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Thursday, September 2, 2010

Craigslist Fighting to Keep CDA 230, First Amendment Case Alive in South Carolina

by Thomas O'Toole

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What the Sam Hill is going on in South Carolina?

This lawsuit, which fell off most folks' radar screen after an Illinois court in Dart v. craigslist Inc., No. 09-1385 (N.D. Ill. Oct. 20, 2009), decided that craigslist enjoys CDA Sec. 230 immunity to a public nuisance claim over classifieds ads for prostitution, is starting to get interesting again.

It seemed like only a matter of time before craigslist would prevail in a related action it initiated in South Carolina. By "related," I mean that the South Carolina litigation arose from the same substantially similar set of operative facts as the Illinois case. Just as in Dart, a public official (South Carolina Attorney General Henry McMaster) claimed that craigslist was criminally liable for online prostitution ads appearing on the site. McMaster, who at the time was running for the Republican nomination for governor, had engaged in a lot of public saber-rattling -- threatening on several occasions to shut down craigslist unless the site banished prostitution solicitation from its South Carolina listings. On one occasion, McMaster told a television reporter that he was "preparing for a prosecution" and that the "#1 defendant is Mr. Jim Buckmaster, who is the man in charge of craigslist ... craigslist is a big promoter and facilitator of prostitution."

Rather than wait for McMaster to make good on his threats, craigslist decided to sue first. craigslist filed a civil rights lawsuit alleging that McMaster's threatened criminal prosecution (1) violated Section 230 of the Communications Act, (2) was an unlawful prior restraint on protected speech, and (3) violated the U.S. Constitution's Commerce Clause by unreasonably burdening interstate commerce. craigslist Inc. v. McMaster, No. 09-1308 (D. S.C., complaint filed July 21, 2009).

McMaster's attorneys initially defended the case on the merits, arguing, among other things, that the CDA does not provide immunity to criminal claims (an argument that has been rejected elsewhere) and that craigslist was itself a content provider because it created the "erotic services" category in which the ads ran (an argument rejected in the Roommates decision).

However -- and this is a matter hotly disputed by craigslist and South Carolina officials -- the South Carolina attorney general, during the course of the litigation, allegedly backed away from some of his provocative asseverations against craigslist. No longer does McMaster believe craigslist is liable merely for hosting advertisements for prostitution. Instead, craigslist is under investigation for "knowingly aiding and abetting prostitution." Under this theory, McMaster's lawyers stated, "the State would have to show [craigslist] knew a particular advertisement was related to prostitution, and either continued to run it, or allowed the same individual to post similar advertisements."

Last month, the court dismissed craigslist's civil rights case for lack of standing. Unfortunately, the court didn't get into the (pretty much settled) CDA Sec. 230 issues or the (very interesting) First Amendment arguments raised by craigslist. Instead, the court found that craigslist no longer faced a credible threat of prosecution by McMaster and, thus, the harms alleged in craigslist's lawsuit were merely hypothetical. Because McMaster has (apparently) backed away from the more extravagant criminal claims he was making at the time craigslist filed suit, the allegations in craigslist's complaint are no longer true and thus do not support craigslist's claims for relief.

I personally thought that the court gave short shrift to craigslist's arguments that McMaster's high-profile railing against it created a chilling effect on protected speech. If a state attorney general, in South Carolina, is repeatedly threatening in the news media to prosecute me and my company for crimes that carry hefty prison terms, associating my company and my good name with prostitution, and hauling my company officials into negotiations over what can and can't appear on my website, then yes I am going to feel more than a little bit inhibited in what I do and don't publish on my website. Color me chilled. Instead, the court was very picky about what McMasters did and did not threaten against craigslist and how his position had evolved over time into something more benign than what appeared in craigslist's complaint. In the court's own words:

This case arises because Attorney General McMaster has publicly stated his belief that the Plaintiff knowingly allows prostitution advertisements to appear on its website. The Plaintiff appears to deny that it does so. Given this denial, the Court cannot simply assume that such advertisements exist and that the Plaintiff will face prosecution. Under the circumstances, the Court believes that a dismissal of the Plaintiff's complaint is appropriate.

craigslist is not walking away from this case. Late last week the company filed both an amended complaint and a motion for reconsideration of the court's dismissal order. Certainly craiglist believes that it continues to face a credible threat of prosecution by McMaster. craigslist attorneys ruefully noted, among the legal arguments raised against the court's dismissal order, the fact that the ink was barely dry on the court's order when McMaster re-commenced his threats against craigslist, issuing a bellicose press release declaring victory and vowing to continue his investigation.

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