Netchoice, L.L.C. v. Paxton

• Decision Date: 16 September 2022
• Docket Number: 21-51178
• Citation: 49 F.4th 439
• Parties: NETCHOICE, L.L.C., a 501(c)(6) District of Columbia organization doing business as NetChoice ; Computer Communications Industry Association, a 501(c)(6) non-stock Virginia Corporation doing business as CCIA, Plaintiffs—Appellees, v. Ken PAXTON, in his official capacity as Attorney General of Texas, Defendant—Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

49 F.4th 439

NETCHOICE, L.L.C., a 501(c)(6) District of Columbia organization doing business as NetChoice ; Computer Communications Industry Association, a 501(c)(6) non-stock Virginia Corporation doing business as CCIA, Plaintiffs—Appellees,
v.
Ken PAXTON, in his official capacity as Attorney General of Texas, Defendant—Appellant.

No. 21-51178

United States Court of Appeals, Fifth Circuit.

FILED September 16, 2022

Scott A. Keller, Todd Lawrence Disher, Matthew Hamilton Frederick, Lehotsky Keller, L.L.P., Austin, TX, Gabriela Gonzalez-Araiza, Jeremy Evan Maltz, Lehotsky Keller, L.L.P., Washington, DC, for Plaintiffs-Appellees.

Judd Edward Stone, II, Office of the Attorney General, Office of the Solicitor General, Austin, TX, Ryan Baasch, William Francis Cole, Esq., Office of the Attorney General of Texas, Office of the Solicitor General, Austin, TX, Courtney Brooke Corbello, Assistant Attorney General, Office of the Attorney General for the State of Texas, General Litigation Division, Austin, TX, for Defendant-Appellant.

William Scott McCollough, Counsel, McCollough Law Firm, P.C., Dripping Springs, TX, for Amicus Curiae Texas Public Policy Foundation.

William Scott McCollough, Counsel, McCollough Law Firm, P.C., Dripping Springs, TX, Evan Goldberg, Evan Miles Goldberg, P.L.L.C., New York, NY, for Amici Curiae Babylon Bee LLC, Not the Bee LLC, Giganews, Incorporated, Golden Frog GmBH.

Kyle Singhal, Hopwood & Singhal, P.L.L.C., Washington, DC, for Amicus Curiae Professor Philip Hamburger.

Endel Kolde, Alan Gura, Institute for Free Speech, Washington, DC, for Amici Curiae Moms for Liberty and Institute for Free Speech.

Joseph D. Sibley, IV, Camara & Sibley, L.L.P., Austin, TX, for Amici Curiae Heartland Institute and American Principles Project.

Leonid Goldstein, Tyler, TX, Pro Se.

Andrei Popovici, Dripping Springs, TX, for Amici Curiae Center for Renewing America, Incorporated and The Claremeont Institute's Center for Constitutional Jurisprudence.

James R. Lawrence, III, Envisage Law Partnership, Raleigh, NC, for Amicus Curiae Donald W. Landry, M.D.

Sarah Rogers, Brewer, Attorneys & Counselors, New York, NY, for Amicus Curiae David Mamet.

Matthew R. Miller, Esq., Robert E. Henneke, Texas Public Policy Foundation, Austin, TX, for Amicus Curiae iTexasPolitics, L.L.C., doing business as The Texan.

Henry Charles Whitaker, Office of the Attorney General for the State of Florida, Tallahassee, FL, for Amici Curiae State of Florida, State of Alabama, State of Alaska, State of Arizona, State of Arkansas, State of Kentucky, State of Louisiana, State of Mississippi, State of Missouri, State of Montana, State of South Carolina.

John Clay Sullivan, SL Law, P.L.L.C., Cedar Hill, TX, for Amicus Curiae Students at Columbia Against Censorship.

Robin Gross, San Francisco, CA, for Amicus Curiae IP Justice.

Corbin Barthold, TechFreedom, Washington, DC, for Amicus Curiae TechFreedom.

William Reid Wittliff, Wittliff Cutter, P.L.L.C., Austin, TX, for Amici Curiae Chamber of Progress, Connected Commerce Council, CTA, Engine Advocacy, Information Technology & Innovation Foundation, TechNet, Washington Center for Technology Policy Inclusion, Hispanic Technology and Telecommunications Partnership.

Scott B. Wilkens, Knight First Amendment Institute at Columbia University, New York, NY, for Amicus Curiae Knight First Amendment Institute at Columbia University.

David A. Greene, Electronic Frontier Foundation, San Francisco, CA, Thomas S. Leatherbury, Esq., Avery Caroline Westerlund, Vinson & Elkins, L.L.P., Dallas, TX, for Amici Curiae Electronic Frontier Foundation, National Coalition Against Censorship, Woodhull Freedom Foundation.

Thomas Arthur Berry, Cato Institute, Washington, DC, for Amicus Curiae Cato Institute.

Catherine R. Gellis, Sausalito, CA, for Amicus Curiae Floor64, Incorporated, doing business as Copia Institute.

Mary Ellen Roy, Dan Brian Zimmerman, Phelps Dunbar, L.L.P., New Orleans, LA, for Amicus Curiae Christopher Cox, Former Member of Congress, Co-Author of Section 230 of the Communications Decency Act.

Bruce D. Brown, Reporters Committee for Freedom of the Press, Washington, DC, for Amicui Curiae Reporters Committee for Freedom of the Press, American Booksellers for Free Expression, American Civil Liberties Union, Authors Guild, Incorporated, Center for Democracy & Technology, Media Coalition Foundation, Media Law Resource Center.

Before Jones, Southwick, and Oldham, Circuit Judges.

Andrew S. Oldham, Circuit Judge:^*

49 F.4th 444

A Texas statute named House Bill 20 generally prohibits large social media platforms from censoring speech based on the viewpoint of its speaker. The platforms urge us to hold that the statute is facially unconstitutional and hence cannot be applied to anyone at any time and under any circumstances.

49 F.4th 445

In urging such sweeping relief, the platforms offer a rather odd inversion of the First Amendment. That Amendment, of course, protects every person's right to "the freedom of speech." But the platforms argue that buried somewhere in the person's enumerated right to free speech lies a corporation's unenumerated right to muzzle speech.

The implications of the platforms' argument are staggering. On the platforms' view, email providers, mobile phone companies, and banks could cancel the accounts of anyone who sends an email, makes a phone call, or spends money in support of a disfavored political party, candidate, or business. What's worse, the platforms argue that a business can acquire a dominant market position by holding itself out as open to everyone—as Twitter did in championing itself as "the free speech wing of the free speech party." Blue Br. at 6 & n.4. Then, having cemented itself as the monopolist of "the modern public square," Packingham v. North Carolina , ––– U.S. ––––, 137 S. Ct. 1730, 1737, 198 L.Ed.2d 273 (2017), Twitter unapologetically argues that it could turn around and ban all pro-LGBT speech for no other reason than its employees want to pick on members of that community, Oral Arg. at 22:39–22:52.

Today we reject the idea that corporations have a freewheeling First Amendment right to censor what people say. Because the district court held otherwise, we reverse its injunction and remand for further proceedings.

I.

A.

This case involves HB 20, a Texas statute that regulates large social media platforms.¹ The law regulates platforms² with more than 50 million monthly active users ("Platforms"), such as Facebook, Twitter, and YouTube. TEX. BUS. & COM. CODE § 120.002(b). In enacting HB 20, the Texas legislature found that the Platforms "function as common carriers, are affected with a public interest, are central public forums for public debate, and have enjoyed governmental support in the United States." It further found that "social media platforms with the largest number of users are common carriers by virtue of their market dominance."

Two sections of HB 20 are relevant to this suit. First is Section 7, which addresses viewpoint-based censorship of users' posts. Section 7 provides:

A social media platform may not censor a user, a user's expression, or a user's ability to receive the expression of another person based on:

(1) the viewpoint of the user or another person;

49 F.4th 446

(2) the viewpoint represented in the user's expression or another person's expression; or

(3) a user's geographic location in this state or any part of this state.

TEX. CIV. PRAC. & REM. CODE § 143A.002(a). "Censor" means "to block, ban, remove, deplatform, demonetize, de-boost, restrict, deny equal access or visibility to, or otherwise discriminate against expression." Id. § 143A.001(1). For Section 7 to apply, a censored user must reside in Texas, do business in Texas, or share or receive expression in Texas. Id. § 143A.004(a)–(b).

This prohibition on viewpoint-based censorship contains several qualifications. Section 7 does not limit censorship of expression that a Platform "is specifically authorized to censor by federal law"; expression that "is the subject of a referral or request from an organization with the purpose of preventing the sexual exploitation of children and protecting survivors of sexual abuse from ongoing harassment"; expression that "directly incites criminal activity or consists of specific threats of violence targeted against a person or group because of their race, color, disability, religion, national origin or ancestry, age, sex, or status as a peace officer or judge"; or "unlawful expression." Id. § 143A.006.

Finally, Section 7 provides a narrow remedial scheme. If a Platform violates Section 7 with respect to a user, that user may sue for declaratory and injunctive relief and may recover costs and attorney's fees if successful. Id. § 143A.007. The Attorney General of Texas may also sue to enforce Section 7 and may recover attorney's fees and reasonable investigative costs if successful. Id. § 143A.008. Damages are not available.

The other relevant provision of HB 20 is Section 2. It imposes certain disclosure and operational requirements on the Platforms. These requirements fall into three categories. First, Platforms must disclose how they moderate and promote content and publish an "acceptable use policy." TEX. BUS. & COM. CODE §§ 120.051 –52. This policy must inform users about the types of content allowed on the Platform, explain how the Platform enforces its policy, and describe how users can notify the Platform of content that violates the policy. Id. § 120.052(b).

Platforms must also publish a "biannual transparency report." Id. § 120.053. This report must contain various high-level statistics related to the Platform's content-moderation efforts, including the number of instances in which the Platform was alerted to the presence of policy-violating content; how the Platform was so alerted; how many times the Platform acted against such content; and how many such actions were successfully or unsuccessfully appealed. See ibid.

Last, Platforms must maintain a complaint-and-appeal system for their...