This year has been difficult for every individual and company in the country. During a global pandemic, which has caused widespread economic damage and uncertainty, startups are struggling—struggling to find funding, struggling to navigate existing government relief programs, and struggling to maintain jobs and operations (let alone sustain growth). And across the country, people are looking to Washington for support and guidance.
But instead of addressing those real and urgent problems, some senators are positioning to rush a facially counter-productive bill through the Senate Judiciary Committee. The Online Content Policy Modernization Act (“OCPMA”), which was introduced on Tuesday, would make it easier to sue startups out of existence and open doors to abusive copyright claims against everyday Internet users. While it should go without saying, these outcomes are the opposite of what the country and our startup ecosystem need right now.
Making it more expensive for Internet platforms to moderate harmful content created by users
The bill includes a measure introduced by a handful of Senate Republicans earlier this month that would make it incredibly risky for startups to do much of the content moderation they currently do to make sure their platforms are safe and relevant online spaces for their users. While it’s unlikely the bill would change the kinds of user-generated content online platforms can technically moderate under the law, it would expose them to lawsuits over content they remove—outside of a limited set of exceptions—and it would open them up to lawsuits over any user content the platform editorializes or modifies, likely including Twitter’s decision earlier this year to fact-check the President’s tweets containing misinformation about mail voting fraud.
Currently, Section 230 ensures that platforms aren’t held legally liable for content created by their users, regardless of whether or how they moderate their content. This law is crucial for small- and medium-sized companies that might have a lot of users and host a lot of content without having a lot of time and money to invest in expensive and inherently imperfect content moderation or large pools of legal resources to defend against lawsuits over user content. And the liability limitations in the law extend far beyond the biggest social media companies to websites with comment sections, photo sharing services, online marketplaces, and more.
Even with Section 230 as it currently stands, a company can spend tens of thousands of dollars just getting a meritless lawsuit over user content dismissed at the earliest stages. That’s already a really high price tag for companies hosting user-generated content. Amending Section 230 as envisioned by OCPMA would make it harder to get those lawsuits dismissed early on, and would just make those costs shoot into the range of hundreds of thousands of dollars.
The bill mirrors several recent criticisms of Section 230 from Republican policymakers, namely that Internet platforms are allegedly unfairly removing content that promotes certain political viewpoints. In addition to being based on claims of “anti-conservative bias” that lack any factual evidence, the bill doesn’t actually change the kind of content hosting and moderation policies that would be required under the law. Internet platforms have their own First Amendment rights to host and moderate speech as they see fit as private companies, and they almost always spell out their acceptable use policies in terms of service users must agree to before using the site. Instead of changing what platforms can and can’t do (which would have it’s own legal and practical problems), this new bill threatens to use expensive private lawsuits as a way to intimidate Internet platforms into leaving up speech that platforms might otherwise want to take down. It replaces the current Section 230 framework—which effectively immunizes platforms that make good faith efforts to remove content they deem objectionable—with one that would open up platforms to lawsuits when they remove content unless the platform has “objectively reasonable belief” that the content is obscene, lewd, lascivious, filthy, excessively violent, harassing, or unlawful, or that the content promotes self-harm or terrorism.
That list does not encompass all Internet ills, let alone the kinds of content a platform may want to moderate. For instance, political and public health misinformation are pretty glaring omissions, as is any kind of hate speech. Internet platforms have a vested interest in making their corner of the Internet a place users want to be. Forcing platforms to choose between allowing hate speech and harmful misinformation, or opening themselves up to lawsuits—which will likely be unsuccessful but still costs potentially hundreds of thousands of dollars to defend against—only harms Internet users and makes it impossible for small and new companies to compete. And the bill would be especially problematic for small and new platforms that host specific kinds of content and cater to niche communities, where the inability to remove irrelevant content would severely impact the usefulness of the platforms for their users.
Increasing opportunities for abusive copyright litigation against everyday Internet users
The other component of the bill would set up an extra-judicial process for adjudicating copyright infringement claims—a process which unfortunately lacks basic safeguards against abuse and would allow the government to impose damages of up to $30,000 on everyday Internet users and small creators. While the general idea of a small-claims copyright process is well-intentioned, the specifics of the pending bill are problematic. Engine, smaller tech companies, the ACLU, and many others have articulated their concerns with a similar bill, the CASE Act, that was previously introduced.
Currently, copyright infringement cases can only be filed in court, but OCPMA would establish a board within the U.S. Copyright Office to hear “small-claim” copyright cases. However, the bill lacks fundamental protections against abuse—the sort of protections that are expected under the Constitution and available in court as a matter of course. For example, it severely restricts an accused infringer’s access to appeal (an essential feature of due process), and limits access to discovery and attorneys. This tips the scales in favor of certain copyright owners, making it easier to obtain default judgements against ordinary people with no experience in copyright law or the court system. Compounding these problems is that $30,000 per case is a lot of money to most Americans, and substantially more than basically every state’s small claims court system. Such high damages play into the hands of abusive litigants seeking to coerce high settlements in frivolous cases.
Why it matters
OCPMA purports to legislate in very important areas—areas that deserve serious attention and scrutiny. Importantly, the Senate has never held a hearing on this bill or either of the previously-introduced bills it is based on. Moreover, the proposed changes to Section 230 should be under the jurisdiction of the Senate Commerce Committee, which is in the middle of its own discussions on the issue. OCPMA was introduced this week and immediately put on the Senate Judiciary Committee’s calendar for consideration. Lawmakers have not been able to hear from diverse stakeholders about the bill’s problems or proposed solutions to craft appropriately-tailored legislation in these areas.
Moreover, at this time when startups are struggling, OCPMA would open them up to more frivolous litigation. Instead of allowing companies to focus on survival and being well-positioned to grow and hire after the pandemic, passing OCPMA would mean existing companies have to divert more attention to defending litigation and would make it even harder for new startups to launch. Likewise, Americans are suffering economically, making this an especially bad time to make it easier for copyright trolls to file abusive copyright cases and put everyday Internet users at risk of coercion or steep damages.
What startups really need right now is for the Senate to seriously focus on COVID relief and economic recovery. OCPMA is, at best, a distraction from those efforts. But because it would increase costs and risks on startups and the users and creators who rely on them, OCPMA is even more harmful right now. Instead of hastily pursuing OCPMA, we hope the Senate will scrutinize the bill and make essential improvements. And we hope that the Senate will also focus on COVID relief measures that support startups and other small businesses, so that they can survive the pandemic and be positioned to grow, create jobs, and lead our economic recovery.
