Prager Univ. v. Google LLC
| Decision Date | 05 December 2022 |
| Docket Number | H047714 |
| Parties | PRAGER UNIVERSITY, Plaintiff and Appellant, v. GOOGLE LLC, et al., Defendants and Respondents. |
| Court | California Court of Appeals Court of Appeals |
Attorney for Plaintiff and Appellant Prager University: Browne George Ross O'Brien, Annaguey & Ellis LLP, Eric M. George, Los Angeles, Peter Obstler, Debi A. Ramos, Ryan Q. Keech.
Attorneys for Defendants and Respondents Google LLC et al.: Wilson Sonsini Goodrich & Rosati, Fred A. Rowley, Jr., Los Angeles, David H. Kramer, Palo Alto, Lauren Gallo White, Amit Q. Gressel, San Francisco.
Attorneys for Amicus Curiae Electronic Frontier Foundation Electronic Frontier Foundation: Mukund Rathi, David A. Greene.
After a United States district court dismissed its federal lawsuit, Prager University filed the present action against Google LLC and its subsidiary, YouTube, LLC, alleging that defendants restricted access to, and third-party advertising on, Prager's YouTube videos due to its political and religious views. Prager's appeal from the superior court's judgment of dismissal turns primarily on the scope of immunity under section 230 of the Communications Decency Act (CDA) ( 47 U.S.C. § 230 )1 for interactive computer service providers acting as "publishers or speakers" of content provided by others. Although the conduct complained of arises from defendants’ exercise of a publisher's traditional editorial functions, Prager variously contends that defendants are themselves information content providers, that defendants by their terms of service and their public pronouncements subjected themselves to liability notwithstanding section 230, and that section 230, to the extent it immunizes defendants from Prager's state law claims, is unconstitutional. We affirm.
Defendants operate YouTube.com, now "the largest video-sharing website in the world," which "maintains a virtual monopoly over the domestic and international internet video posting markets where users can post, view, and comment on video content." The vast majority of videos that internet users can post and view on defendants’ YouTube platform are free to view. Defendants generate revenue through YouTube by selling advertisements displayed with videos, by selling subscriptions that allow users to view videos without advertisements and/or to access certain content, and by renting access to videos.
Defendants place "advertising restrictions" on certain videos. When they do so, it "demonetizes" the video, i.e., prevents the user who posted the video from realizing advertising revenues through the video. Defendants’ stated purpose for imposing advertising restrictions is to ensure that advertisements accompany "advertiser-friendly" content.
Network administrators and individual subscribers can elect to limit user access to YouTube videos using "Restricted Mode." With Restricted Mode activated on a particular network or account, the users of that network or account are unable to view videos that defendants have designated for restriction. According to defendants, they use six criteria for determining whether to restrict access to a video: "(1) Talking about drug use or abuse, or drinking alcohol in videos; (2) Overly detailed conversations about or depictions of sex or sexual activity; (3) Graphic descriptions of violence, violent acts, natural disasters and tragedies, or even violence in the news; (4) Videos that cover specific details about events related to terrorism, war, crime, and political conflicts that resulted in death or serious injury, even if no graphic imagery is shown; (5) Inappropriate language, including profanity; and (6) Video content that is gratuitously incendiary, inflammatory, or demeaning towards an individual or group."
Defendants use an "automated filtering algorithm" to decide whether a video is "suitable" for advertising or should be unavailable to users accessing YouTube through Restricted Mode. Videos may also be restricted pursuant to "human review." Users whose videos have been restricted or demonetized may request human review of decisions made by defendants’ automated systems.
The "University" of its name notwithstanding, Prager states that it "is not an academic institution." Prager's stated mission is to educate the public "about current and historical issues and events of public interest[,] ... with an emphasis on reaching younger, academic, and student-based audiences." Prager seeks to provide "usually (but not always)[ ] conservative viewpoints" on public issues. To that end, Prager produces and promotes videos containing "focused discussions" of such issues. Since its inception, Prager has posted more than 250 videos on YouTube.
Defendants have prevented Prager from monetizing or obtaining sponsors for over 50 of its videos by imposing advertising restrictions or by preventing the videos from being accessed in Restricted Mode. Even so, there have been instances in which other YouTube users have posted "copycat" videos that are identical to Prager's restricted videos, and the copycat videos have not been restricted. Prager "undertook an extensive comparative analysis of its videos which were restricted and those on similar topics by different speakers that were not restricted" and reached the conclusion that defendants are imposing restraints on Prager because of its political identity or viewpoints, not the content of its videos. Prager's efforts to informally resolve the matter pursuant to defendants’ internal appeals process were unsuccessful, as defendants "admitted that" they conducted " ‘human reviews’ " on some of Prager's videos, "leaving little doubt that the restrictions and demonetization of Prager[’s] videos were not merely the result of an automated algorithm error."
Prager initially filed suit in federal court. The result of the federal litigation was dismissal of Prager's federal claims for violation of the First Amendment and the Lanham Act with prejudice and dismissal of Prager's state law claims without prejudice. (See Prager University v. Google LLC (N.D. Cal. Mar. 26, 2018, No. 17-CV-06064-LHK) 2018 WL 1471939, at p. *14, 2018 U.S. Dist. LEXIS 51000, at p. *45 ; Prager University v. Google LLC (9th Cir. 2020) 951 F.3d 991, 999-1000 ( Prager University ).) Prager initiated the present action while its appeal in the federal action was pending.
Here, Prager alleges four causes of action, as follows. First, defendants violated article I, section 2 of the California Constitution by restricting Prager's speech in a public forum in an arbitrary, capricious, and/or discriminatory manner pursuant to "subjective, vague, and overbroad criteria" and by blocking viewers’ access to Prager's videos. Second, defendants violated the Unruh Act by censoring Prager's speech based on its, and its followers’, political identity, religious orientation,3 and viewpoint. Third, defendants violated the Unfair Competition Law by violating the California Constitution, the Unruh Act and the Lanham Act and by misleading viewers about the content of Prager's videos by restricting access. Fourth, defendants breached the covenant of good faith and fair dealing implied in their contracts with Prager by restricting access to and demonetizing its videos, thereby interfering with Prager's right to receive the benefits of the contracts.
The parties filed cross-motions—defendants demurred to the operative complaint and Prager moved for a preliminary injunction. The trial court ruled that the CDA precluded each of Prager's claims, "with the possible exception of those based on [defendants’] own promises and representations[.]" As to those claims, the trial court ruled that Prager could not state a claim for breach of the implied covenant of good faith and fair dealing because the parties’ contracts expressly permitted the challenged conduct or a UCL claim under the "fraudulent" prong because defendants’ statements were non-actionable puffery and/or Prager lacked standing to challenge them. The trial court addressed the merits of Prager's constitutional claim in the alternative, reasoning that the claim failed for want of state action. Pursuant to those rulings, the trial court sustained the demurrer without leave to amend and denied the motion for preliminary injunction.
This appeal followed.
On de novo review of the trial court's order sustaining the demurrer (see T.H. v. Novartis Pharmaceuticals Corp. (2017) 4 Cal.5th 145, 162, 226 Cal.Rptr.3d 336, 407 P.3d 18 ), our conclusion is compelled by section 230(c)(1) and (e)(3) of the CDA. However denominated, Prager's state law causes of action target providers of an interactive computer service in their capacity as publishers restricting access to Prager's information content—i.e., the same "Good Samaritan" screening that Congress has elected to protect from liability under state law. To the extent Prager has pleaded alternative theories of contractual breach and fraudulent business practices to forestall this conclusion, it has neither identified a contractual provision to support the former nor alleged facts establishing standing to prosecute the latter, and it raises no reasonable possibility of curing these defects by amendment. We further reject Prager's argument that the CDA—foreclosing as it does Prager's causes of action against private actors—violates the First and Fourteenth Amendments.
"Congress enacted section 230 ‘for two basic policy reasons: to promote the free exchange of information and ideas over the internet and to encourage voluntary monitoring for offensive and obscene material.’ " ( Hassell v. Bird (2018) 5 Cal.5th 522, 534, 234 Cal.Rptr.3d 867, 420 P.3d 776 ( Hassell ).) "The statute contains express findings and policy declarations recognizing the rapid growth of the Internet, the beneficial effect of minimal government regulation on its...
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