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Posted by Jeff from LTU-207-73-69-80.LTU.EDU ( on Friday, May 17, 2002 at 12:46PM :

Defamation on the Internet
By: Chi Nguyen



Overview of Defamation Law

Public v. Private Plaintiffs
Liability for Republication
Liability of Online Service Providers

Jurisdictional Analysis



Although the pen has always been considered mightier than the sword, with today's technological revolution and an increasing number of on-line users, the keyboard may prove to the mightiest of all. At one time, only the press had the means to express and disseminate ideas to large audience. Today, for a small monthly fee, any individual with a computer and a modem has the power to communicate with millions of people. This power, however, is not unconditional, and with it comes some restrictions and responsibilities, which society has always required of civilized men. Indeed, the common law has long recognized an action for defamation when one's reputation is injured by the words of another.

With a rapidly growing number of computer-communication users, the potential for on-line defamation increases. Electronic mail, discussion groups, and bulleting board services are just a few examples of new vehicles in which defamatory statements can travel on the superinformation highway. Unsuspecting users of these services may not be aware that they are "publishing" a defamatory statement when they post a message on a bulletin board criticizing their stock broker. Similarly, they may not anticipate that their message will be received in distant state or even another country. Because cyberspace presents a host of issues that traditional defamation law has never before addressed, some development and adaptation may be required by the courts when analyzing a case.

Part I of this paper will first overview defamation law as developed in the United States. Part II will discuss liability of online service providers for defamatory statements, and review how courts have analyzed cyberspace defamation cases thus far. Part III of this paper will address personal jurisdiction over non-resident defendants in a cyberspace defamation suit, and some of the issues that arises therefrom.

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I. Overview of Defamation Law

A defamatory statement is a false statement of fact about another person, corporation, or other business unit that tends to injure his or its reputation or the esteem, respect, or goodwill in which the subject is held by a substantial and respectable group of people.(1) To recover damages for defamation, a plaintiff must prove (1) the publication of a statement of fact which (2) was false and defamatory, (3) reasonably referred to the plaintiff, (4) was made with the requisite degree of fault, and (5) caused actual injury to the plaintiff.(2) A statement does not have to refer to a person by name; rather, it a statement reasonably refers to the plaintiff if, from the statement, the plaintiff is identifiable to even a small group of people.(3)

There are two traditional types of defamation: libel, which generally covers written or printed defamation and slander, which traditionally covers oral defamation.(4) Written or printed words, which are deemed more premeditated and deliberate, are also considered more harmful than spoken words. In addition, whereas spoken words are gone once uttered, printed words last longer because printed words are put in a form in which they can remind the auditors of the defamation. Text on a computer screen shares more traits with libel than with slander. In addition, a message posted on a BBS and displayed on a computer screen can become a printed message immediately to an attached printer. Therefore, because it takes more thought and effort to type a message than to speak, and because such a message is more permanent than a spoken one, postings on bulletin boards more closely resemble written than spoken words. Liability for bulletin board defamation should thus come from libel rather than slander law.

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Public v. Private Plaintiffs
Until 1964, defamation law was a product of state common law.(5) However, in New York Times v. Sullivan,(6) the United States Supreme Court held that, in certain circumstances, the Free Speech Clause of the First Amendment protects defamatory speech. In this landmark case, Alabama city commissioner sued the New York Times for defamation after it published an advertisement claiming that he and other commissioners were conducting a "wave of terror" against African-Americans.(7) In reversing the verdict for the commissioner, the Supreme Court held that the First Amendment prohibited a public official from seeking damages for a defamatory tatement relating to his or her official duties, unless he or she could show with clear and convincing evidence that the statement was made with actual malice.(8) The Court defined actual malice as knowledge of falsity or reckless disregard of the truth or falsity of the statement. The Court reasoned that the need to protect the ability to criticize public officials outweighed any harm those officials might suffer.(9)

The Court in a sense "federalized" defamation law in those cases involving a public official plaintiff. Later, in Curtis Publishing Co. v. Butts,(10) the Supreme Court extended the "actual malice" standard to "public figures" as well. Generally, a public figure is meant to be a person who "command[s] sufficient continuing public interest and ha[s] sufficient access to the means of counterargument to be able 'to expose through discussion the falsehood and fallacies' of the defamatory statements."(11) This definition, which relies on a person's "access" to the means of rebuttal, contemplates that a plaintiff who can engage in self-help requires less protection from the courts.

However, in Gertz v. Robert Welch, Inc.,(12) the Court refused to extend the New York Times holding to private persons. In Gertz, a private person claimed that a magazine publisher defamed him. The Court held that the First Amendment protection given to statements about public officials was not applicable to private individuals, even when the matter was of general or public interest.(13) While the Court did not extend constitutional protection to defamatory statements against a private individual, the Court refused to allow states to impose strict liability for defamation.(14) Thus, although the states had a legitimate interest in protecting individuals from injury arising out of defamation,(15) states must at least require a showing of negligence before imposing liability on the defendant, and may not constitutionally permit recovery of presumed or punitive damages without a finding of actual malice.(16)

Although the Gertz holding applied to defamation of a private person involving matters of general or public concern, the Court implied that its rationale could also be extended to any type of defamation of a private plaintiff, including statements regarding matters of purely private concern.(17) In Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc.,(18) the Court addressed this situation. In that case, a construction contractor sued a credit reporting agency for defamation after the credit agency issued a false report to the contractor's creditors claiming that the contractor had filed for bankruptcy.(19) On appeal from the trial court's award of presumed and punitive damages to the contractor, the credit agency argued that under Gertz, presumed or punitive damages could not be awarded to a plaintiff absent proof that defendant acted with actual malice.(20) The Court held that speech on matters of purely private concern did not invoke the same First Amendment protection that New York Times and Gertz sought to protect.(21)

In sum, the requisite degree of fault necessary to establish a cause of action depends on the plaintiff's status. If the plaintiff is a "public figure", he must prove by "clear and convincing evidence" that the defendant published the statement with "actual malice"(22) A defamation plaintiff who is not a public figure need only show that the defendant acted negligently in publishing the defamatory statement.(23) However, if a private plaintiff seeks presumed or punitive damages for a defamatory statement which is a matter of public concern, proof of "actual malice" is required.

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Liability for Republication
Primarily publishers such as magazines, newspapers and broadcasters can be liable for publishing a defamatory statement.(24) To establish liability for a republication, however, the plaintiff must demonstrate that in distributing the publication at issue, the defendant had "knowledge of the contents of [the] publication."(25) Primary publishers are responsible for a defamatory statement because they control the writing, editing, and publication of such material.(26)

However, secondary publishers, who merely act as distributors of defamatory material such as bookstores, libraries and news dealers have no responsibility for, and usually no knowledge of, the contents of the materials. Thus, distributors may be held liable only if they know or have reason to know about the defamatory statement.(27) The Restatement (Second) of Torts section 578 provides that "[e]xcept as to those who only deliver or transmit defamation published by a third person, one who repeats or otherwise republishes a defamatory matter is subject to liability as if he originally published it."(28) To be considered a secondary publisher, the distributer must not alter, recopy, or otherwise exhibit direct control over the original material.

Common carriers such telephone companies, who simply deliver material to its destination, are permitted to deliver without liability even statements that they know to be defamatory. However, liability can attach if carriers know or have reason to know that the sender of the statements cannot claim a privilege in transmitting the statements.(29) Finally, those who merely supply communications equipment are never liable for defamatory statements transmitted through or with the equipment they supply.(30)

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II. Liability of Online Service Providers

One challenge in cyberspace defamation cases is that the obvious person to sue for damaging words -- the service providers or sysop -- has taken little or no active part in the editorial process. Furthermore, the person originally responsible for the libelous statements, even if he or she be adequately identified, may not be worth suing. Thus, the real issue is whether the sysops, with their deeper pockets, are culpable for words they had no part in articulating. If not, an injured party may be without a remedy.

The first major case to address on-line service provider liability for defamation was Cubby, Inc. V. CompuServe. (31) Cubby sued CompuServe for defamation based on a statement made in an on-line newsletter written under contract by Camercon Communications, Inc. In a Motion for Summary Judgment, CompuServe argued that it had no knowledge of the statement made by Camercon, and thus, could not be liable for republishing the statement. Cubby asserted that CompuServe should be held to the standard of a publisher, which is liable for republishing a defamatory statement as if it had published the statement originally. The Southern District of New York Court disagreed. In granting CompuServe's Summary Judgment, the Court stated that CompuServe's relationship with Cameron was less like a publisher and more like a book store owner or book distributor, both of which are liable only for defamatory statements of which they knew or should have known. The Court explained:

CompuServe's CIS product is in essence an electronic, for profit library that carries a vast number of publications and collects usage and membership fees from its subscribers in return for access to the publications... While CompuServe may decline to carry a given publication altogether, in reality, once it does decide to carry a given publication, it will have little or no editorial control over that publication's contents. This is especially so when CompuServe carries the publication as part of a forum that is managed by a company unrelated to CompuServe.
In Stratton Oakmont v. Prodigy, a New York trial court ruled that Prodigy can be liable for a statement anonymously posted to its "Money Talk" bulletin board that accused Stratton Oakmont, Inc., a securities investment banking firm, of criminal and fraudulent conduct.(32) The ruling was on Stratton's Motion for Summary Judgment on the issue of whether Prodigy published or distributed the defamatory statement. The distinction is important because one who republishes a defamatory statement is liable as if it had published it originally, whereas one who distributes a defamatory statement is liable only if it knew or should have known that the statement was defamatory. The Court based its finding that Prodigy exercised sufficient editorial control for it to be considered a publisher on the following:

1. Prodigy required its users to adhere to content guidelines that prohibited the posting of messages that were insulting, harassing, repugnant to community standards or otherwise harmful to maintaining a harmonious online community.
2. Prodigy employed Board Leaders to enforce the guidelines and provided the Board Leaders with an "emergency delete function" that enabled them to remove offensive messages.
3. Prodigy used a software screening program that prescreened bulletin board messages for offensive language.
4. Prodigy held itself out to the public as a family oriented computer network, a claim made possible by the use of the above controls.
The Court distinguished the case from Cubby v. CompuServe(33) which ruled that CompuServe was not liable for defamatory statements in a publication in its electronic library because CompuServe's product was, "in essence, an electronic-profit library that carried a vast number of publications, and that CompuServe had little or no editorial control over the contents of the publications." According to the Court, "Prodigy held itself out to the public and to its members as controlling the content of its computer bulletin boards." Furthermore, "by actively utilizing technology and manpower to delete notes from its bulletin boards on the basis of offensive and bad taste, Prodigy made decisions as to content and thereby, exercised editorial control."

Discussing the public policy implications of the case, the Court stated that computer bulletin boards generally are analogous to bookstores and libraries with respect to liability for defamation. However, to the extent that an online service markets itself as regulating the contents of its bulletin boards and takes on a role analogous of a newspaper or television network, it must also accept the legal consequences. Also, the Court noted that the issues in the case may ultimately be preempted by the Communications Decency Act of 1995 currently pending in Congress.

The Supreme Court of Western Australia has decided a libel case arising out of a posting on the DIALx science anthropology computer bulletin board. In Rindos v. Hardwick, an American anthropologist posted a message criticizing the University of Western Australia for refusing to grant tenure to the plaintiff, a professor at the University, and for dismissing him.(34) The defendant replied to this posting, and alleged that the plaintiff's academic career "has been built not on field research at allo, but on his ability to berate and bully all and sundry on the logic of his own evolutionary theories. In the local pub, drinking and chain smoking all the while for that matter."(35) The plaintiff sued, alleging that along with this comment, the defendant had posted a message accusing the plaintiff of engaging in sexual misconduct with a local boy and of being a racist.(36) In a 1994 unreported decision, the court awarded the plaintiff $40,000 in damages plus interest, making no distinction between defamation on a computer bulletin board and the more traditional media. The court's decision has been criticized for its failure to acknowledge the nature the Internet.

In February 1992, the National Conference of Commissioners on Uniform State Laws rejected a draft of the Uniform Defamation Act, which suggested that information retrieval and transmission services, including computer bulletin boards, should not be subject to liability as republishers:

Section 21. Information Retrieval Services. A library, archive, or similar information retrieval or transmission service providing directly or through electronic or other means access to information originally published by other is not subject to liability under Section 19 or 20 [relating to liability for republishing] and if the library, archive, or similar retrieval or transmission service:
1. is not reasonably understood to assert in the normal course of its business the truthfulness of the information maintained or transmitted; or
2. takes reasonable steps to inform users that it does not assert the truthfulness of the information maintained or transmitted.(37)
Although the law of defamation as applied in cyberspace is far from settled, the U.S. courts seem to be taking a "functional" approach in determine liability for online service providers. Furthermore, the critical question in the analysis is whether the sysop exercises editorial and supervisory control over the material. This could result in a double edged sword for many service providers. Legislation such as the Telecommunications Act of 1996, which includes the Communication Decency Act of 1996, may require the sysop to monitor and regulate indecent materials. However, active control and supervision could expose the sysop to liability for defamation. Until the laws become more user friendly, travelers in cyberspace should take some caution when utilizing the Internet, and service providers should seek some legal advice regarding their potential liability.

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III. Jurisdictional Analysis

Cyberspace defamation not only raises questions with regard to who to sue, but also issue as to where to sue. Generally, a defamatory statement is published where ever the statement is seen, heard or read. Therefore, a cyberspace message posted in California can give rise to a cause of action if downloaded in Florida. The California user, even though he has never set foot in Florida, may be subject to the Florida court's jurisdiction. Personal jurisdiction over a nonresident defendant, however, has constitutional limitations grounded in Fifth and Fourteenth Amendment. In International Shoe Co. v. Washington,(38) the Supreme Court established a two-part test to determine whether the jurisdiction met constitutional due process. First, the defendant must have sufficient minimum contacts with the forum state. Second, the exercise of jurisdiction must comport with notions "fair play and substantial justice."

The proper scope of jurisdiction against nonresident defendants accused of libel was addressed by the Supreme Court in Keeton v. Hustler Magazine(39) and Calder v. Jones.(40) In Keeton, a New York resident sued Hustler Magazine, an Ohio corporation, in New Hampshire. The Supreme Court found that Hustler had limited contacted with New Hampshire because its magazines were regularly circulated in the state, therefore, specific jurisdiction was appropriate.(41) In Calder, the Supreme Court again permitted the exercise of jurisdiction over nonresident libel defendants. The plaintiff was an entertainer who lived in California. Both nonresident defendants, one a reporter and the other an editor, worked for the National Enquirer and resided in Florida.(42) Although the newspaper was written and edited in Florida, the Court held that jurisdiction over the Florida residents was proper because their "actions were expressly aimed at California" and "intentionally directed at a California resident."(43) The Court explained that the author and editor could "reasonable anticipate being haled into court [in California]' to answer the truth of the statements made in the article" because they knew that was where the plaintiff lived and worked and that was where the National Enquirer had its highest publication.(44)

The critical question of jurisdictional due process is "whether the defendant purposefully established 'minimum contacts' in the forum State."(45) Whether a defendant's actions are "purposefully directed" toward a forum state, however, is a challenging analysis. Courts must determine whether activity that occurs outside the forum state is "purposely directed" toward the forum state, and whether personal jurisdiction over the nonresident defendant offends due process.

A defendant could argue that much cyberspace activity is not purposefully directed toward any given state by illustrating the difference between an E-mail message and a traditional letter.(46) Unlike traditional letters which must include a particular state in the address, an E-mail message does not include a destination state in its address.(47) The sender of a e-mail message may not know in which state the recipient resides. Similarly, many users posting messages on a bulletin board do not know in which state the central computer receives the posting.

Likewise, a small circulation newspaper that loads an article on the Internet can anticipate that individuals in states outside its circulation area may download the article. Yet, this newspaper is not "circulating" the article in the forum state in the truest sense of the word. Furthermore, the fact that a plaintiff chooses to download in a particular state is a mere coincidence, caused by the unilateral action of another. Therefore, true "purposeful direction" towards the forum state where the material is downloaded is lacking.

The "effects test" without more would subject a cyberspace defendants to liability in any state in which the defendant knows the information could be viewed or retrieved, even in the absence of independent, affirmative action toward the forum state. Such a result would be contrary, however, to traditional jurisdictional wisdom and Supreme Court precedent.(48)

Cyberspace activity differs from traditional publication, such as those in Calder and Keeton. In cyberspace, E-mails are predestined, however, the sender may not have actual knowledge of the recipient's address. In addition, the review and downloading of posted BBS messages into another state is fortuitous; the "publisher" does not where the message will be read or if it will be read at all. Thus, the absolute knowledge of the publication's circulation in a particular forum and fair warning that a user may be subject to suit there is absent in most cyberspace activity.

Thus, publication in cyberspace should be analyzed under the stream of commerce cases rather than a traditional libel circulation cases. For example, in World-Wide Volkswagen Corp. v. Woodson,(49) the Supreme Court held that the exercise of jurisdiction by an Oklahoma court over a New York automobile distributor and a Connecticut retail automobile dealer violated due process.(50) The defendants' sole contact with the forum state resulted from a customer's unilateral act of driving the car into Oklahoma. Although it was foreseeable that the car sold in New York or Connecticut would be driven into other states, the real issue was whether the defendant's conduct and connection with the forum state was such that he "should reasonably anticipate being haled into court there."(51) The Court found that the connection between the defendants' conduct and the Oklahoma automobile accident was too attenuated to find jurisdiction.(52) Thus, the defendants could not reasonably anticipate being sued in Oklahoma for this cause of action.(53)

Similarly, in Asahi Metal Industry Co. v. Superior Court,(54) the Court, in a plurality opinion, held that the exercise of jurisdiction could not rest on the defendant's mere awareness of the potential for its products eventually entering the forum state.(55) Rather, the Court required a purposeful act directed at the forum state. Absent such an act, the Court held the assertion of personal jurisdiction violated due process.(56)

Applying these principles in cyberspace, court's should refrain from exercising jurisdiction over a nonresident defendants simply because an online message can be read in that state. Whereas the connection between the defendants' conduct and the automobile accident in World-Wide Volkswagen was too attenuated, the nexus between a cyberspace user posting a message in one state and the user that ultimately downloads the same message in another state is also remote. In both cases, personal jurisdiction over the defendant is inappropriate because there is no purposeful activity directed towards the forum and because there is no certainty of the contact. Because mere awareness that one's product may travel into another state was insufficient to support jurisdiction, mere awareness that a message may be downloaded in another state should also be insufficient.

Nonetheless, a defendant who is unable to defeat jurisdiction by arguing that sufficient minimum contacts did not exist may ultimately be able to prevail by showing that the exercise of jurisdiction would offend "traditional notions of fair play and substantial justice."(57) If a plaintiff makes only a bare minimum showing that a defendant purposefully availed himself of the opportunity to act in the forum state, courts should heavily consider the "reasonableness" factors to ensure fairness.(58) The factors are: the burden on the defendant; the state's interest in exercising jurisdiction; the plaintiff's convenience; the court's interest in the proper administration of justice; and the application of general policy concerns.

Most of these factors will generally have little significance for cyberspace defendants accused of libel. However, the first factor -- the defendant's burden/inconvenience -- weights heavily against jurisdiction.(59) In many cases, the burden of appearance on a cyberspace defendant will also be so onerous that it would render the exercise of jurisdiction over the nonresident defendant unreasonable.

If a defendant's contact with the forum state are as attenuated as some of the contacts contemplated ..., the burden on the defendant in defending the suit in a distant forum, standing alone, may require that the assertion of jurisdiction on a nonresident defendant outside the state be recognized as patently unreasonable. Thus, assertion of jurisdiction over persons whose contact with a forum is, at best, attenuated and fortuitous would conflict with "fair play and substantial justice" as we know it.

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Whether online service provider should be liable in a defamation suit, and if so, in what jurisdiction are just examples of the issues that arises when the long arm of the law reaches into cyberspace. Another question not addressed in this paper is whether online plaintiffs should be considered public figures, and held to a higher standard of proof. One of the rationales for requiring a higher standard for public figures is that such persons are deemed to have greater "access" to the media and greater opportunity to rebut the statements made against them. In cyberspace, online plaintiffs similarly have easy "access" to the media -- assuming that the Internet can be considered the "media" in the traditional sense of the word. Furthermore, the issue of forum shopping will have to be addressed by the courts as jurisdiction over online activity expands. These questions may not be adequately answered with traditional law.

As one judge wrote in a case involving the applicability of a retraction statute to cyberspace libel:

The magnitude of computer networks and the consequent communications possibilities were non-existent at the time this statute was enacted. Applying the present libel laws to cyberspace or computer networks entails rewriting the statutes that were written to manage physical, printed objects, not computer networks or services. Consequently, it is for the legislature to address the increasingly common phenomenon of libel and defamation on the information superhighway.
The rate at which technology developments is growing coupled with the complexity of technology is beyond many lay persons' ken. A uniform system of managing information technology and computer networks is needed to cope with the impact of the information age. It is the responsibility of the legislature to manage this technology and to change or amend the statute as needed.(60)
Courts should keep this judge's comments in mind when analyzing Internet defamation cases. Traditional defamation law should not be blindly applied in cyberspace because the environment "out there" differs significantly from the customary modes of communication such as print or speech. Moreover, courts must not shy away from understanding how the technology works, how it differs, and how it will impact our lives and the laws that govern us. Developing the law is as much within court's province as interpreting the law. Moreover, as defamation on the Internet becomes more common, legislatures must determine the applicability of current statutes, and r [snip - maximum size exceeded]

-- Jeff
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