CDT POLICY POST Volume 7, Number 6, July 11, 2001

A BRIEFING ON PUBLIC POLICY ISSUES AFFECTING CIVIL LIBERTIES ONLINE
from
THE CENTER FOR DEMOCRACY AND TECHNOLOGY

CONTENTS:

(1) US Court Agrees to Hear Yahoo!'s Challenge to French Claim of Jurisdiction

(2) CDT Files Amicus Brief Highlighting Threat to Free Expression in Trans-Border Rulings

(3) Foreign Courts' Exercise of Jurisdiction over Web Content Seen in Other Cases

(4) Key Jurisdiction Issues Arising in Disparate Forums

(1) US Court Agrees to Hear Yahoo!'s Challenge to French Claim of Jurisdiction

Yahoo! has cleared a key legal hurdle as it seeks relief in US courts from a French court ruling that set a dangerous precedent for speech and commerce online. The case arises from a decision by a French court in November 2000, which ordered Yahoo! to block French users from accessing auctions -- hosted on Yahoo's US-based servers -- of Nazi paraphernalia and other items.

On June 7, 2001, in the case of Yahoo! Inc. v. LICRA, a federal court in California denied a motion to dismiss Yahoo!'s request to declare the French ruling unenforceable. The California decision opened the way for the US court to take up the merits of Yahoo's claim that the French court exceeded its jurisdiction. The US court's opinion indicated that those who seek to use the foreign courts to control US-based Web sites will face legal challenges to enforcement of those judgments.

The background is this: Last year, a French court ruled that Yahoo!, by allowing its Web site to be accessed from France, ran afoul of France's law criminalizing the exhibition or sale of racist materials. In spite of arguments that it would be technologically difficult to block only French users, the French court ordered Yahoo! to implement the necessary technology, or face heavy daily fines. The court specifically directed Yahoo! to re-engineer its content servers in the United States and elsewhere to enable them to recognize French Internet Protocol addresses and block their access to Nazi material. It also required Yahoo! to ask users with "ambiguous" IP addresses to declare their nationality when they arrive at Yahoo!'s home page or when they initiate a search using the word "Nazi."

After the French court's ruling, Yahoo! filed a lawsuit in the federal district court in its home district in California asking for a declaratory judgment that the foreign verdict was unenforceable in the US. Yahoo! argued that US courts should refuse to enforce the French judgment because it contravened fundamental US policy, namely, the strong protection of free speech offered by the First Amendment. Yahoo! pointed out that freedom of expression is recognized not only in the United States as a fundamental constitutional right, but also under international law. Yahoo! also argued that the French judgment conflicted with a US law that immunizes ISPs from liability for content that originates with third parties.

The US court ruling and the French Yahoo! decision, translated into English, can be found at http://www.cdt.org/jurisdiction/

(2) CDT Files Amicus Brief Highlighting Threat to Free Expression in Trans-Border Rulings

This may seem a little convoluted -- a US court case seeking to block a French court decision. But the issue goes to the heart of the Internet freedom: Holding Web publishers in one country liable for simply publishing material that may be considered inappropriate when viewed by citizens of another country would chill free expression and commerce on the Internet. Online speech and commerce cannot be open and vibrant if governments can extend jurisdiction over foreign-hosted content.

The French Yahoo! ruling jeopardizes the Internet's unique ability to support free expression and other democratic values. Most countries have laws controlling some kinds of speech, but these laws vary widely based on culture. From country to country, prohibitions may cover sexually-explicit materials, hate speech, blasphemy, libel, certain kinds of advertising, national security information, or criticism of government officials.

When countries attempt to control content on the Internet by applying their domestic laws to speech originating outside of their country, the threat to freedom of expression is real. Imagine if every Web site were subject to the laws of all 180 countries in the world. Ironically, it would be the voices from poorer countries that might be stifled the most, as small creators of content would find it impossible to comply with so many different laws.

Making these arguments, CDT filed a "friend of the court" brief in support of Yahoo!, joined by the American Association of Publishers, the Freedom to Read Foundation, the ACLU, Human Rights Watch, People for the American Way, the Society of Professional Journalists, and others. CDT is following the case closely.

Yahoo!'s briefs, CDT's amicus brief, and other materials on the case are available at http://www.cdt.org/jurisdiction/.

(3) Exercise of Jurisdiction by Foreign Courts Seen in Other Cases

Since the Yahoo! case, several other foreign court decisions held Web sites in other countries liable for content, illustrating the threat to freedom of speech online.

The German Federal Court of Justice ruled that the country's legislation banning communications glorifying the Nazis and denying the Holocaust applies to all aspects of the Internet, no matter what their country of origin, or how the information is presented. The case concerned Frederick Toben, an Australian-based Holocaust revisionist who denied that millions of Jews died during World War II. Toben, who was born in Germany and carries an Australian passport, was found guilty in November 1999 of promoting his opinions on Holocaust denial through printed leaflets and Web pages. Sentenced to 10 months in prison, Toben appealed, arguing that since his Internet material was "printed" outside of Germany, it was not subject to German legislation.
The Federal Court disagreed, and in doing so effectively set the precedent that all material published on the Web is subject to German legislation. In their ruling last December, Federal Court judges said that the laws prohibiting racial hatred clearly apply to Internet material created outside of Germany and stored on servers outside the country, but which is accessible to German Internet users.
Also last year, an Italian appellate court ruled that Italy had jurisdiction over a libel case brought by an Italian citizen based on statements and images injurious to his reputation and privacy that had been posted on a Web site hosted outside Italy. The court found that a "theory of ubiquity" allowed the case to go forward on the ground that, while the offending conduct took place outside of Italy, the effects were felt within the country. The case was sent back to the Italian lower court for further investigation on the facts.
The Italian libel decision, translated into English, is posted at http://www.cdt.org/international/001227italiandecision.pdf

(4) Key Issues of Jurisdiction Arising in National and International Forums

When can one country impose its law on a Web site based in another country? This is one of the most complex issues in Internet policy today - with implications for consumer protection, intellectual property, and freedom of expression. The issue of extraterritorial control over the Internet is coming up repeatedly in a variety of contexts:

France is considering a draft Information Society Law that would allow French judges to order ISPs to block the flow of data that is deemed offensive under French law. Under this proposal, Internet service providers would be civilly liable when they have been informed of apparently illegal content and have not deleted it or denied access to it. This proposal would apply not only to host providers, but also to access providers, in effect, codifying and extending the decision in the Yahoo! case.
Meanwhile, an international body known as the Hague Conference on Private International Law has been drafting a convention that would set international rules for determining in which foreign country a party could be sued and when countries must recognize the judgments of foreign courts. The "Hague Convention on Jurisdiction and Foreign Judgments in Civil and Commercial Matters" is essentially designed to make it easier to enforce court rulings across borders. The treaty covers many kinds of civil lawsuits, and may include speech-related torts such as libel and defamation. Consumer groups and free speech activists have warned that the Convention may have a detrimental impact on Internet users, particularly with regard to freedom of expression.
For more information on the Hague Convention, go to http://www.cptech.org/ecom/jurisdiction/hague.html
Finally, the US government has not maintained a consistent policy in this regard. While United States courts have repeatedly affirmed the importance of the Internet as a medium of communication and free expression, and have generally rejected attempts to censor online content, some in Congress and the Justice Department have wanted to control content on Web sites overseas, for example, in cases involving online gambling.

Detailed information about online civil liberties issues may be found at http://www.cdt.org/.

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