The US Court of Appeals for the Ninth Circuit has recently ruled that Section 230 of the Communications Decency Act (“CDA”) defends Yelp from liability concerning an allegedly defamatory user generated review.

Under US law, Section 230 of the CDA sets out the key "Safe Harbor" principle that provides online services with immunity from liability concerning the actions of their users, with certain exceptions.

In the current case, the plaintiff sued the user-generated business reviews platform Yelp after a thirdparty posted a negative review regarding the plaintiff's business on Yelp's website. The plaintiff attempted to rely on an exception which states that the CDA does not defend parties who are an “information content provider”. The plaintiff alleged that Yelp made the user’s post its own based on several actions (see in this regard, the previous U.S. Ninth Circuit precedent in Fair Housing Council of San Fernando Valley v. Roommates.Com, LLC in which it was decided that if the defendant is responsible for the creation or development of the offending content, then it will not be protected under the CDA.

In its ruling, the US Ninth Circuit panel rejected the plaintiff's interpretation of the CDA for the following reasons: (i) the Court did not accept the plaintiff’s allegation that Yelp discovered the relevant review on another website and appropriated it for its own website; (ii) with regard to Yelp’s five-star rating system, the Court determined that it cannot expose the company to liability since Yelp’s five-star rating system is a “neutral tool” that aggregates individual users’ input, and Yelp’s involvement in merely creating the five-star rating does not strengthen the defamatory aspects of the user’s post; and (iii) the Court rejected the plaintiff’s claim that Yelp lost its CDA immunity by republishing its user’s review on third-party platforms.

Although previous rulings (as reported in our related client update) demonstrate the reluctance of courts to uphold the CDA Safe Harbor principle in various circumstances, thereby requiring the service provider to adopt a more proactive approach with respect to user behavior and content, this recent case reflects the complexity associated with the proper interpretation and level of monitoring and scrutiny expected from online UGC providers.