> If Social Media Co. were liable for defamatory, fraudulent, harassing, and pornographic posts on Social Media Net(tm), then Social Media Co's incentives would be to minimize the quantity of such content and to be careful to design algorithmic recommendations to steer people away from such posts if they slip through.

The big websites like Facebook and YouTube would be able to eat the costs of compliance measures and lawsuits. But smaller sites that host user-generated content in the form of social media posts, videos, or even just comments will be incentivized to stop moderating or stop hosting user-generated content.

Penalizing websites for distributing unprotected speech would violate the First Amendment by default. Strict scrutiny [1] requires the least restrictive means of combatting law violations which affect (not necessarily target) speech.

> In U.S. constitutional law, when a law infringes upon a fundamental constitutional right, the court may apply the strict scrutiny standard. Strict scrutiny holds the challenged law as presumptively invalid unless the government can demonstrate that the law or regulation is necessary to achieve a "compelling state interest". The government must also demonstrate that the law is "narrowly tailored" to achieve that compelling purpose, and that it uses the "least restrictive means" to achieve that purpose. Failure to meet this standard will result in striking the law as unconstitutional.

[1] https://en.wikipedia.org/wiki/Strict_scrutiny

Allowing lawsuits against only the originators of the unprotected speech, would be the least restrictive means of reducing unprotected speech, and allowing lawsuits against a website over a particular instance of unprotected speech would violate strict scrutiny in most cases.

But in the US, you can sue for anything if you have the money. What if lawsuit claims that the website managers knowingly and deliberately helped spread specific instances of unprotected speech? Or what if the people who sue present a lawsuit over unprotected speech as not about speech but about something else, like child safety or consumer protection? Or what if the lawsuit is about typically protected speech (such as porn or verbal harrassment) but a statute would impose liability for harms supposedly caused by the speech? Then the court would make the website go through the entire judicial process to resolve respectively 1. whether the people managing the website had knowledge of the specific speech, 2. whether the lawsuit is really about speech, or 3. whether the statute is constitutional.

So how would a small social media website prevent itself from being bankrupted by a flood of the 1st kind of lawsuit? "The website managers know that there must be harmful speech on the website somewhere" is not enough to establish liability. There has to be at least "The website knew about these specific posts." So the website would stop moderating (i.e. avoid examining social media posts to avoid knowing about specific speech) or would stop hosting user-generated content. The former result is what the writers of Section 230 wanted to avoid [2]:

> In the early 1990s, the Internet became more widely adopted and created means for users to engage in forums and other user-generated content. While this helped to expand the use of the Internet, it also resulted in a number of legal cases putting service providers at fault for the content generated by its users. This concern was raised by legal challenges against CompuServe and Prodigy, which were early service providers at that time.[19] CompuServe stated it would not attempt to regulate what users posted on its services, while Prodigy had employed a team of moderators to validate content. Both companies faced legal challenges related to content posted by their users. In Cubby, Inc. v. CompuServe Inc., CompuServe was found not to be at fault as, by its stance as allowing all content to go unmoderated, it was a distributor and thus not liable for libelous content posted by users. However, in Stratton Oakmont, Inc. v. Prodigy Services Co., the court concluded that because Prodigy had taken an editorial role with regard to customer content, it was a publisher and was legally responsible for libel committed by its customers.[20][b]

> Service providers made their Congresspersons aware of these cases, believing that if followed by other courts across the nation, the cases would stifle the growth of the Internet.[21] United States Representative Christopher Cox (R-CA) had read an article about the two cases and felt the decisions were backwards. "It struck me that if that rule was going to take hold then the internet would become the Wild West and nobody would have any incentive to keep the internet civil," Cox stated.[22]

[2] https://en.wikipedia.org/wiki/Section_230

Specific contexts such as federal crimes and copyright infringement aside, Section 230 declared an immunity against liability on distributors for third-party speech online independent of how much knowledge the distributor has about the speech. In doing so, Section 230 provided a clear rule allowing for early dismissal of lawsuits attempting to impose such liability, including but not limited to lawsuits relating to the site managers' knowledge of third-party speech. Reposting a social media post, quoting a comment, and forwarding an email are all protected by Section 230.