The Law and Business of Social Media
November 22, 2016 - Online Reviews, Section 230 Safe Harbor

Yelp Case Shows CDA §230 Still Has Teeth

Yelp Case Shows CDA §230 Still Has Teeth

2016 has been a challenging year for Section 230 of the Communications Decency Act (CDA) and the website operators who depend on it for protection against liability stemming from user-generated content. An unusually large number of cases this year have resulted in decisions holding that the defendant website operators were not entitled to immunity under Section 230. For example, as we’ve discussed recently, in Hassel v. Bird, the California Court of Appeal held that Section 230 did not prevent the court from ordering Yelp to remove from its website allegedly defamatory reviews posted by users, even though Yelp was not a party in the underlying defamation suit.

We are working on an article surveying some of the recent cases holding that Section 230 did not apply. But in the meantime, it is important to remember that Section 230 remains a powerful shield against liability and that defendants continue to wield it successfully in many cases. The Ninth Circuit’s recent decision in Kimzey v. Yelp is one such case.

Kimzey arose from two negative Yelp reviews that user “Sarah K” posted in September 2011 about Douglas Kimzey’s locksmith business in the Seattle area. Sarah K’s reviews were extremely negative and rated Kimzey one out of five stars in Yelp’s multiple-choice star rating system. In all caps, she warned Yelpers that “THIS WAS BY FAR THE WORST EXPERIENCE I HAVE EVER ENCOUNTERED WITH A LOCKSMITH. DO NOT GO THROUGH THIS COMPANY . . . CALL THIS BUSINESS AT YOUR OWN RISK.”

In response, Kimzey filed a pro se complaint in the U.S. District Court for the Western District of Washington alleging that Yelp should be held liable for publishing such “Libelous Per Se statement[s]” on its website. In an apparent attempt to plead around Section 230 and the immunity afforded to website operators for liability arising from user-generated content, Kimzey asserted two arguments.

Kimzey’s first argument was that Yelp created the reviews itself, by copying them from another website and reposting them on Yelp’s website. The court made quick work of this theory, noting that “threadbare allegations of fabrication of statements are implausible on their face and are insufficient to avoid immunity under the CDA.” The court went on to observe that, “[w]ere it otherwise, CDA immunity could be avoided simply by reciting a common line that user-generated statements are not what they say they are” and that “it cannot be the case that the CDA and its purpose of promoting the free exchange of information and ideas over the Internet could be so casually eviscerated.”

Kimzey’s second theory was that Yelp was responsible for Sarah K’s reviews because it “transformed” the reviews into its own advertisements or promotions and because Yelp served as an “author” of the one-star rating by “designing the star image and creating the color” of its star rating system. While it is well established that a website operator may lose Section 230 immunity if it makes a material contribution to the creation or development of the content at issue, here the court held that “neither of the allegedly creative actions taken by Yelp falls within [the court’s] interpretation of the terms ‘creation’ or ‘development’ of information.”

Specifically, the court held that, because Yelp’s star rating system is based entirely on user input and merely “reduces this information into a single, aggregate metric,” the star ratings cannot be “anything other than user-generated data” within the scope of the Section 230 immunity. The court went on to characterize Yelp’s star rating system “as the kind of ‘neutral tool’ operating on ‘voluntary inputs’ that [the Ninth Circuit] determined did not amount to content development or creation” in the case. The court also cited Carafano v. Metrosplash for the proposition that “the mere fact that an interactive computer service classifies user characteristics and collects responses to questions does not transform it into a developer of the underlying misinformation.” Given this analysis, the Ninth Circuit upheld the district court’s dismissal of Kimzey’s complaint based on Yelp’s immunity under Section 230.

Kimzey represents a clean Section 230 victory for Yelp, of the kind that we took for granted before the spate of Section 230 wins for plaintiffs that we have seen this year. We will be watching closely to see how the Section 230 winds blow as we move into 2017.