negligence – Attorney Evan Brown

February 1, 2024 Fraud/Misrepresentation

Online marketplace not liable for causing murder committed by criminal seller

The Tenth Circuit Court of Appeals in Colorado upheld the dismissal of a tort case brought against the operator of the website Letgo. The court held that the website was not negligent and did not commit fraud in facilitating the purported transaction that resulted in the murder of a married couple.

The tragic story

At 11 PM on August 14, 2020, Mr. and Mrs. Roland met an execrable miscreant named Brown at a PETCO parking lot, intending to buy a car that Brown had placed for sale on the online marketplace Letgo. Claiming to not have the right title for the car (it turns out the car was stolen), Brown led the couple to a second location under the pretense of retrieving the correct vehicle title. But Brown ambushed the Rolands with a handgun, resulting in a struggle that led to the tragic deaths of both Mr. and Mrs. Roland, who left behind five minor children. Brown was later convicted of two counts of first-degree felony murder.

The estate sued

The Rolands’ estate sued Letgo under Colorado law, alleging a number of claims, including negligence, fraud and negligent misrepresentation. The lower court dismissed the claims. So the estate sought review with the Tenth Circuit. On appeal, the court affirmed the dismissal.

To act or not to act

The court’s negligence analysis turned on whether plaintiffs’ claim was one of misfeasance (active conduct causing injury) or nonfeasance (a failure to take positive steps to protect others from harm). The plaintiffs contended that Letgo’s claims of collaboration with law enforcement, use of technology to block stolen goods, and a user verification system created a false sense of security – that the negligence was based on misfeasance. But the court was not persuaded, emphasizing that the representations, when viewed in context, did not constitute misfeasance or active misconduct.

Instead, the court determined that the plaintiffs’ allegations were more indicative of nonfeasance, or Letgo’s failure to act, which required a special relationship between the parties for a duty of care to be established – a condition the plaintiffs could not satisfy. And in the court’s mind, even if Letgo’s actions were misfeasance, the plaintiffs failed to adequately plead that these actions were a substantial factor in the Rolands’ deaths, as the decisions made by the Rolands to pursue the transaction, and the decision of the perpetrator to commit murder, were more significant factors in the tragic outcome than the provision of the online platform.

No fraud or negligent misrepresentation either

Colorado law required plaintiffs to demonstrate a series of stringent criteria: Letgo must have made a false representation of a material fact, known to be false, with the intention that the Rolands would rely upon it, leading to damages as a result of this reliance. Negligent misrepresentation, while similar, necessitates showing that Letgo, within its professional capacity, made a careless misstatement of a crucial fact intended for the guidance of others in their business dealings, which the Rolands justifiably relied upon to their detriment.

Federal Rule of Civil Procedure 9(b) sets a higher bar for fraud claims, requiring plaintiffs to specify the circumstances of the alleged fraud with particularity, including the time, place, and content of the false representations, as well as the identity of those making them and the resultant consequences. This rule aims to provide defendants with fair notice of the claims against them and the factual basis for these claims. In certain cases, this standard may also extend to claims of negligent misrepresentation if they closely resemble allegations of fraud, highlighting the necessity for precise and detailed pleadings in such legal matters.

In this case, plaintiffs contended that Letgo’s assurances regarding safety and user verification —such as collaboration with law enforcement, technology to identify stolen goods, and “verified” user statuses — were misleading, constituting either fraud or negligent misrepresentation. However, the court found that plaintiffs failed to plausibly link the alleged misrepresentations to the tragic outcome, failing to provide sufficient factual content to demonstrate causation between Letgo’s actions and the Rolands’ deaths.

Roland v. Letgo, Inc., 2024 WL 372218 (10th Cir., February 1, 2024)

Section 230 did not protect Snapchat from negligence liability in car crash lawsuit over Speed Filter

The tragic facts

Landen Brown was using Snapchat’s Speed Filter in 2017 when the car in which he was riding with two other young men crashed after reaching speeds above 120 miles per hour. The Speed Filter documented how fast the car was traveling. The crash killed Landon and the other two occupants.

The parents of two of the passengers sued Snap, Inc. (the purveyor of Snapchat), claiming that the app was negligently designed. The parents alleged, among other things, that Snap should have known that users believed they would be rewarded within the app for using the filter to record a speed above 100 miles per hour. The negligence claim was based in part on the notion that Snap did not remove or restrict access to Snapchat while traveling at dangerous speeds.

Immune, then not

The lower court dismissed the case, holding that 47 U.S.C. 230 protected Snapchat from liability. Plaintiffs sought review with the Ninth Circuit. On appeal, the court reversed, finding that Section 230 liability did not apply to the negligent design claim.

Section 230’s role in the case

Section 230 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.” In this case, the court held that the parents’ complaint did not seek to hold Snap liable for its conduct as a publisher or speaker. The negligent design lawsuit treated Snap as a products manufacturer, accusing it of negligently designing a product (Snapchat) with a defect (the interplay between Snapchat’s reward system and the Speed Filter). Thus, the duty that Snap allegedly violated sprang from its distinct capacity as a product designer. Simply stated, in the court’s view, Snap’s alleged duty in this case case had nothing to do with its editing, monitoring, or removing of the content that its users generate through Snapchat.

Lemmon v. Snap, Inc. — F.3d —, 2021 WL 1743576 (9th Cir. May 4, 2021)

June 11, 2019 Miscellaneous

Amazon faces liability for assuming a duty to act, by sending email warning of hoverboard fires

Online marketplaces should take note – sometimes trying to do the right thing will create more legal exposure.

Plaintiffs tragically lost their home and suffered injuries in a fire caused by a hoverboard they bought through Amazon. They sued Amazon. Their negligence claim arose under Tennessee tort law, arising from the principle set out in Restatement (Second) of Torts § 324A, which states:

One who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of a third person or his things, is subject to liability to the third person for physical harm resulting from his failure to exercise reasonable care to protect his undertaking if (a) his failure to exercise reasonable care increases the risk of such harm, or (b) he has undertaken to perform a duty owed by the other to the third person, or (c) the harm is suffered because of reliance of the other or the third person upon the undertaking.

Plaintiffs claimed that defendant Amazon gratuitously undertook to warn the purchaser of the hoverboard (one of the plaintiffs) of the dangers posed by the hoverboard when it sent her an email outlining some of the dangers with hoverboards. Plaintiffs claimed that Amazon was negligent in that undertaking, and that the negligence caused plaintiffs harm.

The lower court granted summary judgment in Amazon’s favor, but the Sixth Circuit reversed the summary judgment order. It held that when Amazon chose to send the email to the one plaintiff, and in so doing sought to warn her of the dangers posed by the hoverboard, it assumed a duty to warn. There remained genuine issues of material fact as to whether Amazon breached that duty and whether any breach caused plaintiffs’ harm.

For instance, there was a genuine issue of material fact regarding whether Amazon’s failure to include certain information in the email amounted to negligence. The email did not inform hoverboard purchasers of any of the actions Amazon had taken to evaluate the dangers posed by hoverboards, including the findings and results of its internal investigation. The email did not inform hoverboard purchasers that the reported safety issues included a risk of fire or explosion. And the email did not inform hoverboard purchasers that Amazon had ceased all hoverboard sales worldwide.

And there was a genuine issue of material fact regarding whether the plaintiff read the email, and thereby could have acted in reliance on it. Though plaintiff had no specific recollection of reading the email, she “had a habit” of reading emails sent to her email address. She also testified that she would not have let the hoverboard enter or remain in her home had she known, among other things, that there had been 17 complaints of fires or explosions in the United States that involved hoverboards purchased on Amazon, that Amazon anticipated additional complaints, particularly during the upcoming holiday season, or that Amazon had ceased all hoverboard sales worldwide.

Fox v. Amazon.com, Inc., 2019 WL 2417391 (6th Cir. June 10, 2019)

BitTorrent defendant not negligent for failing to secure home Wi-Fi network

AF Holdings, LLC v. Doe, 2012 WL 3835102 (N.D. Cal., September 4, 2012)

Copyright ~~troll~~ plaintiff AF Holdings sued defendant for, among other things, negligence for failing to secure his home wi-fi network. Plaintiff argued that defendant’s inaction allowed a third-party to commit large-scale infringement of AF Holdings’ copyrighted works.

Defendant moved to dismiss for failure to state a claim. The court granted the motion and dismissed the negligence claim.

It held that a defendant like the one in this case had no duty to protect another from harm in this situation of “non-feasance” (i.e, failing to do something) unless a special relationship existed which would give rise to such duty. In law school this principal is articulated through the hypothetical of standing on a lakeshore watching someone drowning — you don’t have to jump in to save the person unless you are a lifeguard (or the victim’s parent, or a member of some other very limited class).

The court found that no special relationship existed here, thus plaintiff had not articulated any basis for imposing on defendant a legal duty to prevent the infringement of plaintiff’s copyrighted works.

We talked about this issue, along with other issues like copyright preemption, as it arose in a different case back on Episode 170 of This Week in Law beginning at about the 19 minute 40 second mark: