Website Liability Shield Extends to Anti-Malware Provider

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By Alexis Kramer

An anti-malware software provider can’t proceed with claims alleging that a competitor wrongly classified its software as a security threat, the U.S. District Court for the Northern District of California ruled Nov. 7.

The case highlights the broad scope of companies that can be entitled to immunity under Section 230 of the Communications Decency Act, a federal statute that shields “interactive computer service providers” from liability for blocking and screening third-party content.

Plaintiff Engima Software Group USA LLC alleged that Malwarebytes Inc. altered its malware detection criteria to identify Enigma’s software as harmful to users’ computers. Enigma brought claims against Malwarebytes Inc. for false advertising under the Lanham Act and tortious interference with business relations ( Enigma Software Grp. USA LLC v. Malwarebytes Inc. , 2017 BL 400009, N.D. Cal., No. 5:17-CV-02915-EJD, 11/7/17 ).

Malwarebytes moved to dismiss the claims under Section 230. The “good samaritan” provision of Section 230, 47 U.S.C. § 230(c)(2), protects internet service providers from liability for offering tools to others for restricting access to material that the provider considers obscene, harassing, or otherwise objectionable.

The court dismissed the entire complaint. Judge Edward J. Davila cited Zango Inc. v. Kaspersky Lab Inc., in which the U.S. Court of Appeals for the Ninth Circuit held Section 230(c)(2)(B) immunity applies to companies that provide filtering tools for computer programs it deems to be malware. Davila said Zango is “factually indistinguishable” from the Enigma case.

The court rejected Enigma’s argument that Malwarebytes is only entitled to immunity if it acted in good faith. Subsection A of the good samaritan provision has a good faith requirement, but subsection B—the subsection applicable to Malwarebytes—doesn’t contain such language, the court said.

The court also said Enigma’s Lanham Act claim doesn’t fall outside the scope of Section 230 immunity because it doesn’t pertain to intellectual property rights. Section 230 provides an exception for federal intellectual property-based claims.

Terry Budd, attorney at Budd Law PLLC and lead counsel for Enigma, told Bloomberg Law Nov. 8 that Section 230 doesn’t protect against the anticompetitive conduct Malwarebytes has allegedly engaged in. “We will pursue this case as far as necessary to establish what we believe is clear law,” Budd said.

He said he looks forward to having the Ninth Circuit review the decision.

To contact the reporter on this story: Alexis Kramer in Washington at aKramer@bna.com

To contact the editor responsible for this story: Keith Perine at kperine@bna.com

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