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Bizarre Decision Keeps Hope Alive In Enigma Software's Defamation Suit Against BleepingComputer

from the 'viewed-in-the-light-most-favorable-to-ignoring-tons-of-precedent...' dept

Enigma Software joined the long line of aggrieved companies who feel that legal threats and questionable lawsuits are the best form of reputation management. It sued BleepingComputer over a "defamatory review" -- which was actually just a forum post by a member that detailed (with supporting links) its questionable SpyHunter software and its "rogue tactics" over the years.

In addition to the defamation claims, Enigma Software also argued that BleepingComputer only did this to steer site readers towards its own products, alleging a handful of Lanham Act violations.

Unfortunately, Enigma Software's dubious claims have survived a motion to dismiss by BleepingComputer, thanks to some similarly dubious reasoning [PDF] by the judge presiding over the case. Not only are the Lanham Act claims given far too much credence (thanks to some twisted judicial analysis that assumes that because trademark is a part of the Lanham Act, false advertising claims under the Lanham Act are also intellectual property claims, exempt from Section 230 of the CDA), but the court's decision to allow the lawsuit to process also punches a few more holes in Section 230 protections.

Because the author of the post was a third-party contributor, BleepingComputer should not have been held responsible for the content of the post. However, the court appears to be bothered that the user in question was referred to as a "staff member" by BleepingComputer, even if it was actually a volunteer administrative post and BleepingComputer did not directly control the content of the user's contributions.

Eric Goldman, in his analysis of the decision, points out that BleepingComputer could have done a better job delineating between actual site administrators and those just helping out, along with providing more comprehensive disclaimers about "superusers" and their contributions to the site.

So what did Bleeping do wrong? In retrospect, calling super-users “staff members” is probably not the best titling. At least to this judge, “staff” sounds too much like “employee.” The court also says that site disclosures saying super-users could be “trusted to give correct…answers” meant that Bleeping communicated that these super-users were authorized to post on its behalf. I don’t see that interpretation of the disclosure at all, but it’s also easy to imagine rewording Bleeping’s disclosures to downgrade the risks. For example, Bleeping could make disclosures that super-users had been selected because of their consistently reliable advice, but they remain independent and fallible.

That being said, the court's decision does more damage to Section 230 protections by holding websites responsible for the content of certain third-party posts. This determination may be only temporary and fall apart as the lawsuit proceeds, but it still gives those filing questionable lawsuits a glimmer of hope that their dubious claims might survive to fight another day. If nothing else, the assertions made by the court will keep the lawyers fed.

Still, I’m irritated by the court’s glossy handling of the Section 230 super-user precedent. I’m also frustrated by the court’s insensitivity to how this ruling undermines Section 230. It green-lights plaintiffs to allege that a user was the site’s implied agent to survive a Section 230 motion to dismiss, even if those allegations fail later in the case. Everyone loses (except the lawyers, of course) when unmeritorious cases get past a Section 230 motion to dismiss.

Other issues present themselves as well in this decision. The statute of limitations of defamation (one year) gets an extension, thanks to the court considering certain links to older posts as "republication," flying in the face of several other decisions on the same topic. (It actually doesn't say quite as much, but refuses to "resolve the issue" at this point.)

And, on the subject of linking to content to support claims made in an allegedly defamatory post, the court seems to find that something done to deter claims of defamation is actually just the creation of a defamatory echo chamber.

The court says this conclusion is reinforced by Bleeping’s and Quietman7’s self-laudatory statements about their credibility and expertise. Thus, the court distinguishes the recent trend of judges presuming that readers don’t take online comments seriously (a trend partially attributable to the NY Sandals case). Also, “[t]he manner of Quietman7’s written presentation—one using footnotes and citations—conveyed further that his advice was based on an ‘investigation’ of verifiable facts.” (Contrast the cases holding that linking to source materials can reduce defamation liability). The court disregards Quietman7’s qualifier statements “[m]y personal recommendation” and “[i]n my opinion.”

One of the most infuriating assertions made in this decision is that Enigma Software is still, somehow, a private entity that only needs to make the most minimal of damage assertions to continue pursuing this lawsuit.

The court rejects Bleeping’s argument that Enigma is a limited-purpose public figure (which would require Enigma to allege facts showing Bleeping had actual malice) because Enigma’s complaint “does not allege any facts suggesting that ESG has taken a public position on the integrity of its business practices or the quality of its products.” FFS. While focusing on the complaint’s four corners is technically permissible under the legal standards for a motion to dismiss, the judge is allowed to take judicial notice of public statements where Enigma–LIKE EVERY OTHER BUSINESS IN THE UNIVERSE SINCE THE BEGINNING OF TIME–says it does a great job.

While this is not a decision in favor of one party or another, the judge's determinations make it clear that BleepingComputer will be paying a whole lot more in legal fees before this lawsuit (hopefully) is resolved in its favor. Enigma's claims -- not including the severely-stretched "unfair competition" assertions -- were so threadbare as to be almost nonexistent. Its defamation accusations included words not actually used in the post and some complete rewriting of certain post sentences in order to shore up its bogus claims.

Goldman's very thorough assessment of the decision does find that BleepingComputer could have done a few things in a smarter way to avoid potential Section 230 entanglements, but his overall take is that a decent anti-SLAPP law would have gone a long way towards making this lawsuit disappear before dragging the defendants into expensive discovery proceedings. While he grants that motions to dismiss are viewed in the light most favorable to the non-moving party (Enigma Software), the court here has gone out of its way to keep a highly-questionable defamation lawsuit alive -- and has done damage to Section 230 protections in doing so.

Filed Under: anti-slapp, cda 230, criticism, forums, lanham act, reviews, section 230, spyhunter
Companies: bleepingcomputer, enigma software


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  • icon
    orbitalinsertion (profile), 3 Aug 2016 @ 3:27pm

    I suppose, in retrospect, Bleeping computer could have labeled their volunteer moderators differently, but really this is one of those things asking people to engage in speculation about what consequences might evolve from rather inconsequential things.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 3 Aug 2016 @ 6:48pm

    Load enigma "software" on the computer in the judges chambers, case dismissed. Personally I use Malwarebytes Pro.

    reply to this | link to this | view in chronology ]

  • icon
    Whatever (profile), 3 Aug 2016 @ 11:07pm

    The court got it right, it's not troubling at all

    I don't find this one troubling at all, rather I find it refreshing that the court didn't pull the section 230 covers even wider to protect people who represent the website in any form.

    A moderator, editor, or curator who is selected by the company to represent them does just that. Making comments and claims which are defamatory while working in that position (paid or unpaid, the prestige is pay enough for many) is speaking as part of the company / website, and not as an individual.

    So the case may or may not have merit, but section 230 isn't (and shouldn't) protect bleeping computer in this case.

    reply to this | link to this | view in chronology ]

    • identicon
      Wendy Cockcroft, 5 Aug 2016 @ 2:28am

      Re: The court got it right, it's not troubling at all

      What about those times you take a pop at people here in the comments? Does that apply?

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 24 May 2017 @ 6:17am

      Re: The court got it right, it's not troubling at all

      This is ridiculous. The idea that moderators represent the site rather than their own personal opinions is absurd because moderators can disagree with each other. Each moderators comments have a different source, reasoning and justification witch is NOT the website or its owners.

      reply to this | link to this | view in chronology ]

  • identicon
    Ray Gordon, 4 Aug 2016 @ 3:12pm

    The lawyers leave out the part where they profit from all these lawsuits, plus where even they rely on 230 to link to known defamation, something that is not sustainable.

    Section 230 chills speech because it makes knee-jerk linking to defamation a conversation-killer over which no one can be sued. There are other ways to defeat 230 but this is one of them. Another is that a human who hides behind 230 has likely defamed in environments where 230 doesn't apply, or is likely to and should be enjoined.

    reply to this | link to this | view in chronology ]

  • identicon
    chris, 3 Nov 2016 @ 1:34pm

    Bleeping vs Enigma

    When bleeping computer advise users on how to remove a virus or malware, they give advice that works. I have never had to purchase a product recommended by bleeping in order to clean my PC's. However, if I want extra protection from future malware or viruses, then I have the option of paying for that peave of mind, and as Bleeping has already advised me correctly, I have every reason to believe in the product.
    Enigma's spyhunter has been notorious for as many years back as I got involved with the internet, and even before hearing about Bleeping computer, I had the unfortunate luck of stumbling across spyhunter, much to my regret and several lost hours trying to get my PC back to the way it was before I downloaded Spyhunter.
    I think it's common knowledge within or without bleeping computer, that spyhunter is a curse.
    The judge however seems to be right in not dismissing the case, but I don't think that is anything to worry about, more a matter of course. Did quiet man act on behalf of Bleeping or not? It seems so, by virtue of being called an Admin, because paid or unpaid the term 'admin' gives the user the idea he is connected with the management, paid or unpaid. But, the question is...are his comments slander? We all know the truth but how will a court see it, that remains to be seen. Common sense should prevail but we all know how out of touch Judges can be. Best of luck to Bleeping Computer, you have been a trusted friend to your users for many years and deserve to win. On the other hand the sooner software such as Enigma's is wiped off the face of the earth, the better for all of us. Let's hope Bleeping wins it's counter claim to such a high tune that Enigma has to fold.

    reply to this | link to this | view in chronology ]


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