California Supreme Court Gives Yelp a Positive Review

Advertising Law

In a closely watched case, a divided California Supreme Court ruled that a court order directing Yelp to remove defamatory posts violated section 230 of the Communications Decency Act (CDA).

Attorney Dawn Hassell sued former client Ava Bird over two one-star reviews posted on Yelp. The reviews included comments such as “well, here is another business that doesn’t even deserve one star” and “STEER CLEAR OF THIS LAW FIRM!” Yelp was not named in the action.

When Bird failed to respond, a California Superior Court held a “prove-up” evidentiary hearing and granted a default judgment in favor of Hassell. In addition to awarding general and special damages and costs totaling $557,918.85, the court ordered Bird to remove “each and every defamatory review” about Hassell and her law firm.

The court then added: “ is ordered to remove all reviews posted by AVA BIRD under user names ‘Birdzeye B.’ and ‘J.D.’ … and any subsequent comments of these reviewers within 7 business days of the date of the court’s order.” After being served with a copy of the default judgment, Yelp filed a motion to set aside and vacate the judgment.

Yelp argued that the directive violated its due process rights and was barred by section 230. The trial court disagreed, as did a panel of the Court of Appeal. The removal order did not violate section 230 because it did not impose any liability on Yelp, the lower courts declared.

A divided California Supreme Court reversed. Reviewing the history and purpose of the CDA—and specifically section 230—the court emphasized that Congress aimed to protect online publishers to encourage “the free exchange of information and ideas over the Internet.”

Section 230(c)(1) provides, “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider,” while 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.”

Reviewing CDA case law over the past two decades, the majority noted that the immunity provisions within section 230 have been widely and consistently interpreted to confer broad immunity against defamation liability for those who use the Internet to publish information that originated from another source.

The court also pointed out that Yelp could have promptly sought and received section 230 immunity had Hassell and her law firm originally named it as a defendant in this case. Instead, the plaintiffs made the tactical decision not to name the site in the case. “[W]e must decide whether plaintiffs’ litigation strategy allows them to accomplish indirectly what Congress has clearly forbidden them to achieve directly,” the majority wrote. “We believe the answer is no.”

Even though the plaintiffs did not name Yelp as a defendant, “their action ultimately treats it as ‘the publisher or speaker of … information provided by another information content provider,’” the court said. “With the removal order, plaintiffs seek to overrule Yelp’s decision to publish the … challenged reviews. Where, as here, an Internet intermediary’s relevant conduct in a defamation case goes no further than the mere act of publication—including a refusal to depublish upon demand, after a subsequent finding that the published content is libelous—section 230 prohibits this kind of directive.”

The majority was not persuaded by Hassell’s position that the removal order “simply prohibits Yelp from continuing to be the conduit through which Bird violates her injunction.” This “creative pleading” did not “supplant the inquiry that section 230(c)(1) requires. Parties and nonparties alike may have the responsibility to comply with court orders, including injunctions. But an order that treats an Internet intermediary ‘as the publisher or speaker of any information provided by another information content provider’ nevertheless falls within the parameters of section 230(c)(1),” the court said.

“In substance, Yelp is being held to account for nothing more than its ongoing decision to publish the challenged reviews,” the court said. “Despite plaintiffs’ generic description of the obligation they would impose on Yelp, in this case this duty is squarely derived from ‘the mere existence of the very relationship that Congress immunized from suit.’”

Nor was the court persuaded by the plaintiffs’ contention that making Yelp subject to an injunction did not amount to the imposition of “liability” under the statute. “Liability” can encompass more than merely the imposition of damages, the majority wrote.

“An injunction like the removal order plaintiffs obtained can impose substantial burdens on an Internet intermediary,” the majority wrote. “Even if it would be mechanically simple to implement such an order, compliance still could interfere with and undermine the viability of an online platform.”

“To summarize, we conclude that in light of Congress’s designs with respect to section 230, the capacious language Congress adopted to effectuate its intent, and the consequences that could result if immunity were denied here, Yelp is entitled to immunity under the statute,” the court said. “Plaintiffs’ attempted end-run around section 230 fails.”

In addition to a concurrence, two dissenting opinions were filed. Both agreed with the plaintiffs that section 230 did not immunize Yelp because no claim was ever filed against the company and no liability was imposed.

To read the opinion in Hassell v. Bird, click here.

Why it matters: Many stakeholders weighed in with amicus briefs in the high-profile litigation in which Yelp claimed a victory. “With this decision, online publishers in California can be assured that they cannot be lawfully forced to remove third-party speech through enterprising abuses of the legal system, and those of us that use such platforms to express ourselves cannot be easily silenced through such tactics either,” the company wrote on its blog. The fight may not be over, however. Hassell’s attorney called the opinion “an invitation to spread falsehoods on the Internet without consequence” and said her client is considering filing a writ of certiorari with the U.S. Supreme Court.



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