Calise v. Meta Platforms, Inc.

Background

Anastasia Groschen and Christopher Calise sued Meta Platforms, Inc., formerly known as Facebook, Inc. They sought to hold Meta responsible for allegedly deceptive advertisements posted by third parties on Facebook. The plaintiffs alleged that Meta actively solicited, encouraged, and assisted scam advertisers, and knew or should have known that scammers used the platform to defraud users.

Groschen alleged that she clicked a Facebook advertisement for a toddler activity board, bought the item through a third-party website, and received a cheap wooden puzzle instead. She unsuccessfully sought a refund. Calise alleged that he clicked a Facebook advertisement for a car engine assembly kit, paid for the kit through a third-party website, never received it, and never received a refund. After Calise reported the advertisement, Meta determined that it violated its advertising policies and said it would remove it; Calise alleged that the seller later posted another advertisement under a slightly modified name.

The complaint asserted negligence, breach of contract, breach of the implied covenant of good faith and fair dealing, violation of California’s Unfair Competition Law, and unjust enrichment. The plaintiffs sought monetary and injunctive relief.

Section 230 analysis

Meta moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which allows dismissal when a complaint does not state a legally sufficient claim. Meta argued both that Section 230 of the Communications Decency Act barred the claims and that the plaintiffs had not adequately pleaded each claim.

Section 230 generally protects an interactive computer service from being treated as the publisher or speaker of information supplied by another content provider. The court found that Meta was an interactive computer service provider and that third parties created the advertisements at issue.

The court explained that a website can lose Section 230 protection when it materially contributes to the unlawfulness of third-party content. But the plaintiffs did not allege that Meta required advertisers to use particular content, suggested the content of the advertisements, helped create the unlawful advertisements, or directly participated in the allegedly fraudulent transactions, which occurred on third-party websites. The court found that Meta’s efforts to cultivate advertising relationships and encourage advertisers to use the platform did not make Meta the creator of the allegedly unlawful advertisements.

The court also rejected the argument that Meta lost Section 230 protection by failing to remove fraudulent advertisements or adequately enforce its advertising policies. Decisions about whether to remove third-party content were covered by Section 230, according to the court.

The plaintiffs separately argued that Section 230 did not cover their contract claim. The court rejected that argument because the contract claim was based on Meta’s alleged solicitation and publication of deceptive third-party advertisements, and therefore arose from Meta’s role as a publisher.

Disposition

The court concluded that all of the plaintiffs’ claims were based on Meta’s publication of third-party advertisements and that Meta was entitled to Section 230 immunity as to each claim. Because it reached that conclusion, the court did not address whether the plaintiffs had pleaded sufficient facts under Rule 12(b)(6).

The court found that amendment might not be futile because the plaintiffs could potentially allege conduct by Meta that went beyond merely publishing the advertisements, such as involvement in creating or developing the allegedly illegal content. Judge White therefore granted Meta’s motion to dismiss with leave to amend. The plaintiffs were ordered to file any amended complaint within 21 days.