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Seventh Circuit Clarifies Online Service Liability for Illegal Advertisements

By Michelle Yang — Edited by Wen Bu

Chicago Lawyers’ Committee for Civil Rights Under Law, Inc. v. Craigslist, Inc.
Seventh Circuit, March 14, 2008, No. 07-1101
Slip Opinion

On March 14, the Seventh Circuit affirmed summary judgment by the District Court for the Northern District of Illinois for Craigslist, holding that the online bulletin board did not violate the Fair Housing Act by providing “an electronic meeting place” that hosted, among many other things, illegally discriminatory housing advertisements. The opinion by Chief Judge Easterbrook clarified the potential liability of an online service: as Craigslist was not a “speaker” of the illegal information, it was not liable as a publisher.

Eric Goldman
of Technology and Marketing Law Blog analyzes Judge Easterbrook’s reasoning as part of 47 USC 230 Week.
Howard Bashman of How Appealing provides additional links, as well as coverage on the en banc rehearing of a similar case, Fair Housing Council v. Roommates.com, before the Ninth Circuit.
Randy Picker of the University of Chicago Law School Faculty Blog sees the ruling as yet another reason newspapers are dying in the competition against less-strictly-regulated online competitors.
In 2001, Joel Michael Schwarz contributed a JOLT article about liability for third party postings in the context of practicing law over the Internet.

A section of the Fair Housing Act, 42 U.S.C. § 3604(a), prohibits the publishing of advertisements that indicates discrimination based on race and other prohibited classes. A consortium of Chicago law firms sued Craigslist for hosting notices on the website that indicated preferences against minorities and people with children. Although the provision exempts single-family houses rented by an owner with no more than three such houses, many of these notices were for apartments and condominiums falling outside the single-family exemption.

Judge Easterbrook distinguished between newspapers, against which the Fair Housing Act is routinely applies, and Craigslist. The opinion posited that Craigslist, like common carriers such as telephone services, does not create the discriminatory content it carries and would have enormous difficulty screening notices. The website’s thirty-person staff would thus be incapable of vetting the thirty million notices posted monthly. Moreover, a costly increase in staff screening would likely, Judge Easterbrook found, be futile. Instead, the opinion suggested, the Lawyers’ Committee would be better able to identify targets for investigation by Craigslist.

The court also clarified the circuit court’s earlier opinion in Doe v. GTE Corp., 347 F.3d 655 (7th Cir. 2003), regarding the protection for “Good Samaritan” blocking of internet content under the Communications Decency Act of 1996 (“CDA”), 47 U.S.C. § 230. The court held that the CDA forecloses treatment of ISPs and online services as publishers and speakers, but does not grant comprehensive liability for third-party content.

Applying the CDA to the facts of the case, Easterbrook first notes that it is a general statute that applies to the Fair Housing Act, regardless of whether or not Congress had intended it to apply to discriminatory housing advertisements. Since an online service is not a “publisher or speaker” of third party content, Craigslist is not liable under the Fair Housing Act because it is not a “‘speaker’ of the posters’ words,” as would be required for liability under the FHA.

Posted On Mar - 19 - 2008 Comments Off

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