Inc. Zeran v. America Online

The decision meant Internet service providers (ISP) were not responsible as publishers or distributors for what their subscribers wrote, even when receiving notice of potential defamatory language from other parties. The ruling sent a clear message that Section 230 of The Communications Decency Act of 1996 designed to protect ISPs could withstand legal challenge and protect the newly emerging medium of the Internet from unwarranted government intrusion on freedom of speech. However, the decision raised issues concerning the applicability of traditional libel law to the high speed, high volume world of electronic communications. Victims of malicious defamation were essentially left without legal recourse for remedies.

The Internet, with its instantaneous communications and global reach, created unique legal pressures on the First Amendment right of free speech. The Internet, a new bastion of instant and uncensored expression, became a convenient vehicle for material of potentially obscene or defamatory nature. Many citizens, including those with children vulnerable to predators using the World Wide Web and members of minority groups who were targets of hate and racist commentary, were justifiably concerned. Questions of censorship and liability arose which heightened concerns over preserving the constitutional rights of free speech within this new technological framework.

The first case addressing Internet Service Provider (ISP) liability for third-party posted defamation statements was Cubby, Inc. v. CompuServe, Inc. in 1991. However, that case involved a known author and the service provider, CompuServe, won its case by claiming lack of editorial control, hence no liability for the particular messages. Then, in Stratton Oakmont v. Prodigy Services, Inc. (1995) the court ruled against the ISP, Prodigy. Because Prodigy placed some controls over what could be posted on its system, the court considered Prodigy a publisher and, therefore, responsible for the content of posted statements. The Stratton decision sent shock waves through the Internet industry and potentially set the stage for considerable online defamation lawsuits. No clear-cut guidelines existed for ISPs to avoid liability for defamation. Congress quickly responded. On 8 February 1996, Congress passed the Communications Decency Act of 1996 (CDA) to address these issues and others. Section 230 of the act, intending to promote unfettered free speech on the Internet and encourage self-regulation by ISPs, placed liability for obscene and defaming statements solely on the original authors. The intent of Section 230 was to allow ISPs to exert control without incurring liability so that speech not protected by the First Amendment could be filtered out.