Saturday, February 02, 2008

Having your sandwich and eating it too: Quiznos seeks 230 immunity for ads

The New York Times ran a story about the conflict between the Lanham Act and CDA §230 immunity which sets forth the issues fairly clearly: Can a Sandwich Be Slandered? As the Times explained, Quiznos ran a contest for homemade ads, and the rules required “a comparison between Quiznos and Subway with Quiznos being superior.” Subway sued over these ads, as well as Subway-generated ones. Quiznos argues that it’s just facilitating consumer-generated ads, which is protected by §230 (as long as it’s limited to web hosting, of course – run a consumer-generated ad as part of the Superbowl broadcast and you’re clearly in Lanham Act territory).

The complaint describes the objectionable user-generated ads as follows:
[In “Mr. Meat,” “Disgruntled Employee,” and “Breaks You Get What You Pay For”] the Defendants explicitly or implicitly referred to the Subway(R) sandwiches in a false and misleading manner. … For example, in one video under the Contest, the video depicts a Subway Cheesesteak sandwich in front of the Subway outlet and then the sandwich is shown running to the Defendant's store implying there was “no meat” at the Subway store. In another video entitled “Co-workers” two male individuals are shown sitting at lunch on a break with one individual eating a Subway(R) Cheesesteak sandwich and the other employee eating the Defendant’s steak sandwich; the video depicts the individual eating a Subway(R) sandwich with “no meat” and wanting to “trade” his Subway(R) half for the Defendant’s sandwich. In a third example, two children are depicted in a submarine attack situation calling for help because of the enemy Subway ship is approaching without enough meat. The sandwich is then obliterated implying it did not have enough meat. In each of these submissions to the Contest, videos implicitly or explicitly show the Subway(R) product in a false and misleading manner.
In addition, Subway alleges that the website at which the ads were collected,, itself made a false comparative claim. I would think this is clearly not protected by §230, since Quiznos was the creator of the allegedly false content – the domain name. But the “no meat” claim is so exaggerated that it’s likely just puffery, in the absence of additional claims. (Then again, there was that Buffy episode.)

The court denied a motion to dismiss the claims related to the user-generated ads on the ground that §230 is an affirmative defense that can’t be resolved on the pleadings. Doctor’s Associates, Inc. v. QIP Holders, LLC, 2007 WL 1186026 (D. Conn.). The case is scheduled for trial in 2009.

The Times explains the marketing advantages of user-generated ads: “the general population has more leeway to make videos that cross into murky territory. Consumer ads are sometimes offensive and crude, and they often exaggerate the benefits of the products made by the company that dangles the prize money. The sponsor can try to distance itself from the provocative content, while at the same time benefiting from the attention the videos draw to the brand.”

In the Times story, Richard Leighton, a partner at Keller and Heckman, suggests that §230 may not apply if Quiznos effectively made consumers its agents. I’m not so sure – a number of §230 precedents suggest that even extensive editing and – to borrow a term – inducement to create content aren’t sufficient if the ultimate decisions are up to the individual user. Under the Ninth Circuit’s now-en banc’ed decision, however, perhaps the contest instructions are specific enough to make Quiznos responsible for the conforming content. But as long as Quiznos asked only for comparisons, not false comparisons, I’m extremely leery of holding them responsible for the results, not because I like false ads but because §230 applies to such a wide range of claims. Newspapers that ask their readers to offer opinions in online discussion forums aren’t too far from Quiznos – especially newspapers that have a strong editorial position and whose question wording suggests a preferred direction for answers. I had understood §230 to protect that kind of thing. If §230 does protect user-generated ads that are exploited by commercial advertisers, that’s another reason it ought to be revisited.

The Quiznos team, however, made one argument that I really don’t like: “the consumer videos should not cause concern under the Lanham Act anyway because that law requires there to be an element of deception in the ad, and, [the lawyer] said, ‘there can’t be an element of deception if everyone knows the videos were created by consumers for the sake of entering a contest.’” That involves some sleight-of-hand about what the deception is: the comparison between Subway and Quiznos, not the source of the ads. Even if consumers understand the ads are user-generated, it would still be perfectly reasonable to think that Quiznos wouldn’t show the ads if they weren’t true.

The potential of user-generated ads to degrade (further) the integrity of information is illustrated by the remarks of one amateur filmmaker who submitted a video to the Quiznos contest: “‘Quiznos led you to believe it was O.K. to do it,’ [he] said. ‘It’s like mudslinging, in a sense. Like politicians slinging mud back and forth at each other. I took it that it was all fair in business.’” But the Lanham Act holds business to a higher standard than love or war.

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