§ 230 Preempts Texas Mandates on Social Media Platforms, Fifth Circuit Holds by 2-1 Vote

An excerpt from the long opinion in Computer & Comm. Industry Ass’n v. Paxton, decided Friday by Fifth Circuit Judges Dana Douglas and Patrick Higginbotham:

[1.] [Texas] H.B. 18 … imposes requirements on DSPs [Digital Service Providers]…. With the exception of its age-verification requirement, H.B. 18 applies only to DSPs whose digital service “connects users in a manner that allows users to socially interact with other users on the digital service,” “allows a user to create a public or semi-public profile for purposes of signing into and using the digital service,” and “allows a user to create or post content that can be viewed by other users of the digital service,” including via a message board, chat room, or other “landing page, video channel, or main feed that presents to a user content created and posted by other users.”

{H.B. 18 exempts from its coverage state and local government websites, financial institutions, medical websites, small businesses, higher education websites, employee management software, school education software, and e-mail and direct messaging services that provide only those services. H.B. 18 also exempts digital services that “primarily function[ ] to provide a user with access to news, sports, commerce, or content primarily generated or selected by the [DSP]” and provide only incidental social functions.}

H.B. 18’s monitoring and filtering requirement mandates covered DSPs to develop and implement a strategy to prevent known minors’ exposure to “harmful material” and other content “that promotes, glorifies, or facilitates” “suicide, self-harm, or eating disorders”; “substance abuse”; “stalking, bullying, or harassment”; and “grooming, trafficking, child pornography, or other sexual exploitation or abuse.” “Harmful material” is defined with reference to its definition in the Texas Penal Code [to refer to obscene-as-to-minors sexually themed material]….

[2.] Consistent with other courts of appeal, we have interpreted Section 230 to provide DSPs with “broad immunity” from “all claims stemming from their publication of information created by third parties.” … Building on Doe v. MySpace, Inc. (5th Cir. 2018), where we had previously held that Section 230 “shielded MySpace from negligence liability for publishing communications between a minor and an adult who later sexually assaulted her,” in Free Speech Coalition, Inc. v. Paxton (5th Cir. 2024), we held that an age-verification requirement for pornographic websites was different, and not preempted, because it did not pertain to “immuniz[ing] web service providers from harm caused by unremoved speech on their website,” which is “the point of Section 230.”

We distinguished between liability “reliant on the harm done by third-party content,” which is preempted by Section 230, and “liability purely based on whether plaintiffs comply with the statute,” which is not. “[T]he nature of Section 230’s protections,” we observed, is “to protect a provider from speaker-liability stemming from the speech it hosts.” …

[T]he monitoring and filtering requirement requires covered DSPs to “implement a strategy” to prevent known minors’ exposure to “harmful material”—that is, material obscene to minors as it is defined by Texas law—and other content “that promotes, glorifies, or facilitates” “suicide, self-harm, or eating disorders”; “substance abuse”; “stalking, bullying, or harassment”; and “grooming, trafficking, child pornography, or other sexual exploitation or abuse.” It provides for enforcement for “violation[s]” by the Consumer Protection Division of the Attorney General’s Office or by actions for a declaratory judgment or an injunction brought by the parent of a “known minor affected by” a violation.

Actions to enforce the monitoring and filtering requirement are claims stemming from DSPs’ actions as publishers, that is, from their monitoring, screening, and deletion of content, and are thus squarely preempted by Section 230. Although H.B. 18’s monitoring and filtering requirement is framed as a matter of affirmative obligations rather than direct penalties for published content, this is not conclusive under our precedent.

“[I]f the claim seeks to hold the defendant liable for ‘deciding whether to publish, withdraw, postpone, or alter content[,]’ the claim treats the defendant as a publisher or speaker and is barred by section 230.” The requirement would hold DSPs liable for their failure to adhere to state-set publication standards, not only “treat[ing] [them] as … publisher[s] or speaker[s],” but treating them as publishers subject to sweeping state controls. Enforcement is triggered by failures to adequately filter according to a complex array of prescribed practices, as ascertained by the Texas Attorney General’s Office and by the parents of minors “affected”—in other words, harmed—by these failures. The monitoring and filtering requirement thus imposes a “duty” that “‘would necessarily require an internet company to monitor[, alter, or remove] third-party content.'”

As we observed in Free Speech Coalition, “publishers do not filter audiences; they filter content.” Unlike the age-verification requirement we addressed in that case, H.B. 18’s monitoring and filtering requirement is all about filtering content, and is thus preempted….

[3.] The Attorney General contends that the Supreme Court’s recent recognition of the DSPs’ own free speech interest in curating the content they display in Moody v. NetChoice, LLC (2024) means that Section 230’s broadly-interpreted rule against “treat[ing]” the DSPs “as the publisher or speaker of any information provided by another information content provider” does not apply to claims that simply seek to hold social media platforms liable for their own speech, such as the methods they use to curate content.

We hesitate to read Moody to render Section 230 so easily avoidable, as if speech could not be both protected by the First Amendment and subject to preemption on the grounds that the speaker may not be treated as a publisher. Such a narrow view of Section 230 preemption would conflict with the statute’s purpose “to maintain the robust nature of Internet communication and, accordingly, to keep government interference in the medium to a minimum.” It would also conflict with the text of § 230(c)(1), which, in spite of its often-discussed connection with specific instigating judicial decisions, “cannot be ignored”: “Congress grabbed a bazooka to swat [a] fly.”

Given that “First Amendment values … drive the CDA,” it should be no surprise if the two protections overlap. As we recognized in MySpace, drawing on the Fourth Circuit’s influential Zeran decision, “[digital] service providers … subject to liability only for the publication of information, and not for its removal … would have a natural incentive simply to remove messages upon notification [of a possible harm,] whether the contents were [actually harmful] or not.” This would have an obvious “chilling effect on the freedom of Internet speech,” implicating basic First Amendment freedoms as well as Section 230’s more specific protections for internet speech.

Viewing our Section 230 precedent together with Moody, the First Amendment protects the DSPs’ editorial discretion from unconstitutional government regulation, and Section 230 protects those same decisions from civil liability based on third-party content. The argument that we must choose between them presents a false choice….

Because we hold that the monitoring and filtering requirement is preempted by Section 230 of the CDA, we do not reach the constitutional issues presented here.

Judge James Ho dissented as to that analysis:

[1.] Section 230 is triggered only when a provider is treated as the “publisher” or “speaker” of content provided by “another” information content provider. So it does not apply when a provider is held liable for its own content—including its curation of third-party content….

[C]uration of third-party content is fundamentally different from publication of third-party content. A digital service provider may choose to publish content created by third parties. But the providers engage in their own speech when they curate that content. The Supreme Court has so held. See Moody v. NetChoice (2024)….

[To quote Doe ex rel. Roe v. Snap, Inc. (2024) (Thomas, J., dissenting from denial of certiorari),] when “platforms organize users’ content into newsfeeds or other compilations,” they claim that they are “engage[d] in constitutionally protected speech.” Yet “[w]hen it comes time for platforms to be held accountable for their websites, however, they argue the opposite.” “In the platforms’ world, they are fully responsible for their websites when it results in constitutional protections, but the moment that responsibility could lead to liability, they can disclaim any obligations and enjoy greater protections from suit than nearly any other industry.” …

Consistent with Justice Thomas’s observations, … we concluded that “section 230 does not provide a general immunity against all claims derived from third-party content.” To the contrary, “providers of interactive computer services may be held liable for speech or conduct that is properly attributable to them, even if third-party speech exists somewhere upstream.” …

[2.] The Securing Children Online through Parental Empowerment Act (SCOPE Act) … protects children from the dangers of social media. It does so by requiring digital service providers to implement [reasonable steps] to prevent children from being exposed to “harmful material”—namely, content that promotes suicide, self-harm, eating disorders, substance abuse, stalking, bullying, harassment, grooming, trafficking, child pornography, and other sexual exploitation or abuse…. And if a platform fails to take such steps, parents may seek declaratory or injunctive relief against the provider….

[T]he Act simply imposes a duty on social media companies to meet certain standards for curation—that is, for their own speech. It imposes no penalty based on the publication of third-party speech.

So if third-party content leads to harm to children, the SCOPE Act does not hold social media companies liable, so long as they have met its standards for curation…. [T]he SCOPE Act considers the curation decisions made by social media companies—not the harm caused by the third-party content itself….

[3.] As for the First Amendment challenge to the SCOPE Act not reached by the panel majority: “States have a profound interest in protecting the innocence of children,” and “[n]othing in the First Amendment prevents states from taking steps to shield children” from harmful content. I would have simply certified the questions regarding the proper interpretation of the SCOPE Act to allow the Supreme Court of Texas to clarify the meaning of state law….

Steven Paul Lehotsky, Jeremy Evan Maltz, and Joshua Paul Morrow (Lehotsky Cohn, L.L.P.) represent CCIA and NetChoice.