SAN FRANCISCO—Salesforce, a publicly-traded software development company known for developing enterprise customer relationship management solutions, is on the hook for claims of aiding child sex trafficking in a lawsuit brought by a suing party claiming they were victimized and trafficked by Backpage.com.
A split panel of three judges sitting on the U.S. Court of Appeals for the Seventh Circuit ruled that Section 230 of the Communications Decency Act of 1996 doesn't immunize Salesforce, despite case law from recent weeks and months suggesting that the judges are relying on an outdated assessment of the law that resulted in the takedown of the popular classified site and the questionable indictments of James Larkin and Michael Lacey.
This particular case was filed under FOSTA-SESTA, a controversial federal law that sought to curtail online sex trafficking but simply gutted free speech rights on the internet. After former President Donald Trump signed FOSTA-SESTA into law, a civil exception was carved out from the broad protections under Section 230 for non-criminal violations of federal sex trafficking laws.
The exception includes language that grants a civil action against an individual or entity “knowingly benefiting” from “participating in a venture” involved in civil or criminal violations of sex trafficking laws under FOSTA-SESTA statutes. Mike Masnick, the editor for Techdirt.com, also pointed out that the judges in the Salesforce case have dismissed a ruling that upheld the constitutionality of FOSTA but narrowed the legal standards for what is “aiding and abetting” a civil or criminal defendant. That is an extremely high threshold to meet, he argues.
Other case law in question could be found in the landmark decisions for the U.S. Supreme Court cases of Twitter v. Taamneh and Gonzalez v. Google. In Twitter v. Taamneh, the high court ruled per curiam (unanimously) that Twitter cannot be held accountable for aiding and abetting the Islamic State terrorist group in the carrying out of a 2017 bombing at a nightclub in Istanbul.
A similar finding was reached in Gonzalez v. Google, indicating that a majority of the court had no business redefining Section 230 in attempting to lump liability on Google’s parent company, Alphabet, for circulating extremist content related to Islamic State via YouTube recommendation algorithms, which the plaintiffs allege contributed to the 2015 Paris terror attacks and the death of a U.S. citizen who was studying abroad in France at the time. In the Supreme Court’s opinion on Twitter, they state that this was a “far cry from the type of pervasive, systemic, and culpable assistance to a series of terrorist activities that could be described as aiding and abetting each terrorist act.”
Following similar reasoning in a ruling on FOSTA’s constitutionality, a panel for the United States Court of Appeals for the District of Columbia Circuit decided in the case of Woodhull Freedom Foundation v. United States that narrowing the law is necessary. Ricci Levy, the president and chief executive officer of Woodhull Freedom Foundation, explained in a press release that the “court ruled out many of the broader applications of FOSTA that caused us to challenge it.” Considering these assessments, the Seventh Circuit in the Salesforce case chose to broadly interpret the civil action provision in FOSTA, which could lead to similar lawsuits that some observers consider to be frivolous. Eric Goldman, a leading legal mind on internet speech and an advocate for Section 230, told The National Law Journal recently that “[t]here’s so many lawsuits out there alleging ... civil claims over sex trafficking, and so this opinion ... impacts all of them and potentially swings the pendulum even more in favor of the plaintiffs in those cases.”
Goldman, a professor at the Santa Clara University School of Law, explained further to Journal appellate court reporter Avalon Zoppo that the latest ruling in the case of G.G. v. Salesforce is a “roadmap” for how one party can sue other companies that served as vendors to Backpage.com and could survive a motion to dismiss. Note the Seventh Circuit panel was split on the ruling that Salesforce has to face claims that it knowingly aided and abetted sex trafficking by giving CRM services to Backpage before its seizure in April 2018.
The lone dissenting member of the panel, Judge Thomas Kirsch II, said that the majority—judges David Hamilton and Doris Pryor—broadly interpreted federal sex trafficking statutes in this case. Kirsch argues in the official opinion: “The majority ... concludes that the plaintiffs may hold Salesforce civilly liable ... as a participant in sex trafficking because Salesforce sold customized software to Backpage when it should have known that Backpage violated [the named plaintiffs] ... at some point in time, but not necessarily,” Judge Kirsch wrote. G.G., at the time of the initial filing, was characterized as a minor, and the suit was brought against Salesforce with the help of G.G.’s mother. “That broad reading ... would extend civil liability to nearly every company and individual who did regular and personalized business with Backpage after it faced public allegations of sex trafficking,” he added. “It also renders meaningless ... requirement that the defendant have constructive knowledge of a ... violation. Because the plaintiffs have not alleged that Salesforce should have known of G.G.’s particular trafficking, they have failed to allege a ... violation. I respectfully dissent.”
The decision at the Seventh Circuit overturns a dismissal handed down by Judge Andrea Wood of the U.S. District Court for the Northern District of Illinois, based in Chicago. In that ruling, Wood said that counsel representing plaintiff G.G. and her mother failed to present a case that meets the “required elements of a claim for beneficiary liability” under FOSTA. “This case is dismissed with prejudice because Salesforce is protected from liability under [Section 230] of the Communications Decency Act,” Judge Wood wrote in her final order published in May 2022.
The revival of G.G. v. Salesforce comes days after the former Backpage.com executive James Larkin committed suicide in Arizona. The ruling from the Seventh Circuit also came days before Larkin was scheduled for a retrial in the criminal case brought against him and business partner Michael Lacey. According to The Independent, Larkin’s death has delayed the proceedings of the trial.
A federal judge hearing the first criminal trial against Larkin and Lacey declared a mistrial in the case in 2021 but granted the prosecuting U.S. Attorneys the ability to re-hear the filed charges.
