Suspended Twitter User Loses Lawsuit Due to Section 230–Ryan v. X

[This blog post covers two decisions in the same lawsuit: the ruling on X’s initial motion to dismiss from September, which apparently never triggered my Westlaw or Lexis alerts, and then a ruling on X’s motion to dismiss the amended complaint that the court issued this week.

My headline makes it sound like this is a run-of-the-mill outcome, but nothing about 230 is routine any more in the Ninth Circuit after the Calise and YOLO cases.]

Jeremy Ryan claims “that he is a successful “NFT artist” who utilizes his account on X to “further develop his cryptocurrency and NFT community,” and to “promote his NFT projects.”” He says Twitter suspended seven of his accounts without warning and not in response to any TOS breaches, and he claims the suspension damaged his cryptobusiness (and his cryptobro-iness). Twitter’s TOS says it can unilaterally pull the plug any time it wants, but Ryan tried to mine other site disclosures to manufacture promises he allegedly relied upon.

Section 230

Much of this case turns into a surprisingly easy Section 230 dismissal.

ICS Provider. X is “inarguably” an ICS provider.

Third-Party Content. “Ryan seeks to hold X liable for decisions it made regarding ‘information provided by another information content provider,’ i.e. information that he, rather than X, provided.”

Publisher/Speaker Claims. “Ryan seeks to treat X as a publisher for most of his claims because most arise from X’s decision to suspend his seven accounts and suspension is a traditional publishing function according to the Ninth Circuit….the activity that most of Ryan’s claims challenge boils down to X’s decision to exclude Ryan’s material from its platform. To the extent that is the case, his claims are barred by section 230.”

Breach of Contract. “Ryan’s breach of contract claim fails as a matter of law because it is barred by section 230(c)(1)….his suspension was undertaken by X in its capacity as a publisher of information.”

To navigate the recent Calise and YOLO rulings, the court reaches back to the Roommates.com en banc opinion and the Barnes opinion to indicate that Section 230 applies whenever a claim is based on information publishing, including breach of contract. As “in Barnes, the duty Ryan argues X breached can be similarly distilled; the duty to maintain or suspend users’ accounts arises from its Terms and its status as a publisher.” The court cites to Murphy v. Twitter, Zimmerman v. Facebook, and many other account termination/content removal cases.

The court tries to distinguish the Calise ruling:

the breach of contract cause of action in Calise asserted that plaintiff had relied on an “enforceable promise” Meta allegedly made to prevent fraudulent advertising on its platform. That promise, the Ninth Circuit held, was distinguishable from its performance; as such, the breach of contract claim arising from Meta’s failure to fulfill it sought to hold Meta liable for behavior that was not identical to publishing behavior…

Ryan’s breach of contract claim is not analogous to the breach claims in Calise or Barnes. Ryan is trying to impose liability upon X arising from its actions as a publisher, not its failure to fulfill some promise separate from that role.

Does that distinction persuade you?

Later, the court says “statements made in a social media site’s terms and community standards do not amount to a legally enforceable promise,” which is true, but that pertains to the prima facie case, not the Section 230 elements.

The court summarizes: “Ryan’s breach of contract claim, as pleaded, falls squarely within section 230 immunity….There is only the company’s decision to suspend his account, which courts have time and time again found to be a publishing decision covered by section 230 immunity.”

The way I see it, Judge Orrick is defying the Calise and YOLO panels’ overreading of the interplay between Section 230 and contract breach claims, essentially telling those Ninth Circuit panels to suck it. I think Judge Orrick is on the side of righteousness, but perhaps not on the side of precedent. I’m sure an appeal in this case will give us more data on the Ninth Circuit’s temperature on the 230/contract breach interface.

Contract Interference. Any interference between Ryan and his contracting parties is due to Twitter’s publishing decision to suspend his accounts.

Conversion. The allegedly converted assets were Ryan’s “digital property rights to his social media account.” That doesn’t sound like convertible assets to me. The court says the suspension of those assets was a publishing decision. In a footnote, the court adds “Ryan’s theory of conversion ignores that X’s Terms give it the right to suspend his accounts for “any” or “no” reason.”” Note that this is the same right that X has been trying to vindicate in the bankruptcy sale of Alex Jones’ X accounts.

Unjust Enrichment. In the December ruling, the court holds that this claim is preempted by Section 230. Ryan alleged the following unjust enrichment: “X is wrongfully deriving and retaining a benefit from Ryan’s intellectual property because it still generates advertising revenue from ads that continue to run alongside Ryan’s suspended accounts even though Ryan cannot himself access his accounts or the content they hosted.” Putting aside the obvious IP preemption problems with this argument, the court says:

Ryan’s unjust enrichment claim attempts to hold X liable for decisions it made as a publisher and is accordingly barred by section 230. X decided to suspend Ryan’s accounts (a publishing activity) and it continues to allow various entities to advertise on its platform (also a publishing activity). This claim does not attempt to hold X liable for alleged misrepresentations or false promises. Ryan does not assert that X promised him that it would not continue to generate ad revenue from advertisements associated with his suspended accounts—he merely challenges its decision to do so.

The ICS/ICP Distinction. In the December ruling, Ryan argued that Section 230 applies only if the defendant isn’t also an ICP. While this is true, it’s too vague. I wonder if Ryan was making an (insipid) Anderson argument that Twitter became an ICP for third-party content by exercising its editorial discretion….? The court says it doesn’t understand what argument Ryan is making. The court guesses that Ryan is arguing that “the “challenged activity” (i.e. X’s suspending of his accounts) may have been taken “entirely by another information content provider,” meaning X’s AI system, [so] he has shown a dispute about whether the challenged content is provided by “another” information content provider.” As recapped by the judge, the argument goes nowhere because it would be stupid. “Whether X or its AI system or some combination thereof made the decision to suspend Ryan’s accounts, the content at issue on those accounts was content provided by “another” information content provider other than X or its AI system: Ryan.” As I have tried to explain before, content that originates with third parties remains third-party content throughout its life cycle, regardless of what happens to it.

But the Algorithms. Ryan argued that Twitter uses “AI” for content moderation. The court is like…so…?

no authority suggests that X’s use of a generative AI model to do content regulation deprives it of section 230 immunity. Nothing in the plain language of the statute suggests that X would be denied section 230 protection because it uses an AI system for content moderation. No court has held otherwise….

Ryan has offered no authority that suggests section 230 protections are to be rescinded from interactive computer services that use AI systems to moderate content. X’s decision to suspend—and its act of suspending—Ryan’s accounts was publishing activity that falls within the scope of section 230

In a footnote, the court adds that the Moody case didn’t provide any “substantive guidance” about the use of AI for content moderation.

First Amendment

In a footnote from September, the court said:

given the Supreme Court’s recent holding in Moody v. NetChoice, 144 S.Ct. 2383 (2024), where the Court confirmed that “[w]hen [social media] platforms use their Standards and Guidelines to decide which third-party content those feeds will display . . . they are making expressive choices [meaning] they receiving First Amendment protection,” the same claims that are barred by section 230 would probably fail under Moody.

I agree 100%, but note that this exact same argument is what led the Anderson v. TikTok court in the Third Circuit to DENY Section 230. That was such a bonkers and pernicious ruling. More on the 230/First Amendment interface.

Promissory Estoppel

Per Barnes, promissory estoppel isn’t barred by Section 230(c)(1). Nevertheless, it fails on its prima facie elements:

The Complaint does not identify anything that I can reasonably interpret as a “promise” by X to not suspend his account in the manner that it did. Those “unambiguous personal promises and assurances” alleged in the Complaint included, by Ryan’s own account, statements that X “reserved the right to remove Content that violates the User Agreement.” And X told Ryan it suspended his accounts because one or more of those accounts “broke the X Rules.” Id. Moreover, as discussed, X’s Terms stated explicitly that it could suspend accounts for “any … or no reason.”

The 230 promissory estoppel workaround is almost always a dead-end for plaintiffs.

Twitter’s TOS

In the December ruling, the court says flatly: “All of Ryan’s claims are barred by the Terms, which provide that the platform may stop providing its services to users for any or no reason….All of Ryan’s claims arise from his inability to access X’s services after it suspended his accounts.” Another reminder that (1) Section 230 isn’t required to resolve this case (though it makes things easier), and (2) the Section 230 workarounds in Calise and YOLO will most likely result in jurisprudential dead-ends for plaintiffs.

Implications

The 230/Promises Interface. My Internet Law students were pretty annoyed with how I taught the Barnes/Calise/YOLO cases this semester. They wanted nice, clean rules, when all I could give them was scattered and dubious data points. This ruling shows that maybe the Calise and YOLO opinions didn’t have as much impact as I thought. At minimum, it’s a sign that, for now, lower court judges may be rebelling against the precedent.

Section 230 Workarounds Make More Work But Don’t Get Around Very Often. Getting around Section 230 is a major accomplishment for plaintiffs, but only when the substantive prima facie claims are also tenable. The swiss-cheesed exceptions to Section 230 largely force plaintiffs to state claims they can’t win on the merits, even if they get around Section 230. No one wins in those circumstances–everyone spends more time and money to reach the same result.

But “AI”… Automated account or content flags are an integral part of content moderation. Both Twitter and Facebook have reduced their reliance on humans to do the first-level review and depend more heavily on automated filters. For me personally, this has produced a string of silly flags at Facebook of my posts (sometimes LinkedIn too). Automated content moderation is hard. But it’s not actionable.

Another Failed Account Termination/Content Removal Case. This case adds to the burgeoning list of failed account termination and content removal cases. The line of defense successes remains effectively unbroken.

Case Citation: Ryan v. X Corp., No. 24-cv-03553-WHO (N.D. Cal. Sept. 4, 2024) and Ryan v. X Corp., 2024 U.S. Dist. LEXIS 222459 (N.D. Cal. Dec. 9, 2024). The CourtListener page.

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