White Buffalo Ventures, LLC v. University of Texas

• Decision Date: 02 August 2005
• Docket Number: No. 04-50362.,04-50362.
• Citation: 420 F.3d 366
• Parties: WHITE BUFFALO VENTURES, LLC, Plaintiff-Appellant, v. UNIVERSITY OF TEXAS AT AUSTIN, Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

420 F.3d 366

WHITE BUFFALO VENTURES, LLC, Plaintiff-Appellant, v. UNIVERSITY OF TEXAS AT AUSTIN, Defendant-Appellee.

No. 04-50362.

United States Court of Appeals, Fifth Circuit.

August 2, 2005.

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Brad Lee Armstrong (argued), Austin, TX, for Plaintiff-Appellant.

Sean Jordan (argued), Terence L. Thompson, Asst. Atty. Gen., Austin, TX, for Defendant-Appellee.

Appeal from the United States District Court for the Western District of Texas.

Before DAVIS, SMITH and DeMOSS, Circuit Judges.

JERRY E. SMITH, Circuit Judge:

This case involves the regulation of unsolicited, commercial mass electronic messages ("emails") (a species belonging to the larger communication genus often referred to as "spam").¹ Plaintiff White Buffalo Ventures, LLC ("White Buffalo"), operates several online dating services, including longhornsingles.com, which targets students at the University of Texas at Austin ("UT"). Pursuant to its internal anti-solicitation policy,² UT blocked White Buffalo's attempts to send unsolicited bulk commercial email.

White Buffalo sought to enjoin UT from excluding its incoming email. The district court denied the injunction. On cross-motions for summary judgment, the court granted UT's motion and denied White Buffalo's. White Buffalo appeals, challenging the ruling on the grounds that federal law preempts UT's internal anti-spam policy (the "Regents' Rules")³ and that the policy violates the First Amendment. Mindful that this case presents several novel issues, the significance of which will grow proportionally with heightened cultural and economic reliance on the Internet, we affirm.

We make two determinations. First, we decide that the CAN-SPAM Act does not preempt UT's anti-spam policy. Second, we determine that the policy is permissible under our First Amendment commercial speech jurisprudence, but we reserve judgment on whether state university email servers constitute public or private fora.

I.

A.

The parties do not dispute the facts. UT provides, free of charge, Internet access and email addresses to faculty, staff, and students at the domain "utexas.edu." Owners of electronic mail accounts can access those accounts either on-grounds (by means of wireless connections or of wired, authenticated clusters) or remotely (by means of some other Internet access provider). An owner of a UT user account may, for example, log on from any third-party dial-up or broadband service provider and check for email residing on one of UT's 178 email servers.

UT has a policy of blocking many types of incoming spam, irrespective of commercial content or source authenticity. Under the Regents' Rules, the technology department (the "ITC") implements procedures (1) to block incoming unsolicited, commercial emails and (2) to stop the transmission of such emails.⁴

White Buffalo operates several online dating services, including one, called "longhornsingles.com," that targets UT students. In February 2003, White Buffalo submitted a Public Information Act request seeking all "non-confidential, non-exempt email addresses" held by UT, which responded by disclosing all qualifying email addresses. In April 2003, White Buffalo began sending legal commercial spam to targeted members of the UT community.⁵

UT received several complaints regarding unsolicited email blasts from White Buffalo. UT investigated and determined that White Buffalo had indeed sent unsolicited emails to tens of thousands of UT email account-holders, at which point UT issued a cease and desist letter. White Buffalo refused to comply with that letter, so UT blocked all email ingress from the IP address⁶ that was the source address for the unsolicited White Buffalo spam. The filter blocked all email sent from that IP address to addresses containing the "@utexas.edu" string.

B.

White Buffalo obtained a temporary restraining order ("TRO") in state court. UT removed the cause to federal court on the basis of federal question jurisdiction; there the TRO was continued pending a hearing on the preliminary injunction. After a hearing in May 2003, the district court denied the injunction. The parties conducted discovery, and both moved for summary judgment. The district court granted UT's summary judgment motion and denied White Buffalo's.

II.

A.

1.

This court reviews a summary judgment grant de novo, in accordance with the FED R. CIV. PROC. 56 analysis that guides the district court. Ford Motor Co. v. Tex. Dep't of Transp., 264 F.3d 493, 498 (5th Cir. 2001). The district court entered judgment for UT on cross-motions for summary judgment. On review, the motions are reviewed independently, with evidence and inferences taken in the light most favorable to the nonmoving party. See id. We review a district court's preemption determinations de novo. See Baker v. Farmers Elec. Coop., Inc., 34 F.3d 274, 278 (5th Cir.1994).

2.

The doctrine of preemption stems from the Supremacy Clause,⁷ which gives federal law precedence over a conflicting state law. See Cipollone v. Liggett Group, Inc., 505 U.S. 504, 516, 112 S.Ct. 2608, 120 L.Ed.2d 407 (1992). CAN-SPAM's preemption of state law derives from an express provision in the Act. See 15 U.S.C. § 7707(b).

Although a court should begin with the expression provided by Congress, it must also "identify the domain expressly pre-empted."⁸ The fact that Congress has expressly preempted certain activity is plain, but the scope of that express preemption is not. The power to supplant state law is "an extraordinary power in a federalist system." Gregory v. Ashcroft, 501 U.S. 452, 460, 111 S.Ct. 2395, 115 L.Ed.2d 410 (1991). Preemption radically alters the balance of state and federal authority, so the Supreme Court has historically refused to impose that alteration interstitially. See id. The Court has expressed this principle as a presumption against preemption of state law.⁹ Supremacy Clause analysis is classic "tie goes to the state" jurisprudence, and the existence of an express preemption provision does not always plainly demarcate what the federal law expressly preempts.

3.

The district court granted summary judgment to UT on White Buffalo's claim that the CAN-SPAM Act preempts ITC's anti-spam regulations. The court premised its holding on four propositions: (1) that the "purposes" of CAN-SPAM, as determined by reference to the statute and the accompanying Senate Report, suggest that Congress did not mean to preempt technological approaches to combating spam; (2) that § 7707(c) specifically exempts UT from the scope of express preemption; (3) that § 7707(b)(2), which states that "[s]tate laws not specific to electronic mail, including State trespass, contract, or tort law" are not preempted, exempts UT's anti-spam policy because that policy is part of a larger set of anti-solicitation rules; and (4) that UT's ITS policy is not a "statute, regulation, or rule of a State or political subdivision of a state" and is therefore not preempted by § 7707(b)(1). We do not organize our discussion around these four propositions (because the appellate briefing renders an alternate organization more desirable), but we discuss each in its appropriate context.

To our knowledge, no Fifth Circuit panel has scrutinized any portion of CAN-SPAM, and no court in this country has considered the legislation's preemption clause. This is therefore an issue of very, very first impression.

In part, CAN-SPAM prohibits fraudulent, abusive and deceptive commercial email, 15 U.S.C. §§ 7703, 7704; provides for enforcement of the Act by federal agencies, states, and Internet service providers ("ISPs"), id. § 7706; and provides for the issuance of regulations to implement the purposes of the Act, id. § 7711. The parties have agreed, in the district court and on appeal, that White Buffalo complied with the requirements of the CAN-SPAM Act. Its email blasts were not unlawful.

Most relevant to White Buffalo's claim is CAN-SPAM'S preemption clause:

This chapter supersedes any statute, regulation, or rule of a State or political subdivision of a State that expressly regulates the use of electronic mail to send commercial messages, except to the extent that any such statute, regulation, or rule prohibits falsity or deception in any portion of a commercial electronic mail message or information attached thereto.

§ 7707(b)(1).

White Buffalo argues that this preemption clause prevents UT from promulgating regulations to impede the ingress of longhornsingles.com emails to utexas.edu users. According to White Buffalo, because UT is a state actor and has conceded that White Buffalo's spam is not false or fraudulent, CAN-SPAM preempts the Regents' Rules authorizing the email filters. White Buffalo provides no authority beyond § 7707(b)(1) in support of this position.

Matters become more complicated because, in addition to setting forth the preemption clause, § 7707 carves out a set of entities to be exempt from any possible preemptive effect. It states that "[n]othing in this chapter shall be construed to have any effect on the lawfulness or unlawfulness ... of the adoption, implementation, or enforcement by a provider of Internet access service of a policy of declining to transmit, route, relay, handle, or store certain types of electronic mail messages." § 7707(c).

The district court held that CAN-SPAM does not preempt UT's anti-solicitation policy. It noted that § 7707(c) permits Internet service providers to employ protection measures, and it held that UT belongs to that set of service providers. The court also relied on Congress's acknowledgment of "the problems associated with the rapid growth and abuse of unsolicited commercial email [that] cannot be solved by Federal legislation alone" but that will also require the "development and adoption of technological approaches" to serve the goals of the Act. See 15 U.S.C. § 7701(a)(12). The court found that "[t]he Act ... does not preclude a state entity like UT from using...