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Craigslist Not Liable for Discriminatory Housing Ads
Author: Douglas J. Wood, Reed Smith LLP

In a ruling that many in the online community had anticipated with bated breath, a federal appeals court has held that the Communications Decency Act (CDA) shields the Internet classifieds forum craigslist from liability for discriminatory housing advertisements.

The Chicago Lawyers’ Committee for Civil Rights Under Law (Chicago Committee) “cannot sue the messenger just because the message reveals a third party’s plan to engage in unlawful discrimination,” wrote Chief Judge Frank H. Easterbrook of the U.S. Court of Appeals for the Seventh Circuit.

Instead, the Chicago Committee, which had objected to housing ads that specified “No Minorities,” “No children” and similar variations, was free to peruse the “remarkably candid postings on craigslist,” the Chief Judge stated, and identify targets to investigate.

The ruling is generally good for Internet Service Providers (ISPs) but does not provide blanket liability for all actions taken on their sites.

ISPs & Fair Housing
The Chicago Committee sued craigslist, which maintains some 450 classified sites for locales around the world, over alleged violations of the Fair Housing Act (FHA). The FHA forbids discrimination on account of race, religion, sex or family status when selling or renting housing.

The Chicago Committee claimed that by allowing users to post discriminatory ads, craigslist violated a section of the FHA that makes it illegal to “make, print, or publish, or cause to be made, printed, or published” such statements or ads.

The Seventh Circuit concluded that craigslist was an ISP, and as such, was protected from liability by the “Good Samaritan” provision of the CDA, which states: “[n]o 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.”

In so ruling, the Seventh Circuit upheld a decision by a federal district court in Illinois, which departed from courts that have held that the CDA bars all legal actions against ISPs for website content. Instead, the district court had concluded the CDA is more limited and protects ISPs only from lawsuits that seek to treat them as "publishers" of third-party content.

Publisher v. ISP
The Chicago Committee had argued that craigslist functioned more like a publisher than an ISP, and that even if the site were deemed to be an ISP, it should be required to act to bar discriminatory postings. “We believe that ISPs can use existing filtering technology to screen housing listings, with very little need for manual review,” the Chicago Committee stated in a fact sheet regarding its suit.

Chief Judge Easterbrook rejected both arguments.

"What [the CDA] says is that an online information system must not ‘be treated as the publisher or speaker of any information provided by’ someone else," he said.

Further, the filtering technology the Chicago Committee referred to would not work, he said.

“[S]creening, though lawful, is hard. Simple filters along the lines of ‘postings may not contain the words ‘white’ can’t work. Statements such as ‘red brick house with white trim’ do not violate any law, and prospective buyers and renters would be worse off if craigslist blocked descriptive statements,” wrote Chief Judge Easterbrook.

The judge also rejected the notion that craigslist should be forced to filter listings by hand. More than 30 million notices are posted to the system every month; yet fewer than 30 people operate the network of sites, he stated.

Congressional Intent
The Chicago Committee further argued that nothing in the CDA suggested that Congress meant to “immunize” Internet service providers from liability under the Fair Housing Act.

“That’s true enough,” responded Chief Judge Easterbrook, “but the reason a legislature writes a general statute is to avoid any need to traipse through the United States Code and consider all potential sources of liability, one at a time.”

The Committee also argued that even if craigslist itself were not deemed to be the publisher of the discriminatory content, the service should be held liable under the FHA provision that provides liability for causing the publication of discriminatory housing notices.

“An interactive computer service ‘causes’ postings only in the sense of providing a place where people can post,” the Chief Judge said. “That is not, however, a useful definition of a cause.”

He continued, “One might as well say that people who save money ‘cause’ bank robbery, because if there were no banks there could be no bank robberies. Causation … must refer to causing a particular statement to be made, or perhaps the discriminatory content of a statement.”

Protection Not Absolute
Chief Judge Easterbrook was careful to frame the decision within prior case law that has held the protection from liability for ISPs is not absolute. The case at hand may have been different, he noted, if craigslist had induced its users to discriminate by, for example, offering a discount to people who included discriminatory statements.

“That’s the sense in which a non-publisher can cause a discriminatory ad,” the Chief Judge wrote.

While some have suggested that the CDA provides total immunity to ISPs from liability for content, the Chief Judge joined the district court in rejecting this argument. Such a reading would discourage ISPs from filtering indecent and offensive material, he said.
“[P]art of the ‘Communications Decency Act’ … bears the title ‘Protection for ‘Good Samaritan’ blocking and screening of offensive material’,” the Chief Judge noted, which is “hardly an apt description if its principle effect is to induce ISPs to do nothing about the distribution of indecent and offensive materials.”

Others have suggested that ISPs are insulated under the CDA so long as the information at issue came from a third party. But Chief Judge Easterbrook rejected this interpretation as well.

“[T]his reading … never requires ISPs to filter offensive content, and thus [the CDA] would not preempt state laws or common-law doctrines that induce or require ISPs to protect the interests of third parties, … for such laws would not be ‘inconsistent’ with this understanding of [the CDA].”

A third alternative would be to conclude that the CDA “forecloses any liability that depends on deeming the ISP a ‘publisher’—defamation law would be a good example of such liability—while permitting the states to regulate ISPs in their capacity as intermediaries,” the Chief Judge concluded, citing precedent.

“To appreciate the limited role of [the CDA], remember that ‘information content providers’ may be liable for contributory infringement if their system is designed to help people steal music or other material in copyright,” he said.

Why This Matters: The ruling concludes that craigslist, which provides a forum for others to publish their notices, is an Internet Service Provider rather than a publisher. The decision is generally good for ISPs but is careful not to write a blank check—ISPs may be held liable as non-publishers under various state law theories for illegal acts committed on their sites.