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Are Online Networks Company Towns, Shopping Malls, or Neither?

By Rob Heverly

The Southern District of California District Court held last week that the First Amendment does not apply to stop Sony from removing people from its "Playstation 3 Network" based on their speech. Erik Estavillo sued  Sony seeking $55,000 in damages, alleging that (among other claims) the First Amendment's guarantee of free speech precluded Sony from kicking him off of the Network. The District Court held that because Sony was not the government (and thus was not a state actor for First Amendment purposes), nor a "company town" (an exception to the state action requirement of the

First Amendment), nor maintained a sufficient structural or functional nexus to the government (a second "exception" to the state action requirement of the first amendment), the plaintiff could not maintain an action against Sony based on a claim of infringement of free speech rights. [note: the case is Estavillo v. Sony Computer Entm't Am. Inc., 2009 U.S. Dist. LEXIS 86821; as of this writing I cannot locate either a Westlaw version or a free online version; it seems the Southern District of California does not publish its opinions online]

The result really isn't too surprising, as the "company town" exception to a private property owner's ability to control speech unhindered by the First Amendment relies on the notion that the company not only owns the land in question, but takes over the responsibilities usually associated with a municipality (according to the U.S. Supreme Court in Marsh v. Alabama, 326 U.S. 501 (1945)). The Supreme Court has refused to extend the doctrine to cover shopping malls in many situations, for example, though some state courts and legislatures have done just this (and it is consistent with Supreme Court precedent in the area).

Even given its rather brief rejection by the District Court, however, the argument is not entirely without merit. It has also been made (though not in this precise context) in a 2004 law review article [pdf] by Yale Law Professor (and Balkinization blogger) Jack Balkin:

?Although [the online community owner] does not take over ?the full spectrum of municipal powers? in real space, it does exercise all of those functions in the virtual world. If any private entity could be regarded as a company town, it would be a virtual world. This is especially so because the whole point of the virtual world is to create community (or communities), and action in the virtual world occurs through the exchange of ideas.?

Balkin points out that not every attempt at creating an online "space" (my word, not his) will end up creating a space to which the First Amendment should apply. Rather, those where the space is created "to form communities or create channels for general public communication" could be subject to the First Amendment's requirements. Whether Sony's Playstation 3 Network meets this criteria would involve much more discussion about how it functions and what its purpose is (knowing what I do about it I doubt it does), but I see another problem that isn't explicitly addressed in the case or in Balkin's article.

In order to implicate the First Amendment as a restriction on action, the Courts must first perceive that state action has taken place. That might be direct governmental action, or it could be the use of the Courts to enforce or enable the use of private power. This latter use occured in cases such as Shelley v. Kraemer, 334 U.S. 1 (1948) in which the U.S. Supreme Court held that States cannot allow private citizens to use the courts to enforce racially discriminatory restrictions on property. This leaves such requirements practically unenforceable, even between private parties (so long as any one of the parties no longer wishes to abide by them).

In Marsh, the state action was a criminal charge of trespass lodged against the person wishing to distribute religious flyers on the company's property. If you wanted to come into my home and distribute religious flyers (say, to my children), I could kick you out and call the police to help me do so. Because the Supreme Court in Marsh found that the company town was more like a town than traditional private property, it lost the ability to seek the assistance of the State in enforcing what would otherwise be within its rights under property law.

How does that fit in here? Because Sony didn't need any help from the State to keep Estavillo out of (or off of, or from using) the Playstation 3 Network. It simply ousted him technologically. I find it hard in that scenario to find any state action at all. And absent state action, stretching the First Amendment to reach Sony's actions is going to be a tough row to hoe. But there is more to it than that.

I can see a danger that a discussion could evolve in a private forum, perhaps a discussion about a particular physical community or perhaps not, but where that discussion that becomes so central to a particular region, issue, or policy debate that being excluded from it technologically would mean being excluded from the debate practically (the threat of private power being used in this manner on the Internet is addressed in the scholarship, for example, in James Boyle's 1997 piece, Foucault in Cyberspace). Perhaps then the other attack raised by Estavillo -- that there is  a sufficient structural or functional nexus to the government -- would come into play, but that exception has often been limited to cases in which the government actually does play some role (as the Estavillo Court noted, to cases where the government retains some authority or where it coerced or encouraged the challenged action). Doesn't seem like much of a savior in this situation, where a particular forum or online community might be entirely independent of the government's reach.

What it all means is that while Estavillo v. Sony was probably rightly decided -- Sony's Playstation 3 Network is not a company town -- the underlying issue of technological exclusion from an online community raises private power issues that we must address. It's one of the potential situations that makes me think that David Post's repeated entreaties to us to look for situations where the network really changes things are correct. Here, the network really could change something in ways that would be very difficult absent the network (think big brick walls and armed guards at the entrances to the company town and all of the expense that would entail). And just because the situation has not yet arisen does not mean it won't, and if that's the first time we start thinking about it, it may just be too little too late.

Image courtesy of David Rumsey Map Collection.

Full post as published by The Faculty Lounge on September 26, 2009 (boomark / email).