Law of Sex
Mommy Porn & Social Media: Erotic and Mainstream Meet in the Middle
Christian Grey. If you haven’t heard that name uttered dozens times over the last year, it’s safe to say that you may have been living under a rock. While certainly not a literary prose masterpiece, the Fifty Shades trilogy hasn’t done too bad for itself, reaching a sales record of over 31 million copies worldwide just a few days shy of its thirteen month publication anniversary. Evidently tired of their typical lackluster fiction, women across the globe embraced literary erotica in a way never before seen. Sophisticated marketing campaign? Nope. Just your average suburban housewife word of mouth and young professional girly gab session via Facebook. Quite possibly the first truly erotic novel since the advent of the “Oprah Book Club” group dynamic – promotion simply fueled by women talking to other women – has generated a massive demographic of female readership that just keeps growing. So a mediocre piece of fan-fiction centering on the BDSM escapades of an older, emotionally unavailable, brooding alpha male and his younger, innocent, eager-to-love and be-loved companion, is redefining the landscape of mainstream literature as we know it?
Well, don’t get Gloria Steinem on speed dial just yet. The appeal of Fifty Shades has been the subject of many debates over the last year – why are women across the globe scrambling for this book to the point that retailers can’t even keep it on the shelves? For those that viewed the book as more than just another piece of dark chick lit to pacify rainy day boredom, Fifty Shades proved that it could live up to all the sexual liberation hype by simply being available to its target demographic. Whether it triggered long-suppressed bondage fantasies or simply offered an uninhibited escape from the mundane, the book provided a [albeit hazy] glimpse into a fetishist counterculture that was barely even acknowledged in mainstream society, let alone openly discussed during public discourse. This mysterious and clandestine faction of the adult entertainment world collided with the civilian world, and surprisingly, everyone survived.
That being said, what about the classic “porn is taboo” default – a mentality that is supposedly true when it comes to the average female? Is a passage detailing the physical, mental and emotional landmines of a sub-dom relationship between a naïve college student and an emotionally troubled masochist with the help of whips, chains and riding crops from his “playroom,” less oppressive than Debbie Does Dallas? Despite the fact that many schools of feminist thought are rooted in the notion that pornographic materials are damaging to women’s civil rights, feminist-minded activists and writers around the world are praising Fifty Shades as a carnal awakening ”encouraging women to explore their sexuality.” Regardless of the reasoning behind it, generally speaking, certain demographics of females tend to be more receptive to literary erotica as opposed to its visual counterpart. This preference often remains true regardless of the particular content presented in the respective materials.
Notably, there have been contemporary instances where allegations of obscene literature have made their way through the legal system and caused substantial commotion throughout the adult industry during the process. In 1973, the US Supreme Court, in Kaplan v. California, determined that visual images were not necessary to label a work obscene. Even more recently, in 2006 during what became known as the “Red Rose Case,” US Attorneys in the Western District of PA charged an author (and former client) with six counts of distributing obscenity stemming from fictional erotica that she published on her website. US v. Fletcher. This begs the question: in light of the widespread acceptance of Fifty Shades, has text finally become immunized from obscenity charges, or at the very least, less susceptible to prosecution compared to the past? Even if future prosecutors refuse to acknowledge the shift in public perception, there is no doubt that the book’s notoriety and widespread acceptance by the public, will impact juries and community standards arguments for years to come. Lawyers can, and will, predictably reference Fifty Shades of Grey in closing arguments in obscenity cases for years to come.
The Fifty Shades collection is the fastest and bestselling literature series in Kindle history – therefore, it’s no surprise that Fifty Shades of Grey was the first book to sell more than one million Kindle copies. Many have attributed this symbiotic relationship to the fact that Kindles, like other e-readers, afford the reader a level of privacy regarding her current read that was previously nonexistent. In book form, erotic covers were a dead giveaway. With digital manuscripts comprising over 90% of Fifty Shades sales, the marketplace – at least that of female-centric soft core S&M literature – was noticeably receptive to the more covert viewing alternative provided by e-readers. By allowing women to explore literary genres that they traditionally spurned for fear of public exposure of less-than-pure reading habits, e-reading technology is clearly helping to bridge the gap between erotica and mainstream literature. Just as Sasha Grey (who, coincidentally, may play the story’s “Anastasia Steel” in the upcoming film) made the virtually unprecedented leap from porn to mainstream, the Fifty Shades series represents a quantum leap in the mainstreaming of porn.
Surprisingly, just as technology is aiding in advancing porn to the mainstream, it also has a hand in the budding relationship between porn stars and the public. Recent studies show that social media is helping bridge the gap between mainstream society and the adult entertainment industry. Porn stars have taken to social media sites to enable direct communication with civilians in hopes of promoting themselves and developing their respective brands. Allowing the public to engage in this type of personal interaction discourages the typical porn star stereotypes as it allows the stars to be more approachable to their fan base. Given that the very core of the adult industry is rooted in fantasy, performers are finding that allowing the public a glimpse into their private lives facilitates a sense of reality to the relationship. By cultivating that “real” relationship, the entertainers eventually hope to make porn more mainstream, and therefore, more ”socially accepted.”
Never before has the author been able to conclude a post with as strange a statement as this: the average woman is using personal technology to access BDSM erotica hoping to broaden her sexual horizons and bring out her inner kink goddess, while the average porn star is using conventional social media hoping to make herself and her profession appear as mundane as possible. Regardless of where you fall on the spectrum, it is undeniable that technology is allowing, if not actually compelling, the normalization of pornography in mainstream culture – and based on the public’s reception of such activities, the ultimate goal of societal acceptance may not be as unattainable as once thought.
The Ends of the Earth – How Far Can U.S. Content producers pursue foreign infringers?
We all witnessed the uproar over PIPA and SOPA at the beginning of the year. Internet free speech advocates took to cyberspace in a call for action against these proposed laws. Advocating for the broad principle of intellectual property protection, lobbyists for the mainstream film industry argued for the enhanced ability to go after foreign “rogue” websites involved in infringing activity. While the underlying motivations for enacting PIPA/SOPA may have been well-intentioned, they impacted personal freedoms to the point that made many Americans uncomfortable, and the legislation soon stalled in response to the public pressure. A major concern with PIPA/SOPA was that the bills granted the U.S government legal authority over any website domain, wherever hosted or operated, even in the absence of a domestic jurisdictional connection. While the legislative efforts continue, the courts have recently expressed concern, through a series of legal decisions, with enforcement of intellectual property rights against foreign website operators. These decisions may have a substantial impact on the ability of U.S. content producers to pursue foreign websites for copyright and trademark infringement.
U.S. courts primarily gain personal jurisdiction over the parties by the physical presence of the defendants in the location where the lawsuit was filed. However, when the defendant is a foreign entity or individual operating a website, U.S. courts have been increasingly hesitant to find the existence of jurisdiction, merely based on web presence. A U.S. district court can exercise personal jurisdiction over a defendant if the party is “subject to the jurisdiction of a court of general jurisdiction in the state where the district court is located.” Fed.R.Civ.P. 4(k)(1)(A). This means that personal jurisdiction over a non-resident defendant may be acquired by: (a) the defendant’s physical presence in the subject state; or (b) the state’s long-arm statute. A “long-arm” statute allows a court to assert jurisdiction over an out-of-state (or foreign) defendant based on injury suffered by the plaintiff in the state, or some other activity creating a relevant connection. Most long-arm statutes permit this type of extraterritorial jurisdiction so long as doing so constitutes ‘fair play,’ and otherwise comports with Due Process notions.
Recent Judicial Decisions.
In the earlier days of the Internet, U.S. courts seem to have had no qualms about imposing American law on websites maintaining any form of customer base within the U.S., regardless of where the site was operated. However, in recent times, as the world has gotten smaller and foreign online presence more established, judges are starting to realize that the U.S. may have previously attempted to exert a little too much control over the Internet. With seemingly endless cyberspace growth fostering a more “global marketplace,” U.S. courts may be starting to pay more heed to other countries’ laws and sovereignty. Concerns such as diplomacy and comity have come to the forefront, as all nations compete for a seat at the Internet table.
This struggle has played out in the attempt to enforce U.S. copyright and trademark law abroad. Over the last few months, several courts have addressed the issue of whether foreign websites can be held liable for intellectual property violations asserted by U.S. plaintiffs. These courts have all dismissed the cases for lack of jurisdiction. In Fraserside IP L.L.C. v. Hammy Media, Ltd., 2012 WL 124378 (N.D. Iowa Jan. 17, 2012), a federal judge found that the adult entertainment power house, Private Media Group (through its IP holding company), could not establish personal jurisdiction to sue operators of the adult tube site, xHamster.com, in the state of Iowa. Finding that the Cyprus-based tube site lacked sufficient minimum contacts in Iowa, the court rattled off a laundry list of reasons for its decision: "xHamster has no offices in Iowa, no employees in Iowa, no telephone number in Iowa, and no agent for service of process in Iowa. xHamster does not advertise in Iowa. No xHamster officer or director has ever visited Iowa. xHamster does not maintain any of its servers within Iowa. All of xHamster's servers are located outside of the United States." This ruling is consistent with the general principle that the mere availability of a website in the U.S. will not be sufficient to establish personal jurisdiction over the site operators. The same ruling occurred with Private’s case in Iowa against another foreign tube site, DrTuber.com. Fraserside v. Moniker, et al., Case No.: 11-cv-03040 (N.D. Iowa 2012).
A few months after the xHamster.com decision, a California district court protected another adult entertainment website by denying the plaintiff’s motion for a default judgment in the “faceporn.com case,” Facebook v. Pedersen, 10-Cv-04673 (N.D. Cal. March 2, 2012). Relying on a relatively broad jurisdictional argument, Facebook claimed that the defendant intended to compete directly with Facebook and given Facebook’s global notoriety, anyone infringing on Facebook’s intellectual property would know such infringement is harming a California entity. According to the district court ruling, plaintiff’s argument failed two-fold as Facebook lacked any evidence that the defendant purposefully directed its activities at California and further, was unable to prove that the defendant’s conduct successfully redirected traffic away from Facebook. Notably, the court essentially made the arguments for faceporn.com, since the decision was based on a motion for default judgment.
Coming out of Nevada just over a week later, another off-shore website dodged the jurisdictional bullet in the case of Stevo Design, Inc. v. SBR Marketing, Ltd., 2:11-CV-0304 (D. Nev. March 13, 2012). The Nevada district court ignored any potential personal jurisdiction issues, instead dismissing the case based on lack of “subject matter” jurisdiction – an issue that had not even been argued by the defendant. Subject matter jurisdiction involves the underlying authority of the court to consider the case, in the first instance. Often seen as a relatively simple hurdle, U.S. law gives the federal courts subject matter jurisdiction in when the suit is based on a violation of a federal statute, or when the resident of one state sues a defendant of a different state (or another country). Claiming that several of its sports betting reports were unlawfully uploaded and published via the defendant’s website, SBRforum.com, plaintiff’s sued forum site for various violations arising under the Lanham Act and the U.S. Copyright Act. The court noted that all of the alleged infringement occurred entirely on SBRforum.com. Because the defendant’s website was operated in Costa Rica, the court found that it lacked subject matter jurisdiction to even consider the case since federal statutes provide no relief for infringement that occurs solely in a foreign nation.
What may have been taken as a ‘given’ in the past is now being questioned by this new line of cases, imposing what appears to be a higher burden on those seeking to hold foreign website operators responsible for U.S. intellectual property violations. The mere fact that the site is globally available and happens to maintain a U.S. customer-base may no longer be sufficient as a basis for bringing foreign defendants into U.S. courts, under recent judicial rulings. Whether these rulings are a brief respite for foreign website operators, or the beginning of a new judicial trend, remains to be seen. But adult content producers become more aggressive in pursuing theft of their content by foreign website operators, these legal issues are sure to gain significant attention in the coming months.
The Politics of Porn - 2012
By the close of 2011, the Republican presidential hopefuls had their work cut out for them. It was starting to look like the people had gotten their fill of Michele Bachmann’s eccentricities. Such a sentiment was confirmed at the Iowa caucuses, when the Tea Party Chair, receiving only 5% of the votes, placed sixth among the other candidates, ultimately resulting in Bachmann’s withdrawal on January 4, 2012. Despite consistent double-digit polling numbers since early fall, January claimed another candidate in former Utah Governor, Jon Huntsman. Withdrawing from the race on January 16, the former ambassador pledged to “stay relevant” in the race, and has kept that promise by actively supporting Mitt Romney. Then, of course, there’s Herman Cain – once his luck ran out with the ladies, the voters soon followed. Despite suspending his candidacy back in December amidst allegations of sexual misconduct, Cain has done his best to remain in the spotlight, still lobbying for his 9-9-9 Plan and has yet to formally endorse one of his former competitors. And we can’t forget 2012’s latest casualty, Texas Governor, Rick Perry. After his promises to end “Obama’s war on religion” evolved into concerns of Perry’s War on the Establishment Clause, steam behind Team Perry was waning towards the end of 2011, and finally came to an end on January 19.
At this point, it’s almost mid-February and oh how the tides have turned. Deemed a misfit for most of his political career, Ron Paul has ridden the ‘rebel, nonconformist’ wave all the way to its peak. With that success, comes mainstream popularity and partial loss of Paul’s famous underdog status. Struggling to reconcile the Congressman’s political identities, voter support seems to be reaching a plateau, although not necessarily declining. The likely result: Paul is applauded for his valiant effort, but ultimately directed by the GOP powers-that-be to graciously keep the rebel rousing within the confines of the Texas state line.
Former Speaker of the House, Newt Gingrich, was thought to be down and out this past summer after a series of questionable spending excursions and the infamous mass exodus of several high-ranking campaign officials. But ever the true politician, Newt has overcome the instability of his early campaign and gained enough momentum to be considered a genuine presidential hopeful.
Probably the biggest candidate surprise of the campaign thus far is former Pennsylvania Senator, Rick Santorum. Battling disheartening numbers since the day he threw his hat into the ring only to surge ahead in 2012 by winning four of the eight presidential primaries thus far, Santorum is the very definition of a “comeback kid.” Making no apologies for his socially conservative politics, Santorum ready and willing to squeeze out the very last bit of libertarian influence that might be left in the GOP, and based on recent numbers, he might just be able to do that.
The one constant since the beginning of the campaign trail is Mitt Romney’s title as the election’s front-runner. Romney is currently blowing everyone out of the water with ninety-five pledged delegates; that’s more than the other three candidates combined. Maybe the American people think a business consultant as President is the only way to completely pull out of this economic tailspin, or maybe we all harbor deep-seeded respect for Mormon’s with good politician hair – either way, Mitt Romney isn’t going anywhere any time soon.
So what do the Republican Presidential candidates have to say about adult entertainment issues? Not that the Obama Administration has been the champion of personal freedoms that was originally hoped for, but at least the DOJ’s decision to focus on child pornography instead of filing any new obscenity cases allowed the industry a bit of momentary relief. However, it’s safe to say that if a Republican takes over the presidential seat, it’s going to be a different ballgame all together.
According to Morality in Media’s (“MIM”) President, and former DOJ official, Patrick Trueman, “Vigorous prosecution of those who violate our nation's obscenity laws is critical now. Our nation is suffering a pandemic of harm from pornography that is readily available - even to children on the Internet and in other venues.” Trueman has targeted Santorum, Romney and Gingrich for months, requesting that the candidates take a public stand in favor of his anti-porn efforts.
Heading straight for the newbie, Trueman successfully got Santorum to sign the Family Leader Pledge (made famous by former candidate Bachmann’s “ban on porn”) all the way back in July of 2011. The pledge requires Santorum to uphold, among other things, the “Humane protection of women and the innocent fruit of conjugal intimacy — our next generation of American children — from human trafficking, sexual slavery, seduction into promiscuity, and all forms of pornography and prostitution, infanticide, abortion and other types of coercion or stolen innocence.”
Nothing if not persistent, Trueman continued MIM’s crusade this past October by demanding that the 2012 presidential candidates publicly disclose “their respective views on the enforcement of obscenity laws.” MIM officials eventually obtained statements by all three of the frontrunners after calling on MIM followers to continue the crusade through emails, calls, and meetings with the candidates urging them to respond to MIM’s request for disclosure.
In his response to MIM, Santorum wrote: “Federal obscenity laws should be vigorously enforced. If elected President, I will appoint an Attorney General who will do so.”
In a one-on-one interview with MIM staffers, Gingrich was asked if he will enforce existing laws that make distribution of hard-core adult pornography illegal, he responded: "Yes, I will appoint an Attorney General who will enforce these laws."
The only candidate to reference online content in his written reply to the MIM demand, Romney stated: “It is imperative that we cultivate the promotion of fundamental family values. This can be accomplished with increased parental involvement and enhanced supervision of our children. It includes strict enforcement of our nation's obscenity laws, as well as the promotion of parental software controls that guard our children from Internet pornography." Although, Mitt’s status as one of MIM’s golden boys of piety may have hit some rough terrain as it was revealed that everyone’s favorite squeaky-clean Mormon accepted a maximum amount campaign donation from Daniel Staton, chairman of the board of the company that owns Penthouse. While this may not be tantamount to accepting a donation from Max Hardcore or Extreme Associates, this minor campaign faux pas is going to raise more than a few eyebrows.
With MIM sparking GOP discussions of a resurrection of strict enforcement of obscenity laws, notions of MIM President’s Trueman staging a re-entry into politics seem unsettlingly attainable. So is the country in imminent danger of the DOJ turning into the “Trueman Show” come January, 2013? Hopefully not, but with polling data saying one thing, schizophrenic primary numbers saying another, and public opinion exhibiting an extreme of the two on any given day, it truly is anyone’s race. The stakes are high for the country and our Constitutional freedoms. And with the top three presidential candidates pledging to reinvigorate the ‘War on Porn,’ one can’t help but hope that the adult industry won’t be one of the losers in 2012.
Killing the Messenger: The Campaign Against Online Escort Advertising Sites Part II – Operational Policies & Legal Issues
In Part I of the Killing the Messenger blog post, we addressed the latest headlines highlighting the plight of online escort directories, specifically including the story of Craigslist.org, Backpage.com, and Escorts.com. We now turn to an overview of the legal issues associated with such attention-grabbing stories and attempt to identify preventative measures to be considered by those associated with the online escort directory business model.
One of the unanswered questions resulting from the epidemic of law enforcement activity against online escort directories is whether the mere acceptance of advertising revenue from escort-related activity is against the law? Does some state or federal statute prohibit this business model, or is this a large ‘bluff’ by those seeking to censor disfavored speech? Indisputably, prostitution is against the law throughout the United States except for small portions of Nevada, where legal brothels are allowed to exist. Virtually all states prohibit not only the act of sex for hire, but many related offenses such as deriving proceeds from prostitution, renting a space for purposes of prostitution, and facilitating (or aiding and abetting) the act of prostitution. At the federal level, earning money from prostitution that involves some element of interstate commerce (such as website operation) can allegedly violate the Travel Act and money laundering laws, as seen in the Escorts.com case. However, not all escort directory websites are equally vulnerable to prosecution under these laws, as discussed below. Paying close attention to certain relatively common business practices and developing reasonable advertising review policies can make a significant difference in the degree of risk associated with operation of an online escort site.
Escorts, although engaging in presumptively lawful companionship activity, awkwardly fall within what has become known as the “sex worker” occupation. While those in the adult industry recognize that these companionship providers do not equate their services with sex, their business is erotic and adult-themed entertainment. Nudity may or may not be involved, although stripping in the privacy of a home or hotel room is typically not against the law, and does not constitute prostitution. However, the association with the ‘sex worker’ category is often perceived by mainstream society as having some type of involvement with actual sexual intercourse, or some other form of sexual activity. Until this perception is corrected, escorts will continue to fight being unfairly, and automatically branded as prostitutes by those not familiar with the nuances of the profession.
Federal conspiracy, solicitation and money laundering statutes certainly don’t help an escort site’s plight. The epitome of broad and vague statutory language; these laws expose even the most tangentially involved individual/entity to potential legal liability.
Under classic criminal conspiracy, the government need only prove (1) an agreement to engage in criminal activity, (2) one or more overt acts to execute the agreement, and (3) intent to commit the substantive crime. The language of the conspiracy statute cited as grounds for Count I against Escorts.com defined the alleged conspiracy as two or more persons conspiring to commit an offense “in any manner or for any purpose” – you can’t get much more general than that.
1) the website allowed escorts to post advertisements pertaining to their services,
2) the company owning/operating the website received revenue from the escort’s ads and subscriptions from users paying to view such ads,
3) the site’s users were allowed to post reviews, and,
4) “some” of the escorts advertising on the site engaged in prostitution at some point during the advertiser’s association with the site.
A significant factor in the Escorts.com case appears to be the ability of users to post reviews directly on the site. While the significance of this feature may not be readily apparent to those outside this particular niche, the existence of ‘free form’ user reviews, where customers of the advertisers can post comments and feedback pertaining to their ‘experiences’ with the escorts, can significantly impact the level of knowledge imputed to the escort directory operators. For example, if a user posts that he or she engaged in illegal sexual activity with a provider (whether true or not) this is something that the government might use to demonstrate actual or constructive knowledge of illegal activity by the website operators. The element of “knowledge” would be key in any criminal prosecution brought against an online escort site. Absent some level of knowledge that escorts were ‘crossing the line’ into prohibited conduct, an escort directory should be treated the same as any other online advertising venue for a presumptively legal service. Only when the site operators learn that their advertisers are engaging in such illegal activity, should the concept of criminal liability even be considered.
With the foregoing in mind, what are the danger zones when it comes to “knowledge” that can be associated with criminal culpability? The answer to that question can only truly be provided by an experienced attorney that is familiar with the specifics of any particular escort site’s business model and operating policies. But the following issues should be considered when evaluating potential legal exposure associated with an online escort directory:
- User Reviews: As noted above, any sort of free form reviews incorporated into an escort’s advertising space can be dangerous. Initially, the potential for bogus or fraudulent reviews exists, which could confuse readers and provide prosecutors with plenty of evidentiary fodder, even if the information is not truthful. Moreover, if a user submits an accurate review that includes references to an escort engaging in sex for money, the government would argue that such a review should impute some degree of guilty knowledge on the escort site operator. Counter-arguments exist, of course, but allowing user reviews to be placed directly on an online escort’s ad is a practice that should be carefully evaluated, if it is permitted at all.
- Age Verification: Escort activities are for adults only. Law enforcement is particularly concerned about exploitation of minors by online escort directories. Therefore, use of some age verification device for advertisers is essential. While all escorts may not be willing to provide government-issued ID’s prior to placing an ad, criteria can be developed so that young (or young-looking) advertisers are required to engage in a higher level of age verification than older advertisers. A wise mixture of online age verification devices, database searches, and ID checks can be important to reduce the legal risks associated with online escort directories.
- Ad Approval:
- To Review, or Not to Review? Should escort ads be reviewed and approved by the site operator before publication, after publication, or not at all? That is a difficult decision that will need to be made after consideration of the interplay of three federal statutes; 47 U.S.C. §230 (“Section 230”), 17 U.S.C. §512 (“the DMCA”), and 18 U.S.C. §2257 (Section 2257). We call it; the “Trifecta.” These statutes provide potential immunity, safe harbor and records-keeping compliance exemptions (respectively), for certain online service providers, assuming the business operation is set up properly. While advance review of images and text might be the natural inclination for the diligent webmaster trying to prevent the publication of improper (or illegal) material, such actions could adversely impact the protections afforded to online service providers by federal law. For example, selecting which images are acceptable for publication in an ad could make the site a ‘producer’ under Section 2257, and thus responsible for keeping records associated with any sexually explicit depictions. However, failure to review material before publication could result in underage images or other inappropriate material appearing on the site for at least some period of time, thus triggering other legal concerns. Similar concerns apply to the text of the proposed ads. Reviewing ad text is important to identify any advertisers who intend to offer illegal services. Different policies can be developed for review of images as compared to text, so all options should be explored with counsel.
- Approval Criteria. Assuming that some level of pre-publication review occurs, what criteria should be used? This is where the ‘rubber meets the road’ for escort directories and their lawyers. Development of a viable set of publication standards is critical for risk mitigation purposes. Obviously, any ad that states or suggests willingness to trade sex for money should automatically be rejected. But numerous questions arise concerning where to draw the line in such circumstances. What if the suggestion is made using little-known slang terms, or is the subject of a subtle hint as opposed to an outright proposal? The vernacular of the escort industry is constantly changing, so keeping up with a list of ‘banned terms’ can be a full time job. If the ad is rejected, should the advertiser be permanently banned, as someone willing to engage in illegal activity, or should the advertiser be offered another opportunity to submit a legally-compliant ad? If the advertiser is banned, what precautions should be implemented to ensure that he or she does not sign up using different contact information, or a different name? Should the law of the location where the proposed services will be rendered be taken into consideration, or only the law where the escort directory operates? The answers to all these questions are by no means clear, and much depends on the risk tolerance of the website operator. But generally, the more efforts that are used to weed out escorts who demonstrate a desire to violate the law, the safer the site will be.
- Vouching. What about user or advertiser ‘verification’ or ‘vouching’ services? The Internet has allowed individuals to obtain feedback about potential customers and service providers in all industries, and escorts are no exception. Customers can make sure that the thin blonde in the ad is really a thin blonde, while escorts can make sure a potential customer is not violent, deceptive or incompatible. These are all positive developments for both parties, but implementing a verification procedure increases certain risks for the site providing such services. Any failure of the system might be blamed on the site operator. This is where online terms of service and disclaimers are essential. Again, one’s risk tolerance must be considered when verification or vouching services are offered.
As referenced above, it is imperative for escort sites to realize the subtle “red flags” when it comes to escort advertisements. This is a more difficult job than identifying prohibited images. A visual image that crosses the line, so to speak, is relatively easy to notice even in a stack of digital ads. Finding one little word that might violate a site’s publishing standards, on the other hand, is completely different and can be extremely arduous. Detection of unlawful terminology is often considered so important to the legal health of an escort site, some operators have taken to publicizing “banned terms” list as a guideline for their advertisers and have gone so far to generate an even more comprehensive internal list of flagged terms as an added precaution. Decisions as to what terms to include in public and/or internal lists are difficult, but reasonable policies can be developed and implemented.
Although ignorance is bliss, the law often doesn’t see it that way. Defending prostitution or money laundering charges with an “I didn’t know” argument may, in fact, be the truth, but it’s not likely to get you very far with an aggressive prosecutor. Even though escort services are presumptively legal, escort directory sites should implement reasonable precautions to identify those escorts with a proclivity to violate the law; preferably before an ad is published.
The preventative measures discussed above are far from comprehensive and have only scratched the surface of online escort directory safeguards. If nothing else is taken away from this post, understand that operating an escort website is not to be undertaken lightly. Even if you are able to distinguish your current business model from that of sites like Escorts.com or the former adult services category of Craigslist.org, the law in this area remains murky, and concepts of conspiracy, intent, and facilitation are inherently vague. Nonetheless, these legal concepts are routinely applied to prosecute individuals having only tangential association with criminal activity. Given the focus on escort classified sites by state and federal authorities in recent years, a comprehensive risk mitigation strategy should be developed for any existing or new operations in this field.
All statements made in the above article are matters of opinion only, and should not be considered legal advice. Please consult your own attorney on specific legal matters. You can reach Lawrence Walters at firstname.lastname@example.org or www.FirstAmendment.com.
 See e.g., Chapter 796, Fla. Stat. (2011). See, 796.03 – Procuring person under age of 18 for prostitution; 796.035 – Selling or buying of minors into sex trafficking or prostitution; penalties; 796.04 – Forcing, compelling, or coercing another to become a prostitute; 796.045 – Sex trafficking; penalties; 796.05 – Deriving support from the proceeds of prostitution; 796.06 – Renting space to be used for lewdness, assignation, or prostitution; 796.07 – Prohibiting prostitution, etc.; evidence; penalties; definitions; 796.09 – Coercion; civil cause of action; evidence; defenses; attorney’s fees.
 See 18 U.S.C. §1952; 18 U.S.C. § 1957(a).
 Some cities and counties prohibit nudity in ‘commercial establishments’ but personal residences and hotel rooms would typically be exempted from the purview of such laws.
 For example, the vast majority of BDSM companions (such as dominatrixes) categorically refuse to mix actual sexual activity with their professional services, and none is expected by those who engage such companions.
 That being said, as shown by the pressure brought to bear against Craigslist and Backpage, knowledge isn’t always a given in these cases. Law enforcement may also claim that the operators are, in various ways, turning a ‘blind eye’ to ongoing illegal activity by their advertisers. Thus far, this argument has not been tested in any published court case.
 See e.g., http://www.idology.com.
Killing the Messenger: The Campaign Against Online Escort Advertising Sites; Part I – Setting the Stage
The recent guilty plea by Escorts.com has ignited interest in the legal issues surrounding the operation of an online escort site. In this two-part blog post, the author will examine real-world examples of the government’s recent resurgence in its crusade against escort advertising directories, followed by an overview of pertinent legal concerns applicable to this business model.
In recent decades, law enforcement has started focusing its attention on the common advertising venues for prostitution – escort agencies, massage parlors, etc. Some agencies have gone so far as to threaten local phone book publishers with racketeering charges for publishing ads for escort agencies in their yellow pages. Actual racketeering charges were filed against an alternative weekly newspaper in the Orlando, Florida, area based on its publication of escort ads, but the charges were later dismissed. Law enforcement continues its witch hunt-like pursuit of the escort industry under the flawed theory that forcing escorts “underground” will eventually lead to the cessation of prostitution, itself. Admittedly, law enforcement’s efforts had successfully hampered certain commercial outlets for the escort industry; that is until the advent of the Internet.
Like many things involving the so-called ‘business of sex,’ operating an adult-themed website is not exactly easy these days. Between maintaining compliance with relevant laws, less disposable income by consumers, and the impact of piracy, the adult website industry has suffered its share of challenges recently. But those challenges have been magnified for the online escort directory business model, given law enforcement’s renewed interest in finding a scapegoat to blame for so-called “human trafficking.” As a result, legitimate escort websites have their work cut out for them. Substantial concern has arisen in this arena given the recent forfeiture of Escorts.com to the Department of Justice, and the resulting plea deal whereby the operating companies agreed to forfeit millions of dollars in advertising proceeds, and admit to federal money laundering offenses premised on their online escort advertising activity.
Given that some escorts have been known to cross the line into illegal activity a time or two, operators of online escort websites must be well-versed in several areas of criminal law along with the important constitutional protections afforded to commercial speech. The line between prostitution-related offenses and protected speech can often be ‘dim and uncertain’ as is the case with many other legal issues that adult industry participants are forced to confront on a daily basis. Although prostitution related offenses are the purported basis for most criminal liability surrounding the escort business model, the proliferation of the Internet has caused both law enforcement and escort site operators to consider various ‘accomplice liability’ offenses like conspiracy, solicitation and “aiding and abetting,” when evaluating the legality of a given escort advertising business model. The same laws used to prosecute the person who answers the phone at an ‘out-call’ service may be used in the attempt to impose criminal liability on Internet-based escort directory providers. In the end, much depends on whether the alleged accomplice had knowledge (whether actual or constructive) of any illegal activity by the escort(s). An online classified ad space provider would have no traditional legal obligation to second guess the legality of any advertised services, so long as the services themselves were not inherently illegal. Thus, an ad for unlicensed, automatic weapons may be problematic, however escort activity is not inherently illegal, and is, instead, often recognized and even licensed by many local governments. Online escort directories, at least in theory, should have no reason to question whether a particular advertiser was running an illegal ‘side business’ in addition to her presumptively-legal escort companionship services. However, law enforcement tends to see it differently, and often assume that minors are being exploited through the targeted online escort site, in addition to traditional adult prostitution concerns
Thus, in recent years, in yet another misguided attempt to “save the children,” law enforcement has taken to attacking tangential associates of the escort service business model; the online advertising forums. The Internet enabled countless alternative venues for escort advertising, allowing escorts to take control of their businesses – often eliminating dangerous ‘middlemen.’ But this new business model generated new legal concerns – both for the escort and the advertising service provider. The scope of escort site operation can range from ‘hands on’ services such as scheduling meetings and taking payment, to more detached services such as date reviews, or the simple sale of advertising space to escorts or agencies. It is this last category, mere advertising, where the legal issues get complex. While the sale of advertising space for legal activities should remain protected by the First Amendment under the ‘commercial speech’ doctrine, concerns can develop when the advertising venue gains some level of knowledge of illegal activity – whether actual or intended – undertaken by the escort. This knowledge could come from a variety of sources, including arrest records, anonymous complaints, escort reviews, media reports, or even the escort herself, in the form of proposed or published advertisements. The difficult legal issues generated by these distinct sources of potential knowledge will be addressed in Part II of this post.
In recent years, state and federal authorities have relentlessly pursued a select few online escort venues, namely; Craigslist.org, Escorts.com and BackPage.com. In August of 2010, dozens of state Attorneys General publicly declared a quasi-war on escort advertising starting with a demand letter to Craigslist insisting that the site’s entire adult personals category be removed. For fear of criminal prosecution, Craigslist complied and implemented a new thorough screening process for the revised “adult” section of the site. Undeterred by the site’s attempt at compliance, South Carolina’s Attorney General, Henry McMaster, continued his public threats of criminal prosecution. After several months in and out of court, Craigslist shifted gears and completely abandoned its U.S. based erotic services category and ultimately withdrew its efforts to reinvigorate its censorship claims against the government.
Undoubtedly witnessing the successful results of their Craigslist bullying, the AG’s then set their sights on Backpage.com, via another demand letter calling on the site to terminate its online advertising of “adult services” under the threat of criminal charges. Conceding to a degree, Backpage unveiled new security measures for its adult personal ads and subsequently called on “friends in the industry” (incidentally, directly naming over two dozen “fellow” websites involved in escort services) to form a “National Task Force” against misuse of online escort advertising. Within weeks of Backpage’s roguish actions, several of the identified sites were staring down the barrel of their own state or federal investigations; none more publicized than the unexpected FBI raid on the corporate offices of Escorts.com. After more than six months of industry speculation on the issue and virtual silence from the company, on June 21, 2011, Escorts.com quietly shut down its website. The explanation for the closure came recently with the filing of a corporate guilty plea and forfeiture of the domain name along with substantial amounts of cash.
While the campaign against Backpage.com had slowly faded from the headlines, a few months ago, in July of 2011, the case took on new life, as Seattle Mayor Mike McGinn, labeling Backpage as a “well-known accelerant of underage sex trafficking,” ordered all city departments to terminate any active advertising relationship with the Seattle Weekly (a subsidiary of Village Voice Media, the publisher of Backpage.com). Most likely a knee-jerk reaction to the letter issued by the National Organization of Women demanding his support in rallying against Village Voice Media, McGinn’s advertising boycott sent ripples through the online escort industry; the effects of which are still being felt today. Just a few weeks later, in an overly public display reminiscent of that waged against Craigslist, forty-six state AG’s, acting on behalf of the National Association of Attorneys General, sent a letter to Backpage.com accusing the site of knowingly profiting from ads related to prostitution and failing to take the security precautions it once promised to implement. Containing a myriad of demands, the letter’s inquiries into Backpage’s business practices range from “describing in detail” what the site understands to constitute “illegal activity” to requesting specific advertisement statistics and company policy documents. Responding to the letter, Village Voice Media emphatically reiterated that there is "no gap between our mutual goal of eradicating the scourge of child trafficking as quickly and effectively as possible." Citing examples like constant cooperation with police investigators and the successful conclusion of an ad-based sting operation, Village Voice Media maintained that Backpage.com is continually doing everything in its power to prevent criminal activity on its site. Apparently, cooperating with law enforcement is no longer good enough.
The Backpage case was quickly overshadowed by the above-referenced guilty plea by the corporate operators of Escorts.com. National A-1 Advertising and R.S. Duffy, Inc., the parent companies of Escorts.com since 2007, plead guilty to money laundering and criminal forfeiture charges arising from actions that allegedly “facilitated interstate prostitution activities.” According to U.S. Attorney Peter Smith, prostitutes and escort agencies paid to advertise on the site, while customers were charged subscription fees to view such advertisements. The revenue generated by the advertisements and subscription fees constituted the alleged proceeds of “violations of federal laws prohibiting interstate travel in aid of racketeering enterprises, specifically prostitution, and aiding and abetting such travel.” Upon the U.S. District Court’s approval of the settlement agreement, the companies agreed to serve a probation term of 18 months, pay a $1.5 million in fines, and forfeit the domain name www.Escorts.com, along with $4.9 million in cash derived from the alleged unlawful activities. Notably, although the settlement bans the government from bringing additional criminal charges against the companies and their other related business ventures (e.g. – Hotmovies.com and PrimeTel Communications), the agreement does not prohibit the IRS from pursuing any tax-related criminal charges arising from the money laundering. And although prosecutors have reserved the right to criminally pursue individuals associated with both companies, there is no indication that the government intends to pursue such an option. Despite all the ambiguities surrounding the legal fate of online escort directories, one thing is for sure, the pressure from law enforcement not only remains on these online media outlets but is apparently increasing. Legal compliance has never been more important and preventative maintenance is the key. Part II of this blog post will provide an overview of the current issues facing escort websites in light of the current legal environment, and preemptive measures for escort directories that could make all the difference should future litigation arise.
 Escorts participate in a lawful business per local licensing laws specifically drafted to govern escorting activities, for example, various city and county ordinances across the United States enacted specifically for the escorting business model. See Los Angeles Cty. Code, Ch. 7.38 (Escort Bureaus); Las Vegas Code of Ordinances, Ch. 6.36 (Escort Bureaus & Personnel); Dallas Cty. Code of Ordinances, Sec. 10-111 (License for a Sexually Oriented Business); New Orleans Code of Ordinances, Ch. 30, Art. VII (Escort Services); Atlanta Code of Ordinances, Ch. 30, Art. VIII, Div. 2 (Escort Permit); Charlotte Code of Ordinances, Sec. 6-303 (Escort & Dating Service Permit).
 While escorts are referred to throughout this article in the feminine gender, the author recognizes that escort activity crosses gender lines, and is engaged in by males, females, and trans-gendered individuals.
 The author is not suggesting that the post directly caused these investigations, but the timing is at a minimum, suspicious.
United We Stand; Divided We Fall – If Only It Were That Simple
Liberal or conservative? Mac or PC? Romney or Rick? Exacerbated by politics, economic theories, technological preferences and even something as trivial as your reality TV show of choice – these days, it always seems like we’re always picking a side in one way or another. Given that we’re so quick to draw that proverbial line in the sand, one can’t help but wonder how any groups rally together for a common purpose anymore. In this respect, the adult industry is the same as any run-of-the-mill church organization, PTA, or even the federal government – there’s infighting. Representative of, arguably, the strongest motivator of human nature, the adult entertainment industry has the unique task of justly operating within its own sociosphere , all while conveying a somewhat united front to the outside world. But between high-profile obscenity prosecutions, piracy problems, the economy, and DOTXXX, the pressure on those in the industry hasn’t made it easy to sit around singing Kumbaya at the latest industry gathering.
In all fairness, dissension, disagreement, and the dialogue the two create – that’s the kind of stuff we thrive on. When I say ‘we,’ I mean those of us involved in the adult entertainment industry – in one way or another. I understand that we all got involved in the industry for different reasons, intended or not, but we all have that little bit of rebellion deep down inside – if we didn’t, we wouldn’t still be here. This begs the question: Is that drive to question the status quo so innate within us that we simply cannot recognize when it benefits the greater good of the industry to offer support based less upon conditions and more upon the recognition that we’re all supposed to be fighting the same fight?
Despite its substantial contribution to everything from technological development to global charity, the adult industry is not necessarily held in the highest regard in mainstream society. Because of this ‘outsider’ perception, conveying a united front on headline-grabbing issues is all the more important. It seems that the higher-profile the issue, the more cavernous the division is within the industry; especially with matters having a direct impact on the mainstream. Unfortunately for us, those issues that reach the ‘outside’ world, so to speak, are the ones that warrant the most serious attempt at forming a unified front.
As we’ve seen in the past, this industry has actually turned on its own a time or two – a regrettable circumstance that does nothing but harm the industry as a whole. The Extreme Associates and Max Hardcore cases are two perfect examples of situations where the industry severely lacked in supporting its own. Arguably, one of the most significant legal attacks against the adult industry, US v. Extreme Associates, was the federal government’s first major obscenity prosecution since the early 1990’s; a grim reminder that political rants on “moral values” aren’t always just empty threats. For those who don’t remember, in 2003, husband and wife business partners, Rob Black and Lizzy Borden were indicted on various conspiracy and obscenity charges based on the “extreme” hardcore nature of adult content produced by their corporate entity, Extreme Associates. The case was dismissed by the district court in January 2005, which ruled that the federal obscenity statutes were unconstitutional because they violated an individual’s right to privacy. The DOJ appealed and found success in a Third Circuit decision overturning the District Court’s ruling, which eventually lead to the couple pleading guilty on obscenity charges and their subsequent imprisonment. Similarly, in 2008, Paul Little (a.k.a. Max Hardcore) was convicted of ten counts of distributing obscene materials, stemming from adult films produced by his company, Max World Entertainment. He was ultimately sentenced to a 46 month prison term. The lack of support – both financial and moral – offered to these individuals illustrates exactly how the adult industry should not respond to government attacks against a fellow industry associate. Black and Little were essentially on their own, as other content producers tried to distance themselves from the type of content subject to prosecution. Sadly, it became alarmingly easy to distinguish one’s self and/or business practices from “those people” who were targeted in the DOJ’s latest witch hunt du jour.
If we’re being frank here, it was the extreme nature of Black’s and Little’s content that likely had industry players running to their lawyers asking whether their content was ‘safer’ than the material subject to prosecution. Those same lawyers may well have cringed at the thought of advising any public support or association with defendants under federal indictment. But support for the most extreme end of the industry ironically helps keep all others safer. Bottom line: The members of the adult entertainment industry should not only have rallied behind Paul Little and Rob Black, but should thank them for being willing to take a bullet for the same people that averted eye contact for years instead of readily opening their wallets as a gesture of unwavering solidarity. The federal government (and more than a few right-wing political groups, for that matter) would love nothing more than for the industry to cannibalize itself – and with Extreme Associates and Max Hardcore, that’s what happened. Even more industry division has resulted from the DotXXX battle, which has left close friends no longer speaking with each other. It is time to rise above.
Despite its wavering past, hope springs eternal. In 2008, when producer John Stagliano was indicted on seven counts of violating federal obscenity laws stemming from the sale and distribution of adult films by his company, Evil Angel, the industry galvanized solidly behind John. Even though he was financially able to defend himself from the governmental onslaught, most industry stakeholders provided much-needed moral and public support for his cause. Approximately two years later a federal district court judge dismissed the case finding that the evidence provided was insufficient for a jury to find guilt beyond a reasonable doubt. The Stagliano case is a prime example of the adult entertainment industry pulling together to present a united front. Recognizing the fluidity of obscenity prosecutions and the particular content targeted in them, Stagliano’s legal team addressed the industry, specifically requesting that it not make the same mistakes seen in the Max Hardcore case. Calling on each content producer to be a “foot soldier” in the battle against unwarranted prosecution, Stagliano’s attorneys encouraged industry players to preserve current business relationships, donate to the cause and maintain unconditional assistance despite fear of prosecution. John Stagliano chose to fight the good fight and luckily the industry as a whole remained a foundation for that fight.
Remaining optimistic thanks to the Stagliano case, I have also had the pleasure of seeing first-hand the industry unite on a much smaller, but equally as important, scale in opposing the current prosecution of Theresa Taylor (a.k.a. Kimberly Kupps). Involving the all-too-familiar venue of Polk County, Florida, Ms. Taylor is facing felony state obscenity charges based on the content of her website KimberlyKupps.com. The content targeted in this case is well within the mainstream of modern erotic fare, and has thus far not resulted in the distancing and finger pointing that occurred during the Extreme Associates and Max Hardcore cases. This Kupps prosecution epitomizes the slippery slope that occurs when law enforcement agents deem themselves the judge, jury, and executioner in enforcing overly subjective legal standards to adult content. Having already received dozens of donations to help fight the censorship machine that reared its ugly head once again in Polk County, I remain extremely encouraged and pleased to see the adult industry supporting the cause – even for a state level prosecution such as this.
The spirit of this post is a call to action for the adult entertainment industry, not to dwell on missteps of the past. Heck, even the industry lawyers have their own share of in-fighting. But in order to know where we are going, we must know where we’ve been, and in turn recognize the mistakes that were made on the way. I am proud, and always humbled, to have the opportunity to fight for the First Amendment rights of the adult industry, and represent those victimized by sex hysteria. But in order to make progress and deter the government from committing future Free Speech violations, the members of the adult industry must stand in solidarity with each other, regardless of petty intra-industry disputes, issues with competition, disagreements over content, or fear of becoming the next target. Aptly referenced by our colleague, H. Louis Sirkin, Esq., in discussing the importance of unconditional industry support of its own members, I leave you with this famous quote: "First they came for the communists, and I didn't speak out because I wasn't a communist. Then they came for the trade unionists, and I didn't speak out because I wasn't a trade unionist. Then they came for the Jews, and I didn't speak out because I wasn't a Jew. Then they came for me and there was no one left to speak out for me." [Pastor Martin Niemöller]
Where Angels Fear to Tread – The Dangers of Asserting Unfair Competition Claims Involving 2257 Compliance
“Those who live in glass houses should not throw stones.” Although trite, this saying is particularly applicable to participants in the contemporary adult entertainment industry. Invoking criminal laws designed to break the backs of adult business entrepreneurs as a basis for gaining legal leverage in intra-industry commercial disputes can be dangerous business. This concern arose recently in the lawsuit filed by Ventura Content, Ltd. (i.e. Pink Visual) against Motherless.com, a “tube” site. Most of the allegations in the Complaint involve fairly typical claims of copyright infringement directed toward a site that allegedly allowed users to upload Ventura’s content, without its consent. However, what makes this case different, and potentially hurtful to the adult industry as a whole, is the inclusion of a claim premised on California’s Business and Professions Code § 17200, providing various remedies for victims of “unfair” business practices that cause monetary damages to a party. In its Complaint, Ventura alleges that motherless.com: 1) fails to maintain the performer age records mandated by 18 U.S.C.§ 2257 (“Section 2257”); 2) fails to post a compliance statement identifying the location of the age records required by Section 2257; and 3) fails to identify Ventura as the “primary producer” of the content appearing on the motherless.com website. Ventura further claims that consumers are lured to the motherless.com site because of its (false) claims of 2257 compliance, and because its content is free. Perhaps most disturbingly, Ventura asks the court to enforce Section 2257 by issuing an injunction shutting down the motherless.com website for failure to comply with Section 2257.
Those of us who have been involved with the adult industry since the 1980’s can attest that the industry has consistently been fighting the validity and enforcement of Section 2257 for decades. Countless hours of manpower, brain power, volunteerism, and legal work, have gone into multiple lawsuits and lobbying efforts, all designed to rid the world of the unfair and unconstitutional burdens imposed by Section 2257. This law costs both content producers and webmasters millions of dollars in compliance efforts and legal advice on a yearly basis. Drafted by Congress as a knee-jerk reaction to the Traci Lords scandal of the early 90’s, Section 2257, even if fully complied with, does not do a single thing to legitimately combat the involvement of underage participants intentionally misrepresenting their age with a fake ID. This article is not designed to outline the many constitutional defects with Section 2257 – that has been done time and time again, in numerous, well-written complaints and legal briefs filed by industry representatives. Nor is this article designed to cast aspersions upon Ventura as a company. In fact, this author has pointed out in the past that Pink Visual, in particular, is remarkably visionary in its approach to adult content delivery. This article is intended to call attention to a potentially unwise legal strategy that jeopardizes the decades of effort executed by the adult industry in its constant battle against constitutionally-questionable effects of Section 2257.
The Complaint against motherless.com was filed at a particularly vulnerable time in the adult industry’s history. The Free Speech Coalition’s lawsuit challenging Section 2257 was recently dismissed, and with there was a heartbreaking end result in the Connections case, where an earlier decision invalidating Section 2257 on constitutional grounds was vacated by the en banc panel of the Sixth Circuit, which chose to uphold the statute. Unless the FSC happens to catch a break in its appeal to the Third Circuit, few barriers to ultimate enforcement of the statute now exist. Politically, we could be headed for an ultra-conservative new GOP President, House and Senate - all with the adult industry squarely in its sights. While it has been years since any 2257 inspections have occurred, the statute could be enforced with a vengeance given the slightest shift in political winds. The Department of Justice can go back several years in determining whether a producer or distributor was in compliance, and is thus not limited to investigating the current compliance regime in place by a potential target. Therefore, even if companies are in compliance today, they remain at legal risk if their compliance methods fell short in the past few years.
Despite this precarious environment, Ventura initiated a lawsuit against motherless.com which provides implicit validity to Section 2257, and which can be misused by the opponents of the adult industry. Moreover, Ventura seeks to enlist the help of the federal court in enforcing Section 2257 against the website defendant and shutting it down for its alleged failure to fully comply with the records keeping and labeling requirements. Again, such claims pre-suppose the validity of 2257, which (as noted above) the industry has been fighting for decades. Ventura already claims to have recorded numerous instances of copyright infringement against motherless.com, so the additional benefit of including this delicate and potentially dangerous “unfair competition” claim, under California law, seems – at a minimum – questionable. The author fully acknowledges that content producers have the right to fight piracy, and lawyers have the right to use all legal tools at their disposal to vindicate their client's interests. But, from the perspective of a First Amendment lawyer, signing a complaint that seeks to force any party to comply with Section 2257 – under the pain of court-imposed censorship, would present a significant quandary. That’s a little too close to the DOJ’s job for comfort, in this author’s view. Moreover, if Ventura wins, any such ruling could create substantial vulnerability for other online service provider websites that rely on the same statutory 2257 exemptions as tube sites for their operations - such as adult dating sites, online escort sites, adult forums, and adult review sites. Ventura could win its battle against motherless.com, yet help lose the 2257 war for the industry. There could also be a domino effect on related protections from civil liability afforded to online service providers, such as those found in Section 230, and the safe harbor provisions of the DMCA. Notably, the 2257 exemptions at issue in this case are directly tied to Section 230’s immunity concept. See, 28 C.F.R. § 75.1(4)(v). In this author’s opinion, the risks for other service providers, and even for other content producers, is just too high to justify the limited additional leverage that inclusion of this claim accomplishes. However, there is admittedly room for disagreement on this issue. Given the problems that content producers have encountered with getting piracy under control, there is no perfect answer here.
While many content producers maintain a little-publicized, symbiotic relationship with tube sites, whereby the sites are allowed to seed certain levels of content for promotional purposes; there is no indication that such was the case between Ventura and motherless.com. Accordingly, if Ventura was truly the victim of online piracy by motherless.com, as alleged in the Complaint, its outrage and demand for legal justice is understandable. But converting the desire to enforce one’s intellectual property rights into a demand that an adult website be shut down by a federal court for failure to comply with Section 2257 is what generates the discomfort. My recommendation, for what it’s worth; go after the pirates for intellectual property infringement until the cows come home, but leave Section 2257 enforcement to the Department of Justice; it has already accepted the job of making life difficult for the adult industry.
 Case No.: 2:11-cv-05912-SVW-FMO (C.D. CA 2011).
 Complaint at ¶¶ 31-38. (Notably, Section 2257 no longer requires secondary producers to identify the “primary” producer of the material. Such practice was commonly used by webmasters until the change in the law that occurred in 2008, requiring all producers to maintain their own records.)
 Complaint at ¶ 39.
 Complaint at ¶ 41 (Unlike some other federal statutes, Section 2257 does not provide for a private right of action, allowing private parties to seek enforcement of this criminal statute.)
 Most adult industry attorneys concur that 100% compliance is virtually impossible, and that very few (if any) content producers or webmasters are in complete compliance with all the nuances of Section 2257.
 Congress passed the initial version of 2257 in response to the Traci Lords scandal, wherein Ms. Lords, at the tender age of 15, began her adult performer career using a fake ID.
 See, The Marketplace Has Spoken…and at least one company has listened, available at: http://lawofsex.wordpress.com/2011/03/23/the-marketplace-has-spoken%E2%80%A6-and-at-least-one-company-has-listened/
 Connection Distributing Co. v. Keisler, 505 F.3d 545 (6th Cir. 2007) reh’g granted, opinion vacated sub nom, Connection Distributing Co. v. Holder, 557 F.3d 321 (6th Cir. 2009).
 47 U.S.C. § 230, et seq.
 17 U.S.C. § 512
YES WE CAN! NO, ACTUALLY YOU SORT OF DIDN’T…
…And because you didn’t, there’s a good chance that the GOP is going to take this opportunity to pounce.
It seems like just yesterday that Obama was being sworn into office. As with the inception of most new presidential terms, the American people were filled with hope that the new Commander in Chief was going to right the (in this case, considerable) wrongs of his predecessor. It didn’t take long, however, for the citizens to notice that they were looking at a man who had once promised to change Washington, but was now looking like he had, in fact, been changed by it. Claims of reinvigorating personal freedoms and giving the country back to the middle class were now put on the backburner in order to repair the collateral damage left over from Bush-era policies. But in all fairness, is there really time for restricting warrantless wiretaps and closing Guantanamo Bay when you’re left to deal with a record-breaking $1.3 trillion deficit.
With his first year in office analogized to the actions of a chicken with his head cut off, Obama was stigmatized as “trying to do too much” and as a result accomplishing nothing. Granted, Obama had quite the mess to clean up and, after all, it’s politics; if people aren’t complaining about you, you either aren’t relevant or you just haven’t sexted an unwilling recipient yet. But here we are, over two years later and many have been left wondering what kind of legacy the Obama Administration will leave besides the aftermath of one of the worst economic crises in U.S. history and grumblings of “They said they could, but did they?” As much as some might not like it, the reality is that with Obama’s approval ranting hovering in the low to mid 40’s the last few months (even with a recent spike after the killing of Osama Bin Laden), it might be time to take a serious look at what the Republicans are bringing to the table for 2012. Or more importantly, what’s for dinner?
When the GOP presidential hopefuls started tossing their respective hats into the ring, it was most definitely a Romney/Huckabee/Gingrich race. Those nominations slowly warped into a Romney/Gingrich/Pawlenty race and now that the commotion has died down a bit, we not only have a dark horse in the running but one that is actually pulling ahead; Michele Bachmann. Bachmann, a relatively new face to the White House mix, is proving that although she too might be in need of a fact-checker on speed-dial, she is no Sarah Palin, and possibly capable of breaking up the GOP Nominee Boys Club for good.
But first let’s take a look at the number one front-runner for the presidential nomination, a title that he has held since the very beginning of 2012 election talks, everybody’s favorite Mormon; Mitt Romney. After a surprising second-place caucus finish to Mike Huckabee back in 2008, Romney was said to have been hanging up his presidential hat for good. But now that the last three years have seen unparalleled unemployment rates and economic decline , the seasoned venture capitalist seems to be eager to show off his financial prowess in supposedly turning around the U.S.’s teetering economy. Besides a few standard overzealous blips on the legislative radar during his tenure as governor as Massachusetts (read: the infamous RomneyCare), Romney’s only other major political hurdle is his religion.
Reminiscent of the JFK-Catholicism concerns of the 1960 presidential election, Romney seems to be doing his best to bypass any religion-based pigeon-holing, but doing so with enough aloofness and a trademark million dollar smile so as to avoid losing the socially-conservative Christian vote. With the trend of goliath-esque issues like government bailouts and deficit/spending eclipsing social concerns like abortion and gay marriage, the last four years might have created the perfect storm for Romney to save the day.
Next on the list is former Speak of the House, Newt Gingrich. After a thirteen year sabbatical from politics, Newt has started off his presidential nomination the best way he knows how: by shooting off at the mouth. Doing so has more often than not worked to his benefit and this go-round is probably no different. Reminiscent of the fiery Republican Whip of the early 90’s, Gingrich kicked off his candidacy with slamming the GOP’s Medicare proposal and publicly humiliating a Republican representative. He makes no qualms about the fact that he is a big personality, and tends to make up for any goodwill faux pas with swift, public recoveries exhibiting the skills of a truly seasoned politico.
Newt’s aggressive legislative tactics, weak fundraising abilities and, as of late, propensity for infuriating people to the point that they no longer wish to work for him seem to be too large of hurdles to bypass Romney’s unassuming charm to make it to the head of the class. In all honesty, having your campaign team publicly question your commitment to the race probably doesn’t fare well with your political party and more importantly, choosing a Mediterranean cruise over campaign events probably doesn’t fare well Joe Public. Everyone knows that if given the opportunity they would pick Greece over Iowa too, but there’s some to be said for dedication to the cause when the “cause” is running the United States.
Despite Newt’s discipline problems, with his name recognition so deep-rooted in the American psyche and his renowned reputation as one of the “idea guys,” Newt might still have a shot as a contender for the VP seat in 2012. One thing is certain, Newt Gingrich is a politician to the bone and he has decided to come back out and play with the big boys. Meaning, even if his chaotic campaign has destroyed the last shred of a prospective win in 2012, you can be sure that if a Republican ends up in the White House, there’s a good chance that Newt is going to have his hands in the cookie jar somehow.
And finally, we have America’s anti-establishment sweetheart, Michele Bachmann. The three-term Congresswoman from Minnesota is most known for being the chair of the Congressional Tea Party Caucus. Just in case you’ve been living under a rock for the last few months, the Tea Party is a political movement dedicated to limiting government intervention and promoting fiscal conservatism, executed of course, with that oh-so-subtle panache that we’ve all come to love from the party.
Grass-roots fighters by their very nature, the Tea Party has vehemently defended Bachmann and her activists support her in ways that traditional republican candidates only dream of. Bachmann’s sometimes polarizing ideologies and quirky exploits have provided her with a speedy trip up the polls, but it’s her fund-raising capabilities that are going to keep her there. Already deemed a fundraising juggernaut less than two months after announcing her candidacy, Bachmann notably raised over $13.5 million during her last election cycle – numbers like that are simply unheard of in this type of economy. Further, it was reported that virtually all of those campaign contributions came from individuals, not lobbyists/big business, and over 50% of the donations coming from people contributing $200 or less. This tells us one thing for sure: Michelle Bachmann has a loyal following and there are a lot of them. Enough to win a presidential election? Maybe not. A serious contender at the very least? Undeniably. Maybe that “slightly off” courage of conviction is exactly what the American electorate wants to see after the last four years. Recent polls seem to show that is certainly the case. Say what you will about Bachmann, she has been called everything from a fanatic to downright crazy. But regardless of how you feel about her unorthodox methods, at this point, “underestimated” seems more accurate a description.
And because the Tea Party is never to be outdone when it comes to random political shenanigans, just last week Representative Bachmann announced that she was going to be the first presidential nominee to sign “The Marriage Vow,” a pledge sponsored by one of the country’s most socially-conservative organizations; the Family Leader Organization. Upon signing the pledge, Bachmann agreed to remain faithful to his or her partner, oppose gay marriage, reject pornography, reject Islamic law, and declare that homosexuality is a choice and a public health risk, among other things. The signing of this pledge, no doubt directly related to Bachmann’s unexpected success at the Iowa Caucuses, probably isn’t going to do much to help Bachmann’s attempt at reaching beyond the Tea Partiers and resonating as a serious candidate with the rest of the voters. So although she’s clearly not providing the most politically correct platform, Bachmann’s no-holds-barred approach may just be the breath of fresh, albeit bigoted, air needed for the U.S.’s politically jaded general electorate in 2012. She can only hope that Saturday Night Live does not pull off the perfect caricature as it did with Tina Fey’s impeccable Sara Palin.
So what does all this mean for the adult industry? Honestly, as with most things involving politics, it’s just too soon to tell. Obviously with a Republican in office, the sky is the limit in terms of utilizing the adult industry as a political agenda tool. However, we’ve had a supposed liberal in the White House for some time now, and things aren’t exactly ideal by any means. Is this a case of “better the devil you know”? Or even more disturbing, have we gotten to the point where disconcerting thoughts like picking the lesser of two political evils is just the grim reality of politics in the 21st Century? Let’s hope not. But between Romney’s uber-conservative religious background, Newt’s deep-rooted affiliation with all things GOP and Bachmann’s new anti-porn platform, the adult entertainment industry is far from at ease in anticipating the outcome of this election, and rightfully so. Should the electorate respond to the Obama administration’s failure to address the significant economic issues facing the country by electing a reactionary like Bachmann, we could see a level of hostility directed at the adult industry that has not been witnessed since the Reagan – Bush era.
*Note: This article was drafted with the purpose of addressing various political agendas affecting the adult entertainment industry and in no way was intended as a political endorsement of any candidate. It should also be noted that the author is not associated with any election campaign and is not a member of any political party.
Reading the Tea Leaves? Discerning the Ultimate Fate of Section 2257
Adult content producers and webmasters have become increasingly resigned to the fact that Section 2257 compliance is here to stay. Renowned industry attorney Greg Piccionelli, Esq., has recently written a detailed set of articles reminding producers of their complicated obligations necessary to achieve 100% compliance with 2257. The increased focus on records keeping obligations is the result of a confluence of events, such as; the district court’s dismissal of the Free Speech Coalition’s (FSC) most recent legal challenge to the statute and associated regulations; the historical trend in the courts in previous 2257 challenges; and the potential for a Republican president in 2013, complete with a newly-appointed conservative Attorney General.
So, is this reluctant acceptance of 2257 as a fact of life warranted? Or is there still a possibility that these burdensome obligations will be lifted – potentially in favor of a more realistic and constitutional system of performer age verification? The answer to these questions requires that we delve into the history of the challenges to Section 2257, and recap the current status of the law.
Initially, the Free Speech Coalition should be congratulated for continuing to fight the good fight against Section 2257. They’ve litigated hard in several courts in the attempt to beat back these sweeping regulations. J. Michael Murray, Esq., whose firm was hired to mount the most recent challenge, which is currently pending in the Third Circuit Court of Appeals – is one of the best First Amendment lawyers in the biz. But given the history of previous legal challenges to the statute and the way the wind is blowing in the current case, adult webmasters and content producers may need to come to grips with the fact that 2257 will be upheld, therefore, enforcement by the FBI may resume at any time.
The previous attempts to invalidate 2257 have spanned over two decades since its inception in 1988. The original law was struck down as unconstitutional on First Amendment grounds shortly after its passage. American Library Ass’n. v. Thornburgh, 713 F. Supp. 469 (D.D.C. 1989). After the Thornburgh challenge, Congress amended the statute to no longer utilize a rebuttable presumption that the performer in question was a minor, but to directly impose criminal sanctions for noncompliance. The ALA challenged 2257 again challenged, but this time the First Amendment didn’t come out on top. In American Library Ass'n. v. Reno, 33 F.3d 78 (D.C. Cir. 1994), the amended version of 2257 was upheld, as the court rejected the ALA’s argument that the record-keeping provisions were content-based restrictions. In doing so, the Reno court agreed with the feds that record-keeping requirements are necessary to prevent the exploitation of children and a commercial market for child pornography. Further, the district court tailored the scope of the record-keeping provisions by narrowing the definition of "secondary producers" and eliminating the indefinite temporal requirement for maintaining records.
All was calm on the 2257-front for a few years until Sundance Assoc., Inc. v. Reno, 139 F.3d 804 (10th Cir. 1998), when the Tenth Circuit decided to shake things up a bit and take the DOJ down a peg. The Sundance court invalidated the regulations that imposed records keeping obligations on “secondary producers;” a broad category of ‘producers’ that was created purely by agency regulation and not referenced in the actual 2257 statute. The industry as a whole generally relied on the Sundance decision as the correct interpretation of the law. In the real world that meant that only original producers of adult content kept records, and webmasters that were uninvolved with content production maintained no records of their own, but simply identified the ‘primary producer’s’ records custodian on their website, in order to discharge their perceived obligations under the statute. The DOJ disagreed with the Sundance interpretation of the law, but the statute went unenforced for several years after the Sundance case, so the industry became complacent with the status quo.
That all changed in 2005, when the DOJ passed new regulations which re-ignited the “secondary producer” debate, by imposing records-keeping requirements on all producers including webmasters that published material on a website. The Code of Federal Regulations issued in June of 2005 defined a secondary producer as one who "inserts on a computer site or service a digital image of, or otherwise manages the sexually explicit content of a computer site or service that contains a visual depiction of, an actual human being engaged in actual or simulated sexually explicit conduct." Overnight, hundreds of thousands of websites became illegal given the lack of 2257 records to back up the content appearing on those sites.
In response to these amended regulations, and the tremendous panic in the industry, the FSC filed suit in Colorado, which happens to be within the realm of the Tenth Circuit, and was therefore bound to follow the Sundance case as precedent. Free Speech Coalition v. Gonzales, 406 F. Supp. 2d 1196 (D. Colo. 2005). On December 28, 2005, the FSC received a late Christmas present when the district court, following Sundance, preliminarily enjoined enforcement of the new requirements for all secondary producers who were members of the FSC at the time. As the Attorney General commenced the appeals process in Gonzales, Congress was taking matters into its own hands by passing the Adam Walsh Child Protection & Safety Act, which officially amended 2257 by adding “secondary producers” to the list of those responsible for the record keeping obligations. This essentially ‘fixed’ the main problem identified in the Gonzales case. In the wake of the Adam Walsh Act passage, the Gonzalez court granted a partial summary judgment against the FSC in the case, finding that the Sundance decision no longer applied to 2257 as amended. Free Speech Coalition v. Gonzales, 483 F. Supp. 2d 1069 (D. Colo. 2007). On May 1, 2007, based on an agreement by both the DOJ and the FSC, the Gonzales court dismissed the case, likely as a result of the legislative resolution of the main legal challenge raised in the litigation.
This left 2257 in a state of presumed validity until a breathtaking win followed quickly by a heartbreaking loss in the case of Connection Distributing Co. v. Holder, 557 F.3d 321 (6th Cir. 2009) (en banc), cert. denied 2009 U.S. LEXIS 6926 (Oct. 5, 2009). In fall 2007, a panel of three judges on the Sixth Circuit Court of Appeals found the record-keeping requirements set forth in 2257 imposed an overbroad burden on protected speech. Shortly after the opinion was issued, the government successfully petitioned the entire Sixth Circuit for “en banc” review of the panel decision. Ultimately, the en banc court rendered a devastating blow to the adult industry by vacating the well-reasoned panel decision, and upholding 2257 in the face of numerous constitutional challenges.
In 2008, the DOJ passed another set of regulations, clarifying its position on records keeping compliance by both primary and secondary producers (along with many other issues). Those regulations became effective in March, 2009, and are what the industry lives by today.
Ultimately, the FSC mounted its most recent challenge the statute and related regulations by filing FSC v. Holder, 2010. U.S. Dist. LEXIS 75471 (E.D. PA July 27, 2010), in Pennsylvania. However, the district court rejected the FSC’s challenges last summer, and dismissed the case (alternatively) on the grounds of collateral estoppel/res judicata, which means that the prior losses suffered by the FSC in the Gonzalez case prevented the organization from re-litigating those issues in the Holder case. Id; see Memorandum Opinion dated July 27, 2010, at p. 45. This doctrine of ‘claims preclusion’ essentially means that the same party can’t keep suing over and over again, asking different courts (or the same court) for the same relief. The FSC has appealed the dismissal of its most recent case to the Third Circuit, in the hopes of reviving the legal challenge and obtaining some relief on behalf of the industry.
While the author wishes the FSC all the success in the world in its pending appeal, the chances of success in striking down 2257 are looking somewhat slim. As is evident from the above, the majority of court decisions have rejected challenges to 2257, and the FSC has been a party to a couple of these cases already, which negatively impacts its chances of prevailing, given the issues of claims preclusion referenced above. While all the previous court decisions may be wrong, from an academic perspective, a brief gaze into the crystal ball provides a pretty good idea what will happen with the current challenge in the Third Circuit. As a general rule of thumb recognized in the legal community, the chances of prevailing in any appeal are less than 25%. When you factor in things like the fact that the case is being backed by the adult industry, the previous losses by the FSC, and the government’s claim that the challenged regulations are designed to “protect the children” from exposure to sexual activity, the chances of a win on appeal tend to grow even slimmer. Anyone who’s been involved in litigation before will tell you to expect the unexpected, but truth be told; the FSC is fighting an uphill battle.
Certainly this information will be tough to swallow for those closely involved with the case, who undoubtedly remain hopeful for a positive outcome. But as a practical matter, any producers who are counting on invalidation of 2257 as their records-keeping strategy need to wake up and read the tea leaves – to mix a metaphor. All producers of 2257-triggering content should be in full compliance by now, in preparation for another potential loss on appeal, and eventual enforcement of the statute. Moreover, given Congress’s track record lately and waning public approval of the current Administration, a rigorous enforcement plan could be very likely if there is a Republican to answer to in 2013.
At this point in the game, the only realistic hope for invalidating 2257 is for a party with substantial funding and completely separated from the FSC, to initiate a new challenge using a different legal strategy than that which has been employed thus far. Unfortunately for the FSC, as a party plaintiff in the previous cases, it is burdened with these ‘res judicata’ and ‘collateral estoppel’ defenses based on its previous losses in court. Any new 2257 challenge would need to come from a new entity, which may need to carefully avoid association with the FSC or its members, given how courts determine (based on “privity”) which parties are barred by claims preclusion defense. Additionally, for any realistic shot at a successful claim, any new challenge would need to be based on different legal arguments and theories. Admittedly, the arguments made in the litigation thus far have been viable and should have carried the day with any intellectually-honest judge. But that’s not always the reality when one steps into court – particularly when the adult industry is behind the challenge. Other potential claims remain available to be litigated, but it is uncertain whether they will ever be raised, and who would raise them. Naturally, funding is always an issue, and constitutional litigation against the federal government is nothing if not costly.
For the foreseeable future, the industry needs to take a second look at its records keeping and labeling compliance status. This includes so-called user generated content sites which have taken liberal advantage of the 2257 exemptions, even in some cases where the content is not truly user-generated, or does not fall into the recognized exemptions. It’s time to dot the I’s and cross the T’s with your 2257 records, because the writing may be on the wall, for those who choose to see. But for the time being, the only true constant for 2257 is the phrase, ‘to be continued…’
The PROTECT IP Act – Warning: This Bill May Cause Seizures
If a lawmaker were to mix the overzealous propaganda of the USA Patriot Act with the overreaching executive authority of COICA, the new PROTECT IP Act would probably be the result. This new version of COICA, chock full o’ censorship issues, but with a shiny new name was recently introduced to Congress. Say hello to the “Preventing Real Online Threats to Economic Creativity & Theft of Intellectual Property” (PROTECT IP) Act.
Had it not stalled after its committee approval last year, COICA would have allowed federal authorities to seize domain names of sites using infringing content and require ISPs to cut off user access to the rogue sites. Well, the PROTECT IP Act raises the stakes a bit. The Act seeks to set up as system whereby the government, or private parties, can file suit against domain names that are tied to websites allegedly dedicated to infringing activity, get a preliminary court order based on one-sided evidence, and use that court order to force third party service providers like hosts, registrars, payment processors and others, to effectively shut down the site.
This means that any entity providing services to an allegedly infringing site can be dragged into the suit; even “internet location tools.” That’s right, search engines. Under the proposed legislation, these third parties have every incentive to do the government’s bidding, and even police their customers’ activities, since the Act provides an immunity from claims resulting from actions taken by a service provider against a site where the provider has a “good faith belief” that the site is “dedicated to infringing activities.” Host and billing companies beware; ‘you’re either with us or you’re against us’ in this Bill.
Just like they did last year with COICA, supporters of the Act cite to its “safeguards” in defense of the anticipated backlash. These purported safeguards include the ability of an affected site to “petition the court to suspend or vacate the order” in question. As you might guess, the “safeguards” are implemented after the feds get the ball rolling and the involved service providers have already been forced to discontinue services or access to the site. In other words, censor first, ask questions later…
Equally disturbing is the Act’s “private right of action” provided to IP owners. Rights holders, along with the government, will have the ability to pursue legal action against websites that are allegedly infringing on their IP rights and other affiliated third party intermediaries such as a payment processor or “online advertising network.” The import of this provision cannot be understated. The obligations imposed on service providers could change dramatically if they face being dragged into private lawsuits based on their customers’ activities. As the Electronic Frontier Foundation accurately pointed out, “Consider whether Viacom would have bothered to bring a copyright infringement action against YouTube—with the attendant challenges of arguing around the DMCA safe harbors—had it had this cause of action in its arsenal. The act includes language that says it's not intended to ‘enlarge or diminish’ the DMCA's safe harbor limitations on liability, but make no mistake: rights holders will argue that safe harbor qualification is simply immaterial if a site is deemed to be dedicated to infringement.”
The one benefit offered by the PROTECT IP Act is a new, narrower definition of proscribed websites characterized with the infamous phrase of “dedicated to infringing activities.” The previous definition used in COICA was overly vague to the extent that it would have likely put legitimate websites at risk of violation. That definition, although admittedly much more lenient than its predecessor, is only a slight concession in the grand scheme of things.
Of greatest concern, from a First Amendment perspective, is the increased likelihood of pretrial seizure of domain names that are alleged to be in violation of the Act. Registrars, or even registries, are likely included in the category of service providers subject to the new Bill. Shutting down an entire venue of communication based on a preliminary finding that it is dedicated to infringing activities, before a trial or other judicial determination on the merits, runs counter to all Free Speech principles. That’s why the government cannot shut down a bookstore just because a clerk gets arrested for selling an allegedly obscene book. However, the concept of the government seizing domain names, the same domains that are home to constitutionally protected speech, and that seizure occurring before any defenses are heard, reeks suspiciously of what we constitutional lawyers call “prior restraint.” That, simply, is not allowed.
This disturbing trend of seizing domain names made headlines just a few weeks ago in what has come to be known in online gaming circles as “Black Friday.” On April 15, 2011, the United States DOJ issued an indictment, and filed a civil suit against the three largest online poker sites in the world; Poker Stars, Full Tilt Poker and Absolute Poker. As a result, the .com domain names for each of the sites were seized for ultimate forfeiture to the government, as alleged instrumentalities of the “crime.” What crime? Well, since Internet poker is technically not against any federal law, the DOJ dug up some New York misdemeanor statutes which generally prohibit gambling and related promotional activities as the purported basis for the gambling charges, and the multimillion dollar seizures of domain names and bank accounts. But the applicability of this state statute to licensed foreign gaming activities is questionable at best. Regrettably, however, due to some accompanying bank fraud charges, it is unclear whether or not this case will determine once and for if online poker illegal. Regardless of the ultimate outcome, the DOJ has made clear that it will seize any domain name – at the registry level – that it deems to be used in the violation of U.S. law – even if operated from overseas, in full compliance with the host country’s laws.
Granted, the online gaming industry is no stranger to cyber seizures; Kentucky v. 141 Internet Domain Names has been making its way through the court system for almost three years. In this case, the state of Kentucky demanded that various registrars surrender domain names of sites acting as “gambling devices.” There, the state obtained a pretrial seizure order for the domain names, and emailed the order to the sites’ registrars. Some of the domestic registrars complied, but most of the foreign registrars ignored the court order, as coming from an improper jurisdiction. The key distinction between the Kentucky case, and the recent federal online poker domain seizures, is the level at which the domains were seized. On Black Friday the feds double jumped over the registrars, which were all outside the U.S., and went right to the .com registry to enforce its pretrial seizure order. And since all .com domain names are controlled by a U.S.-based registry, there was no jurisdictional issue to worry about.
A few domains have already been seized, under existing intellectual property laws. In November of 2010, the feds seized a number of domain names on grounds of copyright infringement and counterfeiting. As this post goes to publication, it appears that the DOJ has seized another handful of online gambling domains. The government even created its own undercover payment processor to get the sites to sign up. So the trend shows no sign of letting up.
There is no denying the detrimental impact that piracy is having on the adult industry. Copyright infringement should be punished, consistent with due process principles. But the idea of allowing the government to shut down websites by seizing their .com domain names, based on one-sided hearings and allegations of infringement or counterfeiting – without consideration of the merits or defenses, sets a dangerous constitutional precedent. Simply substitute “obscene” for “infringing” and you get the picture.