While the increasing convergence of communications and entertainment on wireless Internet platforms is creating new business opportunities for value-chain stakeholders, it also is raising novel policy issues for mobile-phone operators.
It is not so much that policymakers are attempting to stick cellular carriers with laws and regulations not applicable to the wireless sector in the past, but rather a matter of carriers’ trying to play defense when digital-age lawsuits arise and established law is subject to reinterpretation by the courts.
Such is the situation in the appeal of a $30 million lawsuit against MySpace in which it is argued the social networking Web site is liable for an alleged sexual assault of a 13-year girl by a man she communicated with online and later met. A federal judge in Texas threw out the suit earlier this year, rejecting the plaintiff’s clams of fraud, gross negligence and gross misrepresentation. U.S. District Judge Sam Sparks ruled, among other things, that MySpace and its parent company, News Corp., have immunity under the Communications Decency Act of 1996. The law 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.” Sparks said MySpace is protected under the statutory definition and pointed to the law’s underlying legislative history as a means of putting into broader context Congress’ desire to foster diverse political dialogue and communications generally on the Internet.
“To ensure that Web site operators and other interactive computer services would not be crippled by lawsuits arising out of third-party communications, the act provides interactive computer services with immunity,” Sparks wrote.
Wireless web
But the case did not end there. Sparks’ decision is being challenged in the 5th U.S. Circuit Court of Appeals in New Orleans. The mobile-phone industry, which now accommodates MySpace and is increasingly becoming home to other services, applications and content made popular on the wired Internet, decided it wanted to be heard. So cellphone industry trade association CTIA joined computer, cable TV and free speech-privacy organizations, to persuade the 5th Circuit to affirm the lower court’s ruling in the MySpace case.
“Because they serve as platforms for the online communications of tens of millions of users, the service providers who are represented [in the friend-of-the court brief] have been, and inevitably will continue to be, parties to lawsuits in which they must raise Section 230 [of the Communications Decency Act] as a defense,” the parties jointly told the 5th Circuit. “The success and viability of these companies’ online businesses-and the vitality of online media and online free speech generally-depend at least in part on their not being confronted with the risk and uncertainty of potential liability in cases in which it is alleged that one among their millions of users has used their services to engage in communications that caused harm to someone.”
The mobile-phone and tech sectors warned of serious legal and economic consequences if the 5th Circuit were to reverse the lower court.
The coalition noted that Congress sought to foster industry self-regulation by shielding service providers from lawsuits such that holding MySpace liable in the case at issue “would resurrect the very disincentives that Congress sought to eliminate.” Though the U.S. Supreme Court partially overturned the law, Section 230 remains intact.
