FTC Commissioner Chopra Misreads Section 230 on Whether it Applies to Advertising

In his statement at the ABA Antitrust Section Spring Meeting 2019, Commissioner Chopra said, “A company engaged in or benefiting from behavioral advertising is not acting necessarily as a passive conduit…we need to consider whether they have lost Section 230 immunity.”

In one word, no. Commissioner Chopra is wrong in his reading of Section 230 of the Communications Decency Act.

In this blog, we’ll show that nothing in the law itself, or the way it’s being interpreted, would suggest that promoted content is not protected by Section 230.

Section 230’s empowering of free speech does not change if the platform collects information about the user for purposes of interest based advertisements.

In the law itself, Section 230 explicitly says, “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.” This holds true regardless as to whether the platform, here written as “the interactive computer service,” makes money from ads, displays ads, or targets ads.

Section 230’s empowering of free speech does not change if the platform collects information about the user for purposes of interest based advertisements. Once again, the test regarding Section 230 is, as stated in the law, whether the platform was responsible “for the creation or development of information.”

The creator of Section 230, Congressman Chris Cox, describes his law thus:

“[Section 230] was intended to protect the innocent from being held liable for wrongs committed by others…
One need not rely on the legislative history or the words of the authors for this proposition. The language of the statute is plain enough. If a website, or anyone who provides what the law describes as interactive computer services, is complicit in the creation of unlawful content then it may not claim protection under Section 230.”

Newspapers are not considered the “developer” or the “creator” for ads in their classified section. Neither would online platforms.

However, Commissioner Chopra’s suggestion that Section 230 should not cover paid promotion on online platforms is not only legally incorrect, if somehow made into law, such a policy would also be very damaging to the digital economy.

Chopra’s suggestion that interest based advertising removes Section 230 would make every advertising platform liable for the veracity of advertisements they place.

Imagine this, an sushi restaurant runs an ad on Yelp that falsely claims a 5 star rating. Using interest-based ads, the ad is shown only users looking for a sushi restaurant nearby. Under Commissioner Chopra’s incorrect interpretation of Section 230, Yelp could be sued by any reader who saw the fraudulent ad.

Most online platforms are powered by ads, and part of the success of digital advertising has been its flexibility, inexpense, and targeting tools — all things traditional advertising lacks. By making online platforms liable for the conduct of advertisers, we could undermine the digital advertising market and disrupt the central model of funding for most online platforms.

Section 230 author Chris Cox says:

“[L]iability protection has not only become the foundation supporting sites like Yelp, eBay, Facebook, Amazon, Twitter, the New York Times, and other well-known web brands that provide user-generated content (UGC), but also the entire Web 2.0 revolution through which thousands of smaller, innovative platforms have offered a range of socially useful services.”

It is by no mistake that Section 230 applies regardless of whether content is promoted or not. Commissioner Chopra should take note.