Fordham IPLJ Blog: Limited Liability for Online Pimping Websites
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Limited Liability for Online Pimping Websites

Pimping

Limited Liability for Online Pimping Websites

On October 6, 2016, California Attorney General Kamala D. Harris announced the arrest of Carl Ferrer, CEO of the “escort services” advertising website Backpage.com, on felony pimping charges. Michael Lacey and James Larkin, both controlling shareholders of the company’s parent company, have also been criminally charged with conspiracy to commit pimping.1 The complaint alleged that Backpage operates as an “online brothel,” where users post classified ads to solicit prostitution. The arrest warrant claims that Backpage primarily generates its revenue by charging fees for users to post “escort ads.” From January 2013 to March 2015, 99% of its revenue was “directly attributable” to the “adult services” section, and the company made more than $51 million of its revenue in California. The California Department of Justice seeks to prevent Backpage from expanding its sex advertising market, and to dismantle the online sex trafficking market, particularly for children under the age of eighteen years old.2

 

Ferrer’s lawyers filed a motion to demur all charges on the grounds that he is entitled to First Amendment free speech protections, and that federal law limits the legal liability for website operators posting third-party content.3 The defense asserts that the charges would have a chilling effect on free expression by imposing a heavy burden on publishers to review all speech to guarantee that none is unlawful.4 Furthermore, the motion claims that the Communications Decency Act grants Backpage.com criminal and civil immunity from liability for publishing user content, or for failing to remove such content, regardless of whether the website knew or should have known that the content involved illegal conduct.5

 

This argument has proven to be a successful defense in courts across the country.6 In May 2015, a federal judge in Massachusetts dismissed a civil suit brought against Backpage, and ruled that escort classified ads are not illegal, despite their moral implications.7 The anonymous plaintiffs alleged that they had been sexually assaulted by men who found them on the site, two of whom were under 18 years when they were pimped. The court determined that “the allegedly sordid practices of Backpage . . . amount to neither affirmative participation in an illegal venture nor active web content creation.”8 The website was shut down after an investigation by the U.S. Attorney’s office that determined that the company operated primarily for criminal purposes.

 

In the wake of these recent criminal investigations, there may be a shift in federal protections for adult services websites. The legal implications are more uncertain for websites like SeekingArrangement.com and LetsTalkSugar.com that promote “sugaring,” and blur the lines between online dating services and facilitating prostitution.9 “Sugaring” is a form of dating where a wealthy sugar “daddy” or “momma” offers financial or other benefits (i.e. luxury goods, lavish vacations, or other expensive gifts) to a sugar “baby,” often in exchange for sexual favors. The average sugar baby is 27 years old and is enrolled at a university. Sugar babies make an average of $3,000 per month. The average sugar daddy is 40 years old with an income of over $250,000 a year, and about 40% of “daddies” are married. Over the last several years, sex work has increased in popularity, particularly among millennials who are saddled with student loans and high college tuition costs.10 The United States has the highest number of sugar babies in the world, and SeekingArrangement has over 5 million users.11

 

In the United States, sugaring operates within the legal gray area, and is not considered prostitution if it is a consensual sexual relationship. SeekingArrangement avoids claims of online pimping by advertising its business as providing “mentorship and quality companionship” for its users. The website’s Terms of Use Agreement explicitly prohibit use of the website to promote or engage in prostitution or for escort services.12 Sugaring websites can operate legally under careful observation by law enforcement, in part, because the terms of any transactions are within the full discretion of users and any monetary exchange is considered implicit.13 There is a fine line between sugaring and prostitution. Though users may explicitly solicit sex for money, websites that promote themselves as “relationship services” may continue to operate legally under the protection of federal law.


  1. https://oag.ca.gov/news/press-releases/attorney-general-kamala-d-harris-announces-criminal-charges-against-senior [https://perma.cc/5R9C-63NK].

  2. http://www.nytimes.com/2016/10/07/us/carl-ferrer-backpage-ceo-is-arrested.html?_r=0 [https://perma.cc/X58S-PRQU].

  3. http://www.politico.com/blogs/under-the-radar/2016/10/backpage-ceo-carl-ferrer-wants-charges-dropped-230010 [https://perma.cc/5RT4-4M5T].

  4. Notice of Demurrer and Demurrer of Defendants, Cal. v. Carl Ferrer, No. 16FE019224 (Cal. Sup. Ct. Sept. 26, 2016) http://www.politico.com/f/?id=00000157-df5b-da04-af7f-ff5fcb3c0001 [https://perma.cc/DZ3P-T29N].

  5. 47 U.S.C. § 230.

  6. https://www.buzzfeed.com/matthewzeitlin/backpagecom-ceo-contests-criminal-pimping-charges?utm_term=.sxWavAZNl#.meYBjbaJ6 [https://perma.cc/TF66-35WP].

  7. Motion to Dismiss at 33, Jane Doe v. Backpage.com L.L.C., No. 14-13870-RGS (Mass. Dist. Ct. May 15, 2015)  https://www.eff.org/files/2015/05/15/53_-_order_on_motion_to_dismiss.pdf [https://perma.cc/6867-AXNT].

  8. Id. at 14.[/foootnote]

     

    Traditionally, websites like Backpage.com have been protected under federal law; however, the federal government and Department of Justice have cracked down on similar websites that promote escort services. In 2013, several state attorney generals asked Congress to amend the Communications Decency Act, which courts have interpreted to grant internet content providers broad criminal and civil immunity, even if the companies profit from unlawful conduct.  In October 2016, the founder of Rentboy.com pleaded guilty to promoting prostitution, and faces charges for other criminal activity.[footnote]http://www.nydailynews.com/new-york/nyc-crime/founder-rentboy-pleads-guilty-prostitution-charge-article-1.2821488 [https://perma.cc/H4XP-UBQB].

  9. http://nymag.com/thecut/2016/03/sex-workers-legalization-c-v-r.html [https://perma.cc/N7L4-VK32].

  10. http://www.wnd.com/2016/05/millennials-turn-to-sugar-daddy-prostitution-to-pay-debts/ [https://perma.cc/6MWE-XGF8].

  11. http://www.huffingtonpost.com/anahita-pardiwalla/post_10274_b_9683356.html [https://perma.cc/G2UL-NZBV].

  12. §§8(e)(x)-(xv), https://www.seekingarrangement.com/terms/ [https://perma.cc/9AWM-YSD5].

  13. http://stories.avvo.com/relationships/sugar-daddy-dating-sites-differ-prostitution.html [https://perma.cc/4AZR-7W7F].

E. Alex Kirk

E. Alex Kirk is a second year J.D. Candidate at Fordham University School of Law and a staff member of the Fordham Intellectual Property, Media & Entertainment Law Journal. She holds a B.A. in Art History from Columbia University.