NetChoice to 5th Circuit: Section 230 Shields Publishers That Also Offer Payment Services

Permitting a “payment-processor loophole” in Section 230 would thwart the congressional goal “of promoting a vibrant, innovative Internet and e-commerce ecosystem,” said NetChoice and Chamber of Progress in a 5th U.S. Circuit Court of Appeals amicus brief Tuesday (docket 22-16914) supporting Apple’s appeal to reverse the district court’s decision denying it Section 230 immunity (see 2307310046). In the App Store Simulated Casino-Style Games Litigation, the court sided with the plaintiffs’ theory that Section 230 didn’t bar Apple’s liability for processing transactions for virtual currency used within third-party online gambling apps, though it also ruled Section 230 did shield Apple from selling the gambling apps in the App Store. If the 5th Circuit adopts the same theory of Section 230 liability, “app developers could be deprived of key functionality and safe transaction tools that are integral” to digital services’ “trusted app marketplaces,” said the amicus brief. “For small app developers with limited or no resources to invest in facilitating payment processing, this could be particularly harmful,” it said. Consumers and other online users, app developers, and the broader internet ecosystem will also be harmed if the services “are essentially forced by the threat of vexatious litigation to remove their neutral payment processing services from app stores and online marketplaces,” it said. The 5th Circuit “should reverse the district court’s holding that Section 230 does not shield publishers that also offer payment services,” it said. It should also affirm the district court’s determination that Section 230 protects digital services “from claims that they are liable for listing the casino apps,” it said. NetChoice and the Chamber of Progress also filed similar 5th Circuit briefs Tuesday in support of Google (docket 22-16921) and Meta (docket 22-16888).