Social media sites are transforming not only the daily lives of consumers, but also how companies interact with consumers. Here at Morrison Foerster, across all of our practice groups, we are seeing complex, cutting-edge legal issues arising out of social media. As with the Internet boom during the mid-to-late 1990s, social media is generating new legal questions at a far faster pace than the law’s ability to provide answers to such questions. In an effort to stay on top of these emerging issues, and to keep our clients and friends informed of new developments, Morrison Foerster publishes this blog devoted to the law and business of social media.<h2>ABOUT MORRISON FOERSTER</h2>Morrison Foerster is a leading global law firm that transforms complexity into advantage for its clients. Our clients include some of the largest financial institutions, banks, consulting and accounting firms, and Fortune 100, technology, and life sciences companies. Highlighting the firm’s commitment to client service, leadership in market-changing deals and impact litigation, and values-based culture, Morrison Foerster has been repeatedly recognized as one of the top 10 firms on The American Lawyer’s A-List. Year after year, the firm receives significant recognition from Chambers and The Legal 500 across their various guides, including Global, USA, Asia‑Pacific, Europe, UK, Latin America, and FinTech Legal. Our lawyers passionately care about delivering legal excellence while living our values. Morrison Foerster has a long-standing commitment to creating a culture that respects and celebrates differences, while providing an inclusive environment. The firm has achieved Mansfield Certification Plus since 2018 as a result of successfully reaching at least 30 percent women, communities of color, and LGBTQ+ lawyer representation in a notable number of current leadership roles and committees. The firm also has a long history of commitment to the community and society through providing pro bono legal services, including litigating for civil rights and civil liberties, improving public education and fostering the wellbeing of children, advocating for veterans, promoting international human rights, enforcing the right to asylum, and safeguarding the environment.

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Aaron is the chair of the firm’s Technology Transactions Group and co-chair of the Interactive + Digital Media Group. He advises clients on a wide range of complex transactions involving intellectual property and technology, including structuring and negotiating strategic licensing, development, collaboration, procurement, and distribution deals.Aaron’s practice focuses on advising both established and emerging companies in a variety of data- and technology-intensive sectors, including software, SaaS, cloud-based technology, digital media (social media, AR/VR, gaming, streaming media, AdTech), AI, healthcare, consumer electronics, e-commerce, other online business models, and mobile applications. He also maintains an active practice counseling companies on branding and marketing, trademark licensing, and content-related transactions, as well as the intellectual property aspects of mergers, acquisitions, asset spin-offs, and private equity investments.He has represented clients such as Autodesk, Meta, OpenAI, Splunk, Konami, Kaiser Permanente, SoftBank, Visa, and Yahoo, among others.Aaron has been recognized by numerous publications for his work on market-defining technology transactions. He is currently ranked by Chambers USA for “Technology Transactions.”Aaron also serves as co-editor of Socially Aware, the firm’s award-winning newsletter and blog devoted to the law and business of social media, and regularly publishes on various IP and technology-related topics. Aaron is also a sought-after speaker on new and emerging areas of law, and is a frequent presenter and panelist at conferences and legal services programs. In addition to his active practice, Aaron regularly provides pro bono assistance to various nonprofit and charitable organizations such as Common Sense Media and the Starlight Children’s Foundation. He is a member of the board of directors of California Lawyers for the Arts.While in law school at the University of California, Berkeley, Boalt Hall School of Law, Aaron served as executive editor of the California Law Review and was elected to the Order of the Coif. Following law school, Aaron served as law clerk to the Honorable William H. Orrick and the Honorable Martin J. Jenkins, both United States District Judges for the Northern District of California.

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Aaron is the chair of our Technology Transactions Group. He advises clients on a wide range of complex transactions involving intellectual property and technology, including structuring and negotiating strategic licensing, development, collaboration, procurement, and distribution deals. Aaron’s practice focuses on advising both established and emerging companies in a variety of data– and technology–intensive sectors, including software, SaaS, cloud computing, AR/VR, AI, gaming, healthcare, consumer electronics, social media, e–commerce, other online business models, and mobile applications. He also maintains an active practice counseling companies on the intellectual property aspects of mergers, acquisitions, asset spin–offs, and private equity investments.

Aaron P. Rubin

Lawrence Gallick is of counsel in the firm’s Austin office and a member of the Technology Transactions Group.Lawrence focuses his practice on technology transactions and licensing matters. His diverse experience includes advising on SaaS agreements, cross-licensing agreements, research and collaboration agreements, development agreements, and distribution agreements. He counsels a broad range of companies across the software, hardware, life sciences, biotech and FinTech spaces, as well as other entities including universities.He advises clients in connection with general corporate matters including contract negotiations, and leasing and technology placement agreements.Lawrence also serves as co-editor of <a href="https://www.sociallyawareblog.com/" target="_blank">Socially Aware</a>, the firm’s award-winning newsletter and blog devoted to the law and business of social media, and regularly publishes on various IP and technology-related topics.Prior to joining the firm, Lawrence was counsel at another major law firm. Before earning his law degree, Lawrence was a web consultant, project manager, and web developer in Portland, Oregon, where he managed and consulted on projects using industry methodologies and performed custom development and integration of content management systems.Lawrence was named a Super Lawyers “Rising Star” in 2015 and 2018–2022, and is licensed in both California and New York. Lawrence earned his J.D. from the University at Buffalo School of Law, where he was the electronic systems editor for the Buffalo Law Review and awarded the ABA-BNA Award for Excellence in the Study of Intellectual Property Law.

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Lawrence Gallick

Anthony Ramirez is a partner in the Technology Transactions Group in the New York office of Morrison Foerster.Anthony advises clients on general commercial and transactional matters. He regularly advises companies on the IP aspects of their M&A transactions. His clients include technology, digital media and content for television and music, financial services, and communications companies with diverse intellectual property assets and issues.His practice focuses on the legal aspects of developing, licensing, and commercializing technology and intellectual property, as well as negotiating general commercial contracts, including outsourcing transactions, as well as content and data licenses. He regularly assists clients with legal issues relating to licensing and commercialization of digital media and content, digital content that is distributed over the Internet or streamed, mobile applications and social media, as well as the licensing of recorded music for distribution via digital platforms. Anthony is also experienced with issues relating to open-source software, software development, artificial intelligence and machine learning, cloud-based technology, and protection of proprietary information.Anthony has extensive experience working on matters involving disruptive technologies, such as blockchain. He has helped fintech clients with general intellectual property issues in connection with terms of service for online financial products and services.Anthony is an integral part of the outside pro bono legal team for nonprofit organizations based in New York, including advising clients on legal issues regarding entertainment, social media, privacy rights, and the negotiation of outsourcing and service agreements. Anthony received his J.D. from the University of Michigan Law School in 2009. He received his B.S. from Cornell University in 2004.

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Anthony Ramirez is a partner in the Technology Transactions Group in the New York office of Morrison Foerster. He advises clients on general commercial and transactional matters. His clients include technology, media, and communications companies with considerable intellectual property assets. His practice focuses on the legal aspects of licensing and commercializing technology and intellectual property, as well as negotiating general commercial contracts. He also regularly assists clients with legal issues relating to mobile applications and social media.

Anthony M. Ramirez

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Socially Aware is devoted to the law and business of social media, proactively addressing emerging issues and keeping our clients informed of new developments. We cover fields such as artificial intelligence, privacy and data security, Section 230, intellectual property, and much more.

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Lawrence W. Gallick

Social Links: If the Suit Fits

Social Links: Age Verification, X Appeal, and the Great White North

Social Links: Fake Reviews, Real Rulings, and an Epic Fail

Lawrence W. Gallick on Toth v. Everly Well, Inc.

Social Links: Going Back to Cali

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CHALLENGE TO TEXAS AGE-VERIFICATION LAW RETURNED TO LOWER COURTThe U.S. Court of Appeals for the Fifth Circuit has sent a challenge to Texas’s controversial <a href="https://www.statesman.com/story/news/state/2024/09/13/scope-act-texas-hb-18-social-media-children-personal-data-online-judge-robert-pitman-block/75178891007/" target="_blank">online age verification law</a> back to district court for additional clarification, while leaving the lower court’s injunction blocking the legislation in place. In its current form, the law requires that companies (including social media platforms) that host or distribute digital content verify a user’s age if more than one-third of the content is “sexually harmful to minors.”<a href="https://aboutblaw.com/bgdo" target="_blank">In its opinion</a>, the Fifth Circuit wrote that the lower court failed to properly resolve who is covered by the law and the type of content under its purview. Though the law was set to go into effect on September 1, 2024, a <a href="https://ccianet.org/wp-content/uploads/2024/07/CCIA-and-NetChoice-v.-Paxton-Complaint-ECF-1.pdf" target="_blank">challenge filed in July 2024</a> by Computer & Communications Industry Association and NetChoice LLC secured a partial injunction in the U.S. District Court for the Western District of Texas, which effectively blocked implementation on First Amendment grounds. Texas Attorney General Ken Paxton immediately appealed the decision, which brings us to where we are today. Privacy concerns are at the heart of the case, with critics maintaining that this type of age verification law would put all users at significant risk for exploitation as a result of the data collected for verification. Proponents argue that the proliferation of smartphones has made pornographic content easily available to children and only legislation can protect them from themselves. <a href="https://www.newsweek.com/states-porn-age-verification-free-speech-1903108" target="_blank">Similar legislation</a> has been proposed or enacted in many states, prompting a <a href="https://www.sociallyawareblog.com/topics/state-social-media-laws-targeted-at-teens-face-opposition" target="_blank">slew of challenges</a>.FTC GOES AFTER SITEJABBER FOR FAKE PRODUCT REVIEWSAs we <a href="/topics/socially-aware-fake-reviews-real-rulings-and-an-epic-fail" target="_self">reported last month</a>, the Federal Trade Commission (FTC) is not playing around when it comes to fraudulent online reviews. It wasted no time when taking action against online review platform Sitejabber for violations of <a href="https://www.ftc.gov/system/files/ftc_gov/pdf/r311003consumerreviewstestimonialsfinalrulefrn.pdf" target="_blank">new FTC rules</a> prohibiting false or deceptive customer testimonials and has issued a proposed consent order in a 5–0 decision. According to <a href="https://www.ftc.gov/system/files/ftc_gov/pdf/SiteJabber-Complaint.pdf" target="_blank">the complaint</a>, Sitejabber collected ratings and reviews for its online business clients from consumers at the time of purchase, rather than after purchasers had an opportunity to actually use the products, and used this data to deceptively inflate its clients’ ratings. Commissioner Melissa Holyoak pointed out in her <a href="https://www.ftc.gov/system/files/ftc_gov/pdf/holyoak-sitejabber-statement.pdf" target="_blank">concurring statement</a> that Sitejabber’s embeddable web widget for instant product reviews is “an inherently deceptive tool.” Commissioner Andrew Ferguson <a href="https://www.ftc.gov/system/files/ftc_gov/pdf/ferguson-sitejabber-concurring-statement.pdf" target="_blank">agreed</a>, adding: “These widgets had no purpose other than to represent that those product ratings were derived from the reviews of consumers who had received and had a chance to use the product in question.” If it does not comply with FTC rules before a final consent order is issued, Sitejabber could be subject to fines of up to $51,744 for each violation.OMAR ABDULAZIZ LOSES APPEAL AGAINST XOmar Abdulaziz, a dissident Saudi blogger, activist, and <a href="https://www.imdb.com/title/tt11382384/?ref_=nm_flmg_knf_t_2" target="_blank">longtime associate of Jamal Khashoggi</a>, has lost his appeal against X. Abdulaziz alleged that X (known as Twitter at the time) improperly shared his private information with the Saudi government, leading to his arrest and torture. Abdulaziz filed the appeal after a California district court <a href="https://casetext.com/case/abdulaziz-v-twitter-inc-1" target="_blank">dismissed the complaint</a> for failure to plead the causation needed for Article III standing and negligence. The Ninth Circuit Court of Appeals disagreed with the lower court’s Article III stance, finding that the allegations in the complaint were sufficient for standing, but still rejected the appeal on statute of limitations grounds. The court <a href="https://law.justia.com/cases/federal/appellate-courts/ca9/21-16195/21-16195-2024-11-06.html" target="_blank">ruled</a> that Abdulaziz’s claim was barred by California’s statute of limitations since it was not filed until 2019, though X notified him as early as 2015 that state-sponsored actors may have targeted his account.TIKTOK ORDERED TO SHUTTER OFFICES IN CANADACiting national security concerns, the Canadian government has <a href="https://www.canada.ca/en/innovation-science-economic-development/news/2024/11/government-of-canada-orders-the-wind-up-of-tiktok-technology-canada-inc-following-a-national-security-review-under-the-investment-canada-act.html" target="_blank">issued an order</a> requiring TikTok to shut down operations and close its offices in Canada. Though the order is light on details, Canadian intelligence agencies have long <a href="https://www.cbc.ca/news/politics/csis-tikok-vigneault-1.7206000">expressed apprehension</a> over the app’s data security and ties to the Chinese government. Canada has banned the app on government-issued devices since 2023 (like <a href="https://www.pbs.org/newshour/world/these-countries-have-already-banned-tiktok">many other countries</a>), but this new order requires TikTok to completely end operations at their Toronto and Vancouver offices. In a <a href="https://newsroom.tiktok.com/en-ca/our-response-to-canadas-order-to-shut-down-tiktok-canada-ca">statement</a>, TikTok pointed out that this action will result in the loss of hundreds of high-paying jobs and have pledged to fight it in court. The order does not block the app for Canadian citizens and content creators, though other countries <a href="https://www.npr.org/2024/04/24/1246663779/biden-ban-tiktok-us">have proposed</a> exactly that. University of Ottawa professor Michael Geist found the ruling misguided, <a href="https://www.michaelgeist.ca/2024/11/canadian-government-to-ban-tiktok-the-company-not-the-app/">writing</a> “[B]anning the company rather than the app may actually make matters worse since the risks associated with the app will remain but the ability to hold the company accountable will be weakened.”OPENAI TAKES PROACTIVE MEASURES FOR ELECTION INTEGRITYOpenAI’s wildly popular generative AI chatbot, ChatGPT, <a href="https://www.cnbc.com/2024/11/08/chatgpt-blocked-250000-image-generations-of-presidential-candidates.html">actively blocked</a> more than 250,000 requests to generate images of U.S. presidential candidates ahead of the election and <a href="https://techcrunch.com/2024/11/08/chatgpt-told-2m-people-to-get-their-election-news-elsewhere-and-rejected-250k-deepfakes/" target="_blank">redirected millions</a> of users to trusted news sites such as Reuters and the Associated Press when the chatbot was asked for candidate information. In a <a href="https://openai.com/index/how-openai-is-approaching-2024-worldwide-elections/" target="_blank">blog</a> posted on its official site, OpenAI detailed the steps taken to ensure its product would not be used for nefarious purposes, writing: “Protecting the integrity of elections requires collaboration from every corner of the democratic process, and we want to make sure our technology is not used in a way that could undermine this process.”DOMAIN NAMES CONTINUE TO INCREASE IN VALUEIn other OpenAI news, the company has purchased the domain <a href="https://chat.com/" target="_blank">chat.com</a> for <a href="https://www.theverge.com/2024/11/6/24289768/openai-chat-chatgpt-sam-altman-hubspot" target="_blank">reportedly</a> more than $ 10 million. The simpler URL is likely to position OpenAI's ChatGPT tool at the forefront of consumer awareness, and “Chat it” may soon become as ubiquitous as “Google it” in the online lexicon. Though the price tag may seem steep, this is probably a <a href="https://www.businessinsider.com/openai-acquires-chat-com-url-website-domain-2024-11" target="_blank">savvy move</a>. URL familiarity has become crucial in the digital marketplace and simple, memorable domain names are now extremely valuable properties. Former MTV VJ Adam Curry was quite possibly the first person to realize this, which may be the weirdest sentence you’ll read this month. He started <a href="https://mtv.com/" target="_blank">mtv.com</a> way back in 1994, but the network was uninterested in getting involved with this newfangled internet thing, so they let him have the domain. When they realized what a staggering mistake they made, <a href="https://law.justia.com/cases/federal/district-courts/FSupp/867/202/1456301/" target="_blank">lawsuits soon followed</a>.

Lawrence Gallick is of counsel in the firm’s Austin office and a member of the Technology Transactions Group.

Anthony Ramirez is a partner in the Technology Transactions Group in the New York office of Morrison Foerster. Anthony advises clients on general commercial and transactional matters. He regularly advises companies on the IP aspects of their M&A transactions.











Anthony Ramirez

Aaron is the chair of the firm’s Technology Transactions Group and co-chair of the Interactive + Digital Media Group. He advises clients on a wide range of complex transactions involving intellectual property and technology, including structuring and negotiating strategic licensing, development, collaboration, procurement, and distribution deals.

Aaron Rubin

FAKE REVIEW RULES TAKE EFFECTThe Federal Trade Commission’s new rules banning phony online reviews are now in effect. These rules aim to curb false consumer testimonials, the buying of fake reviews from brokers, review suppression, falsifying social media influence, and misrepresentation of company ownership for review sites. As <a href="/topics/social-links-recent-developments-in-the-law-and-business-of-social-media" target="_self">we reported</a> last August, fake and bot-generated reviews have proliferated at an alarming rate, potentially leading to consumer cynicism, mistrust, and unfair competition. These <a href="https://www.ftc.gov/system/files/ftc_gov/pdf/r311003consumerreviewstestimonialsfinalrulefrn.pdf" target="_blank">new FTC rules</a> have some teeth: non-compliance could result in a $51,744 fine for each violation. It remains to be seen how e-commerce behemoths that host tens of millions of online reviews will navigate compliance, but it’s probably a safe bet there will be some late nights for IT personnel in Seattle and Mountain View. <a href="https://www.ftc.gov/news-events/news/press-releases/2024/08/federal-trade-commission-announces-final-rule-banning-fake-reviews-testimonials" target="_blank">FTC chair Lina Khan said</a>, “Fake reviews not only waste people’s time and money, but also pollute the marketplace and divert business away from honest competitors. [The rule will] protect Americans from getting cheated, put businesses that unlawfully game the system on notice, and promote markets that are fair, honest, and competitive.” It will be interesting to see what e-commerce and review sites look like in six months.MASS. SUPREME COURT RULES IN FAVOR OF MEDICAL DATA TRACKINGThe Supreme Judicial Court of Massachusetts <a href="https://www.reuters.com/legal/transactional/web-browsing-tracking-doesnt-violate-massachusetts-wiretap-law-court-rules-2024-10-24/" target="_blank">has ruled</a> that website tracking software does not run afoul of the <a href="https://bja.ojp.gov/program/it/privacy-civil-liberties/authorities/statutes/1284#:~:text=1968%2C%20(Pub.-,L.,wiretapping%20by%20government%20officials%2C%20and" target="_blank">1968 Wiretap Act</a>, and sites can continue tracking browser activity without the consent of the user. The <a href="https://fingfx.thomsonreuters.com/gfx/legaldocs/lbpgjobqqvq/10242024sjc_wiretap.pdf" target="_blank">5–1 ruling</a> maintains that two hospitals named in the action—Beth Israel Deaconess Medical Center and New England Baptist Hospital—were not breaking the law by collecting and sharing patient data with tracking sites. The plaintiff alleged that the collected data allowed tech companies to profit from private medical data without consent.Writing for the majority, Judge Scott Kafker noted that the 1968 Wiretap Act does not apply to website operators who track data from those who visit, and the law’s legislative history does not lead to the conclusion that it was meant to apply so broadly as to potentially criminalize the interception of web browsing. He added, “If the legislature intends for the wiretap act’s criminal and civil penalties to prohibit the tracking of a person’s browsing of, and interaction with, published information on websites, it must say so expressly.”In a strongly worded dissent, Judge Dalila Wendlandt argued that the Wiretap Act’s prohibition on electronic surveillance does apply to browser tracking because, despite the implied privacy of the hospitals’ online communications, third parties were allowed to track and record patients’ healthcare information. She wrote, “The court decides that the wiretap act provides no recourse despite its prohibition on surreptitious electronic surveillance by private parties. Lamentably, the court is right about one thing; the Legislature will need to correct today’s error.”With hundreds of <a href="https://www.reuters.com/legal/transactional/massachusetts-top-court-considers-allowing-website-tracking-class-actions-2024-04-03/" target="_blank">similar cases</a> filed across the country, this ruling is unlikely to be the final word.LAWSUIT AGAINST X THROWN OUT IN DRAMATIC FASHIONFormer Twitter (now X) executive Mark Schobinger’s attempt to gain class status in a suit over unpaid bonuses <a href="https://www.courthousenews.com/former-twitter-employees-denied-class-action-certification-in-bonuses-suit/" target="_blank">failed in spectacular fashion</a> in a San Francisco courtroom this month. In a <a href="https://www.courthousenews.com/wp-content/uploads/2024/10/schobinger-vs-twitter-order-denying-motion-class-certification.pdf" target="_blank">scathing order</a>, U.S. District Judge Vince Chhabria wrote that Schobinger “might fit nicely into this case as a defendant,” adding that the suit “reflects remarkable hubris.” The crux of Judge Chhabria’s order comes down to one simple thing—hypocrisy. It turns out that Schobinger himself was a leading advocate for not paying out the very bonuses he is now seeking when he was Twitter’s senior director of compensation. Discovery in the case revealed a litany of messages, emails, and alleged conversations in which Schobinger aggressively lobbied against the bonus payments. Schobinger’s attorney attempted a last-minute swap to bring in a new, untainted plaintiff, but Judge Chhabria stuck to the dance-with-who-brung-ya protocol, saying: “The fact that Schobinger’s lawyer thought it was a good idea to file a motion for class certification in the face of this evidence (as opposed to dropping the case or seeking to substitute another plaintiff immediately upon discovering it) shows that she is totally unqualified to serve as class counsel.” No word yet on whether any <a href="https://youtu.be/DGuOUJ132bU?si=jXRkCGU-0IYlsANt" target="_blank">gavels were broken</a>.ALEX JONES SET TO LOSE IP RIGHTS AND SOCIAL MEDIA ACCOUNTSConspiracy peddler Alex Jones’s social media accounts and IP rights are <a href="https://www.msn.com/en-in/entertainment/oscars/blow-for-alex-jones-as-judge-rules-on-how-he-ll-pay-sandy-hook-victims/ar-AA1rc6WL?apiversion=v2&noservercache=1&domshim=1&renderwebcomponents=1&wcseo=1&batchservertelemetry=1&noservertelemetry=1" target="_blank">likely to be sold</a> to the highest bidder in an effort to pay down the nearly $1.5 billion in defamation judgments levied against him for repeatedly calling the tragic 2012 Sandy Hook school shooting a hoax. Jones’s assets are currently controlled by a court-appointed trustee after he <a href="https://www.reuters.com/world/us/alex-jones-files-bankruptcy-following-sandy-hook-verdict-court-filing-2022-12-02/" target="_blank">filed for bankruptcy</a> shortly following the judgment. Many of his tangible assets (including his Infowars studio) are already slated to be auctioned off, but it’s possible the IP assets and social media accounts will prove more valuable at auction. Jones and his legal team maintain that his personal social media accounts are not subject to liquidation and cannot be disentangled from his name, likeness, or image. As one of the <a href="https://youtu.be/_V1vacCrFNs?si=vV9bVHQq9VF1PH1a">least sympathetic defendants</a> in recent memory, Jones faces serious headwinds in his attempt to retain assets.TIKTOK SUFFERS ANOTHER COURT LOSSSocial media juggernaut TikTok’s bid for an en banc panel rehearing has been shot down by the Third Circuit. The action stems from an <a href="https://www.sociallyawareblog.com/topics/social-links-tinder-tiktok-and-the-copacabana" target="_blank">August decision</a> in which the court ruled TikTok and its parent company, ByteDance, <a href="https://cases.justia.com/federal/appellate-courts/ca3/22-3061/22-3061-2024-08-27.pdf?ts=1724792413" target="_blank">were not protected</a> under <a href="https://www.law.cornell.edu/uscode/text/47/230" target="_blank">Section 230</a> of the Communications Decency Act in the tragic death of a 10-year-old child. TikTok argued that the panel’s August decision went against 30 years of precedent involving Section 230. The court disagreed, citing the U.S. Supreme Court’s <a href="https://www.supremecourt.gov/opinions/23pdf/22-277_d18f.pdf" target="_blank">Moody v. Netchoice LLC</a> decision in finding that the app’s algorithm qualifies as “expressive content.” The ruling revives a lawsuit by the deceased child’s mother against TikTok, which had been <a href="https://www2.ca3.uscourts.gov/opinarch/223061p.pdf" target="_blank">dismissed in January</a> by the U.S. District Court on Section 230 grounds. This ruling has wide implications for social media companies and is likely to be appealed to the U.S. Supreme Court. We’ll keep a close eye on this one.

Newsom Vetoes AI BillCalifornia Governor Gavin Newsom has vetoed <a href="https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=202320240SB1047" target="_blank">SB-1047</a>. The controversial bill was intended to establish safety guidelines for artificial intelligence models and would have been the first significant piece of state AI legislation in the country. Though it had many <a href="https://www.latimes.com/entertainment-arts/business/story/2024-09-24/mark-hamill-jane-fonda-joseph-gordon-levitt-sign-letter-in-support-of-ai-safety-bill-sb-1047" target="_blank">high-profile supporters</a>, the Governor ultimately felt the bill went too far and would hamstring the state’s growing AI industry. In a <a href="https://www.gov.ca.gov/wp-content/uploads/2024/09/SB-1047-Veto-Message.pdf" target="_blank">statement to the Senate</a>, Newsom wrote: “While well-intentioned, SB-1047 does not take into account whether an AI system is deployed in high-risk environments, involves critical decision-making or the use of sensitive data. Instead, the bill applies stringent standards to even the most basic functions — so long as a large system deploys it. I do not believe this is the best approach to protecting the public from real threats posed by the technology.” He also announced that the state will partner with several industry insiders, including <a href="https://profiles.stanford.edu/fei-fei-li" target="_blank">Dr. Fei-Fei Li</a> (who opposed the legislation), to develop guardrails around powerful AI models. State Senator Scott Wiener, who introduced the original bill, has <a href="https://www.sfexaminer.com/news/technology/why-gavin-newsom-veto-just-beginning-of-ai-safety-fight/article_dd1dedb8-7f89-11ef-9510-6f396710820a.html" target="_blank">vowed to continue</a> the fight.AI technology is evolving far too quickly for reactive legislation. Will lawmakers emerge who understand the intricacies and implications of artificial intelligence, but also have the political clout to push proactive bills through legislatures? That’s a lot to ask of anyone. Time will tell.SB-976 Becomes Law in CaliforniaThere’s no shortage of news coming out of California. Governor Newsom has signed the <a href="https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=202320240SB976" target="_blank">Protecting Our Kids From Social Media Addiction Act</a> (SB-976) into law, mandating that algorithm-based social media feeds will be inaccessible to children without parental consent. The law also stipulates that social media entities may not send notifications to children overnight or during school hours without express parental permission. The state attorney general is now tasked with outlining a process by 2027 to determine if users are children, which will certainly be controversial. This bill is very similar to <a href="https://www.nysenate.gov/legislation/bills/2023/S7694/amendment/A" target="_blank">legislation recently passed in New York</a> and may be a harbinger of things to come on the national stage. As we’ve <a href="https://www.sociallyawareblog.com/topics/state-social-media-laws-targeted-at-teens-face-opposition" target="_blank">previously reported</a>, parental consent rules run the risk of isolating vulnerable teens, while age-verification requirements may trigger privacy, bias, accuracy, and other concerns (including litigation). We’ll continue to pay close attention as this unfolds.California Deepfake Law BlockedShould political deepfakes be <a href="https://www.politico.com/news/2024/10/02/california-law-block-political-deepfakes-00182277" target="_blank">protected as satire</a>? In Kohls v. Bonta, Judge John A. Mendez of the U.S. District Court for the Eastern District of California ruled that it should. Despite being signed into law on September 17, 2024, <a href="https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=202320240AB2839" target="_blank">AB-2839</a> was blocked in Judge Mendez’s court just two weeks later on grounds that the law does not meet the high standard for legislation that may burden protected speech. In rejecting the state’s argument that the law is akin to restrictions on defamation, Judge Mendez wrote: “YouTube videos, Facebook posts, and X tweets are the newspaper advertisements and political cartoons of today, and the First Amendment protects an individual’s right to speak regardless of the new medium these critiques may take.” Read <a href="https://storage.courtlistener.com/recap/gov.uscourts.caed.453046/gov.uscourts.caed.453046.14.0.pdf" target="_blank">Judge Mendez’s extensive ruling</a> in its entirety<a href="https://storage.courtlistener.com/recap/gov.uscourts.caed.453046/gov.uscourts.caed.453046.14.0.pdf">.</a>Privacy Rights Bill VetoedGovernor Gavin Newsom’s veto pen was working overtime as a number of tech-related bills recently landed on his desk. In addition to the aforementioned AI bill, Newsom vetoed <a href="https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=202320240AB3048" target="_blank">AB-3048</a>. This law would have mandated that internet browsers and mobile operating systems provide Californians with a simple, single-click option to block the use and sharing of their data. Unsurprisingly, the bill was <a href="https://x.com/jason_kint/status/1834682846125944905" target="_blank">aggressively opposed</a> by major tech entities who argued that implementing such functionality presented too many technical hurdles and would be disruptive to operations for both the companies and the end users. Consumer and privacy rights activists <a href="https://advocacy.consumerreports.org/press_release/california-governor-vetoes-landmark-bill-for-privacy-rights/" target="_blank">strongly disagreed</a>. In his <a href="https://www.gov.ca.gov/wp-content/uploads/2024/09/AB-3048-Veto-Message.pdf" target="_blank">veto statement</a>, Governor Newsom wrote: “I am concerned… about placing a mandate on operating system (OS) developers at this time. No major mobile OS incorporates an option for an opt-out signal. By contrast, most internet browsers either include such an option or, if users choose, they can download a plug-in with the same functionality. To ensure the ongoing usability of mobile devices, it’s best if design questions are first addressed by developers, rather than by regulators.”Though AB-3048 <a href="https://leginfo.legislature.ca.gov/faces/billVotesClient.xhtml?bill_id=202320240AB3048" target="_blank">overwhelmingly passed</a> in both chambers, the California Legislature has not overridden a gubernatorial veto <a href="https://prospect.org/politics/2023-10-16-missing-veto-override-california/" target="_blank">since 1980</a>. As tech is a major economic engine of the state, a veto seems extremely unlikely in this case – despite the Legislature having more than enough votes to do so.X Ordered to Honor Severance AgreementA former Twitter employee who was terminated and offered a reduced severance package after Elon Musk purchased the platform for $44 billion in 2022 <a href="https://www.business-standard.com/world-news/ex-twitter-worker-wins-fight-with-elon-musk-over-unpaid-severance-124092400092_1.html" target="_blank">has prevailed in arbitration</a>. The company, now rebranded as X, was ordered to pay the unnamed employee the full amount owed under the initial severance agreement. It’s possible that this settlement may result in additional severance adjustments for the more than 2,000 former Twitter employees who have filed arbitration grievances after allegedly being denied their contractually agreed severance. Legendary Los Angeles <a href="https://www.youtube.com/watch?v=-ey5agy1blc&list=OLAK5uy_kBru2bFCew4EFmAoCTtT_XrydeTIPT4G0" target="_blank">punk band X</a> was unavailable for comment.

Social Links: Going Back to Cali

California Governor Gavin Newsom has vetoed SB-1047. The controversial bill was intended to establish safety guidelines for artificial intelligence models and would have been the first significant piece of state AI legislation in the country. 

The Federal Trade Commission has finalized a <a href="https://www.ftc.gov/business-guidance/blog/2024/08/well-pay-you-give-our-new-rule-good-review">new rule</a> aimed at curtailing false, misleading, and otherwise fraudulent reviews on online retail sites. Fake reviews are a <a href="https://pushpullagency.com/blog/a-deep-dive-into-amazon-consumer-review-statistics/">significant problem</a> for the big e-commerce platforms, given that a robust customer review system is crucial to modern e-commerce business models. In fact, <a href="https://pushpullagency.com/blog/a-deep-dive-into-amazon-consumer-review-statistics/">studies</a> have shown that a one-star rating increase in a product review can result in as much as a 26% increase in sales. Unsurprisingly, this has caused a proliferation of fake reviews and “<a href="https://www.theguardian.com/money/2023/apr/22/it-can-be-incredibly-profitable-the-secret-world-of-fake-online-reviews">review brokers</a>.” The new FTC rule is pretty comprehensive and worth a <a href="https://www.ftc.gov/system/files/ftc_gov/pdf/r311003consumerreviewstestimonialsfinalrulefrn.pdf">full read</a>.New York trademark attorney Jeremy Green Eche hit the jackpot—and may have run afoul of <a href="http://www.internetlibrary.com/publications/anticybsquattSamson9-05_art.cfm">federal anti-cybersquatting law</a>—when he recently sold the HarrisWalz.com domain for $15,000. Eche <a href="https://www.cbsnews.com/news/harris-walz-domain-name-sold-for-1500/">purchased the domain in 2020</a> for $8.50. Though cybersquatting law is focused predominantly on trademark protection, it includes a provision barring any registration that “consists of the name of another living person” without their consent and “with the specific intent to profit” from its sale. This isn’t the first time Eche got lucky purchasing domains. In 2016, he <a href="https://www.usatoday.com/story/news/politics/onpolitics/2016/10/03/clinton-kaine-trump-website/91462708/">sold ClintonKaine.com to the Trump campaign,</a> also for $15,000. Eche denied being profit-driven, noting the relatively low price he put on both the Harris and Clinton domains. That the “relatively low” price happens to be slightly less than the cost of pursuing a cybersquatting case against him is probably just a coincidence, right?The U.S. Court of Appeals for the Ninth Circuit has ruled that employers may be subject to lawsuits based on their employees’ off-work social media posts. In <a href="https://casetext.com/case/okownowsky-v-garland">Okonowsky v. Garland</a>, the court unanimously ruled that an employee of a federal prison was sexually harassed on Instagram by a coworker in violation of Title VII of the 1964 Civil Rights Act. Following the ruling, plaintiff’s attorney Drew Pletcher said, “It appears to be the first holding in the Ninth Circuit to find that social media posts on an Instagram page could be considered workplace harassment under Title VII.” In the wake of this ruling, companies will need to consider whether their employee <a href="https://www.expresspros.com/Newsroom/America-Employed/88-Percent-of-Hiring-Managers-Would-Consider-Firing-Workers-for-Content-in-Personal-Social-Media-Posts.aspx">social media policies</a> adequately address abusive or harassing behavior both inside and outside the workplace, including on personal social media.Ye, the artist formerly known as Kanye West, <a href="https://usaherald.com/kanye-west-faces-1-5m-copyright-suit-over-unauthorized-photo-use/">has been hit</a> with a $1.5 million copyright infringement lawsuit by celebrity photography sites <a href="https://usa.backgrid.com/">BackGrid USA</a> and <a href="https://uk.backgrid.com/">BackGrid UK</a>. The paparazzi companies allege Ye posted 10 BackGrid-owned photos to his Instagram account without permission or compensation. While it may seem counterintuitive that celebrities cannot post photos of themselves on their own social media, this is actually a fairly common fact pattern, and one that we <a href="https://www.sociallyawareblog.com/topics/by-winning-motion-to-dismiss-supermodel-loses-chance-to-clarify-whether-she-can-lawfully-post-photos-of-herself-to-social-media">have covered previously</a>. For Ye, in any event, this will not be the first time he has <a href="https://edition.cnn.com/2014/03/17/showbiz/kanye-west-plea-deal/">tangled with paparazzi</a>.Embattled Georgia attorney Lin Wood has been <a href="https://lawandcrime.com/high-profile/pro-trump-defamation-attorney-lin-wood-must-pay-former-law-partners-4-5-million-after-defaming-them-as-criminal-extortionists-on-social-media/">ordered to pay</a> his former law partners $4.5 million after an <a href="https://www.documentcloud.org/documents/25049449-lin-wood-defamation-damages">Atlanta jury found him liable</a> for defaming them on social media. The feud began, like so many do, as an argument over money. The federal court’s initial <a href="https://storage.courtlistener.com/recap/gov.uscourts.gand.301086/gov.uscourts.gand.301086.90.0.pdf">ruling</a> contained some not-so-subtle jabs at Wood. Judge Michael L. Brown wrote, “During a five-week period the following year, Defendant repeatedly accused Plaintiffs of criminal extortion in a series of messages he posted on a social media platform called Telegram. Hundreds of thousands of people viewed Defendant’s messages.” Brown continued, adding: “Tellingly, Defendant does not even try to show his accusations were true. Indeed, he admits Plaintiffs did not commit ‘the crime of extortion.’ But he insists his extortion accusations were still non-false because they contained ‘loose, figurative, or hyperbolic language’ that no reasonable person could construe as a genuine accusation of criminal conduct. The Court disagrees.” Lin Wood’s Telegram page can be viewed <a href="https://t.me/s/linwoodspeakstruth?before=50839">here</a>.A paywall for Reddit? CEO Steve Huffman <a href="https://www.pcmag.com/news/reddit-ceo-teases-paywalled-subreddits">hinted</a> at subscription-only features for the wildly popular news aggregation and social forum site during an <a href="https://s203.q4cdn.com/380862485/files/doc_financials/2024/q2/Reddit-Q2-24-Earnings-Call_Transcript.pdf">earnings call</a> with investors. Unsurprisingly, Redditors had a snarky, and often hilarious, <a href="https://www.reddit.com/r/technology/comments/1emac0p/some_subreddits_could_be_paywalled_hints_reddit/">meltdown</a> on the site. Despite its popularity, Reddit has struggled to become profitable. It’s a top site for AI web scrapers, which prompted the company to <a href="https://www.pcmag.com/news/microsofts-bing-search-engine-gets-ai-overviews-as-reddit-blocks-it">block Microsoft’s Bing</a> search engine and enter into an <a href="https://www.theverge.com/2024/2/22/24080165/google-reddit-ai-training-data">agreement with Google</a> for site access for AI training. Of the data sharing and web scraping situation, Huffman said, “[Our] preference is to have relationships with everybody, but we need to be very considered of where Reddit data goes and what it’s used for.”

 Social Links: Recent Developments in the Law and Business of Social Media

Social Links: Recent Developments in the Law and Business of Social Media

The Federal Trade Commission has finalized a new rule aimed at curtailing false, misleading, and otherwise fraudulent reviews on online retail sites.

Social Links: Recent Developments in the Law and Business of Social Media

In a rare example of bipartisan agreement, the dramatically named DEFIANCE (Disrupt Explicit Forged Images and Non-Consensual Edits) Act unanimously <a href="https://gizmodo.com/anti-deepfake-porn-bill-unanimously-passes-in-the-senate-2000479051" target="_blank">passed the Senate</a>. The bill allows victims of AI-generated deepfake pornography to sue anyone who knowingly creates, receives, or distributes such images. It only addresses civil liability and only applies to pornographic content, but we would not be surprised to see more expansive legislation in this area in the future.Utah’s stringent social media laws survived a court challenge when a federal judge <a href="https://www.ksl.com/article/51076729/federal-judge-dismisses-claim-in-lawsuit-against-utahs-social-media-laws" target="_blank">dismissed a claim</a> by NetChoice that the legislation was preempted by federal law under Section 230. The dismissal by U.S. District Judge Robert J. Shelby cited autoplay, seamless pagination, and notifications on minors’ accounts as outside the scope of Section 230. Utah has become a <a href="https://www.ksl.com/article/50846522/utah-residents-suing-state-over-soon-to-be-enacted-social-media-restrictions" target="_blank">flashpoint</a> in the debate over social media, its impact on children, and related First Amendment concerns.Meta has <a href="https://about.fb.com/news/2024/07/combating-financial-sextortion-scams-from-nigeria/" target="_blank">removed more than 60,000 accounts</a> involved in sexual extortion scams aimed predominantly at men in the United States. The accounts were based in the fraud hotbed of Nigeria and used sexually compromising photos—both real and fake—to blackmail victims. The vast majority of the now-deleted accounts were on Instagram, but Meta also deactivated more than 7,000 Facebook accounts, pages, and groups that offered advice (including scripts) on how to defraud people. Although mostly targeting adults, there were also attempts against minors, which Meta reported to the U.S. National Center for Missing and Exploited Children.In another uncharacteristically bipartisan vote, the <a href="https://www.nbcnews.com/politics/congress/senate-poised-pass-significant-child-online-safety-bills-decades-rcna164259" target="_blank">Senate voted 91-3 in favor</a> of the Children and Teens’ Online Privacy Protection Act (COPPA 2.0) and the Kids Online Safety Act (KOSA). This is significant legislation that would create a legal “duty of care” for social media companies to prevent and mitigate harm. Violators would be subject to penalties enforced by the Federal Trade Commission. Opponents argue that the bill’s definition of harm is too broad and could lead to censorship of content that promotes politically polarizing issues, gender equality, or abortion rights. The bill will now go to the House, where its passage is less certain. Should it pass, this legislation would dramatically impact the operations of social media companies. We’re watching this very closely.Red-hot AI startup Perplexity has <a href="https://www.msn.com/en-us/news/technology/nvidia-backed-perplexity-ai-inks-deal-with-publishers-to-put-ads-in-search-engine/ar-BB1qTjUy?ocid=BingNewsVerp" target="_blank">entered into agreements</a> with several major media companies including Time, Fortune, and Automattic (owner of WordPress). Perplexity will begin featuring its partners’ content in AI-assisted search results and providing a percentage of the ad revenue. This move is on the heels of plagiarism accusations by news organizations such as Forbes and Condé Nast, the latter of which <a href="https://www.engadget.com/conde-nast-has-reportedly-accused-ai-search-startup-perplexity-of-plagiarism-191639677.html" target="_blank">reportedly sent a cease and desist</a> letter to the startup.The US Copyright Office <a href="https://cointelegraph.com/news/us-copyright-office-reports-urgent-need-protection-ai-law-deepfakes" target="_blank">issued a report</a> calling on Congress to take urgent action on the distribution of unauthorized deepfakes. The report is a result of its 2023 initiative to examine the intellectual property implications of generative AI. The speed of technology has always challenged lawmakers to keep up with bad actors, but AI deepfake capability has moved at staggering speed. <a href="https://www.fastcompany.com/91165063/microsoft-white-paper-new-laws-ai-deepfakes-frauid" target="_blank">Microsoft</a> has also called for Federal legislation addressing deepfakes.

Social Links: July 2024

A few months ago, we <a href="/topics/state-lawmakers-introduce-laws-governing-teen-use-of-social-media" target="_self">highlighted</a> the many pending and enacted state-level social media laws targeting minors’ use of social media. Since then, political and industry groups have begun to push back, calling into question whether these types of social media laws will ultimately be successfully implemented. Most recently, pending or enacted laws in Mississippi, New York, and California are facing overlapping challenges.Mississippi. A federal district court judge <a href="https://news.bloomberglaw.com/product/blaw/bloomberglawnews/exp/eyJpZCI6IjAwMDAwMTkwLTUxMjEtZGVlOS1hM2JkLWZkYjc3OGE4MDAwMSIsImN0eHQiOiJURU5XIiwidXVpZCI6InllRlhUR0g5M1htWXlyc3Zrc1k5YlE9PURoVjZoUVBQZ2s4bGFuQ1dLREVpbGc9PSIsInRpbWUiOiIxNzE5OTE5MzIzMDk1Iiwic2lnIjoid0hmdXg4cllXTzU3MGtERlJmNGRpNjJQVWUwPSIsInYiOiIxIn0=?source=newsletter&item=read-text&region=top%20stories%20digest&channel=tech-and-telecom-law" target="_blank">blocked</a> Mississippi’s attorney general from enforcing <a href="https://billstatus.ls.state.ms.us/documents/2024/html/HB/1100-1199/HB1126PS.htm" target="_blank">H.B. 1126</a> (the Walker Montgomery Protecting Children Online Act) on July 1, 2024, the day it was set to go into effect. The law would require social media platforms both to obtain parental consent for minors to use the platforms and to verify user ages. The internet trade association NetChoice sued the state on June 7, 2024, arguing that the law was unconstitutional. The court found that the state attorney general failed to show that alternatives to the law are insufficient for the state’s objective of protecting children, as mandated under the required strict scrutiny standard, and upheld a preliminary injunction of the law. Most recently, the court <a href="https://news.bloomberglaw.com/product/blaw/bloomberglawnews/exp/eyJpZCI6IjAwMDAwMTkwLWJjOTctZGMxMy1hMzkwLWJlOTdlNjNhMDAwMSIsImN0eHQiOiJURU5XIiwidXVpZCI6IkhFRDhlcEFJLzdvM2wrWU5HeDN5SlE9PUJONmNRSWxZandBaktLZlNXV0p2RXc9PSIsInRpbWUiOiIxNzIxMjE2MTI1MjQ1Iiwic2lnIjoiakpEb3hpYjlVSDMra1MrekhnQ2lnU2s0Mkc4PSIsInYiOiIxIn0=?source=newsletter&item=read-text&region=digest&channel=tech-and-telecom-law" target="_blank">denied</a> the attorney general’s motion to allow the law to go into effect pending appeal. As we previously reported, NetChoice has already prevailed in similar cases involving state social media laws in Ohio, California, and Arkansas.New York. In June, New York enacted <a href="https://www.nysenate.gov/legislation/bills/2023/S7694/amendment/A" target="_blank">S.B. 7694A</a> (the SAFE For Kids Act), which requires age verification by social media platforms to determine whether users need to seek parental consent to use such platforms. The state attorney general is tasked with determining the rules for verifying ages and identities of legal guardians. However, she faces significant opposition from tech industry groups, as well as practical hurdles in determining an adequate age verification process to require from platforms. Strict standards that require personal information could face privacy issues, while less stringent measures could allow easy circumvention. Age verification is also <a href="https://news.bloomberglaw.com/product/blaw/bloomberglawnews/exp/eyJpZCI6IjAwMDAwMThmLWNhMjQtZGIyOS1hYmFmLWRiNzQzOTRjMDAwMSIsImN0eHQiOiJURU5XIiwidXVpZCI6Ikh2QitXbk1SYzluVmhqRVZqUEgwRGc9PUxqSGQ5WXFPcW0va1VPQ1NEZ2hycWc9PSIsInRpbWUiOiIxNzE3MTUzMTM1MTY2Iiwic2lnIjoiVHB6M29aTnJweWJ2eEpzMm0ra2FIUWVoWThrPSIsInYiOiIxIn0=?source=newsletter&item=read-text&region=digest&channel=tech-and-telecom-law" target="_blank">controversial</a> because of its potential to limit access to platforms by vulnerable groups and immigrants without lawful status. The law has <a href="https://news.bloomberglaw.com/product/blaw/bloomberglawnews/exp/eyJpZCI6IjAwMDAwMThmLWUwZDgtZGExOC1hYjlmLWZkZmM5OTZmMDAwMSIsImN0eHQiOiJURU5XIiwidXVpZCI6ImFxdjNQaUI5eGZGY0orU0JwV3RHYUE9PWRhR2tub3hFc0ptTmRGMzhTSm15Unc9PSIsInRpbWUiOiIxNzE3NTg0OTkwNTEzIiwic2lnIjoiR1duT3lOMHJUU1Y4S1RXN1BtbWMzZmZiOWZzPSIsInYiOiIxIn0=?source=newsletter&item=read-text&region=digest&channel=tech-and-telecom-law" target="_blank">already faced significant lobbying opposition</a>, leading lawmakers to update the initial bill to (i) require the attorney general rather than platforms to make rules on age verification, and (ii) remove the private right of action in the initial bill in favor of limiting enforcement to the attorney general.California. California’s <a href="https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=202320240SB976" target="_blank">SB-976</a> (the Protecting Our Kids from Social Media Addiction Act) is <a href="https://news.bloomberglaw.com/product/blaw/bloomberglawnews/exp/eyJpZCI6IjAwMDAwMTkwLTViYjItZDNjYi1hOWZiLWRiZjI5OGVjMDAwMSIsImN0eHQiOiJURU5XIiwidXVpZCI6ImpwTk9oYjJPQjhvN0xPMWd1cW5sNnc9PUtlV2VzdDFaWHE3WmdQdlRnNFRtQXc9PSIsInRpbWUiOiIxNzE5OTE5MzIzMDk3Iiwic2lnIjoicyt6VjRtalJQZmVlLzVXVVRZL1llWW5Ka0JjPSIsInYiOiIxIn0=?source=newsletter&item=read-text&region=top%20stories%20digest&channel=tech-and-telecom-law" target="_blank">facing opposition</a> from tech industry lobbying groups. The law allows parents to control notifications and whether children can access an algorithmic feed as opposed to a chronological feed, and requires rules for age verification. Opponents argue that LGBTQ+ teenagers would be restricted from connecting with others in their community if parental consent is required. Critics also argue that the law is invasive, citing potential infringement on free speech protections and privacy concerns related to age verification. State lawmakers have already updated the law to attempt to remedy some of these concerns.Despite the roadblocks faced by states in pushing forward these laws, movement in this area persists and social media laws focused on minors continue to move through the lawmaking process. We will continue to monitor new laws in this area and the increasing efforts to oppose them.

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Associate

Lindsay is an associate in the Technology Transactions Group of Morrison Foerster.

Lindsay B. Harris

Lindsay Harris

A few months ago, we highlighted the many pending and enacted state-level social media laws targeting minors’ use of social media. Since then, political and industry groups have begun to push back, calling into question whether these types of social media laws will ultimately be successfully implemented.

State Social Media Laws Targeted at Teens Face Opposition

In case you haven’t noticed, state legislatures have been hard at work drafting, passing, and trying to pass laws that govern minors’ use of social media. Several states have passed laws requiring social media companies to implement certain policies, including age verification and parental consent for use of their platforms. Lawmakers in other states have introduced similar laws that are currently working their way through the legislative process and may be enacted soon. Below is a roundup of pending or enacted laws introduced in recent months.These enacted laws and in-process bills show a broad state-level trend towards efforts to hold social media companies responsible for minors on their platforms. Common themes include age verification and parental consent, but these are certainly not universal, and there are a variety of other requirements, making compliance an interesting question. As noted below, several of these laws have already been challenged in court. As the laws begin to take effect, companies will need to implement new policies and procedures to ensure platforms are compliant despite an ever-changing legislative and judicial backdrop.<a href="https://www.akleg.gov/basis/Bill/Text/33?Hsid=HB0254A#:~:text=HB%20254%3A%20%22An%20Act%20relating,to%20minors%20on%20the%20Internet.%22" target="_blank">Alaska House Bill 254</a>, which was <a href="https://alaskabeacon.com/2024/04/26/alaska-house-approves-social-media-ban-for-young-kids-online-pornography-id-checks-for-all/" target="_blank">passed in the House</a> on April 26, 2024 and now advances to the Senate, would prohibit children under age 14 from using social media, require parents to sign off on children aged 14 and 15 using social media, and require providers of internet pornography to verify that viewers are at least 18 years old.Arkansas’ <a href="https://www.arkleg.state.ar.us/Bills/Detail?id=SB396&ddBienniumSession=2023%2F2023R" target="_blank">Social Media Safety Act</a>, first introduced in March 2023, would require age verification of users by social media companies and parental consent for minors using such platforms. However, in September 2023, a federal judge <a href="https://www.cnn.com/2023/09/01/business/arkansas-social-media-age-verification/index.html" target="_blank">blocked the law</a> from going into effect while a lawsuit brought by NetChoice is resolved.California is seeing movement on several social media laws. First, the state adopted the <a href="https://leginfo.legislature.ca.gov/faces/billCompareClient.xhtml?bill_id=202120220AB2273&showamends=false" target="_blank">Age-Appropriate Design Code Act</a> in September 2022, requiring platform providers to make default privacy settings provide a “high level” of privacy, assess whether their platforms could harm children, and use age-appropriate language on their platforms. The law was subsequently <a href="#" target="_blank">#</a><a href="https://www.theverge.com/2023/9/18/23879489/california-age-appropriate-design-code-act-blocked-unconstitutional-first-amendment-injunction">blocked by a federal judge</a> in September 2023 in a lawsuit brought by NetChoice. Second, the Protecting Our Kids from Social Media Addiction bill, <a href="https://sd09.senate.ca.gov/news/20240129-sen-skinner-introduces-landmark-bill-protect-youth-social-media-addiction" target="_blank">introduced on January 29, 2024</a>, would prohibit platforms from providing an “addictive social media feed” or pushing notifications during school and overnight hours to minors without parental consent. Third, the pending <a href="https://trackbill.com/bill/california-senate-bill-1444-let-parents-choose-protection-act-of-2024/2520714/#:~:text=The%20bill%20would%20prohibit%20the,the%20account%20with%20the%20large" target="_blank">Let Parents Choose Protection Act</a>, introduced on February 16, 2024, would require providers of “large social media platforms” to make available to certain safety software providers a set of application programming interfaces (APIs) that allow them to monitor children’s activities.Colorado has two new social media laws. <a href="https://leg.colorado.gov/bills/hb24-1136" target="_blank">Introduced in January 2024</a>, <a href="https://leg.colorado.gov/sites/default/files/documents/2024A/bills/2024a_1136_rer.pdf">HB 24-1136</a> would require social media companies to push notifications to minors who have spent a certain amount of time on social media platforms at certain hours to help them understand the effects of using social media. <a href="https://leg.colorado.gov/sites/default/files/documents/2024A/bills/2024a_158_01.pdf">Introduced in February 2024</a>, <a href="https://leg.colorado.gov/sites/default/files/documents/2024A/bills/2024a_158_01.pdf" target="_blank">Senate Bill 24-158</a> would require social media companies to verify the age of users, provide certain tools to parents and minors, and notify minors about harms of social media use.Connecticut updated its <a href="https://www.cga.ct.gov/2023/ACT/PA/PDF/2023PA-00056-R00SB-00003-PA.PDF" target="_blank">Data Privacy Act</a> to <a href="https://www.bloomberglaw.com/bloomberglawnews/in-house-counsel/XCDTIMES000000?bna_news_filter=in-house-counsel#jcite" target="_blank">require social media platforms</a> to remove minors’ accounts when requested and prohibit such platforms from processing minors’ personal data. The changes will come into effect on July 1, 2024.As we previously <a href="https://www.sociallyawareblog.com/topics/social-links-april-2024" target="_blank">discussed</a>, Florida enacted <a href="https://www.flsenate.gov/Session/Bill/2024/3" target="_blank">HB 3</a> on March 25, 2024, <a href="https://www.flgov.com/2024/03/25/governor-desantis-signs-legislation-to-protect-children-and-uphold-parental-rights/#:~:text=%E2%80%94Today%2C%20Governor%20Ron%20DeSantis%20signed,%2C%E2%80%9D%20said%20Governor%20Ron%20DeSantis." target="_blank">requiring social media companies</a> to prohibit minors under age 14 from holding accounts, allowing parents to decide if 14- and 15-year-olds can have accounts, and requiring “inappropriate” websites to verify the age of minor users.Georgia enacted <a href="https://www.legis.ga.gov/legislation/66023" target="_blank">SB 351</a> on April 23, 2024, which <a href="https://www.bloomberglaw.com/bloomberglawnews/states-of-play/XFHLJFOS000000?bna_news_filter=states-of-play#jcite" target="_blank">requires children under 16</a> to get parental consent to create social media accounts, prohibits social media use on school devices, requires pornography sites to verify users are at least 18 years old, and requires education on social media use.The Iowa House approved pending <a href="https://www.legis.iowa.gov/legislation/BillBook?ga=90&ba=HF2523" target="_blank">House File 2523</a> on March 6, 2024. The bill would prohibit minors under age 18 from creating accounts on social media platforms without permission from a parent or guardian who can also monitor their activity.<a href="https://apps.legislature.ky.gov/record/24rs/hb450.html" target="_blank">House Bill 450</a> was introduced in the Kentucky House on February 1, 2024. It would require social media companies to verify that users are at least 18 years old and require parental consent for users under age 18. It would also allow parents to view their children’s online activity.Louisiana enacted the <a href="https://legis.la.gov/legis/BillInfo.aspx?s=23RS&b=SB162&sbi=y" target="_blank">Secure Online Interaction and Age Limitation Act</a> on <a href="https://apps.legislature.ky.gov/record/24rs/hb450.html" target="_blank">June 28, 2023</a>, which requires social media platforms to verify user age, get parental consent for minors to open accounts, allow parents to supervise minors’ accounts, and prevent unwanted messages from adults to minors. It would also prohibit use of minors’ personal information to display advertisements and unnecessary collection of data from minors.On May 9, 2024, Maryland enacted the <a href="https://marylandkidscode.com/" target="_blank">Maryland Kids Code</a>, which requires age-appropriate design of online products and prevents companies from using minors’ data for targeted advertising or providing addictive content.The pending Minnesota <a href="https://www.house.mn.gov/bills/Info/HF2257/93/2023/0" target="_blank">Age-Appropriate Design Code Act</a>, introduced in February 2023, would require online services likely to be accessed by children to implement certain design features and settings that prioritize privacy and data protection for minors.As we’ve <a href="https://www.sociallyawareblog.com/topics/social-links-april-2024" target="_blank">noted</a> before, New York’s <a href="https://www.nysenate.gov/legislation/bills/2023/S7694" target="_blank">Stop Addictive Feeds Exploitation (SAFE) for Kids Act</a>, introduced on October 13, 2023 and currently pending in the Senate, would prohibit social media companies from using certain addictive feed algorithms for minors without parental consent and prohibit platforms from sending nighttime notifications to minors. The state’s related <a href="https://www.nysenate.gov/legislation/bills/2023/S7695/amendment/A" target="_blank">Child Data Protection Act</a>, introduced on October 13, 2023, would prevent websites from collecting personal data from minors for advertising.North Carolina lawmakers introduced <a href="https://www.ncleg.gov/BillLookUp/2023/H644" target="_blank">House Bill 644</a> in April 2023. If passed, the bill would require social media companies to verify age to provide age-appropriate content for minors and prohibit such companies from using a minors’ data for advertising and recommendations.The currently pending <a href="https://www.ncleg.gov/BillLookUp/2023/H773" target="_blank">Let Parents Choose Protection Act</a> in North Carolina, introduced in April 2023, would require providers of large social media platforms to work with providers of safety software to allow them to monitor minors’ accounts.Ohio’s <a href="https://codes.ohio.gov/ohio-revised-code/section-1349.09" target="_blank">Social Media Parental Notification Act</a>, enacted in July 2023, would require social media platforms to get parental consent for users under age 16. It was <a href="https://thehill.com/policy/technology/4454087-federal-judge-blocks-ohio-law-requiring-parental-consent-for-social-media-use/" target="_blank">blocked by a federal judge</a> in February 2024 in a case brought by NetChoice (see our prior <a href="https://www.sociallyawareblog.com/topics/court-prohibits-ohio-s-ag-from-enforcing-social-media-parental-notification-act" target="_blank">article</a> on this case).Oklahoma <a href="http://www.oklegislature.gov/BillInfo.aspx?Bill=hb3914&Session=2400" target="_blank">House Bill 3914</a>, which <a href="https://www.okhouse.gov/posts/news-20240314_7" target="_blank">passed in the House</a> on March 14, 2024 and is now in the Senate, would require social media companies to verify users are over age 18 and require parental consent for users who are 16 to 18 years old.The pending <a href="https://www.legis.state.pa.us/cfdocs/billinfo/billinfo.cfm?syear=2023&sind=0&body=H&type=B&bn=2017" target="_blank">Pennsylvania House Bill 2017</a>, passed by the House on May 8, 2024, would require social media companies to verify users’ ages and obtain consent from a parent or guardian for minor users. If enacted, it would also allow parents to view the privacy settings of minors’ accounts.South Carolina’s <a href="https://www.scstatehouse.gov/sess125_2023-2024/prever/4700_20240206.htm" target="_blank">Social Media Regulation Act</a>, passed by the House in February 2024 and currently in the Senate, would prohibit social media companies from allowing minors to have accounts without parental consent, require such companies to prevent adults from messaging minors’ accounts, develop policies to filter certain content from minors’ accounts, and prohibit advertising based on minors’ personal data.Tennessee enacted the <a href="https://wapp.capitol.tn.gov/apps/BillInfo/Default.aspx?BillNumber=HB1891" target="_blank">Protecting Children from Social Media Act</a> on May 2, 2024. The law requires social media sites to verify the age of potential users and obtain parental consent for minor users. Such sites must also provide tools for parents to supervise minors’ accounts.Texas enacted the <a href="https://capitol.texas.gov/BillLookup/History.aspx?LegSess=88R&Bill=HB18" target="_blank">Securing Children Online through Parental Empowerment Act</a> (“SCOPE Act”) on June 13, 2023. This law requires certain “digital service providers” to verify the ages of users and limits such providers from collecting personal information from minors. Providers must also develop strategies to prevent minors’ exposure to harmful materials.As we previously <a href="https://www.sociallyawareblog.com/topics/social-links-april-2024" target="_blank">reported</a>, Utah <a href="https://apnews.com/article/utah-tiktok-social-media-youth-aeaa2bd114d50249216d8d1567a97a2c" target="_blank">repealed and replaced</a> its <a href="https://socialmedia.utah.gov/" target="_blank">Social Media Regulation Act</a>, which was previously challenged by NetChoice, on March 7, 2024. The law requires social media companies to determine whether users are minors, but no longer requires parental consent. It also requires default privacy settings for minors’ accounts, limits data collection from minors, prohibits certain addictive functions, and allows parents to monitor children’s activity.<a href="https://legislature.vermont.gov/bill/status/2024/S.289" target="_blank">Vermont’s Kids Code</a>, passed in the Senate in March 2024 and currently in the House, would require covered companies to implement default privacy settings and provide certain protections to minors.West Virginia’s <a href="https://www.wvlegislature.gov/Bill_Status/bills_history.cfm?INPUT=5226&year=2024&sessiontype=rs" target="_blank">Child Social Media Protection</a> bill, introduced in January 2024 and currently pending, would prohibit minors from holding social media accounts without parental consent and require social media companies to verify the ages of account holders.

State Lawmakers Introduce Laws Governing Teen Use of Social Media

State Lawmakers Introduce Laws Governing Teen Use of Social Media

In case you haven’t noticed, state legislatures have been hard at work drafting, passing, and trying to pass laws that govern minors’ use of social media. 

On February 12, 2024, in <a href="https://caselaw.findlaw.com/court/us-9th-circuit/115812465.html" target="_blank">Patrick v. Running Warehouse LLC</a>, the Ninth Circuit held that a defendant’s arbitration agreement contained in a website terms of use was enforceable, using the test the court articulated in 2022 in <a href="https://casetext.com/case/berman-v-freedom-fin-network-6" target="_blank">Daniel Berman v. Freedom Financial Network</a>. The court’s analysis is straightforward and the result is about what one would expect given the facts, but the opinion goes slightly off the rails in describing the terms of use at issue as a “browsewrap” agreement. We <a href="/topics/terms-of-use" target="_self">have been critical</a> of the generally confusing and unhelpful (but ubiquitous) “-wrap” terminology for many years, and this opinion is a good illustration of how that terminology tends to create more problems than it solves.  In Berman, the Ninth Circuit examined a website interface that displayed the text “I understand and agree to the Terms & Conditions which includes mandatory arbitration and Privacy Policy” in a tiny gray font (with “Terms & Conditions” and “Privacy Policy” functioning as hyperlinks to the applicable terms), above a large green “Continue” button. Users were required to click the “Continue” button to proceed to the next screen of the website. The defendants argued that, by clicking the “Continue” button, the plaintiffs (who had submitted their information to the websites at issue and then received unwanted telemarketing calls and text messages) had agreed to be bound by the arbitration provision in the terms of use.The Berman court determined that, unless a website operator can show that the user had actual knowledge of the underlying arbitration agreement, the user can only be held to the arbitration terms if: (1) the website provided reasonably conspicuous notice of the terms; and (2) the user took some action, such as clicking a button or checking a box, that unambiguously manifests assent to those terms. In Berman, the court decided that the defendants’ web pages did not provide reasonably conspicuous notice because of the small font size and format and because the hyperlink to the terms was not readily apparent.In Patrick, the court came to the opposite conclusion on different facts. Here, the “call to action” was much more explicit: “On each website, the following statement appears immediately adjacent to the account creation checkbox: ‘[b]y creating an account, you agree to our privacy policy and terms of use.’” In addition, users were required to confirm their orders by clicking a final button to “Place Order” or “Submit Order,” and immediately adjacent to this final button was the following statement: “By submitting your order you agree to our privacy policy and terms of use.” As in Berman, the “terms of use” text functioned as a hyperlink to the actual terms of use.Applying the Berman test to these facts, the court determined that the language about agreeing to the website’s terms was reasonably conspicuous, and the hyperlinks to the terms themselves were readily apparent, so the plaintiffs, each of whom had purchased goods on the websites and clicked the relevant buttons, were in fact bound by the arbitration provision in the terms of use.This seems straightforward enough, but for some reason the Patrick court refers to the defendants’ terms of use implementation as a “browsewrap,” which it clearly is not.  The phrase “browsewrap” typically refers to an implementation where terms are presented to users merely by including a link on a page or screen without requiring affirmative acceptance (see some of our prior coverage on <a href="https://www.sociallyawareblog.com/search?q=browsewrap" target="_self">browsewraps</a>). Courts often refuse to enforce browsewraps, but typically look more favorably on “clickwrap” agreements where users agree to be bound by, for example, checking a box or clicking an “I accept” button.In the Byzantine world of “-wrap” terminology, the implementation at issue in Patrick would likely be categorized as a “sign-in wrap” or “hybridwrap” (ugh), and would be seen as falling somewhere between a pure browsewrap and a classic clickwrap in terms of enforceability. By incorrectly referring to this implementation as a browsewrap but then holding that it is enforceable, the Patrick court creates potential confusion by suggesting that, hey, maybe browsewraps are enforceable after all!A better approach would have been simply to apply the Berman test to the facts to determine that: (1) the terms were presented clearly and conspicuously, (2) the plaintiffs took action to unambiguously manifest their assent to the terms, so (3) the terms are enforceable. It is entirely possible to apply that analysis without ever addressing what category of “-wrap” the terms fall into. And that about wraps up this installment of online contracting gripes!

On February 12, 2024, in Patrick v. Running Warehouse LLC, the Ninth Circuit held that a defendant’s arbitration agreement contained in a website terms of use was enforceable, using the test the court articulated in 2022 in Daniel Berman v. Freedom Financial Network. 

An Enforceable Browsewrap . . . or Not?

A court in the Southern District of Ohio has issued a preliminary injunction against enforcement of the Social Media Parental Notification Act, an Ohio law that would require social media platforms to obtain parental consent for users under 16. NetChoice LLC, an industry group whose membership includes a number of large social media companies, challenged the legislation on behalf of its members and their users.The Act would impose age verification measures on social media platforms and require parental consent for users under the age of 16. The Ohio law applies specifically to platforms that target children or are likely to be accessed by children, which is determined based on the following factors:(1) Subject matter;(2) Language;(3) Design elements;(4) Visual content;(5) Use of animated characters or child-oriented activities and incentives;(6) Music or other audio content;(7) Age of models;(8) Presence of child celebrities or celebrities who appeal to children;(9) Advertisements;(10) Empirical evidence regarding audience composition; and(11) Evidence regarding the intended audience.Additionally, the Act makes exceptions for product review sites and “established and widely recognized” news sites with commenting functionality. Penalties for non-compliance include fines of (i) up to $1000 per day for the first 60 days of noncompliance; (ii) up to an additional $5000 per day for days 61–90; and (iii) up to an additional $10,000 per day for days 91 and beyond. While aimed at protecting minors online, the legislation raises serious concerns about free speech, vagueness, and compliance burdens on digital platforms.NetChoice, a trade association representing online businesses, filed a motion for a preliminary injunction against Ohio Attorney General Dave Yost, arguing that the Act violates the First and Fourteenth Amendment rights of both NetChoice’s members and their users. NetChoice contended that the law unduly restricts freedom of expression and the right to access information on the internet. Moreover, NetChoice argued that the law is vague and would cause some companies to needlessly spend large amounts of money to comply with a law which may not even apply to them.The court first determined that NetChoice had standing to bring claims on behalf of both itself and its members, based on economic harms to its members as well as constitutional harms, such as the chilling effect on free speech if the court did not hear NetChoice’s claims. Next, the court scrutinized the Act through the lens of both the First and Fourteenth Amendments, considering its implications for free speech and the potential harm it posed to social media platforms and their users.1. Strict Scrutiny and Content Based Restrictions: The court determined that the Act was subject to strict scrutiny, the highest standard of review, because it is “content based.” Strict scrutiny requires the government to show that a law uses a narrowly tailored approach to serve a compelling government interest. The Attorney General argued that, by applying to sites that “target children” or are “reasonably anticipated to be accessed by children,” the Ohio law was simply tailoring its application to platforms that pose a risk to minors’ privacy, health, and safety rather than targeting any particular content. The court held, however, that provisions of the law that applied to sites with certain features were inherently content based, since they conveyed a message about the community that the site intended to curate and foster. Moreover, the court pointed to the exceptions for “established” news sites and product review sites as obviously content based (as an example, the court asked why the law didn’t also include exceptions for book and film review sites). Therefore, the court determined that the Act selectively regulates speech and is subject to strict scrutiny review.2. Vagueness and Overbreadth: The court found the Act’s vagueness and broad application potentially chilled free speech, with unclear compliance requirements for platforms. For example, the Attorney General argued that the Ohio law is concerned with protecting minors from entering into terms of service that permit use of their personal data. The court noted, however, that the law is both overbroad because it completely blocks minors from these sites absent parental consent, and also underinclusive because it allows that “a child can still agree to a contract with the New York Times without their parent’s consent, but not with Facebook.” The Attorney General also recited a litany of potential psychological and real-world harms to children from use of certain social media sites, to which the court replied that the law “is a breathtakingly blunt instrument for reducing social media’s harm to children.” With respect to vagueness issues under the Fourteenth Amendment, the court pointed to the law’s “eyebrow-raising exception” for “established” and “widely recognized” media outlets and concluded that “[s]uch capacious and subjective language practically invites arbitrary application of the law.”3. Impact on Minors’ Rights: Highlighting the 2011 Supreme Court case, Brown v. Ent. Merchants Ass’n, which invalidated a California law prohibiting the sale of violent video games to minors, the court noted that the Ohio law does not enforce parental authority, as the Attorney General argued, but rather imposes governmental authority, subject to a parental veto. The court also made the converse point, that online platforms have a right to disseminate protected speech to both minors and adults.4. Balance of Equities and the Public Interest: After concluding that NetChoice had shown a strong likelihood of success on the merits and likelihood of irreparable harm, the court considered the final two preliminary injunction factors, whether the injunction would harm others and whether the public interest would be served by the injunction, noting that these two factors “merge when the government is a party.” While the Attorney General contended that the public interest would be served by allowing the law to go into effect and protect minors, the court was convinced by NetChoice’s argument that “the State has no interest in enforcing laws that are unconstitutional.” Accordingly, the court granted the preliminary injunction.This case is one of a number of recent and pending cases pitting legislative attempts to regulate social media platforms against the free speech rights and other constitutional rights of the platforms and their users. We will be following the case as it progresses, and will report back on any further developments.

Court Prohibits Ohio’s AG From Enforcing Social Media Parental Notification Act