ContractsProf Blog

Editor: Jeremy Telman
Oklahoma City University
School of Law

Wednesday, September 28, 2022

Contracts Aspects to the Fifth Circuit's NetChoice v. Paxton Ruling

In May we posted about the Eleventh Circuit's ruling in NetChoice, LLC v. Attorney General, which struck down many provisions of a Florida statute that sought to regulate social media companies as common carriers engaged in "censorship."  The Eleventh Circuit quoted from the language that animated the challenged legislation: The law was created to punish “the ‘big tech’ oligarchs in Silicon Valley” who “silenc[e]” “conservative” speech in favor of a “radical leftist” agenda.  Subtle. Before that, we posted about Texas HB 20, which is similar.  Judge Pitman of the District Court for the Western District of Texas had enjoined the enforcement of HB 20 in a 30-page opinion.  The Fifth Circuit lifted that injunction, and then last week, it issued an opinion in the case, NetChoice v. Paxton

GoldmanIt's a 113-page doozy.  Fortunately, in a 6000-word post, Eric Goldman (right) has gone through the entire opinion carefully, and he provides not only a trenchant analysis but also links to sources so that readers can do their own deep dive into the case.  That leaves little for us to say except to address to the contractual connection in this case.  But first, an overview.

Professor Goldman's post begins helpfully with a synopsis of how HB 20 fared in the Fifth Circuit, an edited version of which appears below:

The Texas law has four main provisions. Here’s where they stand after the Fifth Circuit’s ruling:

  • mandatory editorial transparency requirements. . . . [unanimously upheld]
  • digital due process requirements, including an appellate process for aggrieved users. . . . [unanimously upheld]
  • restrictions on viewpoint-biased content moderation. The panel voted 2-1 to lift the injunction for multiple reasons. However, only one vote (Oldham) endorsed the common carriage justification. . . .
  • a ban on email service providers deploying anti-spam filters unless they give appellate rights to all filtered senders. No one has yet challenged this provision, so it was never enjoined and remains available for AG Paxton to enforce. . . . 

The Fifth Circuit opinion begins by saying that HB 20 "generally prohibits large social media platforms from censoring speech based on the viewpoint of its speaker."  Because, as Professor Goldman points out, the social media platforms are private actors who, as such, by definition, cannot engage in censorship, they are not lawfully susceptible to regulation on that basis.  Indeed, as Professor Goldman notes as well, what is really going on here is government censorship of the social media companies' expression.  One way to state the issue might have been "Can social media platforms be prohibited by statute from suppressing speech on the basis that they are state actors engaged in censorship?  So posed, under current law, the answer is no.  By defining content regulation as "censorship" the Fifth Circuit is making new law and deciding the case in advance by making words mean what it wants them to mean.  It doesn't even pay them extra, as the equitable Humpty Dumpty does.

Having started with a faulty premise, the opinion continues:

But the platforms argue that buried somewhere in the person’s enumerated right to free speech lies a corporation’s unenumerated right to muzzle speech.

The implications of the platforms’ argument are staggering. On the platforms’ view, email providers, mobile phone companies, and banks could cancel the accounts of anyone who sends an email, makes a phone call, or spends money in support of a disfavored political party, candidate, or business . . . 

That is almost certainly a mischaracterization of the platforms' arguments, because their argument is that they are not and should not be treated like "email providers, mobile phone companies," etc.  And with that, the District Court's injunction is vacated.

Twitter-logo.svgBut on to the contracts angle.  I have been writing a lot lately about the interaction of First Amendment law and contracts law.  The relationships between the social media platforms and their users are governed by a contract -- the platforms' terms of service.  My co-blogger and co-author Nancy Kim has spent much of her career highlighting the dangers of expansive or exploitative terms of service.  I am not unaware of the hazards.  But terms of service are routinely enforced, and it is a huge problem when the government suddenly steps in to change contractual relations based on the wholly unsubstantiated claim that the social media companies discriminate against conservative voices.  If the social media companies muzzle speech, they muzzle speech that violates their terms and conditions.  As a frequent user of social media, I'm glad that they do it, and I hope they do it better, which means doing it more, as there are ever-new automated mechanisms for flooding popular sites with speech that has little to do with insight and everything to do with incitement of political violence.

The Fifth Circuit opinion surgically excerpts passages from the platforms' terms of service in order to make those platforms look like public fora or common carriers.  What the opinion does not do is note the substantive components of those terms of service and community standards.  Twitter's terms of service, for example, specifically prohibit posts that promote or encourage:

  • Violence
  • Terrorism/violent extremism
  • Child sexual exploitation
  • Abuse/harassment
  • Hateful conduct
  • Perpetrators of violent attacks
  • Suicide or self-harm
  • Graphic violence and adult content
  • Illegal or certain regulated goods or services

Facebook's community standards are broader but non-partisan and pretty damn thoughtful.

But the ultimate point is.  These are private sites with private rules.  Citing Justice Kennedy's dictum in Packingham, the Fifth Circuit calls the each platform a "monopolist"of the modern public sphere.  But the very fluidity of these markets shows the opposite.  Who had even heard of TikTok five years ago?  My students are contemptuous of Facebook and prefer platforms like Snapchat and Instagram that I would never use.  Alternatives to Twitter abound, and if they are less successful than Twitter, that is because they suck, and one of the main reasons that they suck is that they don't have the powerful algorithms that the best platforms have, which allow them, among other things, to enforce their terms of service effectively.

Let's hope that SCOTUS takes this case.  It just about has to given the 5th Circuit/11th Circuit split and the global nature of the Internet.  And let's hope that it enjoins these attempts at government censorship masquerading as regulating private censorship (which is not a thing). 

https://lawprofessors.typepad.com/contractsprof_blog/2022/09/contracts-aspects-to-the-fifth-circuits-netchoice-v-paxton-ruling.html

Commentary, Current Affairs, E-commerce, In the News, Legislation, Recent Cases | Permalink

Comments