal” before service is accomplished. By doing so, AWS could argue that no Washington defendant had been “served,” so removal did not violate the forum defendant rule.

Parler’s Motion to Remand accuses AWS of gamesmanship and says that courts frown upon “snap removals.” This motion is noted for hearing on March 26, 2021. It’s being heard by Judge Rothstein, who also heard Parler’s request for a preliminary injunction.

___

Why did Parler try to move the lawsuit to state court? One hypothesis: State court judges are generally considered more plaintiff-friendly. Unlike federal judges who try to trim their dockets, state court judges will sometimes allow lawsuits to cycle through discovery and even past dispositive motions.

What’s the difference between Parler’s new complaint and the old one? The second complaint is more detailed. It has good soundbites. While Parler does not include a federal cause of action for antitrust, the new complaint does not ignore the antitrust element. Its claim under the Washington Consumer Protection Act focuses on AWS’s allegedly anticompetitive activities. Without the antitrust angle, Parler must argue that it was wrongly kicked off AWS’s platform. This argument is always a long shot. It may still be a long shot, but the antitrust overtones undoubtedly help Parler (which is fighting an uphill battle based on its own approach to content moderation and styling itself as a network that welcomes those whose content may not be welcome elsewhere).

What to make of Parler’s request to remand? That’s a tough question. There’s plenty of gamesmanship to go around. Courts are mixed in their treatment of snap removal as a tactic. Here’s a link to a July 2020 ruling from the Western District of Washington (Robart, J.) addressing the propriety of snap removal. Interestingly, given Parler’s status as an LLC, it’s unclear whether diversity jurisdiction exists in the first place.

Case citation: Parler, LLC v. Amazon Web Services, Inc., et al., 21-cv-00270 (King County Case No. 21-2-02856-6 SEA) (Complaint) (Notice of Removal) (Motion to Remand)

Previous post on the case: “Court Rejects Parler’s Demand That Amazon Host Its Services“

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