Libel Tourism Hits a New Low

by Paul Alan Levy

A currently developing situation represents a new low for “libel tourism” – the practice of bringing libel claims against United States defendants in foreign courts where the First Amendment and other provisions of US law that protect free speech are not recognized.  The plaintiff's objective is to suppress speech by obtaining a judgment abroad and then claiming that international principles of comity require that the judgment be recognized – subject to a possible defense that enforcing the judgment would violate public policy – or at least to intimidate other speakers that might be tempted to engage in similar criticism.  In the most recent example, a UK company has seized on another recent trend in efforts to suppress free speech online — instead of taking action directly against a web site operator who might actually defend his or her free speech rights, the plaintiff goes after the speaker’s Internet Service Provider in the hope that it may be unwilling to risk a lawsuit and may, instead, sacrifice its customer’s free speech.  By threatening to file suit in a jurisdiction that does not recognize principles of ISP immunity, the company hoped to achieve its objective of suppressing criticism without even having to obtain a judicial determination that the speech was wrongful.  Public Citizen has urged Congress to address this issue in legislation currently being considered on the subject of libel tourism.

The current victim is Julia Forte, a North Carolinian who operates a pair of web sites —  800notes.com  and whocallsme.com  — that provide an interesting consumer service.   These web sites include message boards that permit consumers who receive calls from telemarketers to comment on their experiences; other consumers who receive a call from a given telemarketer can take a look and make a decision about whether they want to take a particular call.  The web sites are arranged by telephone number – so, when a cell phone or landline caller ID shows that the number of the caller, you search on Forte’s web sites and find out what others are saying before you take (or return) the call.  If a consumer does not find any previous comments for that number, she can begin a page for comments about that number, and leave comments about her own experience as a beginning of the discussion.

Needless to say, telemarketers whose conduct is described in less than flattering terms want to suppress these sites, and a number of them have threatened to sue Forte.  Until recently, she was able to just point to her immunity from suit provided by the section 230 of the Communications Decency Act and explain that the companies would be wise to explain on the web site why any criticisms are false, because she is immune from suit.  Criticized companies can respond free of charge, just as posting criticisms is free of charge to the consumer. (As encouraged by the Good Samaritan provision of the CDA, Forte is also willing to consider whether to remove specific posts in response to specific objections). 

More recently, however, the targets of criticism on her web site have resorted to threatening litigation abroad, in jurisdictions where neither the First Amendment nor section 230 immunity is recognized. Last year, she received a cease and desist demand from a lawyer based in Canada, representing a telemarketer that tried to sell an expensive certification course by dangling the prospect of lucrative employment afterward.  The Canadian lawyer threatened to file suit against her in Canada unless criticisms of his client were taken offline. Forte refused, and suit has been filed in Ontario.  That action is proceeding to judgment, and Forte expects to have to defend against this libel tourism by arguing that a judgment obtained without regard to her immunity rights under section 230 cannot be enforced in the United States because they violate public policy. 

Next, Forte rejected complaint from Mistral Telecom, an English company that peddles cellular telephones, over postings on her web site.  Instead of threatening to sue Forte, Mistral threatened to file a defamation action (in the United Kingdom) against her ISP, SoftLayer Techonologies, a company from Plano, Texas that provides the server space on which her phone-number-checking web sites are hosted. 

Those who want to suppress free speech know very well how sensitive Internet Service Providers are to the prospect of litigation where they cannot rely on absolute statutory immunity from suit, as under the Section 230, or the Digital Millenium Copyright Act ("DMCA"), or any other such provisions.   For example, during the last Presidential election campaign, some of the networks objected to the fact that both Senator McCain, and then-Senator Obama, used tiny clips from news broadcasts in the course of political ads carried on YouTube.  They did not complain to the campaigns, or file suit against them for copyright infringement – in fact, no such suit would have been tenable, because these were obvious examples of fair use.  Instead, they filed takedown notices under the DMCA, and Google was entirely unwilling to make an individualized decision about the specific videos – it just took the YouTube videos down and kept them down for the entire period of time required to retain its immunity from suit under the DMCA.    Similarly, when John W. Dozier wanted to shut down a web site criticizing his law firm in caustic terms, he did not seek a preliminary injunction against the site, but threatened to sue the ISP’s hosting the gripe site themselves, taking advantage of the trademark exception to section 230 and of the unwillingness of most ISP’s to do anything that would put their immunity at risk.

Seen from the ISP's perspective, the insistence is understandable.  Most web site operators pay a relative pittance for hosting, or they pay nothing and the site is supported by advertising.  The margin of profit on any one web site, or one blog, or one YouTube account, is tiny.  The hosts make their money by handling a large volume of sites, and automating their relationship with the content providers (their clients, the actual operators of individual web sites).  Unless there is absolute immunity, the profit on any one site is vastly outweighed by the mere expense of defending against a defamation claim, at several hundred dollars an hour.  (If there is immunity, the law is so clear that a plaintiff risks sanctions by filing suit).  Even the expense of hiring legal professionals to examine claims that are put forward about particular speech being defamatory (or otherwise actionable) far exceeds the revenue that can be gained from hosting the web site at issue.  And as a practical matter, this review must be done by legal professionals, because absent statutory immunity, what the ISP must do is assess the risk of being held liable if a court concludes otherwise than it does.   So, what the ISP's need is immunity, not the possibility of making a vague public policy argument.    Without immunity, almost every ISP is going to take the easy way out and just remove the challenged speech.

Of course, one could argue – and we do make this argument on behalf of our clients when communicating with ISP's – that if a given ISP gets a reputation for being a pushover and giving in to threats too easily, that could be bad for business, because web site operators will go elsewhere with their web hosting business.  But that argument usually doesn't work, because most ISP's give in easily. (For an attempt to identify ISP's whose defense of free speech is more robust, see here).

Knowing this, a cynical target of critical speech who wants to suppress that speech doesn't have to threaten or sue the offending speaker, or obtain any judicial determination that the speech was actionable.  Such companies or individuals just go up the line looking for an ISP that has no real stake in the controversy and is ready to cave in. 

Faced with a threat of costly litigation, for which SoftLayer risked having to spend tens of thousands of dollars to address the threatened litigation in the United Kingdom, followed by a possible judgment enforcement action in the United States, SoftLayer gave serious consideration to giving into the demand until Public Citizen offered to provide a pro bono defense in any judgment enforcement action.   At that point, SoftLayer decided to take a stand for its customer’s free speech rights, challenging Mistral to get a judgment and try to enforce it in Texas.  SoftLayer deserves a great deal of credit for its willingness to take risks that make many other ISP's flinch.

The challenge of libel tourism has begun to receive a legislative response, ensuring protection from abusive foreign litigation against speech without having to rely on case-by-case recognition of the significant public policies protecting free speech.  In the past year, statutes have been enacted in New York, CPLR 5204(b)(8), and Illinois, 735 ILCS 5/12 621(b)(7)  declaring that foreign defamation judgments from jurisdictions that do not uphold American free speech values are unenforceable as against public policy. The House of Representatives also passed such a bill last year, although the Senate took no action on similar legislation proposed by Senators Specter and Lieberman.   As Congress begins to consider such bills in the coming year, it should include protection for the immunity of the hosts of allegedly defamatory web sites, because interests abroad that are hostile to free speech can easily suppress opinions they do not like without ever suing the actual speakers, simply by intimidating the companies that host that speech online.

Comments

[Ernest Moretti]

This blog is so helpful. I have been reading this blog for some time. Wanted to let you know that. I am a fan and enjoy your post. Libel tourism is a growing concern online, where individuals can find a country with the most favorable libel laws and sue from there for any item posted on the Internet. I think the libel law make the situation even worse. The entry costs to make a libel claim can be very low. Outside the US, truth is often not a defence in a libel case, and the actual malice standard of the Sullivan case, which is a cornerstone of free speech and the First Amendment, is not accepted in the UK, Canada. Truth is, however, a defence in a UK libel case and the Unless there is absolute immunity.

[Vikas Gupta]

US jurisdictions deserved it.

[Dr. Barbara Levine Bartlett]

If the United States wasn't so difficult to obtain relief that genuine victims of libel, then they would make a jurisdiction shopping. Also, just because the US lets people say almost what they want with impunity, if they use a medium that's available internationally they should expect legal trouble in those jurisdictions