Section 230 protected Google in illegal gambling lawsuit over loot boxes

Section 230

Plaintiffs sued Google claiming that loot boxes in games available through the Google Play store were illegal “slot machines or devices”. (Players who buy loot boxes get a randomized chance at receiving an item designed to enhance game play, such as a better weapon, faster car, or skin.) Plaintiffs characterized these loot boxes as a “gamble” because the player does not know what the loot box actually contains until it is opened. Defendant Google moved to dismiss the lawsuit on Section 230 grounds. The court granted the motion.

As relevant here, Section 230(c)(1) provides that “[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.” 47 U.S.C. § 230(c)(1). “No cause of action may be brought and no liability may be imposed under any State or local law that is inconsistent with this section.” 47 U.S.C. § 203(e)(3).

The court held that Google was immune under Section 230 because (a) it is an interactive computer service provider, (b) plaintiffs’ claims over the loot boxes sought to treat Google as the “publisher or speaker” of the games containing the allegedly illegal loot boxes, and (c) the games constituted information provided by third parties.

Of particular interest was the court’s treatment of plaintiff’s argument that Section 230 only relates to “speech” and that Google’s provision of software did not fit into that category. Rejecting this argument, the court cited to the case of Evans v. Hewlett-Packard Co., 2013 WL 4426359(N.D. Cal. Aug. 15, 2013) in which the court used Section 230 to knock out Chubby Checker’s trademark and unfair competition claims against HP over a game HP made available.

Coffee v. Google, LLC, 2021 WL 493387 (N.D. Cal., February 10, 2021)

Evan Brown is a technology and intellectual property attorney in Chicago.

Wait just a second . . . isn’t online gambling illegal?

Wong v. Partygaming Ltd., — F.3d —, 2009 WL 4893955 (6th Cir. December 21, 2009)

The Sixth Circuit’s recent opinion in the case of Wong v. Partygaming is interesting if you’re a civil procedure wonk and care about things like which law applies to determine the enforceability of forum selection clauses in website terms and conditions and what factors a court should consider when dismissing a case on the basis of forum non conveniens.

bling

The most intriguing part of the case, however, comes from Judge Merritt’s concurrence, in which he addresses the significance of the fact that the terms of service for an online gambling website are probably illegal.

The majority opinion painstakingly analyzed whether the district court abused its discretion in dismissing, of its own will (or “sua sponte” as stodgy lawyers like to say), the plaintiffs’ suit against an online gambling website. The plaintiffs had alleged that the site fraudulently misrepresented that there was no collusion among other online gamblers, and that the site did not target people with gambling problems. The website terms of service contained a forum selection clause naming Gibraltar as the jurisdiction in which disputes were to be heard.

The appellate court affirmed the lower court’s decision that the case should be dismissed and that Gibraltar (which follows English law) would be a suitable and not-too-inconvenient forum. But the majority opinion said nothing about the legality of online gaming.

That’s where Judge Merritt picked up in the concurrence. He agreed that the matter should have been dismissed in favor of it being heard in Gibraltar — that’s why he concurred and did not dissent. His reasoning differed from that of the majority.


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Judge Merritt observed that the plaintiffs’ logic was inconsistent. They had argued that Ohio law should apply to the terms of service. But under Ohio law (and federal statutes like RICO), the subject matter of the contract would probably have been illegal and therefore void. Not to mention the fact that the conduct could send the parties to jail.

The judge wrote that something analogous to the principle of lenity — and not necessarily a rigorous analysis of the forum selection clause and the doctrine of forum non conveniens — should underlie the dismissal of the lawsuit. Lenity requires that when the question of criminal liability is ambiguous, interpretation should be made in favor of the defendant (see McNally v. United States). Since online gambling presumably was not illegal under the law of Gibraltar, the more lenient stance would be to see the matter litigated there.

Bling photo courtesy Flickr user PhotoDu.de under this Creative Commons license.

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