Opinion ID: 4036586
Heading Depth: 1
Heading Rank: 3

Heading: LeadClickʹs

Text: L s Liability y
A FTC Act A Liabillity
ble Law Sectio on 5 of thee FTC Act ʺempowerr[s] and dirrect[s]ʺ thee FTC to nt persons,, partnersh ʺpreven hips, or corrporationss . . . from u using . . . u unfair or deceptiv ve acts or practices iin or affectting comm merce,ʺ and d declares u unlawful ʺunfair or deceptiive acts or practices iin or affectting comm merce.ʺ 15 U.S.C. § ‐ 19 ‐ 45(a)(1) and (a)(2).4 The FTC Act is drafted broadly to include not only traditional anti‐trust violations but also ʺpractices that the Commission determines are against public policy for other reasons.ʺ FTC v. Indiana Fedʹn of Dentists, 476 U.S. 447, 454 (1986). ʺIt is important to note the generality of [this] standard[] of illegality; the proscriptions in [Section] 5 are flexible, ʹto be defined with particularity by the myriad of cases from the field of business.ʹʺ FTC v. Colgate‐Palmolive Co., 380 U.S. 374, 384‐85 (1965) (quoting FTC v. Motion Picture Advert. Serv. Co., 344 U.S. 392, 394 (1953)). The FTC and the State allege that LeadClick is liable under Section 5 because it engaged in a deceptive act or practice.5 ʺTo prove a deceptive act or practice under § 5(a)(1), the FTC must show three elements: ʹ[1] a representation, 4 CUTPA provides that ʺ[n]o person shall engage in unfair methods of competition and unfair or deceptive acts or practice in the conduct of any trade or commerce.ʺ C.G.S.A. § 42‐110b(a). The statute is interpreted consistently with the federal statute. Id. 42‐110b(b) (ʺIt is the intent of the legislature that in construing subsection (a) of this section, the commissioner and the courts of this state shall be guided by interpretations given by the Federal Trade Commission and the federal courts to Section 5(a)(1) of the [FTC] Act.ʺ); 42‐110(c) (noting that regulations may be established provided ʺ[s]uch regulations shall not be inconsistent with the rules, regulations and decisions of the federal trade commission [sic] and the federal courts in interpreting the provisions of the [FTC] Act.ʺ). Accordingly, although we discuss only the alleged violation of the FTC Act below, the analysis applies with equal force to the alleged CUTPA violation. The FTC and State of Connecticut do not assert that that LeadClick engaged in 5 an unfair trade practice. ‐ 20 ‐ omission, or practice, that [2] is likely to mislead consumers acting reasonably under the circumstances, and [3], the representation, omission, or practice is material.ʺ FTC v. Verity Intʹl, Ltd., 443 F.3d 48, 63 (2d Cir. 2006) (quoting In re Cliffdale Assocs., Inc., 103 F.T.C. 110, 165 (1984)). ʺThe deception need not be made with intent to deceive; it is enough that the representations or practices were likely to mislead consumers acting reasonably.ʺ Id. The deceptive acts or practices must be ʺlikely to cause substantial injury to consumers which is not reasonably avoidable by consumers themselves and not outweighed by countervailing benefits to consumers or to competition.ʺ 15 U.S.C. § 45(n). LeadClick argues that a defendant may be held liable under Section 5(a) for deceptive acts or practices only when a defendant creates the deceptive content or when that content is attributable to the defendant. According to LeadClick, because it did not create the deceptive content appearing on the false news sites, nor was that content attributable to it, it cannot be held liable under the FTC Act. As discussed below, we disagree that the FTC Act requires that a defendant create deceptive content to be liable. Instead, we hold that under the FTC Act, a defendant may be held liable for engaging in deceptive practices or ‐ 21 ‐ acts if, with knowledge of the deception, it either directly participates in a deceptive scheme or has the authority to control the deceptive content at issue. Both the Ninth and Eleventh Circuits have recognized that a defendant may be liable for deceptive content even if it was not solely responsible for a deceptive scheme. In FTC v. Neovi, Inc., the Ninth Circuit held a check processing company liable under the FTC Act for creating and delivering fraudulent checks drawn by its customers without proper verification, where the company had ʺreason to believe that a vast number of checks were being drawn on unauthorized accounts.ʺ 604 F.3d 1150, 1157 (9th Cir. 2010). The defendant argued that it could not be held liable, because its users, and not the defendant itself, created the deceptive checks. Id. at 1155. The Ninth Circuit rejected this argument, noting that ʺa single violation of the [FTC] Act may have more than one perpetrator,ʺ id., and ʺbusinesses can cause direct consumer harm as contemplated by the FTC Act in a variety of ways,ʺ id. at 1156. The check processing company, through its own actions, ʺengaged in a practice that facilitated and provided substantial assistance to a multitude of deceptive schemes.ʺ Id. at 1157. The Court recognized that ʺthe creation and distribution of most any good is subject to a host of sequential stepsʺ and that while ʺ[s]ome of ‐ 22 ‐ those steps involve the contribution of independent causal agents, . . . those contributions do not magically erase the role of the aggregator and distributer of the goods.ʺ Id. at 1155. Rather, because the check processing company ʺengaged in behavior that was, itself, injurious to consumers,ʺ it was liable under the FTC Act. Id. at 1157 Similarly, in FTC v. IAB Marketing Associates, LP, the Eleventh Circuit considered the likelihood that the FTC would succeed in an action against a company selling trade association memberships. 746 F.3d 1228 (11th Cir. 2014). The company hired third‐party telemarketers who misrepresented that the memberships were ʺfunctionally equivalent to major medical insurance.ʺ Id. at 1231. The Court found ʺno meritʺ in the argument that the company could not be held liable for misrepresentations ʺmade by various independent contractors it engaged to sell its products.ʺ Id. at 1232‐33. The defendants argued that they could not be held liable for the misrepresentations made by the third‐party telemarketers without ʺdirect participation in, knowledge of, and the ability to control the telemarketersʹ behavior.ʺ Id. at 1233. This test had previously been applied by the Eleventh and Seventh Circuits to determine when an individual employee may be held liable ‐ 23 ‐ for the conduct of a corporation. See FTC v. Gem Merch. Corp., 87 F.3d 466, 467‐68, 470 (11th Cir. 1996) (holding an individual liable under the FTC Act where ʺhe was aware that salespeople made material representations to consumers to induce sales, and he was in a position to control the salespeopleʹs behaviorʺ); FTC v. Amy Travel Serv., Inc., 875 F.2d 564, 573 (7th Cir. 1989) (holding individuals liable under the FTC Act for deceptive practices of a corporation where those individuals had knowledge of the deceptive practices and participated directly in those practices or had authority to control them). Without deciding whether the standard for imposing liability was as ʺdemandingʺ as to require both direct participation and authority to control, the IAB Marketing Associates court determined that the company would be liable even under the knowledge, participation, and control test, because it directly participated in the scheme with knowledge and had the ability to control the telemarketers it employed to sell its trade association memberships. IAB Mktg. Associates, 746 F.3d at 1233. While there was no evidence in the record that the defendants instructed the telemarketers to make material misrepresentations, the defendants hired the third party telemarketers to sell its products with knowledge that the telemarketers were making the misrepresentation. Id. The ‐ 24 ‐ defendants also had authority over those telemarketers, and could have, but did not, require them to cease making the misrepresentations. Id. We agree that a deceptive scheme violating the FTC Act may have more than one perpetrator. We adopt the test applied by the Eleventh Circuit in the context of an individualʹs liability for corporate deception to determine LeadClickʹs Section 5 liability under the FTC Act: A defendant may be held liable for deceptive practices that cause consumer harm if, with knowledge of the deceptive nature of the scheme, he either ʺparticipate[s] directly in the practices or acts or ha[s] authority to control them.ʺ Amy Travel Serv., 875 F.2d at 573. A defendant directly participates in deception when it engages in deceptive acts or practices that are injurious to customers with at least some knowledge of the deception. 15 U.S.C. § 45(a) and (n). Similarly, a defendant who knows of anotherʹs deceptive practices and has the authority to control those deceptive acts or practices, but allows the deception to proceed, may be held liable for engaging in a deceptive practice injurious to consumers. This is consistent with the FTCʹs longstanding policy that an omission in certain circumstances may constitute a deceptive or unfair practice. See Letter from Federal Trade Commission to Hon. John D. Dingell, Chairman of the Committee on Energy and ‐ 25 ‐ Commerce (October 14, 1983), appended to Cliffdale Assocs., 103 F.T.C. at 182 (ʺThe Commission will find an act or practice deceptive if there is a misrepresentation, omission, or other practice, that misleads the consumer acting reasonably in the circumstances, to the consumerʹs detriment.ʺ); In the Matter of Intʹl Harvester Co., 104 F.T.C. 949 (1984) (finding defendantʹs failure to warn consumers of a material risk of harm created by its product would be an unfair trade practice under Section 5). LeadClick argues that applying a test that imposes liability based on direct participation in or authority to control deceptive practices conflates principal liability with aiding and abetting liability, which is foreclosed under the FTC Act. We reject this argument. We have not previously considered whether a defendant may be held liable under the FTC Act for aiding and abetting anotherʹs deceptive acts or practices. As LeadClick notes, the FTC Act does not expressly provide for aiding and abetting liability. Cf. Central Bank of Denver, N.A. v. First Interstate Bank of Denver, N.A., 511 U.S. 164, 177 (1994) (noting that in securities fraud context that if ʺCongress intended to impose aiding and abetting liability . . . it would have used the words ʹaidʹ and ʹabetʹ in the statutory textʺ); Wright v. Ernst & Young ‐ 26 ‐ LLP, 152 F.3d 169, 175 (2d Cir. 1998) (noting where Section 10(b) liability is based on making material false representations, ʺ[a]nything short of such conduct is merely aiding and abetting, and no matter how substantial that aid may be, it is not enough to trigger liabilityʺ). We need not decide this issue, however, because we conclude that a defendant acting with knowledge of deception who either directly participates in that deception or has the authority to control the deceptive practice of another, but allows the deception to proceed, engages, through its own actions, in a deceptive act or practice that causes harm to consumers. As the Ninth Circuit noted in Neovi, Inc.: To be clear, none of this is to say that [defendant] is liable under a theory of aiding and abetting. [Defendant] engaged in behavior that was, itself, injurious to consumers. [Defendantʹs] business practices might have served to assist others in illicit or deceptive schemes, but the liability under the FTC Act that attached to [defendant] is not mediated by the actions of those third parties. [Defendant] caused harm through its own deeds ‐‐ in this case creating and delivering unverified checks ‐‐ and thus § 5 of the FTC Act easily extends to its conduct. Neovi, Inc., 604 F.3d at 1157. A defendant may be held liable for its own acts of deception under the FTC Act, whether by directly participating in deception or by allowing deceptive acts or practices to occur that are within its control. This direct liability is distinguishable from liability for merely aiding and abetting the deceptive conduct of another. ‐ 27 ‐
LeadClick does not dispute on appeal that its affiliates engaged in false and deceptive advertising practices. Instead, it argues that even assuming these statements were deceptive, such deception ʺsupport[s] only imposition of liability against the publishers who created and made the deceptive statements ‐‐ not against a wholly separate entity[, LeadClick,] that the FTC concedes did not make the challenged statements.ʺ LeadClick Br. at 33. As discussed below, we reject this argument and hold that LeadClick is directly liable for its own deceptive conduct in the eAdvertising scheme. LeadClick knew that deceptive false news sites were prevalent in its affiliate marketing network, directly participated in the deception, and had the authority to control the deceptive content of these fake news sites, but allowed the deceptive content to be used in LeanSpa advertisements on its network. Accordingly, LeadClick is liable under Section 5 of the FTC Act for engaging in deceptive acts or practices.
LeadClick knew that (1) the use of false news pages was prevalent in affiliate marketing, and (2) its own affiliate marketers were using fake news sites to market LeanSpaʹs products: ‐ 28 ‐  An eAdvertising division employee noted that in the summer of 2010, fake news sites were ʺfairly common,ʺ J. App. at 158a‐59a;  Another employee testified in his deposition that during his time at LeadClick, ʺeveryone was using ʹem,ʺ id. at 235;  LeadClick employees occasionally discussed fake article pages, fake news pages, and news style pages among themselves and with affiliates and merchant clients;  A LeadClick employee testified that he saw ʺmanyʺ false news sites from LeadClick affiliates that contained false information, J. App. at 387a, 389a; and  LeadClick was even familiar with the specific content of these sites, and employees occasionally referred to ʺstep 1 and step 2ʺ pairing typical of fake news sites, see J. App. at 157a, 746a, 800a. ii. Direct Participation in the Deceptive Practices In addition to this knowledge, LeadClick participated in the deceptive scheme through the following acts:  A LeadClick employee ʺscoutedʺ fake news websites to recruit potential affiliates for the LeanSpa account; ‐ 29 ‐  LeadClick employees required alterations to the content of its affiliatesʹ fake news pages by instructing them to revise their pages to comply with explicit directives from LeanSpa;  A LeadClick employee instructed an affiliate to check that his fake news site was not ʺcrazy [misleading]ʺ and advising him not to remove the reporter photograph, but to ʺjust add advertorial,ʺ J. App. at 230a‐31a;  LeadClick employees advised affiliates on the content to include in their pages to increase consumer traffic, see J. App. at 788a (telling an affiliate ʺ[i]t is much more realistic if you say that someone lost 10‐12 lbs[.] in 4 weeks rather than saying anything more than thatʺ); and  LeadClick purchased banner advertisement space on genuine news sites to resell that space to affiliates running fake news pages to ʺgenerat[e] quality traffic in very lucrative placements.ʺ J. App. at 714a. Considered together, this conduct clearly demonstrates LeadClickʹs direct participation in the deceptive advertising scheme. LeadClickʹs own actions ‐‐ recruiting and paying affiliates who used fake news sites for generating traffic, managing those affiliates, suggesting substantive edits to fake news ‐ 30 ‐ pages, and purchasing banner space for fake news sites on legitimate news sources ‐‐ caused significant harm to consumers. iii. LeadClickʹs Authority to Control the Deceptive Practices or Acts LeadClick was paid by LeanSpa to recruit and manage a network of affiliates who would advertise LeanSpaʹs products. As established above, LeadClick knew that some of its affiliates were using fake news sites to advertise LeanSpa products. As the manager and orchestrator of the affiliate marketing scheme, LeadClick had the authority to control the deceptive practices of affiliates that joined its network:  LeadClick had the ultimate authority to review and approve or disapprove of an affiliate using a fake news site;  LeadClick permitted affiliates using fake news sites to join its network and refer customers to LeanSpa, and it paid its affiliates with fake news sites for generating actions; and  LeadClick employees affirmatively approved the use of fake news sites by telling a potential affiliate that ʺNews Style landers are totally fine,ʺ J. App. at 761a, and explaining to a potential merchant client that ʺ[a]ll of ‐ 31 ‐ [its] traffic would be through display on fake article pages,ʺ Id. at 750a (emphasis added); As the manager of the affiliate network, LeadClick had a responsibility to ensure that the advertisements produced by its affiliate network were not deceptive or misleading. By failing to do so and allowing the use of fake news sites on its network, despite its knowledge of the deception, LeadClick engaged in a deceptive practice for which it may be held directly liable under the FTC Act. As discussed above, LeadClick is not liable here merely because it aided and abetted its affiliatesʹ deception. Rather, its liability arises from its own deceptive practices: directly participating in the deceptive scheme by recruiting, managing, and paying a network of affiliates to generate consumer traffic through the use of deceptive advertising and allowing the use of deceptive advertising where it had the authority to control the affiliates participating in its network. See Neovi, 604 F.3d at 1157 n.5 (rejecting similar argument and noting that defendantʹs ʺactions caused consumer harm; it did not merely aid or abet others who caused consumer harmʺ). Moreover, LeadClick is directly liable regardless of whether it intended to deceive consumers ‐‐ it is enough that it orchestrated a scheme that ‐ 32 ‐ was likeely to misllead reason nable conssumers. Seee Verity In ntʹl, Ltd., 4443 F.3d at 663. And thee scheme d did just tha at: the ma ajority of trraffic from m LeadClick kʹs affiliatee network k came fro generating enough trraffic to billl LeanSpaa for om fake neews sites, g approxiimately $2 22 million a and earn L LeanSpa reecognition as LeadCllickʹs ʺtop customer.ʺ J. App p. at 343a, 908a, 1016 6a. Acco ordingly, th he district court did n not err in cconcluding that LeadCliick is direcctly liable u under Secttion 5 of th he FTC Act and CUT TPA.
B Immu unity undeer the CDA A Lead dClick argu ues that, ev ven if it wo ould otherrwise be liaable underr Section 5 of the FT TC Act and d CUTPA for its parrticipation in the deceptive mune undeer Section 2230 of the CDA. Wee conclude, marketiing scheme, it is imm howeveer, that thee district co ourt correcctly held th hat LeadCllick was no ot entitled d to Section 230 immu unity.
ble Law n it was in When ntroduced, the primaary purposse of the CD DA was to o protect children frrom sexua Section 230, enacted ally expliciit internet ccontent.6 S 6 In hiss statement introducin ng the propo osed legislaation, Senattor Exon proclaim med ʺ[T]he iinformation n superhighhway shoulld not beco ome a red liight districtt. This legiislation willl keep that from happpening and extend the standards of decency y ‐ 33 ‐ through an amendment to the CDA, had a different objective: ʺ[T]o preserve the vibrant and competitive free market that presently exists for the Internet and other interactive computer services, unfettered by Federal or State regulation.ʺ 47 U.S.C. § 230(b)(2); see also Zeran v. America Online, Inc., 129 F.3d 327, 330 (4th Cir. 1997) (ʺCongress recognized the threat that tort‐based lawsuits pose to freedom of speech in the new and burgeoning Internet medium.ʺ). The amendment assuaged Congressional concern regarding the outcome of two inconsistent judicial decisions applying traditional defamation law to internet providers. 141 Cong. Rec. H8469‐70 (daily ed. Aug. 4, 1995 (statement of Rep. Cox). The first held that an interactive computer service provider could not be liable for a third partyʹs defamatory statement, Cubby, Inc. v. CompuServe, Inc., 776 F. Supp. 135, 141 (S.D.N.Y. 1991), but the second imposed liability where a service provider filtered its content in an effort to block obscene material, Stratton Oakmont, Inc. v. Prodigy Servs. Co., No. 31063/94, 1995 WL 323710, at  (N.Y. Sup. Ct. May 24, 1995). The amendment was intended to overrule Stratton and provide immunity for ʺinteractive computer service[s]ʺ that which have protected telephone users to new telecommunications devices.ʺ 141 Cong. Rec. S1953 (daily ed. Feb. 1, 1995) (statement of Sen. Exon). ‐ 34 ‐ make ʺgood faithʺ efforts to block and screen offensive content. 47 U.S.C. § 230(c). To accomplish that goal, Section 230 provides that ʺ[n]o provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.ʺ 47 U.S.C. § 230(c)(1). We have had limited opportunity to interpret Section 230. Other circuits, however, have recognized that Section 230 immunity is broad. See, e.g., Jones v. Dirty World Entmʹt Recordings LLC, 755 F.3d 398, 406‐07 (6th Cir. 2014) (ʺclose cases . . . must be resolved in favor of immunityʺ (quoting Fair Hous. Council of San Fernando Valley v. Roommates.Com, LLC, 521 F.3d 1157, 1174 (9th Cir. 2008) (en banc))); Almeida v. Amazon.com, 456 F.3d 1316, 1321 (11th Cir. 2006) (ʺThe majority of federal circuits have interpreted the CDA to establish broad federal immunity to any cause of action that would make service providers liable for information originating with a third‐party user of the service.ʺ (internal quotation marks omitted)); id. at n.3 (collecting cases). In applying the statute, courts have ʺbroken [it] down into three component parts,ʺ finding that ʺ[i]t shields conduct if the defendant (1) ʹis a provider or user of an interactive ‐ 35 ‐ computer service, (2) the claim is based on information provided by another information content provider and (3) the claim would treat [the defendant] as the publisher or speaker of that information.ʹʺ Jane Doe No. 1 v. Backpage.com, LLC, 817 F.3d 12, 19 (1st Cir. 2016) (quoting Universal Commcʹn Sys., Inc. v. Lycos, Inc., 478 F.3d 413, 418 (1st Cir. 2007)); see also Jones, 755 F.3d at 409; Zeran, 129 F.3d at 330. On appeal, LeadClick argues that it is immune under Section 230 because it meets these elements. We discuss each, in turn.
ʺThe term ʹinteractive computer serviceʹ means any information service, system, or access software provider that provides or enables computer access by multiple users to a computer server, including specifically a service or system that provides access to the Internet and such systems operated or services offered by libraries or educational institutions.ʺ 47 U.S.C. § 230(f)(2). Courts typically have held that internet service providers, website exchange systems, online message boards, and search engines fall within this definition. See, e.g., Zango, Inc. v. Kaspersky Lab, Inc., 568 F.3d 1169, 1175 (9th Cir. 2009) (concluding that malware provider who blocked plaintiffʹs software as ʺpotentially maliciousʺ was interactive computer service provider because it ‐ 36 ‐ provided service to consumers by screening for malicious content); Chicago Lawyersʹ Comm. for Civil Rights Under Law, Inc. v. Craigslist, Inc., 519 F.3d 666, 671 (7th Cir. 2008), as amended (May 2, 2008) (applying definition to Craigslist, a classified advertisements website); Universal Commcʹns Sys. v. Lycos, Inc., 478 F.3d 413, 419 (1st Cir. 2007) (applying definition to internet message board operator); Zeran, 129 F.3d at 329 (ʺAOL is just such an interactive computer service.ʺ); Murawski v. Pataki, 514 F. Supp. 2d 577, 591 (S.D.N.Y. 2007) (concluding Ask.com is an interactive service provider because it is a search engine).
As noted above, the statute requires that the claim be based on content provided by another information content provider. This grant of immunity applies only if the interactive service provider is not also an ʺinformation content providerʺ of the content which gives rise to the underlying claim. ʺInformation content providerʺ is defined to include ʺany person or entity that is responsible, in whole or in part, for the creation or development of information provided through the Internet or any other interactive computer service.ʺ 47 U.S.C. § 230(f)(3). This definition ʺcover[s] even those who are responsible for the development of content only in part.ʺ FTC v. Accusearch Inc., 570 F.3d 1187, 1197 (10th Cir. 2009) (quoting Universal Commcʹn Sys., Inc. v. Lycos, ‐ 37 ‐ Inc., 478 F.3d 413, 419 (1st Cir. 2007)). A defendant, however, will not be held responsible unless it assisted in the development of what made the content unlawful. Id. at 1201. For example, a defendant who paid researchers to uncover confidential phone records protected by law, and then provided that information to paying customers, fell within the definition because he did not merely act as a neutral intermediary, but instead ʺspecifically encourage[d] development of what [was] offensive about the content.ʺ Id. at 1199; see also Roommates.com, 521 F.3d at 1167‐68 (holding defendant liable for developing content by ʺnot merely . . . augmenting the content generally, but . . . materially contributing to its alleged unlawfulnessʺ when it required subscribers to provide information which enabled users of site to unlawfully discriminate in selecting a roommate).
Publisher or Speaker of Content Provided by Another ʺAt its core, § 230 bars ʹlawsuits seeking to hold a service provider liable for its exercise of a publisherʹs traditional editorial functions ‐‐ such as deciding whether to publish, withdraw, postpone or alter content.ʹʺ Dirty World Entmʹt Recordings LLC, 755 F.3d at 407 (quoting Zeran, 129 F.3d at 330). Section 230(c)(1) provides that ʺno provider of an interactive computer service shall be treated as the publisher or speaker of any information provided by another ‐ 38 ‐ information content providerʺ but it does not define the terms ʺpublisher or speaker.ʺ 47 U.S.C. § 230(c)(1). In Barnes v. Yahoo!, Inc., the Ninth Circuit addressed ʺhow to determine when, for purposes of this statute, a plaintiffʹs theory of liability would treat a defendant as a publisher or speaker of third‐party content.ʺ 570 F.3d 1096, 1101 (9th Cir. 2009), as amended (Sept. 28, 2009). The Ninth Circuit considered traditional dictionary definitions of publisher, including ʺthe reproducer of a work intended for public consumptionʺ and ʺone whose business is publication.ʺ Id. at 1102 (quoting Websterʹs Third New International Dictionary 1837 (Philip Babcock Gove ed., 1986)). In deciding whether the claim at issue sought to hold the defendant liable as a publisher or speaker, the Court noted that ʺwhat matters is whether the cause of action inherently requires the court to treat the defendant as the ʹpublisher or speakerʹ of content provided by another. To put it another way, courts must ask whether the duty that the plaintiff alleges the defendant violated derives from the defendantʹs status or conduct as a ʹpublisher or speaker.ʹʺ Id. at 1102. In Accusearch, Inc., the only other case considering the application of Section 230 immunity to liability arising under Section 5 of the FTC Act, the ‐ 39 ‐ Tenth Circuit concluded that the defendant could not be immune for its payment to researchers to uncover confidential phone records and subsequent publishing of that information because it was an information content provider of the offensive conduct. 570 F.3d at 1197. The majority concluded that the defendant was not immune because liability was based on the defendantʹs own content rather than the content of another, while the concurrence was of the view that the defendant was not immune because liability was premised not on content but on its conduct. Id. at 1197, 1205.
LeadClick argues that it should be immune from liability under the FTC Act and CUTPA because it was an interactive computer service provider, it did not publish deceptive content, and the plaintiffs seek to hold it liable for the deceptive statements of its affiliates. We disagree and conclude that LeadClick is not entitled to Section 230 immunity because it is an information content provider with respect to the deception at issue and because LeadClick is liable under the FTC Act for its own deceptive acts or practices, rather than for publishing content created by another. ‐ 40 ‐
As an initial matter, we are doubtful that LeadClick is an ʺinteractive service provider.ʺ The definition is indeed broad, but we are not convinced that LeadClick provides computer access in the sense of an internet service provider, website exchange system, online message board, or search engine. LeadClick contends that it is covered because it ʺenabled computer access by multiple users to a computer serverʺ by routing consumers from its affiliatesʹ webpages to LeanSpaʹs websites via the HitPath server. LeadClick Reply Br. at 4. But LeadClick cites no case law applying the definition of ʺinteractive service providerʺ in a similar context, where the defendantʹs provision of services (in this case, consumer access to LeadClickʹs HitPath computer server) was wholly unrelated to its potential liability under the statute. Moreover, the ʺserviceʺ LeadClick purportedly provided ‐‐ access to the HitPath server ‐‐ is not the type of service that Congress intended to protect in granting immunity. The statute aims to promote the continued development of the internet, through ʺthe availability of educational and informational resources to our citizensʺ and to ʺoffer a forum for a true diversity of political discourse, unique opportunities for cultural development, and myriad avenues for intellectual activity.ʺ 47 U.S.C. § 230(a)(1), (a)(3); see also id. at (b)(1), (b)(3) ‐ 41 ‐ (noting that it is the policy of the United States ʺto promote the continued development of the Internet and other interactive computer servicesʺ and to ʺmaximize user control over what information is received by individuals, families, and schools who use the Internet and other interactive computer servicesʺ). The computer access service LeadClick actually provided, routing customers through the HitPath server before reaching LeanSpaʹs website, was invisible to consumers and did not benefit them in any way. Its purpose was not to encourage discourse but to keep track of the business referred from its affiliate network. In any event, we need not reach this issue because we conclude, as described below, that LeadClick is an information content provider with respect to the content at issue and that LeadClick is liable for its own content and not merely because it was the ʺpublisher or speakerʺ of deceptive content provided by its affiliates.
LeadClick is not entitled to immunity because it participated in the development of the deceptive content posted on fake news pages. As discussed in greater detail above, LeadClick recruited affiliates for the LeanSpa account that used false news sites. LeadClick paid those affiliates to advertise LeanSpa ‐ 42 ‐ products online, knowing that false news sites were common in the industry. LeadClick employees occasionally advised affiliates to edit content on affiliate pages to avoid being ʺcrazy [misleading],ʺ J. App. at 231a, and to make a report of alleged weight loss appear more ʺrealisticʺ by reducing the number of pounds claimed to have been lost, id. at 788a. LeadClick also purchased advertising banner space from legitimate news sites with the intent to resell it to affiliates for use on their fake news sites, thereby increasing the likelihood that a consumer would be deceived by that content. LeadClickʹs role in managing the affiliate network far exceeded that of neutral assistance. Instead, it participated in the development of its affiliatesʹ deceptive websites, ʺmaterially contributing to [the contentʹs] alleged unlawfulness.ʺ Roommates.com, LLC, 521 F.3d at 1168. Accordingly, LeadClick is an information content provider with respect to the deceptive content at issue and is not entitled to immunity under Section 230. iii. The Claim does not treat LeadClick as a Publisher or Speaker of Anotherʹs Content LeadClick cannot establish the third element necessary for immunity because it is not being held liable as a publisher or speaker of anotherʹs content. Rather, as discussed above, LeadClick is being held accountable for its own ‐ 43 ‐ deceptive acts or practices ‐‐ for directly participating in the deceptive scheme by providing edits to affiliate webpages, for purchasing media space on real news sites with the intent to resell that space to its affiliates using fake news sites, and because it had the authority to control those affiliates and allowed them to publish deceptive statements. Accordingly, because LeadClickʹs Section 5 liability is not derived from its status as a publisher or speaker, imposing liability under Section 5 does not ʺinherently require[] the court to treat the [LeadClick] as the ʹpublisher or speakerʹʺ of its affiliatesʹ deceptive content, and Section 230 immunity should not apply. See Barnes, 570 F.3d at 1101‐02; see also Accusearch, 570 F.3d at 1204‐05 (Tymkovitch, J., concurring) (noting that ʺthe FTC sought and ultimately held [defendant] liable for its conduct rather than for the content of the information is was offering on [its] websiteʺ and arguing that there should be no immunity because ʺSection 230 only immunizes publishers or speakers for the content of the information from other providers that they make publicʺ).