Universal Communication v. Lycos

Citation: Universal Comm. Sys. v. Lycos, Inc., 478 F.3d 413 (1st Cir. 2007).

Factual Background
Plaintiffs, Universal Communication Systems, Inc. and its chief executive officer (collectively, “UCS”) brought suit for a series of allegedly false and defamatory postings made under pseudonymous screen names on an Internet message board operated by Lycos. Lycos operates a network of websites devoted to a wide array of content, including RagingBull.com, which hosts financially-oriented message boards, including ones designed to allow users to post comments about publicly-traded companies. Starting in at least 2003, a number of postings disparaging the “financial condition, business prospects and management integrity” of UCS appeared on Raging Bull’s message board.

District Court Proceedings
The district court dismissed the complaint. The court concluded that Lycos, as a facilitator of the speech of others on the Internet, was immune from liability under Section 230 of the Communications Decency Act (CDA). In addition, the district court held that the claim for cyberstalking under 47 U.S.C. §233 would be dismissed for failure to state a claim, because that statute does not provide a private right of action.

Appellate Court Proceedings
The appelliate court affirmed. More specifically, the court found that Lycos’s conduct in operating the Raging Bull website fit perfectly within the immunity intended by Congress. In addition, the court found no merit in UCS’s suggestion that Lycos might not be a provider of an interactive computer service and therefore not entitled to Section 230 immunity.

UCS also argued that Lycos might not be such a provider because it “does not provide user access to the internet.” However, the court found that providing access to the Internet is not the only way to be an interactive computer service provider. UCS also claimed that Lycos was “manifestly aware of the illegal nature of the subscriber postings” and had involved itself with its subscribers’ conduct/activities and/or rendered culpable assistance to its registered subscribers to the Lycos Network, through the construction and operation of its website. However, the court found that at best, UCS’s allegations established that Lycos’s conduct may have made it a little easier for others to develop and disseminate misinformation but that is not enough to overcome Section 230 immunity.