In Nemet Chevrolet v. Consumeraffairs.com, Inc., No. 08-2097 (4th Cir. 2009), the Fourth Circuit majority, Judges King and Agee, recently upheld the district court’s Rule 12(b)(6) dismissal of Nemet's defamation claims against Consumeraffairs.com, based on website posts relating to Nemet’s automobile services. The majority found defendant immune as an information service provider under section 230 of the Communications Decency Act (“CDA”). Nemet argued that its claims were sufficient to withstand the motion to dismiss and that Consumeraffairs.com was not entitled to immunity because it was an “information content provider” under section 230(f)(3).

Section 230 of the CDA prohibits a “provider or user of an interactive computer service” from being held responsible “as the publisher or speaker of any information provided by another information content provider.” 47 U.S.C. § 230(c)(1). However, the scope of the immunity depends on whether a person’s actions also make it an “information content provider” or “responsible … for the creation or development of information provided through the Internet,” in which case the person is not entitled to immunity. Id. at § 230(f)(3).

Nemet first argued that its general allegations that defendant participated in the preparation of the posts: (1) through the structure and design of its website, or (2) by soliciting its customers’ complaints, steering them into specific categories designed to attract consumer class action lawyers, contacting customers to ask questions about their complaints, and helping them draft or revise their complaints, were sufficient to show that Consumeraffairs.com was responsible, in part, for the creation or development of the information in the posts. Nemet’s argument was based on Fair Housing Council v. Roommates.com, LLC, 521 F.3d 1157 (9th Cir. 2008), in which the Ninth Circuit held a website operator liable as an information content provider for the discriminatory postings created by third parties because it had designed the website to develop unlawful content as a condition precedent of use.

However, the Fourth Circuit disagreed with Nemet, finding Roommates.com distinguishable because the website there required users to input illegal content, whereas Nemet merely alleged that Consumeraffairs.com structured its website and business operations to develop purely lawful information related to class-action lawsuits. Also, because Nemet failed to make any cognizable argument as to how a website operater who contacted a user “developed” or “created” the website content, the court found the allegations both threadbare and conclusory.

Nemet also argued that Consumeraffairs.com had fabricated eight of the posts because it could not confirm that the posts were created by a Nemet customer, based on the date, model of car, and first name. However, the majority found that the sole basis for these claims was that Nemet could not find the customer in its records based on the information in the post. Thus, viewed in their best light, Nemet’s allegations allowed inference of no more than “the mere possibility” that defendant was responsible for the creation of the posts, and it was entitled to immunity under the CDA.

Judge Jones concurred with respect to the insufficiency of the allegations based on the website structure and design, but dissented with regard to the eight fabricated posts, because Nemet had alleged that each of those posts gave the name and hometown of the putative customer as well as the make and model of the vehicle sold by Nemet. Thus, Judge Jones believed Nemet’s allegations, along with other factual allegations concerning Consumeraffairs.com’s derogatory statements about Nemet in connection with the posts, were sufficient to create a reasonable inference that Consumeraffairs.com wrote the eight posts to attract additional complaints, and should withstand the motion to dismiss.

Click here for this Fourth Circuit opinion.