Wednesday, November 02, 2016

230 provides protection against liability, not immediately appealable immunity from suit

General Steel Domestic Sales, L.L.C. v. Chumley, No. 15-1293 (10th Cir. Nov. 1, 2016)

Defendants (Armstrong Steel) appealed from the district court’s denial of CDA §230 immunity for a number of General Steel’s false advertising claims.  Armstrong ran an online ad campaign that included twenty posts summarizing, quoting, and referencing lawsuits involving General Steel. While the district court found that Armstrong Steel was entitled to immunity for three posts because those posts simply contained links to content created by third parties, it found that Armstrong created and developed the content of the remaining seventeen posts and the internet search ads leading to Armstrong’s pages; the district court found that the defendants developed the content by selectively quoting and summarizing court documents in a deceptive way, and that CDA immunity didn’t apply to the Lanham Act.

The court of appeals refused to allow Armstrong Steel to appeal the §230 ruling before final judgment.  The denial of §230 immunity would be appealable as a collateral order if (as relevant here) it would be unreviewable on appeal from a final judgment, which would only be true if §230 provides immunity from suit, not just immunity from liability.  This requires “an explicit statutory or constitutional guarantee that trial will not occur,” but the CDA doesn’t have language clearly indicating such a guarantee.  Section 230(e)(3) states: “No cause of action may be brought and no liability may be imposed under any State or local law that is inconsistent with this section.” But “reading the text in its entirety reveals that 47 U.S.C. § 230(e)(3) is merely a preemption provision.”

Armstrong Steel argued that construing §230 as a bar against suit would further congressional intent, but the statute simply doesn’t say that. Furthermore, immunity from suit is a benefit typically reserved for governmental officials, in the absence of a close connection to government or a historical basis for providing immunity to that type of private entity, neither of which were present here.

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