Cubby v. Compuserve [1]

In this landmark internet case, internet service provider Compuserve was absolved from liability for content hosted on its servers.

Don Fitzpatrick published a daily newsletter called "Rumorville" that provided news and gossip pieces about the journalism industry and individual reporters. Rumorville was available to CompuServe users who subscribed to CompuServe's Journalism Forum, one of CompuServe's many electronic forums and electronic bulletin boards that were operated by third parties.

Robert Blanchard and his company Cubby, Inc. developed a competing news source called "Skuttlebut." They claimed that Rumorville had published disparaging remarks about Skuttlebut that were false and which rose to the level of defamation. In addition to suing Fitzpatrick, however, the plaintiffs brought action against CompuServe itself, alleging that as a publisher, CompuServe was liable for the statements of its authors.

The Southern District of New York dismissed all claims against CompuServe, ruling that CompuServe did not have the status of a publisher, but one of a distributor. A distributor, the court said, must have first-hand knowledge of the contents of a publication before liability is imposed. Compuserve, the court found, had no knowledge and weilded no control over Rumorville's publications, nor did it have the "opportunity to review Rumorville's contents before [Fitzpatrick] uploads it onto CompuServe's computer banks, from which it is immediately available to approved [CompuServe] subscribers."

That an internet service provider (ISP) does not carry the responsibility of a publisher was far from a settled question, even after the Cubby decision. In this case, the Court said: "CompuServe has no more editorial control over such a publication than does a public library, book store, or newsstand, and it would be no more feasible for CompuServe to examine every publication it carries for potentially defamatory statements than it would be for any other distributor to do so."

However, a couple years later, a court in Stratton Oakmont v. Prodigy Services [2] held that Prodigy, another online service provider, was responsible for user-uploaded content because it excercised more editorial control over its articles than did CompuServe.

The Stratton case was arguably a break from the Cubby decision, representing an expansion of liability for ISPs. Nonetheless, soon after the Stratton case Congress passed the Communications Decency Act which provides immunity for most third-party content under section 230 [3].