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President Donald Trump has repeatedly called for repeal of Section 230. But while Trump and fellow conservatives decry Big Tech companies for their alleged anti-conservative bias, including at yet more recent hearings, their issue is not actually with Section 230. It’s with the First Amendment. 

Conservatives can’t actually do anything directly about how social media platforms moderate content because it is the First Amendment that grants those platforms a right to editorial discretion. Even FCC Commissioner Brendan Carr, who strongly opposes “Big Tech censorship,” recognizes this

By the same token, even if one were to grant that conservatives are right about the bias of moderators at these large social media platforms, it does not follow that removal of Section 230 immunity would alter that bias. In fact, in a world without Section 230 immunity, there still would be no legal cause of action for political bias. 

The truth is that conservatives use Section 230 immunity for leverage over social media platforms. The hope is that, because social media platforms desire the protections of civil immunity for third-party content, they will follow whatever conditions the government puts on their editorial discretion. But the attempt to end-run the First Amendment’s protections is also unconstitutional.

There is no cause of action for political bias by online platforms if we repeal Section 230

Consider the counterfactual: if there were no Section 230 to immunize them from liability, under what law would platforms face a viable cause of action for political bias? Conservative critics never answer this question. Instead, they focus on the irrelevant distinction between publishers and platforms. Or they talk about how Section 230 is a giveaway to Big Tech. But none consider the actual relationship between Section 230 immunity and alleged political bias.

But let’s imagine we’ve done what President Trump has called for and repealed Section 230. Where does that leave conservatives?

Unfortunately, it leaves them without any cause of action. There is no law passed by Congress or any state legislature, no regulation promulgated by the Federal Communications Commission or the Federal Trade Commission, no common law tort action that can be asserted against online platforms to force them to carry speech they don’t wish to carry. 

The difficulties of pursuing a contract claim for political bias

The best argument for conservatives is that, without Section 230 immunity, online platforms could be more easily held to any contractual restraints in their terms of service. If a platform promises, for instance, that it will moderate speech in a politically neutral way, a user could make the case that the platform violated its terms of service if it acted with political bias in her particular case.

For the vast majority of users, it is unclear whether there are damages from having a post fact-checked or removed. But for users who share in advertising revenue, the concrete injury from a moderation decision is more obvious. PragerU, for example, has (unsuccessfully) sued Google for being put in Restricted Mode on YouTube, which reduces its reach and advertising revenue. 

Even where there is a concrete injury that gets a case into court, that doesn’t necessarily mean there is a valid contract claim. In PragerU’s case against Google, a California court dismissed contract claims because the YouTube terms of service contract was written to allow the platform to retain discretion over what is published. Specifically, the court found that there can be no implied covenant of good faith and fair dealing where “YouTube reserves the right to remove Content without prior notice” and to “discontinue any aspect of the Service at any time.”

Breach-of-contract claims for moderation practices are highly dependent on what is actually promised in the terms of service. For instance, under Facebook’s TOS the company retains the right “to remove or restrict access to content that is in violation” of its community standards. Facebook does provide a process for users to request further review, but retains the right to remove content. The community standards also give Facebook broad discretion to determine, among other things, what counts as hate speech or false news. It is exceedingly unlikely that a court would ever have a basis to find a contract violation by Facebook if the company can reasonably point to a user’s violation of its terms of service. 

For example, in Ebeid v. Facebook, the U.S. Northern District of California dismissed fraud and breach of contract claims, finding the plaintiff failed to allege what contractual provision Facebook breached, that Facebook retained discretion over what ads would be posted, and that the plaintiff suffered no damages because no money was taken to be spent on the ads. The court also dismissed an implied covenant of good faith and fair dealing claim because Facebook retained the right to “remove or disapprove any post or ad at Facebook’s sole discretion.”

While the conservative critique has been that social media platforms do too much moderation—in the form of politically biased removals, fact-checking, and demonetization—others believe platforms do far too little to restrain bad conduct by users. But as long as social media platforms retain editorial discretion in their terms of service and make no other promises that can be relied upon by their users, there is little basis for a contract claim. 

The First Amendment protects the moderation policies of social media platforms, and there is no way around this

With no reasonable cause of action for political bias under the law, conservatives dangle the threat of making changes to Section 230 immunity that could prove costly to the social media platforms in order to extract concessions from the platforms to alter their practices.

This is why there are no serious efforts to actually repeal Section 230, as President Trump has asked for repeatedly. Instead, several bills propose to amend Section 230, while a rulemaking by the FCC seeks to clarify its meaning. 

But none of these proposed bills would directly affect platforms’ ability to make “biased” moderation decisions. Put simply: the First Amendment protects social media platforms’ editorial discretion. They may set rules to use their platforms, just as any private person may set rules for their own property. If I kick someone off my property for saying racist things, the First Amendment (as well as regular property law) protects my right to do so. Only under extremely limited circumstances can the government change this baseline rule and survive constitutional scrutiny.

Social media platforms’ right to editorial discretion is the same as that enjoyed by newspapers. In Miami Herald Publishing Co. v. Tornillo, the Supreme Court found:

The choice of material to go into a newspaper, and the decisions made as to limitations on the size and content of the paper, and treatment of public issues and public officials—whether fair or unfair—constitute the exercise of editorial control and judgment. It has yet to be demonstrated how governmental regulation of this crucial process can be exercised consistent with First Amendment guarantees of a free press as they have evolved to this time. 

Social media platforms, just like any other property owner, have the right to determine what they want displayed on their property. In other words, Facebook, Google, and Twitter have the right to moderate content on news feeds, search results, and timelines. The attempted constitutional end-run—threatening to remove immunity for third-party content unrelated to political bias, like defamation and other tortious acts, unless social media platforms give up their right to editorial discretion over political speech—is just as unconstitutional as directly imposing “fairness” requirements on social media platforms.

The Supreme Court has held that Congress may not leverage a government benefit to regulate a speech interest outside of the benefit’s scope. This is called the unconstitutional conditions doctrine. It basically delineates the level of regulation the government can undertake through subsidizing behavior. The government can’t condition a government benefit on giving up editorial discretion over political speech.

The point of Section 230 immunity is to remedy the moderator’s dilemma set up by Stratton Oakmont v. Prodigy, which held that if a platform chose to moderate third-party speech at all, they would be liable for what was not removed. Section 230 is not about compelling political neutrality on platforms, because it can’t be consistent with the First Amendment. Civil immunity for third-party speech online is an important benefit for social media platforms because it holds they are not liable for the acts of third-parties, with limited exceptions. Without it, platforms would restrict opportunities for third-parties to post out of fear of liability

In sum, the government may not condition enjoyment of a government benefit upon giving up a constitutionally protected right. Section 230 immunity is a clear government benefit. The right to editorial discretion is clearly protected by the First Amendment. Because the entire point of conservative Section 230 reform efforts is to compel social media platforms to carry speech they otherwise desire to remove, it fails this basic test.

Conclusion

Fundamentally, the conservative push to reform Section 230 in response to the alleged anti-conservative bias of major social media platforms is not about policy. Really, it’s about waging a culture war against the perceived “liberal elites” from Silicon Valley, just as there is an ongoing culture war against perceived “liberal elites” in the mainstream media, Hollywood, and academia. But fighting this culture war is not worth giving up conservative principles of free speech, limited government, and free markets.

Over at the Federalist Society’s blog, there has been an ongoing debate about what to do about Section 230. While there has long-been variety in what we call conservatism in the United States, the most prominent strains have agreed on at least the following: Constitutionally limited government, free markets, and prudence in policy-making. You would think all of these values would be important in the Section 230 debate. It seems, however, that some are willing to throw these principles away in pursuit of a temporary political victory over perceived “Big Tech censorship.” 

Constitutionally Limited Government: Congress Shall Make No Law

The First Amendment of the United States Constitution states: “Congress shall make no law… abridging the freedom of speech.” Originalists on the Supreme Court have noted that this makes clear that the Constitution protects against state action, not private action. In other words, the Constitution protects a negative conception of free speech, not a positive conception.

Despite this, some conservatives believe that Section 230 should be about promoting First Amendment values by mandating private entities are held to the same standards as the government. 

For instance, in his Big Tech and the Whole First Amendment, Craig Parshall of the American Center for Law and Justice (ACLJ) stated:

What better example of objective free speech standards could we have than those First Amendment principles decided by justices appointed by an elected president and confirmed by elected members of the Senate, applying the ideals laid down by our Founders? I will take those over the preferences of brilliant computer engineers any day.

In other words, he thinks Section 230 should be amended to only give Big Tech the “subsidy” of immunity if it commits to a First Amendment-like editorial regime. To defend the constitutionality of such “restrictions on Big Tech”, he points to the Turner intermediate scrutiny standard, in which the Supreme Court upheld must-carry provisions against cable networks. In particular, Parshall latches on to the “bottleneck monopoly” language from the case to argue that Big Tech is similarly situated to cable providers at the time of the case.

Turner, however, turned more on the “special characteristics of the cable medium” that gave it the bottleneck power than the market power itself. As stated by the Supreme Court:

When an individual subscribes to cable, the physical connection between the television set and the cable network gives the cable operator bottleneck, or gatekeeper, control over most (if not all) of the television programming that is channeled into the subscriber’s home. Hence, simply by virtue of its ownership of the essential pathway for cable speech, a cable operator can prevent its subscribers from obtaining access to programming it chooses to exclude. A cable operator, unlike speakers in other media, can thus silence the voice of competing speakers with a mere flick of the switch.

Turner v. FCC, 512 U.S. 622, 656 (1994).

None of the Big Tech companies has the comparable ability to silence competing speakers with a flick of the switch. In fact, the relationship goes the other way on the Internet. Users can (and do) use multiple Big Tech companies’ services, as well as those of competitors which are not quite as big. Users are the ones who can switch with a click or a swipe. There is no basis for treating Big Tech companies any differently than other First Amendment speakers.

Like newspapers, Big Tech companies must use their editorial discretion to determine what is displayed and where. Just like those newspapers, Big Tech has the First Amendment right to editorial discretion. This, not Section 230, is the bedrock law that gives Big Tech companies the right to remove content.

Thus, when Rachel Bovard of the Internet Accountability Project argues that the FCC should remove the ability of tech platforms to engage in viewpoint discrimination, she makes a serious error in arguing it is Section 230 that gives them the right to remove content.

Immediately upon noting that the NTIA petition seeks clarification on the relationship between (c)(1) and (c)(2), Bovard moves right to concern over the removal of content. “Unfortunately, embedded in that section [(c)(2)] is a catch-all phrase, ‘otherwise objectionable,’ that gives tech platforms discretion to censor anything that they deem ‘otherwise objectionable.’ Such broad language lends itself in practice to arbitrariness.” 

In order for CDA 230 to “give[] tech platforms discretion to censor,” they would have to not have that discretion absent CDA 230. Bovard totally misses the point of the First Amendment argument, stating:

Yet DC’s tech establishment frequently rejects this argument, choosing instead to focus on the First Amendment right of corporations to suppress whatever content they so choose, never acknowledging that these choices, when made at scale, have enormous ramifications. . . . 

But this argument intentionally sidesteps the fact that Sec. 230 is not required by the First Amendment, and that its application to tech platforms privileges their First Amendment behavior in a unique way among other kinds of media corporations. Newspapers also have a First Amendment right to publish what they choose—but they are subject to defamation and libel laws for content they write, or merely publish. Media companies also make First Amendment decisions subject to a thicket of laws and regulations that do not similarly encumber tech platforms.

There is the merest kernel of truth in the lines quoted above. Newspapers are indeed subject to defamation and libel laws for what they publish. But, as should be obvious, liability for publication entails actually publishing something. And what some conservatives are concerned about is platforms’ ability to not publish something: to take down conservative content.

It might be simpler if the First Amendment treated published speech and unpublished speech the same way. But it doesn’t. One can be liable for what one speaks, writes, or publishes on behalf of others. Indeed, even with the full protection of the First Amendment, there is no question that newspapers can be held responsible for delicts caused by content they publish. But no newspaper has ever been held responsible for anything they didn’t publish.

Free Markets: Competition as the Bulwark Against Abuses, not Regulation

Conservatives have long believed in the importance of property rights, exchange, and the power of the free market to promote economic growth. Competition is seen as the protector of the consumer, not big government regulators. In the latter half of the twentieth century into the twenty-first century, conservatives have fought for capitalism over socialism, free markets over regulation, and competition over cronyism. But in the name of combating anti-conservative bias online, they are willing to throw these principles away.

The bedrock belief in the right of property owners to decide the terms of how they want to engage with others is fundamental to American conservatism. As stated by none other than Bovard (along with co-author Jim Demint in their book Conservative: Knowing What to Keep):

Capitalism is nothing more or less than the extension of individual freedom from the political and cultural realms to the economy. Just as government isn’t supposed to tell you how to pray, or what to think, or what sports teams to follow or books to read, it’s not supposed to tell you what to do with your own money and property.

Conservatives normally believe that it is the free choices of consumers and producers in the marketplace that maximize consumer welfare, rather than the choices of politicians and bureaucrats. Competition, in other words, is what protects us from abuses in the marketplace. Again as Bovard and Demint rightly put it:

Under the free enterprise system, money is not redistributed by a central government bureau. It goes wherever people see value. Those who create value are rewarded which then signals to the rest of the economy to up their game. It’s continuous democracy.

To get around this, both Parshall and Bovard make much of the “market dominance” of tech platforms. The essays take the position that tech platforms have nearly unassailable monopoly power which makes them unaccountable. Bovard claims that “mega-corporations have as much power as the government itself—and in some ways, more power, because theirs is unchecked and unaccountable.” Parshall even connects this to antitrust law, stating:  

This brings us to another kind of innovation, one that’s hidden from the public view. It has to do with how Big Tech companies use both algorithms plus human review during content moderation. This review process has resulted in the targeting, suppression, or down-ranking of primarily conservative content. As such, this process, should it continue, should be considered a kind of suppressive “innovation” in a quasi-antitrust analysis.

How the process harms “consumer welfare” is obvious. A more competitive market could produce social media platforms designing more innovational content moderation systems that honor traditional free speech and First Amendment norms while still offering features and connectivity akin to the huge players.

Antitrust law, in theory, would be a good way to handle issues of market power and consumer harm that results from non-price effects. But it is difficult to see how antitrust could handle the issue of political bias well:

Just as with privacy and other product qualities, the analysis becomes increasingly complex first when tradeoffs between price and quality are introduced, and then even more so when tradeoffs between what different consumer groups perceive as quality is added. In fact, it is more complex than privacy. All but the most exhibitionistic would prefer more to less privacy, all other things being equal. But with political media consumption, most would prefer to have more of what they want to read available, even if it comes at the expense of what others may want. There is no easy way to understand what consumer welfare means in a situation where one group’s preferences need to come at the expense of another’s in moderation decisions.

Neither antitrust nor quasi-antitrust regimes are well-suited to dealing with the perceived harm of anti-conservative bias. However unfulfilling this is to some conservatives, competition and choice are better answers to perceived political bias than the heavy hand of government. 

Prudence: Awareness of Unintended Consequences

Another bedrock principle of conservatism is to be aware of unintended consequences when making changes to long-standing laws and policies. In regulatory matters, cost-benefit analysis is employed to evaluate whether policies are improving societal outcomes. Using economic thinking to understand the likely responses to changes in regulation is fundamental to American conservatism. Or as Bovard and Demint’s book title suggests, conservatism is about knowing what to keep. 

Bovard has argued that since conservatism is a set of principles, not a dogmatic ideology, it can be in favor of fighting against the collectivism of Big Tech companies imposing their political vision upon the world. Conservatism, in this Kirkian sense, doesn’t require particular policy solutions. But this analysis misses what has worked about Section 230 and how the very tech platforms she decries have greatly benefited society. Prudence means understanding what has worked and only changing what has worked in a way that will improve upon it.

The benefits of Section 230 immunity in promoting platforms for third-party speech are clear. It is not an overstatement to say that Section 230 contains “The Twenty-Six Words that Created the Internet.” It is important to note that Section 230 is not only available to Big Tech companies. It is available to all online platforms who host third-party speech. Any reform efforts at Section 230 must know what to keep.In a sense, Section (c)(1) of Section 230 does, indeed, provide greater protection for published content online than the First Amendment on its own would offer: it extends the First Amendment’s permissible scope of published content for which an online service cannot be held liable to include otherwise actionable third-party content.

But let’s be clear about the extent of this protection. It doesn’t protect anything a platform itself publishes, or even anything in which it has a significant hand in producing. Why don’t offline newspapers enjoy this “handout” (though the online versions clearly do for comments)? Because they don’t need it, and because — yes, it’s true — it comes at a cost. How much third-party content would newspapers publish without significant input from the paper itself if only they were freed from the risk of liability for such content? None? Not much? The New York Times didn’t build and sustain its reputation on the slapdash publication of unedited ramblings by random commentators. But what about classifieds? Sure. There would be more classified ads, presumably. More to the point, newspapers would exert far less oversight over the classified ads, saving themselves the expense of moderating this one, small corner of their output.

There is a cost to traditional newspapers from being denied the extended protections of Section 230. But the effect is less third-party content in parts of the paper that they didn’t wish to have the same level of editorial control. If Section 230 is a “subsidy” as critics put it, then what it is subsidizing is the hosting of third-party speech. 

The Internet would look vastly different if it was just the online reproduction of the offline world. If tech platforms were responsible for all third-party speech to the degree that newspapers are for op-eds, then they would likely moderate it to the same degree, making sure there is nothing which could expose them to liability before publishing. This means there would be far less third-party speech on the Internet.

In fact, it could be argued that it is smaller platforms who would be most affected by the repeal of Section 230 immunity. Without it, it is likely that only the biggest tech platforms would have the necessary resources to dedicate to content moderation in order to avoid liability.

Proposed Section 230 reforms will likely have unintended consequences in reducing third-party speech altogether, including conservative speech. For instance, a few bills have proposed only allowing moderation for reasons defined by statute if the platform has an “objectively reasonable belief” that the speech fits under such categories. This would likely open up tech platforms to lawsuits over the meaning of “objectively reasonable belief” that could deter them from wanting to host third-party speech altogether. Similarly, lawsuits for “selective enforcement” of a tech platform’s terms of service could lead them to either host less speech or change their terms of service.

This could actually exacerbate the issue of political bias. Allegedly anti-conservative tech platforms could respond to a “good faith” requirement in enforcing its terms of service by becoming explicitly biased. If the terms of service of a tech platform state grounds which would exclude conservative speech, a requirement of “good faith” enforcement of those terms of service will do nothing to prevent the bias. 

Conclusion

Conservatives would do well to return to their first principles in the Section 230 debate. The Constitution’s First Amendment, respect for free markets and property rights, and appreciation for unintended consequences in changing tech platform incentives all caution against the current proposals to condition Section 230 immunity on platforms giving up editorial discretion. Whether or not tech platforms engage in anti-conservative bias, there’s nothing conservative about abdicating these principles for the sake of political expediency.

Twitter’s decision to begin fact-checking the President’s tweets caused a long-simmering distrust between conservatives and online platforms to boil over late last month. This has led some conservatives to ask whether Section 230, the ‘safe harbour’ law that protects online platforms from certain liability stemming from content posted on their websites by users, is allowing online platforms to unfairly target conservative speech. 

In response to Twitter’s decision, along with an Executive Order released by the President that attacked Section 230, Senator Josh Hawley (R – MO) offered a new bill targeting online platforms, the “Limiting Section 230 Immunity to Good Samaritans Act”. This would require online platforms to engage in “good faith” moderation according to clearly stated terms of service – in effect, restricting Section 230’s protections to online platforms deemed to have done enough to moderate content ‘fairly’.  

While seemingly a sensible standard, if enacted, this approach would violate the First Amendment as an unconstitutional condition to a government benefit, thereby  undermining long-standing conservative principles and the ability of conservatives to be treated fairly online. 

There is established legal precedent that Congress may not grant benefits on conditions that violate Constitutionally-protected rights. In Rumsfeld v. FAIR, the Supreme Court stated that a law that withheld funds from universities that did not allow military recruiters on campus would be unconstitutional if it constrained those universities’ First Amendment rights to free speech. Since the First Amendment protects the right to editorial discretion, including the right of online platforms to make their own decisions on moderation, Congress may not condition Section 230 immunity on platforms taking a certain editorial stance it has dictated. 

Aware of this precedent, the bill attempts to circumvent the obstacle by taking away Section 230 immunity for issues unrelated to anti-conservative bias in moderation. Specifically, Senator Hawley’s bill attempts to condition immunity for platforms on having terms of service for content moderation, and making them subject to lawsuits if they do not act in “good faith” in policing them. 

It’s not even clear that the bill would do what Senator Hawley wants it to. The “good faith” standard only appears to apply to the enforcement of an online platform’s terms of service. It can’t, under the First Amendment, actually dictate what those terms of service say. So an online platform could, in theory, explicitly state in their terms of service that they believe some forms of conservative speech are “hate speech” they will not allow.

Mandating terms of service on content moderation is arguably akin to disclosures like labelling requirements, because it makes clear to platforms’ customers what they’re getting. There are, however, some limitations under the commercial speech doctrine as to what government can require. Under National Institute of Family & Life Advocates v. Becerra, a requirement for terms of service outlining content moderation policies would be upheld unless “unjustified or unduly burdensome.” A disclosure mandate alone would not be unconstitutional. 

But it is clear from the statutory definition of “good faith” that Senator Hawley is trying to overwhelm online platforms with lawsuits on the grounds that they have enforced these rules selectively and therefore not in “good faith”.

These “selective enforcement” lawsuits would make it practically impossible for platforms to moderate content at all, because they would open them up to being sued for any moderation, including moderation  completely unrelated to any purported anti-conservative bias. Any time a YouTuber was aggrieved about a video being pulled down as too sexually explicit, for example, they could file suit and demand that Youtube release information on whether all other similarly situated users were treated the same way. Any time a post was flagged on Facebook, for example for engaging in online bullying or for spreading false information, it could similarly lead to the same situation. 

This would end up requiring courts to act as the arbiter of decency and truth in order to even determine whether online platforms are “selectively enforcing” their terms of service.

Threatening liability for all third-party content is designed to force online platforms to give up moderating content on a perceived political basis. The result will be far less content moderation on a whole range of other areas. It is precisely this scenario that Section 230 was designed to prevent, in order to encourage platforms to moderate things like pornography that would otherwise proliferate on their sites, without exposing themselves to endless legal challenge.

It is likely that this would be unconstitutional as well. Forcing online platforms to choose between exercising their First Amendment rights to editorial discretion and retaining the benefits of Section 230 is exactly what the “unconstitutional conditions” jurisprudence is about. 

This is why conservatives have long argued the government has no business compelling speech. They opposed the “fairness doctrine” which required that radio stations provide a “balanced discussion”, and in practice allowed courts or federal agencies to determine content  until President Reagan overturned it. Later, President Bush appointee and then-FTC Chairman Tim Muris rejected a complaint against Fox News for its “Fair and Balanced” slogan, stating:

I am not aware of any instance in which the Federal Trade Commission has investigated the slogan of a news organization. There is no way to evaluate this petition without evaluating the content of the news at issue. That is a task the First Amendment leaves to the American people, not a government agency.

And recently conservatives were arguing businesses like Masterpiece Cakeshop should not be compelled to exercise their First Amendment rights against their will. All of these cases demonstrate once the state starts to try to stipulate what views can and cannot be broadcast by private organisations, conservatives will be the ones who suffer.

Senator Hawley’s bill fails to acknowledge this. Worse, it fails to live up to the Constitution, and would trample over the rights to freedom of speech that it gives. Conservatives should reject it.

Yet another sad story was caught on camera this week showing a group of police officers killing an unarmed African-American man named George Floyd. While the officers were fired from the police department, there is still much uncertainty about what will happen next to hold those officers accountable as a legal matter. 

A well-functioning legal system should protect the constitutional rights of American citizens to be free of unreasonable force from police officers, while also allowing police officers the ability to do their jobs safely and well. In theory, civil rights lawsuits are supposed to strike that balance.

In a civil rights lawsuit, the goal is to make the victim (or their families) of a rights violation whole by monetary damages. From a legal perspective, this is necessary to give the victim justice. From an economic perspective this is necessary to deter future bad conduct and properly align ex ante incentives going forward. Under a well-functioning system, juries would, after hearing all the evidence, make a decision about whether constitutional rights were violated and the extent of damages. A functioning system of settlements would result as a common law develops determining what counts as reasonable or unreasonable uses of force. This doesn’t mean plaintiffs always win, either. Officers may be determined to be acting reasonably under the circumstances once all the evidence is presented to a jury.

However, one of the greatest obstacles to holding police officers accountable in misconduct cases is the doctrine of qualified immunity. Qualified immunity started as a mechanism to protect officers from suit when they acted in “good faith.” Over time, though, the doctrine has evolved away from a subjective test based upon the actor’s good faith to an objective test based upon notice in judicial precedent. As a result, courts have widely expanded its scope to the point that qualified immunity is now protecting officers even when their conduct violates the law, as long as the officers weren’t on clear notice from specific judicial precedent that what they did was illegal when they did it. In the words of the Supreme Court, qualified immunity protects “all but the plainly incompetent or those who knowingly violate the law.” 

This standard has predictably led to a situation where officer misconduct which judges and juries would likely find egregious never makes it to court. The Cato Institute’s website Unlawful Shield details many cases where federal courts found an officer’s conduct was illegal yet nonetheless protected by qualified immunity.

Immunity of this nature has profound consequences on the incentive structure facing police officers. Police officers, as well as the departments that employ them, are insufficiently accountable when gross misconduct does not get past a motion to dismiss for qualified immunity. On top of that, the regular practice of governments is to indemnify officers even when there is a settlement or a judgment. The result is to encourage police officers to take insufficient care when making the choice about the level of force to use. 

Economics 101 makes a clear prediction: When unreasonable uses of force are not held accountable, you get more unreasonable uses of force. Unfortunately, the news continues to illustrate the accuracy of this prediction.

In the wake of the launch of Facebook’s content oversight board, Republican Senator Josh Hawley and FCC Commissioner Brendan Carr, among others, have taken to Twitter to levy criticisms at the firm and, in the process, demonstrate just how far the Right has strayed from its first principles around free speech and private property. For his part, Commissioner Carr’s thread makes the case that the members of the board are highly partisan and mostly left-wing and can’t be trusted with the responsibility of oversight. While Senator Hawley took the approach that the Board’s very existence is just further evidence of the need to break Facebook up. 

Both Hawley and Carr have been lauded in rightwing circles, but in reality their positions contradict conservative notions of the free speech and private property protections given by the First Amendment.  

This blog post serves as a sequel to a post I wrote last year here at TOTM explaining how There’s nothing “conservative” about Trump’s views on free speech and the regulation of social media. As I wrote there:

I have noted in several places before that there is a conflict of visions when it comes to whether the First Amendment protects a negative or positive conception of free speech. For those unfamiliar with the distinction: it comes from philosopher Isaiah Berlin, who identified negative liberty as freedom from external interference, and positive liberty as freedom to do something, including having the power and resources necessary to do that thing. Discussions of the First Amendment’s protection of free speech often elide over this distinction.

With respect to speech, the negative conception of liberty recognizes that individual property owners can control what is said on their property, for example. To force property owners to allow speakers/speech on their property that they don’t desire would actually be a violation of their liberty — what the Supreme Court calls “compelled speech.” The First Amendment, consistent with this view, generally protects speech from government interference (with very few, narrow exceptions), while allowing private regulation of speech (again, with very few, narrow exceptions).

Commissioner Carr’s complaint and Senator Hawley’s antitrust approach of breaking up Facebook has much more in common with the views traditionally held by left-wing Democrats on the need for the government to regulate private actors in order to promote speech interests. Originalists and law & economics scholars, on the other hand, have consistently taken the opposite point of view that the First Amendment protects against government infringement of speech interests, including protecting the right to editorial discretion. While there is clearly a conflict of visions in First Amendment jurisprudence, the conservative (and, in my view, correct) point of view should not be jettisoned by Republicans to achieve short-term political gains.

The First Amendment restricts government action, not private action

The First Amendment, by its very text, only applies to government action: “Congress shall make no law . . . abridging the freedom of speech.” This applies to the “State[s]” through the Fourteenth Amendment. There is extreme difficulty in finding any textual hook to say the First Amendment protects against private action, like that of Facebook. 

Originalists have consistently agreed. Most recently, in Manhattan Community Access Corp. v. Halleck, Justice Kavanaugh—on behalf of the conservative bloc and the Court—wrote:

Ratified in 1791, the First Amendment provides in relevant part that “Congress shall make no law . . . abridging the freedom of speech.” Ratified in 1868, the Fourteenth Amendment makes the First Amendment’s Free Speech Clause applicable against the States: “No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law . . . .” §1. The text and original meaning of those Amendments, as well as this Court’s longstanding precedents, establish that the Free Speech Clause prohibits only governmental abridgment of speech. The Free Speech Clause does not prohibit private abridgment of speech… In accord with the text and structure of the Constitution, this Court’s state-action doctrine distinguishes the government from individuals and private entities. By enforcing that constitutional boundary between the governmental and the private, the state-action doctrine protects a robust sphere of individual liberty. (Emphasis added).

This was true at the adoption of the First Amendment and remains true today in a high-tech world. Federal district courts have consistently dismissed First Amendment lawsuits against Facebook on the grounds there is no state action. 

For instance, in Nyawba v. Facebook, the plaintiff initiated a civil rights lawsuit against Facebook for restricting his use of the platform. The U.S. District Court for the Southern District of Texas dismissed the case, noting 

Because the First Amendment governs only governmental restrictions on speech, Nyabwa has not stated a cause of action against FaceBook… Like his free speech claims, Nyabwa’s claims for violation of his right of association and violation of his due process rights are claims that may be vindicated against governmental actors pursuant to § 1983, but not a private entity such as FaceBook.

Similarly, in Young v. Facebook, the U.S. District Court for the Northern District of California rejected a claim that Facebook violated the First Amendment by deactivating the plaintiff’s Facebook page. The court declined to subject Facebook to the First Amendment analysis, stating that “because Young has not alleged any action under color of state law, she fails to state a claim under § 1983.”

The First Amendment restricts antitrust actions against Facebook, not Facebook’s editorial discretion over its platform

Far from restricting Facebook, the First Amendment actually restricts government actions aimed at platforms like Facebook when they engage in editorial discretion by moderating content. If an antitrust plaintiff was to act on the impulse to “break up” Facebook because of alleged political bias in its editorial discretion, the lawsuit would be running headlong into the First Amendment’s protections.

There is no basis for concluding online platforms do not have editorial discretion under the law. In fact, the position of Facebook here is very similar to the newspaper in Miami Herald Publishing Co. v. Tornillo, in which the Supreme Court considered a state law giving candidates for public office a right to reply in newspapers to editorials written about them. The Florida Supreme Court upheld the statute, finding it furthered the “broad societal interest in the free flow of information to the public.” The U.S. Supreme Court, despite noting the level of concentration in the newspaper industry, nonetheless reversed. The Court explicitly found the newspaper had a First Amendment right to editorial discretion:

The choice of material to go into a newspaper, and the decisions made as to limitations on the size and content of the paper, and treatment of public issues and public officials — whether fair or unfair — constitute the exercise of editorial control and judgment. It has yet to be demonstrated how governmental regulation of this crucial process can be exercised consistent with First Amendment guarantees of a free press as they have evolved to this time. 

Online platforms have the same First Amendment protections for editorial discretion. For instance, in both Search King v. Google and Langdon v. Google, two different federal district courts ruled Google’s search results are subject to First Amendment protections, both citing Tornillo

In Zhang v. Baidu.com, another district court went so far as to grant a Chinese search engine the right to editorial discretion in limiting access to democracy movements in China. The court found that the search engine “inevitably make[s] editorial judgments about what information (or kinds of information) to include in the results and how and where to display that information.” Much like the search engine in Zhang, Facebook is clearly making editorial judgments about what information shows up in newsfeed and where to display it. 

None of this changes because the generally applicable law is antitrust rather than some other form of regulation. For instance, in Tornillo, the Supreme Court took pains to distinguish the case from an earlier antitrust case against newspapers, Associated Press v. United States, which found that there was no broad exemption from antitrust under the First Amendment.

The Court foresaw the problems relating to government-enforced access as early as its decision in Associated Press v. United States, supra. There it carefully contrasted the private “compulsion to print” called for by the Association’s bylaws with the provisions of the District Court decree against appellants which “does not compel AP or its members to permit publication of anything which their `reason’ tells them should not be published.”

In other words, the Tornillo and Associated Press establish the government may not compel speech through regulation, including an antitrust remedy. 

Once it is conceded that there is a speech interest here, the government must justify the use of antitrust law to compel Facebook to display the speech of users in the newsfeeds of others under the strict scrutiny test of the First Amendment. In other words, the use of antitrust law must be narrowly tailored to a compelling government interest. Even taking for granted that there may be a compelling government interest in facilitating a free and open platform (which is by no means certain), it is clear that this would not be narrowly tailored action. 

First, “breaking up” Facebook is clearly overbroad as compared to the goal of promoting free speech on the platform. There is no need to break it up just because it has an Oversight Board that engages in editorial responsibilities. There are many less restrictive means, including market competition, which has greatly expanded consumer choice for communications and connections. Second, antitrust does not even really have a remedy for free speech issues complained of here, as it would require courts to engage in long-term oversight and engage in compelled speech foreclosed by Associated Press

Note that this makes good sense from a law & economics perspective. Platforms like Facebook should be free to regulate the speech on their platforms as they see fit and consumers are free to decide which platforms they wish to use based upon that information. While there are certainly network effects to social media, the plethora of options currently available with low switching costs suggests that there is no basis for antitrust action against Facebook because consumers are unable to speak. In other words, the least restrictive means test of the First Amendment is best fulfilled by market competition in this case.

If there were a basis for antitrust intervention against Facebook, either through merger review or as a standalone monopoly claim, the underlying issue would be harm to competition. While this would have implications for speech concerns (which may be incorporated into an analysis through quality-adjusted price), it is inconceivable how an antitrust remedy could be formed on speech issues consistent with the First Amendment. 

Conclusion

Despite now well-worn complaints by so-called conservatives in and out of the government about the baneful influence of Facebook and other Big Tech companies, the First Amendment forecloses government actions to violate the editorial discretion of these companies. Even if Commissioner Carr is right, this latest call for antitrust enforcement against Facebook by Senator Hawley should be rejected for principled conservative reasons.

Monday July 22, ICLE filed a regulatory comment arguing the leased access requirements enforced by the FCC are unconstitutional compelled speech that violate the First Amendment. 

When the DC Circuit Court of Appeals last reviewed the constitutionality of leased access rules in Time Warner v. FCC, cable had so-called “bottleneck power” over the marketplace for video programming and, just a few years prior, the Supreme Court had subjected other programming regulations to intermediate scrutiny in Turner v. FCC

Intermediate scrutiny is a lower standard than the strict scrutiny usually required for First Amendment claims. Strict scrutiny requires a regulation of speech to be narrowly tailored to a compelling state interest. Intermediate scrutiny only requires a regulation to further an important or substantial governmental interest unrelated to the suppression of free expression, and the incidental restriction speech must be no greater than is essential to the furtherance of that interest.

But, since the decisions in Time Warner and Turner, there have been dramatic changes in the video marketplace (including the rise of the Internet!) and cable no longer has anything like “bottleneck power.” Independent programmers have many distribution options to get content to consumers. Since the justification for intermediate scrutiny is no longer an accurate depiction of the competitive marketplace, the leased rules should be subject to strict scrutiny.

And, if subject to strict scrutiny, the leased access rules would not survive judicial review. Even accepting that there is a compelling governmental interest, the rules are not narrowly tailored to that end. Not only are they essentially obsolete in the highly competitive video distribution marketplace, but antitrust law would be better suited to handle any anticompetitive abuses of market power by cable operators. There is no basis for compelling the cable operators to lease some of their channels to unaffiliated programmers.

Our full comments are here

[Note: A group of 50 academics and 27 organizations, including both myself and ICLE, recently released a statement of principles for lawmakers to consider in discussions of Section 230.]

In a remarkable ruling issued earlier this month, the Third Circuit Court of Appeals held in Oberdorf v. Amazon that, under Pennsylvania products liability law, Amazon could be found liable for a third party vendor’s sale of a defective product via Amazon Marketplace. This ruling comes in the context of Section 230 of the Communications Decency Act, which is broadly understood as immunizing platforms against liability for harmful conduct posted to their platforms by third parties (Section 230 purists may object to myu use of “platform” as approximation for the statute’s term of “interactive computer services”; I address this concern by acknowledging it with this parenthetical). This immunity has long been a bedrock principle of Internet law; it has also long been controversial; and those controversies are very much at the fore of discussion today. 

The response to the opinion has been mixed, to say the least. Eric Goldman, for instance, has asked “are we at the end of online marketplaces?,” suggesting that they “might in the future look like a quaint artifact of the early 21st century.” Kate Klonick, on the other hand, calls the opinion “a brilliant way of both holding tech responsible for harms they perpetuate & making sure we preserve free speech online.”

My own inclination is that both Eric and Kate overstate their respective positions – though neither without reason. The facts of Oberdorf cabin the effects of the holding both to Pennsylvania law and to situations where the platform cannot identify the seller. This suggests that the effects will be relatively limited. 

But, and what I explore in this post, the opinion does elucidate a particular and problematic feature of section 230: that it can be used as a liability shield for harmful conduct. The judges in Oberdorf seem ill-inclined to extend Section 230’s protections to a platform that can easily be used by bad actors as a liability shield. Riffing on this concern, I argue below that Section 230 immunity be proportional to platforms’ ability to reasonably identify speakers using their platforms to engage in harmful speech or conduct.

This idea is developed in more detail in the last section of this post – including responding to the obvious (and overwrought) objections to it. But first it offers some background on Section 230, the Oberdorf and related cases, the Third Circuit’s analysis in Oberdorf, and the recent debates about Section 230. 

Section 230

“Section 230” refers to a portion of the Communications Decency Act that was added to the Communications Act by the 1996 Telecommunications Act, codified at 47 U.S.C. 230. (NB: that’s a sentence that only a communications lawyer could love!) It is widely recognized as – and discussed even by those who disagree with this view as – having been critical to the growth of the modern Internet. As Jeff Kosseff labels it in his recent book, the key provision of section 230 comprises the “26 words that created the Internet.” That section, 230(c)(1), states that “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.” (For those not familiar with it, Kosseff’s book is worth a read – or for the Cliff’s Notes version see here, here, here, here, here, or here.)

Section 230 was enacted to do two things. First, section (c)(1) makes clear that platforms are not liable for user-generated content. In other words, if a user of Facebook, Amazon, the comments section of a Washington Post article, a restaurant review site, a blog that focuses on the knitting of cat-themed sweaters, or any other “interactive computer service,” posts something for which that user may face legal liability, the platform hosting that user’s speech does not face liability for that speech. 

And second, section (c)(2) makes clear that platforms are free to moderate content uploaded by their users, and that they face no liability for doing so. This section was added precisely to repudiate a case that had held that once a platform (in that case, Prodigy) decided to moderate user-generated content, it undertook an obligation to do so. That case meant that platforms faced a Hobson’s choice: either don’t moderate content and don’t risk liability, or moderate all content and face liability for failure to do so well. There was no middle ground: a platform couldn’t say, for instance, “this one post is particularly problematic, so we are going to take it down – but this doesn’t mean that we are going to pervasively moderate content.”

Together, these two provisions stand generally for the proposition that online platforms are not liable for content created by their users, but they are free to moderate that content without facing liability for doing so. It recognized, on the one hand, that it was impractical (i.e., the Internet economy could not function) to require that platforms moderate all user-generated content, so section (c)(1) says that they don’t need to; but, on the other hand, it recognizes that it is desirable for platforms to moderate problematic content to the best of their ability, so section (c)(2) says that they won’t be punished (i.e., lose the immunity granted by section (c)(1) if they voluntarily elect to moderate content). 

Section 230 is written in broad – and has been interpreted by the courts in even broader – terms. Section (c)(1) says that platforms cannot be held liable for the content generated by their users, full stop. The only exceptions are for copyrighted content and content that violates federal criminal law. There is no “unless it is really bad” exception, or a “the platform may be liable if the user-generated content causes significant tangible harm” exception, or an “unless the platform knows about it” exception, or even an “unless the platform makes money off of and actively facilitates harmful content” exception. So long as the content is generated by the user (not by the platform itself), Section 230 shields the platform from liability. 

Oberdorf v. Amazon

This background leads us to the Third Circuit’s opinion in Oberdorf v. Amazon. The opinion is remarkable because it is one of only a few cases in which a court has, despite Section 230, found a platform liable for the conduct of a third party facilitated through the use of that platform. 

Prior to the Third Circuit’s recent opinion, the best known previous case is the 9th Circuit’s Model Mayhem opinion. In that case, the court found that Model Mayhem, a website that helps match models with modeling jobs, had a duty to warn models about individuals who were known to be using the website to find women to sexually assault. 

It is worth spending another moment on the Model Mayhem opinion before returning to the Third Circuit’s Oberdorf opinion. The crux of the 9th Circuit’s opinion in the Model Mayhem case was that the state of Florida (where the assaults occurred) has a duty-to-warn law, which creates a duty between the platform and the user. This duty to warn was triggered by the case-specific fact that the platform had actual knowledge that two of its users were predatorily using the site to find women to assault. Once triggered, this duty to warn exists between the platform and the user. Because the platform faces liability directly for its failure to warn, it is not shielded by section 230 (which only shields the platform from liability for the conduct of the third parties using the platform to engage in harmful conduct). 

In its opinion, the Third Circuit offered a similar analysis – but in a much broader context. 

The Oberdorf case involves a defective dog leash sold to Ms. Oberdorf by a seller doing business as The Furry Gang on Amazon Marketplace. The leash malfunctioned, hitting Ms. Oberdorf in the face and causing permanent blindness in one eye. When she attempted to sue The Furry Gang, she discovered that they were no longer doing business on Amazon Marketplace – and that Amazon did not have sufficient information about their identity for Ms. Oberdorf to bring suit against them.

Undeterred, Ms. Oberdorf sued Amazon under Pennsylvania product liability law, arguing that Amazon was the seller of the defective leash, so was liable for her injuries. Part of Amazon’s defense was that the actual seller, The Furry Gang, was a user of their Marketplace platform – the sale resulted from the storefront generated by The Furry Gang and merely hosted by Amazon Marketplace. Under this theory, Section 230 would bar Amazon from liability for the sale that resulted from the seller’s user-generated storefront. 

The Third Circuit judges had none of that argument. All three judges agreed that under Pennsylvania law, the products liability relationship existed between Ms. Oberdorf and Amazon, so Section 230 did not apply. The two-judge majority found Amazon liable to Ms. Oberford under this law – the dissenting judge would have found Amazon’s conduct insufficient as a basis for liability.

This opinion, in other words, follows in the footsteps of the Ninth Circuit’s Model Mayhem opinion in holding that state law creates a duty directly between the harmed user and the platform, and that that duty isn’t affected by Section 230. But Oberdorf is potentially much broader in impact than Model Mayhem. States are more likely to have broader product liability laws than duty to warn laws. Even more impactful, product liability laws are generally strict liability laws, whereas duty to warn laws are generally triggered by an actual knowledge requirement.

The Third Circuit’s Focus on Agency and Liability Shields

The understanding of Oberdorf described above is that it is the latest in a developing line of cases holding that claims based on state law duties that require platforms to protect users from third party harms can survive Section 230 defenses. 

But there is another, critical, issue in the background of the case that appears to have affected the court’s thinking – and that, I argue, should be a path forward for Section 230. The judges writing for the Third Circuit majority draw attention to

the extensive record evidence that Amazon fails to vet third-party vendors for amenability to legal process. The first factor [of analysis for application of the state’s products liability law] weighs in favor of strict liability not because The Furry Gang cannot be located and/or may be insolvent, but rather because Amazon enables third-party vendors such as The Furry Gang to structure and/or conceal themselves from liability altogether.

This is important for analysis under the Pennsylvania product liability law, which has a marketing chain provision that allows injured consumers to seek redress up the marketing chain if the direct seller of a defective product is insolvent or otherwise unavailable for suit. But the court’s language focuses on Amazon’s design of Marketplace and the ease with which Marketplace can be used by merchants as a liability shield. 

This focus is unsurprising: the law generally does not allow one party to shield another from liability without assuming liability for the shielded party’s conduct. Indeed, this is pretty basic vicarious liability, agency, first-year law school kind of stuff. It is unsurprising that judges would balk at an argument that Amazon could design its platform in a way that makes it impossible for harmed parties to sue a tortfeasor without Amazon in turn assuming liability for any potentially tortious conduct. 

Section 230 is having a bad day

As most who have read this far are almost certainly aware, Section 230 is a big, controversial, political mess right now. Politicians from Josh Hawley to Nancy Pelosi have suggested curtailing Section 230. President Trump just held his “Social Media Summit.” And countries around the world are imposing near-impossible obligations on platforms to remove or otherwise moderate potentially problematic content – obligations that are anathema to Section 230 as they increasingly reflect and influence discussions in the United States. 

To be clear, almost all of the ideas floating around about how to change Section 230 are bad. That is an understatement: they are potentially devastating to the Internet – both to the economic ecosystem and the social ecosystem that have developed and thrived largely because of Section 230.

To be clear, there is also a lot of really, disgustingly, problematic content online – and social media platforms, in particular, have facilitated a great deal of legitimately problematic conduct. But deputizing them to police that conduct and to make real-time decisions about speech that is impossible to evaluate in real time is not a solution to these problems. And to the extent that some platforms may be able to do these things, the novel capabilities of a few platforms to obligations for all would only serve to create entry barriers for smaller platforms and to stifle innovation. 

This is why a group of 50 academics and 27 organizations released a statement of principles last week to inform lawmakers about key considerations to take into account when discussing how Section 230 may be changed. The purpose of these principles is to acknowledge that some change to Section 230 may be appropriate – may even be needed at this juncture – but that such changes should be careful and modest, carefully considered so as to not disrupt the vast benefits for society that Section 230 has made possible and is needed to keep vital.

The Third Circuit offers a Third Way on 230 

The Third Circuit’s opinion offers a modest way that Section 230 could be changed – and, I would say, improved – to address some of the real harms that it enables without undermining the important purposes that it serves. To wit, Section 230’s immunity could be attenuated by an obligation to facilitate the identification of users on that platform, subject to legal process, in proportion to the size and resources available to the platform, the technological feasibility of such identification, the foreseeability of the platform being used to facilitate harmful speech or conduct, and the expected importance (as defined from a First Amendment perspective) of speech on that platform.

In other words, if there are readily available ways to establish some form of identify for users – for instance, by email addresses on widely-used platforms, social media accounts, logs of IP addresses – and there is reason to expect that users of the platform could be subject to suit – for instance, because they’re engaged in commercial activities or the purpose of the platform is to provide a forum for speech that is likely to legally actionable – then the platform needs to be reasonably able to provide reasonable information about speakers subject to legal action in order to avail itself of any Section 230 defense. Stated otherwise, platforms need to be able to reasonably comply with so-called unmasking subpoenas issued in the civil context to the extent such compliance is feasible for the platform’s size, sophistication, resources, &c.

An obligation such as this would have been at best meaningless and at worst devastating at the time Section 230 was adopted. But 25 years later, the Internet is a very different place. Most users have online accounts – email addresses, social media profiles, &c – that can serve as some form of online identification.

More important, we now have evidence of a growing range of harmful conduct and speech that can occur online, and of platforms that use Section 230 as a shield to protect those engaging in such speech or conduct from litigation. Such speakers are clear bad actors who are clearly abusing Section 230 facilitate bad conduct. They should not be able to do so.

Many of the traditional proponents of Section 230 will argue that this idea is a non-starter. Two of the obvious objections are that it would place a disastrous burden on platforms especially start-ups and smaller platforms, and that it would stifle socially valuable anonymous speech. Both are valid concerns, but also accommodated by this proposal.

The concern that modest user-identification requirements would be disastrous to platforms made a great deal of sense in the early years of the Internet, both the law and technology around user identification were less developed. Today, there is a wide-range of low-cost, off-the-shelf, techniques to establish a user’s identity to some level of precision – from logging of IP addresses, to requiring a valid email address to an established provider, registration with an established social media identity, or even SMS-authentication. None of these is perfect; they present a range of cost and sophistication to implement and a range of offer a range of ease of identification.

The proposal offered here is not that platforms be able to identify their speaker – it’s better described as that they not deliberately act as a liability shield. It’s requirement is that platforms implement reasonable identity technology in proportion to their size, sophistication, and the likelihood of harmful speech on their platforms. A small platform for exchanging bread recipes would be fine to maintain a log of usernames and IP addresses. A large, well-resourced, platform hosting commercial activity (such as Amazon Marketplace) may be expected to establish a verified identity for the merchants it hosts. A forum known for hosting hate speech would be expected to have better identification records – it is entirely foreseeable that its users would be subject to legal action. A forum of support groups for marginalized and disadvantaged communities would face a lower obligation than a forum of similar size and sophistication known for hosting legally-actionable speech.

This proportionality approach also addresses the anonymous speech concern. Anonymous speech is often of great social and political value. But anonymity can also be used for, and as made amply clear in contemporary online discussion can bring out the worst of, speech that is socially and politically destructive. Tying Section 230’s immunity to the nature of speech on a platform gives platforms an incentive to moderate speech – to make sure that anonymous speech is used for its good purposes while working to prevent its use for its lesser purposes. This is in line with one of the defining goals of Section 230. 

The challenge, of course, has been how to do this without exposing platforms to potentially crippling liability if they fail to effectively moderate speech. This is why Section 230 took the approach that it did, allowing but not requiring moderation. This proposal’s user-identification requirement shifts that balance from “allowing but not requiring” to “encouraging but not requiring.” Platforms are under no legal obligation to moderate speech, but if they elect not to, they need to make reasonable efforts to ensure that their users engaging in problematic speech can be identified by parties harmed by their speech or conduct. In an era in which sites like 8chan expressly don’t maintain user logs in order to shield themselves from known harmful speech, and Amazon Marketplace allows sellers into the market who cannot be sued by injured consumers, this is a common-sense change to the law.

It would also likely have substantially the same effect as other proposals for Section 230 reform, but without the significant challenges those suggestions face. For instance, Danielle Citron & Ben Wittes have proposed that courts should give substantive meaning to Section 230’s “Good Samaritan” language in section (c)(2)’s subheading, or, in the alternative, that section (c)(1)’s immunity require that platforms “take[] reasonable steps to prevent unlawful uses of its services.” This approach is problematic on both First Amendment and process grounds, because it requires courts to evaluate the substantive content and speech decisions that platforms engage in. It effectively tasks platforms with undertaking the task of the courts in developing a (potentially platform-specific) law of content moderations – and threatens them with a loss of Section 230 immunity is they fail effectively to do so.

By contrast, this proposal would allow, and even encourage, platforms to engage in such moderation, but offers them a gentler, more binary, and procedurally-focused safety valve to maintain their Section 230 immunity. If a user engages in harmful speech or conduct and the platform can assist plaintiffs and courts in bringing legal action against the user in the courts, then the “moderation” process occurs in the courts through ordinary civil litigation. 

To be sure, there are still some uncomfortable and difficult substantive questions – has a platform implemented reasonable identification technologies, is the speech on the platform of the sort that would be viewed as requiring (or otherwise justifying protection of the speaker’s) anonymity, and the like. But these are questions of a type that courts are accustomed to, if somewhat uncomfortable with, addressing. They are, for instance, the sort of issues that courts address in the context of civil unmasking subpoenas.

This distinction is demonstrated in the comparison between Sections 230 and 512. Section 512 is an exception to 230 for copyrighted materials that was put into place by the 1998 Digital Millennium Copyright Act. It takes copyrighted materials outside of the scope of Section 230 and requires platforms to put in place a “notice and takedown” regime in order to be immunized for hosting copyrighted content uploaded by users. This regime has proved controversial, among other reasons, because it effectively requires platforms to act as courts in deciding whether a given piece of content is subject to a valid copyright claim. The Citron/Wittes proposal effectively subjects platforms to a similar requirement in order to maintain Section 230 immunity; the identity-technology proposal, on the other hand, offers an intermediate requirement.

Indeed, the principal effect of this intermediate requirement is to maintain the pre-platform status quo. IRL, if one person says or does something harmful to another person, their recourse is in court. This is true in public and in private; it’s true if the harmful speech occurs on the street, in a store, in a public building, or a private home. If Donny defames Peggy in Hank’s house, Peggy sues Donny in court; she doesn’t sue Hank, and she doesn’t sue Donny in the court of Hank. To the extent that we think of platforms as the fora where people interact online – as the “place” of the Internet – this proposal is intended to ensure that those engaging in harmful speech or conduct online can be hauled into court by the aggrieved parties, and to facilitate the continued development of platforms without disrupting the functioning of this system of adjudication.

Conclusion

Section 230 is, and has long been, the most important and one of the most controversial laws of the Internet. It is increasingly under attack today from a disparate range of voices across the political and geographic spectrum — voices that would overwhelming reject Section 230’s pro-innovation treatment of platforms and in its place attempt to co-opt those platforms as government-compelled (and, therefore, controlled) content moderators. 

In light of these demands, academics and organizations that understand the importance of Section 230, but also recognize the increasing pressures to amend it, have recently released a statement of principles for legislators to consider as they think about changes to Section 230.

Into this fray, the Third Circuit’s opinion in Oberdorf offers a potential change: making Section 230’s immunity for platforms proportional to their ability to reasonably identify speakers that use the platform to engage in harmful speech or conduct. This would restore the status quo ante, under which intermediaries and agents cannot be used as litigation shields without themselves assuming responsibility for any harmful conduct. This shielding effect was not an intended goal of Section 230, and it has been the cause of Section 230’s worst abuses. It was allowed at the time Section 230 was adopted because the used-identity requirements such as proposed here would not have been technologically reasonable at the time Section 230 was adopted. But technology has changed and, today, these requirements would impose only a moderate  burden on platforms today

The US Senate Subcommittee on Antitrust, Competition Policy, and Consumer Rights recently held hearings to see what, if anything, the U.S. might learn from the approaches of other countries regarding antitrust and consumer protection. US lawmakers would do well to be wary of examples from other jurisdictions, however, that are rooted in different legal and cultural traditions. Shortly before the hearing, for example, Australia’s Competition and Consumer Protection Commission (ACCC) announced that it was exploring broad new regulations, predicated on theoretical harms, that would threaten both consumer welfare and individuals’ rights to free expression that are completely at odds with American norms.

The ACCC seeks vast discretion to shape the way that online platforms operate — a regulatory venture that threatens to undermine the value which companies provide to consumers. Even more troubling are its plans to regulate free expression on the Internet, which if implemented in the US, would contravene Americans’ First Amendment guarantees to free speech.

The ACCC’s errors are fundamental, starting with the contradictory assertion that:

Australian law does not prohibit a business from possessing significant market power or using its efficiencies or skills to “out compete” its rivals. But when their dominant position is at risk of creating competitive or consumer harm, governments should stay ahead of the game and act to protect consumers and businesses through regulation.

Thus, the ACCC recognizes that businesses may work to beat out their rivals and thus gain in market share. However, this is immediately followed by the caveat that the state may prevent such activity, when such market gains are merely “at risk” of coming at the expense of consumers or business rivals. Thus, the ACCC does not need to show that harm has been done, merely that it might take place — even if the products and services being provided otherwise benefit the public.

The ACCC report then uses this fundamental error as the basis for recommending content regulation of digital platforms like Facebook and Google (who have apparently been identified by Australia’s clairvoyant PreCrime Antitrust unit as being guilty of future violations). It argues that the lack of transparency and oversight in the algorithms these companies employ could result in a range of possible social and economic damages, despite the fact that consumers continue to rely on these products. These potential issues include prioritization of the content and products of the host company, under-serving of ads within their products, and creation of “filter bubbles” that conceal content from particular users thereby limiting their full range of choice.

The focus of these concerns is the kind and quality of  information that users are receiving as a result of the “media market” that results from the “ranking and display of news and journalistic content.” As a remedy for its hypothesised concerns, the ACCC has proposed a new regulatory authority tasked with overseeing the operation of the platforms’ algorithms. The ACCC claims this would ensure that search and newsfeed results are balanced and of high quality. This policy would undermine consumer welfare  in pursuit of remedying speculative harms.

Rather than the search results or news feeds being determined by the interaction between the algorithm and the user, the results would instead be altered to comply with criteria established by the ACCC. Yet, this would substantially undermine the value of these services.  The competitive differentiation between, say, Google and Bing lies in their unique, proprietary search algorithms. The ACCC’s intervention would necessarily remove some of this differentiation between online providers, notionally to improve the “quality” of results. But such second-guessing by regulators would quickly undermine the actual quality–and utility — of these services to users.

A second, but more troubling prospect is the threat of censorship that emerges from this kind of regime. Any agency granted a mandate to undertake such algorithmic oversight, and override or reconfigure the product of online services, thereby controls the content consumers may access. Such regulatory power thus affects not only what users can read, but what media outlets might be able to say in order to successfully offer curated content. This sort of control is deeply problematic since users are no longer merely faced with a potential “filter bubble” based on their own preferences interacting with a single provider, but with a pervasive set of speech controls promulgated by the government. The history of such state censorship is one which has demonstrated strong harms to both social welfare and rule of law, and should not be emulated.

Undoubtedly antitrust and consumer protection laws should be continually reviewed and revised. However, if we wish to uphold the principles upon which the US was founded and continue to protect consumer welfare, the US should avoid following the path Australia proposes to take.

A recent exchange between Chris Walker and Philip Hamburger about Walker’s ongoing empirical work on the Chevron doctrine (the idea that judges must defer to reasonable agency interpretations of ambiguous statutes) gives me a long-sought opportunity to discuss what I view as the greatest practical problem with the Chevron doctrine: it increases both politicization and polarization of law and policy. In the interest of being provocative, I will frame the discussion below by saying that both Walker & Hamburger are wrong (though actually I believe both are quite correct in their respective critiques). In particular, I argue that Walker is wrong that Chevron decreases politicization (it actually increases it, vice his empirics); and I argue Hamburger is wrong that judicial independence is, on its own, a virtue that demands preservation. Rather, I argue, Chevron increases overall politicization across the government; and judicial independence can and should play an important role in checking legislative abdication of its role as a politically-accountable legislature in a way that would moderate that overall politicization.

Walker, along with co-authors Kent Barnett and Christina Boyd, has done some of the most important and interesting work on Chevron in recent years, empirically studying how the Chevron doctrine has affected judicial behavior (see here and here) as well as that of agencies (and, I would argue, through them the Executive) (see here). But the more important question, in my mind, is how it affects the behavior of Congress. (Walker has explored this somewhat in his own work, albeit focusing less on Chevron than on how the role agencies play in the legislative process implicitly transfers Congress’s legislative functions to the Executive).

My intuition is that Chevron dramatically exacerbates Congress’s worst tendencies, encouraging Congress to push its legislative functions to the executive and to do so in a way that increases the politicization and polarization of American law and policy. I fear that Chevron effectively allows, and indeed encourages, Congress to abdicate its role as the most politically-accountable branch by deferring politically difficult questions to agencies in ambiguous terms.

One of, and possibly the, best ways to remedy this situation is to reestablish the role of judge as independent decisionmaker, as Hamburger argues. But the virtue of judicial independence is not endogenous to the judiciary. Rather, judicial independence has an instrumental virtue, at least in the context of Chevron. Where Congress has problematically abdicated its role as a politically-accountable decisionmaker by deferring important political decisions to the executive, judicial refusal to defer to executive and agency interpretations of ambiguous statutes can force Congress to remedy problematic ambiguities. This, in turn, can return the responsibility for making politically-important decisions to the most politically-accountable branch, as envisioned by the Constitution’s framers.

A refresher on the Chevron debate

Chevron is one of the defining doctrines of administrative law, both as a central concept and focal debate. It stands generally for the proposition that when Congress gives agencies ambiguous statutory instructions, it falls to the agencies, not the courts, to resolve those ambiguities. Thus, if a statute is ambiguous (the question at “step one” of the standard Chevron analysis) and the agency offers a reasonable interpretation of that ambiguity (“step two”), courts are to defer to the agency’s interpretation of the statute instead of supplying their own.

This judicially-crafted doctrine of deference is typically justified on several grounds. For instance, agencies generally have greater subject-matter expertise than courts so are more likely to offer substantively better constructions of ambiguous statutes. They have more resources that they can dedicate to evaluating alternative constructions. They generally have a longer history of implementing relevant Congressional instructions so are more likely attuned to Congressional intent – both of the statute’s enacting and present Congresses. And they are subject to more direct Congressional oversight in their day-to-day operations and exercise of statutory authority than the courts so are more likely concerned with and responsive to Congressional direction.

Chief among the justifications for Chevron deference is, as Walker says, “the need to reserve political (or policy) judgments for the more politically accountable agencies.” This is at core a separation-of-powers justification: the legislative process is fundamentally a political process, so the Constitution assigns responsibility for it to the most politically-accountable branch (the legislature) instead of the least politically-accountable branch (the judiciary). In turn, the act of interpreting statutory ambiguity is an inherently legislative process – the underlying theory being that Congress intended to leave such ambiguity in the statute in order to empower the agency to interpret it in a quasi-legislative manner. Thus, under this view, courts should defer both to this Congressional intent that the agency be empowered to interpret its statute (and, should this prove problematic, it is up to Congress to change the statute or to face political ramifications), and the courts should defer to the agency interpretation of that statute because agencies, like Congress, are more politically accountable than the courts.

Chevron has always been an intensively studied and debated doctrine. This debate has grown more heated in recent years, to the point that there is regularly scholarly discussion about whether Chevron should be repealed or narrowed and what would replace it if it were somehow curtailed – and discussion of the ongoing vitality of Chevron has entered into Supreme Court opinions and the appointments process with increasing frequency. These debates generally focus on a few issues. A first issue is that Chevron amounts to a transfer of the legislature’s Constitutional powers and responsibilities over creating the law to the executive, where the law ordinarily is only meant to be carried out. This has, the underlying concern is, contributed to the increase in the power of the executive compared to the legislature. A second, related, issue is that Chevron contributes to the (over)empowerment of independent agencies – agencies that are already out of favor with many of Chevron’s critics as Constitutionally-infirm entities whose already-specious power is dramatically increased when Chevron limits the judiciary’s ability to check their use of already-broad Congressionally-delegated authority.

A third concern about Chevron, following on these first two, is that it strips the judiciary of its role as independent arbiter of judicial questions. That is, it has historically been the purview of judges to answer statutory ambiguities and fill in legislative interstices.

Chevron is also a focal point for more generalized concerns about the power of the modern administrative state. In this context, Chevron stands as a representative of a broader class of cases – State Farm, Auer, Seminole Rock, Fox v. FCC, and the like – that have been criticized as centralizing legislative, executive, and judicial powers in agencies, allowing Congress to abdicate its role as politically-accountable legislator, abdicating the judiciary’s role in interpreting the law, as well as raising due process concerns for those subject to rules promulgated by federal agencies..

Walker and his co-authors have empirically explored the effects of Chevron in recent years, using robust surveys of federal agencies and judicial decisions to understand how the doctrine has affected the work of agencies and the courts. His most recent work (with Kent Barnett and Christina Boyd) has explored how Chevron affects judicial decisionmaking. Framing the question by explaining that “Chevron deference strives to remove politics from judicial decisionmaking,” they ask whether “Chevron deference achieve[s] this goal of removing politics from judicial decisionmaking?” They find that, empirically speaking, “the Chevron Court’s objective to reduce partisan judicial decision-making has been quite effective.” By instructing judges to defer to the political judgments (or just statutory interpretations) of agencies, judges are less political in their own decisionmaking.

Hamburger responds to this finding somewhat dismissively – and, indeed, the finding is almost tautological: “of course, judges disagree less when the Supreme Court bars them from exercising their independent judgment about what the law is.” (While a fair critique, I would temper it by arguing that it is nonetheless an important empirical finding – empirics that confirm important theory are as important as empirics that refute it, and are too often dismissed.)

Rather than focus on concerns about politicized decisionmaking by judges, Hamburger focuses instead on the importance of judicial independence – on it being “emphatically the duty of the Judicial Department to say what the law is” (quoting Marbury v. Madison). He reframes Walker’s results, arguing that “deference” to agencies is really “bias” in favor of the executive. “Rather than reveal diminished politicization, Walker’s numbers provide strong evidence of diminished judicial independence and even of institutionalized judicial bias.”

So which is it? Does Chevron reduce bias by de-politicizing judicial decisionmaking? Or does it introduce new bias in favor of the (inherently political) executive? The answer is probably that it does both. The more important answer, however, is that neither is the right question to ask.

What’s the correct measure of politicization? (or, You get what you measure)

Walker frames his study of the effects of Chevron on judicial decisionmaking by explaining that “Chevron deference strives to remove politics from judicial decisionmaking. Such deference to the political branches has long been a bedrock principle for at least some judicial conservatives.” Based on this understanding, his project is to ask whether “Chevron deference achieve[s] this goal of removing politics from judicial decisionmaking?”

This framing, that one of Chevron’s goals is to remove politics from judicial decisionmaking, is not wrong. But this goal may be more accurately stated as being to prevent the judiciary from encroaching upon the political purposes assigned to the executive and legislative branches. This restatement offers an important change in focus. It emphasizes the concern about politicizing judicial decisionmaking as a separation of powers issue. This is in apposition to concern that, on consequentialist grounds, judges should not make politicized decisions – that is, judges should avoid political decisions because it leads to substantively worse outcomes.

It is of course true that, as unelected officials with lifetime appointments, judges are the least politically accountable to the polity of any government officials. Judges’ decisions, therefore, can reasonably be expected to be less representative of, or responsive to, the concerns of the voting public than decisions of other government officials. But not all political decisions need to be directly politically accountable in order to be effectively politically accountable. A judicial interpretation of an ambiguous law, for instance, can be interpreted as a request, or even a demand, that Congress be held to political account. And where Congress is failing to perform its constitutionally-defined role as a politically-accountable decisionmaker, it may do less harm to the separation of powers for the judiciary to make political decisions that force politically-accountable responses by Congress than for the judiciary to respect its constitutional role while the Congress ignores its role.

Before going too far down this road, I should pause to label the reframing of the debate that I have impliedly proposed. To my mind, the question isn’t whether Chevron reduces political decisionmaking by judges; the question is how Chevron affects the politicization of, and ultimately accountability to the people for, the law. Critically, there is no “conservation of politicization” principle. Institutional design matters. One could imagine a model of government where Congress exercises very direct oversight over what the law is and how it is implemented, with frequent elections and a Constitutional prohibition on all but the most express and limited forms of delegation. One can also imagine a more complicated form of government in which responsibilities for making law, executing law, and interpreting law, are spread across multiple branches (possibly including myriad agencies governed by rules that even many members of those agencies do not understand). And one can reasonably expect greater politicization of decisions in the latter compared to the former – because there are more opportunities for saying that the responsibility for any decision lies with someone else (and therefore for politicization) in the latter than in the “the buck stops here” model of the former.

In the common-law tradition, judges exercised an important degree of independence because their job was, necessarily and largely, to “say what the law is.” For better or worse, we no longer live in a world where judges are expected to routinely exercise that level of discretion, and therefore to have that level of independence. Nor do I believe that “independence” is necessarily or inherently a criteria for the judiciary, at least in principle. I therefore somewhat disagree with Hamburger’s assertion that Chevron necessarily amounts to a problematic diminution in judicial independence.

Again, I return to a consequentialist understanding of the purposes of judicial independence. In my mind, we should consider the need for judicial independence in terms of whether “independent” judicial decisionmaking tends to lead to better or worse social outcomes. And here I do find myself sympathetic to Hamburger’s concerns about judicial independence. The judiciary is intended to serve as a check on the other branches. Hamburger’s concern about judicial independence is, in my mind, driven by an overwhelmingly correct intuition that the structure envisioned by the Constitution is one in which the independence of judges is an important check on the other branches. With respect to the Congress, this means, in part, ensuring that Congress is held to political account when it does legislative tasks poorly or fails to do them at all.

The courts abdicate this role when they allow agencies to save poorly drafted statutes through interpretation of ambiguity.

Judicial independence moderates politicization

Hamburger tells us that “Judges (and academics) need to wrestle with the realities of how Chevron bias and other administrative power is rapidly delegitimizing our government and creating a profound alienation.” Huzzah. Amen. I couldn’t agree more. Preach! Hear-hear!

Allow me to present my personal theory of how Chevron affects our political discourse. In the vernacular, I call this Chevron Step Three. At Step Three, Congress corrects any mistakes made by the executive or independent agencies in implementing the law or made by the courts in interpreting it. The subtle thing about Step Three is that it doesn’t exist – and, knowing this, Congress never bothers with the politically costly and practically difficult process of clarifying legislation.

To the contrary, Chevron encourages the legislature expressly not to legislate. The more expedient approach for a legislator who disagrees with a Chevron-backed agency action is to campaign on the disagreement – that is, to politicize it. If the EPA interprets the Clean Air Act too broadly, we need to retake the White House to get a new administrator in there to straighten out the EPA’s interpretation of the law. If the FCC interprets the Communications Act too narrowly, we need to retake the White House to change the chair so that we can straighten out that mess! And on the other side, we need to keep the White House so that we can protect these right-thinking agency interpretations from reversal by the loons on the other side that want to throw out all of our accomplishments. The campaign slogans write themselves.

So long as most agencies’ governing statutes are broad enough that those agencies can keep the ship of state afloat, even if drifting rudderless, legislators have little incentive to turn inward to engage in the business of government with their legislative peers. Rather, they are freed to turn outward towards their next campaign, vilifying or deifying the administrative decisions of the current government as best suits their electoral prospects.

The sharp-eyed observer will note that I’ve added a piece to the Chevron puzzle: the process described above assumes that a new administration can come in after an election and simply rewrite all of the rules adopted by the previous administration. Not to put too fine a point on the matter, but this is exactly what administrative law allows (see Fox v. FCC and State Farm). The underlying logic, which is really nothing more than an expansion of Chevron, is that statutory ambiguity delegates to agencies a “policy space” within which they are free to operate. So long as agency action stays within that space – which often allows for diametrically-opposed substantive interpretations – the courts say that it is up to Congress, not the Judiciary, to provide course corrections. Anything else would amount to politically unaccountable judges substituting their policy judgments (this is, acting independently) for those of politically-accountable legislators and administrators.

In other words, the politicization of law seen in our current political moment is largely a function of deference and a lack of stare decisis combined. A virtue of stare decisis is that it forces Congress to act to directly address politically undesirable opinions. Because agencies are not bound by stare decisis, an alternative, and politically preferable, way for Congress to remedy problematic agency decisions is to politicize the issue – instead of addressing the substantive policy issue through legislation, individual members of Congress can campaign on it. (Regular readers of this blog will be familiar with one contemporary example of this: the recent net neutrality CRA vote, which is widely recognized as having very little chance of ultimate success but is being championed by its proponents as a way to influence the 2018 elections.) This is more directly aligned with the individual member of Congress’s own incentives, because, by keeping and placing more members of her party in Congress, her party will be able to control the leadership of the agency which will thus control the shape of that agency’s policy. In other words, instead of channeling the attention of individual Congressional actors inwards to work together to develop law and policy, it channels it outwards towards campaigning on the ills and evils of the opposing administration and party vice the virtues of their own party.

The virtue of judicial independence, of judges saying what they think the law is – or even what they think the law should be – is that it forces a politically-accountable decision. Congress can either agree, or disagree; but Congress must do something. Merely waiting for the next administration to come along will not be sufficient to alter the course set by the judicial interpretation of the law. Where Congress has abdicated its responsibility to make politically-accountable decisions by deferring those decisions to the executive or agencies, the political-accountability justification for Chevron deference fails. In such cases, the better course for the courts may well be to enforce Congress’s role under the separation of powers by refusing deference and returning the question to Congress.

 

Copyright law, ever a sore point in some quarters, has found a new field of battle in the FCC’s recent set-top box proposal. At the request of members of Congress, the Copyright Office recently wrote a rather thorough letter outlining its view of the FCC’s proposal on rightsholders.

In sum, the CR’s letter was an even-handed look at the proposal which concluded:

As a threshold matter, it seems critical that any revised proposal respect the authority of creators to manage the exploitation of their copyrighted works through private licensing arrangements, because regulatory actions that undermine such arrangements would be inconsistent with the rights granted under the Copyright Act.

This fairly uncontroversial statement of basic legal principle was met with cries of alarm. And Stanford’s CIS had a post from Affiliated Scholar Annemarie Bridy that managed to trot out breathless comparisons to inapposite legal theories while simultaneously misconstruing the “fair use” doctrine (as well as how Copyright law works in the video market, for that matter).

Look out! Lochner is coming!

In its letter the Copyright Office warned the FCC that its proposed rules have the potential to disrupt the web of contracts that underlie cable programming, and by extension, risk infringing the rights of copyright holders to commercially exploit their property. This analysis actually tracks what Geoff Manne and I wrote in both our initial comment and our reply comment to the set-top box proposal.

Yet Professor Bridy seems to believe that, notwithstanding the guarantees of both the Constitution and Section 106 of the Copyright Act, the FCC should have the power to abrogate licensing contracts between rightsholders and third parties.  She believes that

[t]he Office’s view is essentially that the Copyright Act gives right holders not only the limited range of rights enumerated in Section 106 (i.e., reproduction, preparation of derivative works, distribution, public display, and public performance), but also a much broader and more amorphous right to “manage the commercial exploitation” of copyrighted works in whatever ways they see fit and can accomplish in the marketplace, without any regulatory interference from the government.

What in the world does this even mean? A necessary logical corollary of the Section 106 rights includes the right to exploit works commercially as rightsholders see fit. Otherwise, what could it possibly mean to have the right to control the reproduction or distribution of a work? The truth is that Section 106 sets out a general set of rights that inhere in rightsholders with respect to their protected works, and that commercial exploitation is merely a subset of this total bundle of rights.

The ability to contract with other parties over these rights is also a necessary corollary of the property rights recognized in Section 106. After all, the right to exclude implies by necessity the right to include. Which is exactly what a licensing arrangement is.

But wait, there’s more — she actually managed to pull out the Lochner bogeyman to validate her argument!

The Office’s absolutist logic concerning freedom of contract in the copyright licensing domain is reminiscent of the Supreme Court’s now-infamous reasoning in Lochner v. New York, a 1905 case that invalidated a state law limiting maximum working hours for bakers on the ground that it violated employer-employee freedom of contract. The Court in Lochner deprived the government of the ability to provide basic protections for workers in a labor environment that subjected them to unhealthful and unsafe conditions. As Julie Cohen describes it, “‘Lochner’ has become an epithet used to characterize an outmoded, over-narrow way of thinking about state and federal economic regulation; it goes without saying that hardly anybody takes the doctrine it represents seriously.”

This is quite a leap of logic, as there is precious little in common between the letter from the Copyright Office and the Lochner opinion aside from the fact that both contain the word “contracts” in their pages.  Perhaps the most critical problem with Professor Bridy’s analogy is the fact that Lochner was about a legislature interacting with the common law system of contract, whereas the FCC is a body subordinate to Congress, and IP is both constitutionally and statutorily guaranteed. A sovereign may be entitled to interfere with the operation of common law, but an administrative agency does not have the same sort of legal status as a legislature when redefining general legal rights.

The key argument that Professor Bridy offered in support of her belief that the FCC should be free to abrogate contracts at will is that “[r]egulatory limits on private bargains may come in the form of antitrust laws or telecommunications laws or, as here, telecommunications regulations that further antitrust ends.”  However, this completely misunderstand U.S. constitutional doctrine.

In particular, as Geoff Manne and I discussed in our set-top box comments to the FCC, using one constitutional clause to end-run another constitutional clause is generally a no-no:

Regardless of whether or how well the rules effect the purpose of Sec. 629, copyright violations cannot be justified by recourse to the Communications Act. Provisions of the Communications Act — enacted under Congress’s Commerce Clause power — cannot be used to create an end run around limitations imposed by the Copyright Act under the Constitution’s Copyright Clause. “Congress cannot evade the limits of one clause of the Constitution by resort to another,” and thus neither can an agency acting within the scope of power delegated to it by Congress. Establishing a regulatory scheme under the Communications Act whereby compliance by regulated parties forces them to violate content creators’ copyrights is plainly unconstitutional.

Congress is of course free to establish the implementation of the Copyright Act as it sees fit. However, unless Congress itself acts to change that implementation, the FCC — or any other party — is not at liberty to interfere with rightsholders’ constitutionally guaranteed rights.

You Have to Break the Law Before You Raise a Defense

Another bone of contention upon which Professor Bridy gnaws is a concern that licensing contracts will abrogate an alleged right to “fair use” by making the defense harder to muster:  

One of the more troubling aspects of the Copyright Office’s letter is the length to which it goes to assert that right holders must be free in their licensing agreements with MVPDs to bargain away the public’s fair use rights… Of course, the right of consumers to time-shift video programming for personal use has been enshrined in law since Sony v. Universal in 1984. There’s no uncertainty about that particular fair use question—none at all.

The major problem with this reasoning (notwithstanding the somewhat misleading drafting of Section 107) is that “fair use” is not an affirmative right, it is an affirmative defense. Despite claims that “fair use” is a right, the Supreme Court has noted on at least two separate occasions (1, 2) that Section 107 was “structured… [as]… an affirmative defense requiring a case-by-case analysis.”

Moreover, important as the Sony case is, it does not not establish that “[t]here’s no uncertainty about [time-shifting as a] fair use question—none at all.” What it actually establishes is that, given the facts of that case, time-shifting was a fair use. Not for nothing the Sony Court notes at the outset of its opinion that

An explanation of our rejection of respondents’ unprecedented attempt to impose copyright liability upon the distributors of copying equipment requires a quite detailed recitation of the findings of the District Court.

But more generally, the Sony doctrine stands for the proposition that:

“The limited scope of the copyright holder’s statutory monopoly, like the limited copyright duration required by the Constitution, reflects a balance of competing claims upon the public interest: creative work is to be encouraged and rewarded, but private motivation must ultimately serve the cause of promoting broad public availability of literature, music, and the other arts. The immediate effect of our copyright law is to secure a fair return for an ‘author’s’ creative labor. But the ultimate aim is, by this incentive, to stimulate artistic creativity for the general public good. ‘The sole interest of the United States and the primary object in conferring the monopoly,’ this Court has said, ‘lie in the general benefits derived by the public from the labors of authors.’ Fox Film Corp. v. Doyal, 286 U. S. 123, 286 U. S. 127. See Kendall v. Winsor, 21 How. 322, 62 U. S. 327-328; Grant v. Raymond, 6 Pet. 218, 31 U. S. 241-242. When technological change has rendered its literal terms ambiguous, the Copyright Act must be construed in light of this basic purpose.” Twentieth Century Music Corp. v. Aiken, 422 U. S. 151, 422 U. S. 156 (1975) (footnotes omitted).

In other words, courts must balance competing interests to maximize “the general benefits derived by the public,” subject to technological change and other criteria that might shift that balance in any particular case.  

Thus, even as an affirmative defense, nothing is guaranteed. The court will have to walk through a balancing test, and only after that point, and if the accused party’s behavior has not tipped the scales against herself, will the court find the use a “fair use.”  

As I noted before,

Not surprisingly, other courts are inclined to follow the Supreme Court. Thus the Eleventh Circuit, the Southern District of New York, and the Central District of California (here and here), to name but a few, all explicitly refer to fair use as an affirmative defense. Oh, and the Ninth Circuit did too, at least until Lenz.

The Lenz case was an interesting one because, despite the above noted Supreme Court precedent treating “fair use” as a defense, it is one of the very few cases that has held “fair use” to be an affirmative right (in that case, the court decided that Section 1201 of the DMCA required consideration of “fair use” as a part of filling out a take-down notice). And in doing so, it too tried to rely on Sony to restructure the nature of “fair use.” But as I have previously written, “[i]t bears noting that the Court in Sony Corp. did not discuss whether or not fair use is an affirmative defense, whereas Acuff Rose (decided 10 years after Sony Corp.) and Harper & Row decisions do.”

Further, even the Eleventh Circuit, which the Ninth relied upon in Lenz, later clarified its position that the above-noted Supreme Court precedent definitely binds lower courts, and that “fair use” is in fact an affirmative defense.

Thus, to say that rightsholders’ licensing contracts somehow impinge a “right” of fair use completely puts the cart before the horse. Remember, as an affirmative defense, “fair use” is an excuse for otherwise infringing behavior, and rightsholders are well within their constitutional and statutory rights to avoid potential infringing uses.

Think about it this way. When you commit a crime you can raise a defense: for instance, an insanity defense. But just because you might be excused for committing a crime if a court finds you were not operating with full faculties, this does not entitle every insane person to go out and commit that crime. The insanity defense can be raised only after a crime is committed, and at that point it will be examined by a judge and jury to determine if applying the defense furthers the overall criminal law scheme.

“Fair use” works in exactly the same manner. And even though Sony described how time- and space-shifting were potentially permissible, it did so only by determining on those facts that the balancing test came out to allow it. So, maybe a particular time-shifting use would be “fair use.” But maybe not. More likely, in this case, even the allegedly well-established “fair use” of time-shifting in the context of today’s digital media, on-demand programing, Netflix and the like may not meet that burden.

And what this means is that a rightsholder does not have an ex ante obligation to consider whether a particular contractual clause might in some fashion or other give rise to a “fair use” defense.

The contrary point of view makes no sense. Because “fair use” is a defense, forcing parties to build “fair use” considerations into their contractual negotiations essentially requires them to build in an allowance for infringement — and one that a court might or might not ever find appropriate in light of the requisite balancing of interests. That just can’t be right.

Instead, I think this article is just a piece of the larger IP-skeptic movement. I suspect that when “fair use” was in its initial stages of development, it was intended as a fairly gentle softening on the limits of intellectual property — something like the “public necessity” doctrine in common law with respect to real property and trespass. However, that is just not how “fair use” advocates see it today. As Geoff Manne has noted, the idea of “permissionless innovation” has wrongly come to mean “no contracts required (or permitted)”:  

[Permissionless innovation] is used to justify unlimited expansion of fair use, and is extended by advocates to nearly all of copyright…, which otherwise requires those pernicious licenses (i.e., permission) from others.

But this position is nonsense — intangible property is still property. And at root, property is just a set of legal relations between persons that defines their rights and obligations with respect to some “thing.” It doesn’t matter if you can hold that thing in your hand or not. As property, IP can be subject to transfer and control through voluntarily created contracts.

Even if “fair use” were some sort of as-yet unknown fundamental right, it would still be subject to limitations upon it by other rights and obligations. To claim that “fair use” should somehow trump the right of a property holder to dispose of the property as she wishes is completely at odds with our legal system.

About a month ago, I was asked by some friends about the shift from the first-to-invent patent system to a first-to-file patent system in the America Invents Act of 2011 (AIA). I was involved briefly in the policy debates in the spring of 2011 leading up to the enactment of the AIA, and so this query prompted me to share a short essay I wrote in May 2011 on this issue. In this essay, I summarized my historical scholarship I had published up to that point in law journals on the legal definition and protection of patents in the Founding Era and in the early American Republic. I concluded that a shift to a first-to-file patent system contradicted both the constitutional text and the early judicial interpretations of the patent statutes that secured patent rights to first inventors.

This legal issue will likely reach the courts one day. A constitutional challenge a couple years ago was rightly dismissed as not being justiciable, but there may yet be an appropriate case in which an inventor is denied a patent given that he or she lost the race to file first in the Patent Office. So, after sharing my essay with my friends, I thought it valuable to post it again on the Internet, because the website on which it was first published (www.noonHR1249.com) slipped into digital oblivion long ago.

I was asked to write this essay in May 2011 by the U.S. Business & Industry Council (USBIC)[1] The USBIC requested my scholarly analysis of the first-to-file provision of the AIA, which was being debated as H.R. 1249 on Capitol Hill at the time, because I had been publishing articles in law journals on the legal definition and protection of patents as property rights in the Founding Era and in the early American Republic (see here and here for two examples). In my essay, I identified the relevant text in the Constitution, which authorizes Congress to secure an exclusive right to “Inventors” in their “Discoveries” (Article 1, Section 8, Clause 8). Based on my academic research, I summarized in my essay the historical Supreme Court and lower federal court decisions, which secured patents to inventors according to the same policy justifications used in common-law cases to justify property rights to first possessors of land. Thus, I concluded that the first-to-file provision in the American Invents Act was unconstitutional, based on well-recognized arguments concerning textual analysis of the Constitution and inferences from original public meaning as reflected in the historical judicial record.

There’s more to my essay, though, than just the substantive legal argument. It also provides an insight into the nature of the legal academic debates going back many years, because at the time Professor Mark Lemley of Stanford Law School compared me to an “Obama-birther” and he called this constitutional and legal argument “fringe science.” Given concerns expressed last year in an open letter co-authored by Professor Lemley and others about inappropriate rhetoric used by academics, among other issues (see here for a news report on this letter), it bears noting for the record that this is a concern that goes back many years.

Here’s the basic story: My essay was published by the USBIC in May 2011 and I was invited to speak in congressional staffer briefings and in other venues in Capitol Hill against the AIA on this issue. At this time, I was the only legal academic writing and speaking on Capitol Hill on this issue in the AIA. In late May, the 21st Century Coalition for Patent Reform, which supported enactment of the AIA, distributed on Capitol Hill a response that it had solicited from Professor Lemley. I no longer possess this response statement that was sent out via email by the 21st Century Coalition, but I do have the response I was asked to write on June 1, 2011 in which I explicitly refer to Professor Lemley’s argument against the first-to-invent position. In response to a law professors’ letter to Congress defending the first-to-file provision in the AIA that was circulated on an IP professors listserv (IPProfs), I sent out on IPProfs on June 11 a draft letter to Congress, calling for signatures from other law professors in support of my argument first presented in my essay (the final version is here). The next day, on June 12, Professor Lemley wrote on Facebook that my constitutional and legal argument made me the same as an “Obama-birther.”[2] Although he didn’t refer directly to me, it was clear that it was directed at me given that this posting by Lemley followed the day after my email to all IP professors asking them to join my letter to Congress, and I also was the only law professor actively writing on this issue and speaking on it on Capitol Hill up until then.

The following year, in a New York Times article on the court challenge to the first-to-file provision, Professor Lemley further characterized this constitutional argument as “the legal equivalent of fringe science.”

Before the spring of 2011, my writings on legal doctrine and policy were published only in law journals, and I had never participated in a policy debate over patent legislation. In my academic articles before this time, I had critiqued Professor Lemley’s incorrect historical claims about whether U.S. patents were considered monopolies or property rights, and they reflected a purely academic tone that one should expect in a law journal article (see here). Before spring 2011, I had never addressed Professor Lemley, nor had he addressed me, about the AIA, other legislation or court cases.

Professor Lemley’s “Obama-birther” attack on me was surprising, and when I replied in the comments to his Facebook post solely on the substantive merits of the issue of policy versus law, Professor Lemley defended his accusation against me. (This is evidenced in the screen shot.)[2] At the time, I was still a relatively junior academic, and this was an object lesson about what a senior academic at a top-five-ranked law school considers acceptable in addressing a much-more junior academic with whom he disagrees. This remark in 2011 was not an outlier either, as Professor Lemley has used similar rhetoric in the ensuing years in addressing academics with whom he disagrees; for instance, a couple years ago, Professor Lemley publicly referred to an academic conference that I and other patent scholars participated in as a “Tea Party convention.”

Of course, legal and constitutional disputes consist of opposing arguments. In court cases and legislative debates, there are colorable legal and policy arguments on both sides of a dispute. Few issues are so irrational that they are not even cognizable as having a supporting argument, such as astrology and conspiracy theories like the birthers or 9-11 truthers. So, I will simply let my essay speak for itself as to whether it makes me the same as an “Obama-birther” and if my argument represents “fringe science.”

More important, if or when a good case arises in which an inventor can rightly claim an identifiable and specific harm as a result of the statutory change created by the AIA, I hope my essay will be of some value.

[1] Full disclosure: The U.S. Business & Industry Council paid me for my time in writing the essay, which I disclosed in the essay itself. Unfortunately, as recently reported by IAM Magazine, other legal academics are not always so forthcoming about their financial and legal connections to companies when publicly commenting on court cases or advocating for enactment of legislation.

[2] This is a link to a screen shot I took last year only because the Facebook post by Professor Lemley recently disappeared after I only quoted the language from it about a month ago when I shared on Facebook my essay with my friends and colleagues.

UPDATE on June 7: I added some more supporting links and some additional information after this was initially published on June 6, 2016.

On March 31, a federal judge gave the city of Boston six months to rectify the disparities between the way it treats Transportation Network Companies (“TNC”) (such as Uber and Lyft) and taxicab companies. This comes pursuant to an order by US District Court Judge Nathaniel M. Gorton in a suit filed by members of the Boston taxi industry against the city and various officials. The suit is an interesting one because it reveals unusual fault lines in the ongoing struggle between taxi companies, local regulators, and the way that federal law recognizes and respects property and economic rights.

The three chief claims by the Boston taxi medallion holders are that the city had wronged them by by devaluing their medallions in violation of the Fifth Amendment’s prohibition on regulatory takings, by discriminating against them in favor of TNCs under the equal protection clause (“EPC”) of the Fourteenth Amendment, and by violating Massachusetts law under a theory of promissory estoppel.

On the federal claims, the court seems to get it half right, and half wrong.  In sum, Judge Gorton seems to get the takings argument more or less correct. He notes:

The exclusivity of medallion owners’ access to the market prior to the arrival of TNCs existed by virtue of the City’s regulatory structure rather than the medallion owners’ property rights.  Medallion owners have no property interest in the enforcement of Rule 403 against others  … If a person who wishes to operate a taxicab without a medallion is prevented from doing so, it is because he or she would violate municipal regulations, not because he or she would violate medallion owners’ property rights.

Indeed. The plaintiff’s takings argument essentially amounts to a claim that the government, by virtue of creating the medallion system, is thereby disabled from ever regulating in a way that disrupts medallion owners from making a profit. Efficiency concerns, consumer safety concerns, and the like be damned! takings can be a fairly complicated body of law, but it seems highly unlikely that the plaintiff’s view is right—for one thing, a medallion is much more like a business license subject to health and safety considerations than it is like a property right— and Judge Gorton handily disposes of the plaintiff’s claims.

However, on the EPC analysis Judge Morton’s analysis goes off the rails. He first properly notes that, as an economic rights claim, the EPC analysis is controlled by rational basis review. As the legally trained reader will already know,  “[r]ational basis review simply requires that there be “any reasonably conceivable set of facts justifying the disparate treatment.”

According to the Supreme Court:

[B]ecause we never require a legislature to articulate its reasons for enacting a statute, it is entirely irrelevant for constitutional purposes whether the conceived reason for the challenged distinction actually motivated the legislature.

And as Clark Neily, a constitutional litigator from the Institute for Justice, has noted: “Not only is the government invited to dream up entirely post hoc rationalizations for challenged legislation, it has “no obligation to produce evidence” in support of those rationalizations either.” (citing Heller v. Doe).

In short, rational basis review is an exceedingly easy burden for the government to meet when one of its regulations is challenged.

In this case, Boston offered a number of reasons that it decided to regulate TNCs and taxi companies differently, including a very strong one that doing so “enhances the city’s interest in increasing the availability and accessibility of cost-effective transportation[.]” Nonetheless, Judge Morton disagreed, holding that

[T]he Court finds persuasive plaintiffs’ argument that many of the obvious differences between taxis from TNCs, such as the kind of vehicle used and the fact that taxicabs must be clearly labeled, are caused by the City’s application of the requirements of Rule 403 to taxi operators but not to TNCs.  The City may not treat the two groups unequally and then argue that the results of that unequal treatment render the two groups dissimilarly situated and, consequently, not subject to equal protection analysis.  Such circular logic is unavailing.

The judge pegged his opinion to the fact that Rule 403 — which regulates “hackney carriages” — defines the subject of its regulations as “used or designed to be used for the conveyance of persons for hire from place to place within the city of Boston.” Both TNCs and taxi cabs arguably fit into this definition, thus for Judge Morton, despite the fact that the city offered at least two policy goals for its differential regulations, “[n]either objective is … rationally related to any distinction between taxi operators and TNCs.”

This just has to be wrong under current federal law. As I noted above, rational basis review requires “any reasonably conceivable set of facts”  and, even though the city created the distinctions itself through its regulations, the reasons it states for doing so — including increasing availability of transportation for its citizens — are definitely rationally related to its distinction between the two types of consumer carriers. Sure, Rule 403 provides a scope of regulatory power for the city that sweeps in both TNCs and taxicabs, but within that regulatory scope the City then has the power to “rationally” assign rules as it sees fit (unless someone comes up with a fundamental right here that is more important than economic interests, of course).

I get it, rational basis review of economic regulations is frustrating and often just provides a free pass to protectionist regulators. Nevertheless, it is the law, and I think that Judge Morton got the equal protection claim wrong.

The real lesson here? Don’t get into bed with government and expect a virtual monopoly to protect you indefinitely. It’s no secret that federal law provides scant little protection for economic liberty, so when the government decides it wants to do something that harms the industry that it was previously cozy with it’s just too bad. Maybe there is a future world in which courts will recognize the right to earn a living is as deeply important as the right to speak or practice your religion or vote — but that is not the world we live in today.

Moreover, when an industry depends upon the government to explicitly protect it from competitors it is the worst kind of cronyism, and, at least in this case, represents an economic mindset that is badly aging. As upstart competitors like Uber and Lyft discover new ways to deploy cost-effective (and generally just more effective) technology to manage different industries, the fig leaf of legitimate government intervention is stripped away and revealed for what it often is: protectionism.

So to some extent, I sympathize with  Judge Gorton’s instinct in the equal protection claim: it should be the case that the government is not allowed to pick winners and losers in the economy based on its own taking of the political temperature. But the larger lesson is the opposite of the plaintiff’s intention, in my opinion. The government should roll back the regulations that created the medallion industry in the first place, and find a way to strike a politically feasible deal that eases the taxi companies out of their well-painted corner. We need more competition and more service in pursuit of consumer choice, and we need much less industry control guided in a top-down manner by state fiat.