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News and Insights

Electronic Bulletin Boards: Publishers or Distributors?

January 1992

Electronic bulletin boards are the newsstand of the future. With on-line access becoming commonplace, computer users are able to utilize an extraordinary variety of news and information sources electronically. A New York case involving Compuserve has taken a step toward recognizing the newsstand analogy as a reality, at least in the eyes of the law. As a result, sponsors of on-line databases and bulletin board systems (BBS) may get the same protection from defamation lawsuits that their traditional media counterparts enjoy.

Compuserve Information Service sponsors electronic “forums” which provides access to a wide variety of publications, including “Rumorville USA,” a newsletter. Rumorville and Compuserve were both sued for defamatory statements made in Rumorville and made available to Compuserve subscribers.

The case turned on whether Compuserve was a “publisher” of the defamatory statements, or a “distributor.” The court determined that Compuserve had no control over the contents of Rumorville, was merely a distributor acting as the electronic equivalent of the corner newsdealer or library, and could not be held liable unless it knew or had reason to know of the defamatory statements. This conclusion was based in part on the fact that once Compuserve agreed to carry a publication, it was uploaded onto the BBS directly by that publication’s publishers, without review by Compuserve. In effect, once Compuserve agreed to carry Rumorville, it merely rented “space” in the BBS and provided general editorial guidelines.

The Compuserve decision was grounded on First Amendment concerns of freedom of speech and freedom of the press. The proprietor of a bookstore or newsstand is not assumed to have read every publication she sells. To hold her liable for any defamatory statement in his inventory would have a chilling effect, eventually restricting the information available to the public. Instead, as a distributor, the proprietor is only liable if she knew or should have known she was distributing defamatory statements.

This case does not mean that all on-line database and BBS sponsors will qualify as distributors even if other jurisdictions follow New York’s lead), as this conclusion depends on the particular circumstances of each sponsor. Compuserve is an extreme example: not only is it a nationwide organization, carrying a large number of publications, but it had contracted out management of its BBS to a third party and Rumorville was an independently published newsletter. The conclusion could be different if a BBS sponsor operates a system itself, can reasonably review all material uploaded onto the bulletin board, or circulates material which has not been previously published.

TLB Comment: We believe the Compuserve decision should be expanded to apply generally to BBS sponsors. Even small bulletin boards share the problem with Compuserve that data can be uploaded onto the board without prior review by the sponsor. If the sponsor is required to pre-screen each message in order to weed out potentially defamatory statements, the burdensome effect of such a rule could stunt bulletin board growth.

Postscript: Our admonition that each case of this nature stands on its own merits was confirmed in the second case to address this issue. There, a court held that Prodigy was responsible for defamatory material published on its system, since Prodigy monitored the content of its forums.