Court Decisions on Section 230
Defamatory information (CDA abuse)
MCW, Inc. v. badbusinessbureau.com(RipOff Report/Ed
Magedson/XCENTRIC Ventures LLC) 2004 WL 833595, No. Civ.A.3:02-CV-
2727-G, (N.D. Tex. April 19, 2004).
The court rejected the defendant's motion to dismiss on the grounds of Section 230
immunity, ruling that the plaintiff's allegations that the defendants wrote
disparaging report titles and headings, and themselves wrote disparaging editorial
messages about the plaintiff, rendered them information content providers. The
Web site, www.badbusinessbureau.com, allows users to upload "reports"
containing complaints about businesses they have dealt with.
Hy Cite Corp. v. badbusinessbureau.com (RipOff Report/Ed
Magedson/XCENTRIC Ventures LLC), 418 F. Supp. 2d 1142 (D. Ariz.
The court rejected immunity and found the defendant was an "information content
provider" under Section 230 using much of the same reasoning as the MCW case.
Goddard v. Google, Inc., C 08-2738 JF (PVT), 2008 WL 5245490, 2008 U.S.
Dist. LEXIS 101890 (N.D. Cal. Dec. 17, 2008).
Immunity upheld against claims of fraud and money laundering. Google was not
responsible for misleading advertising created by third parties who bought space on
Google's pages. The court found the creative pleading of money laundering did not
cause the case to fall into the crime exception to Section 230 immunity.
Litigation Involving Communications Decency Act Immunity
According to a United States law called the Communications Decency Act, 47 U.S.C.
§ 230(c), websites like the Ripoff Report are protected from most forms of civil
liability arising from user-generated content. This protection applies even if the
website hosts material which is false and even if the site does not take any steps to
investigate content prior to publication or remove content after receiving notice that
the material is false. Protection also extends to editorial changes made by the
website operator itself, as long as such editing does not alter the meaning of the
original third-party content.
Because of the site’s steadfast refusal to remove complaints, many lawsuits have
been filed against the Ripoff Report claiming the site does not qualify for protection
under the CDA or that such protection has been lost due to its alleged solicitation of
defamatory content, its refusal to remove content which is false, and its alleged
alteration and/or modification of reports or their titles. For a variety of reasons,
none of these cases have ever reached trial.
In one frequently cited case from 2004, a federal court in Texas in MCW, Inc. v.
Badbusinessbureau.com LLC, 2004 WL 833595 (N.D.Tex. 2004) held that Ripoff
Report may not be entitled to CDA immunity. This part of the ruling was based on
the fact that the plaintiff claimed that Ripoff Report itself created defamatory
material as opposed to simply hosting material created by a third party. Based on
these allegations, the court determined that CDA immunity would not apply
because, "Contrary to the defendants' arguments, MCW is not seeking to hold the
defendants liable for merely publishing information provided by a third party.
Rather, MCW is seeking relief because the defendants themselves create, develop,
and post original, defamatory information concerning [the plaintiff]." MCW, 2004
WL 833595, *9.
Critics of the Ripoff Report sometimes claim that Ripoff Report "lost" the MCW
case. However, after finding that the plaintiff's allegations were sufficient to
overcome CDA immunity, the court in MCW found that it lacked jurisdiction and
the case was dismissed on that basis. According to a summary of the case from the
Citizen Media Law Project, the plaintiff "MCW appealed the ruling, but later
voluntarily dismissed its appeal." More recent legal decisions have generally
rejected the argument that MCW establishes that Ripoff Report is not entitled to
Other notable cases involving the Ripoff Report include the following:
Asia Economic Institute, LLC v. Xcentric Ventures, LLC, U.S. District Court,
Central District of California Case No. 10-CV-1360 (May 4, 2011) (summary
judgment granted in favor of Ripoff Report due, in part, to CDA immunity);
Herman & Russo, P.C. v. Xcentric Ventures, LLC, U.S. District Court,
Northern District of Georgia Case No. 10-CV-398 (Feb. 14, 2011) (summary
judgment granted in favor of Ripoff Report due to CDA immunity);
Intellect Art Multimedia, Inc. v. Milewski, 2009 WL 2915273 (N.Y.Sup. Sept.
11, 2009) (claims against Ripoff Report dismissed for failure to state a claim due
to CDA immunity);
GW Equity, LLC v. Xcentric Ventures, LLC, 2009 WL 62173 (N.D.Tex. 2009)
summary judgment entered in favor of Ripoff Report based on CDA
Global Royalties, Ltd. v. Xcentric Ventures, LLC, 544 F.Supp.2d 929 (D.Ariz.
2008) (claims against Ripoff Report dismissed pursuant to Fed. R. Civ. P. 12(b)
(6) without leave to amend based on CDA immunity);
Whitney Info. Network, Inc. v. Xcentric Ventures, LLC, 2008 WL 450095; 2008
U.S. Dist. LEXIS 11632 (M.D.Fla. Feb. 15, 2008) (summary judgment entered in
favor of Ripoff Report based on CDA immunity).
A-1 Technology, Inc. v. Ed Magedson, 2011 150033/10; (N.Y. Sup. Ct. June
22, 2011) (claims against Ripoff Report dismissed).
Other Lawsuits Against Ripoff Report
Many other companies have sued Ripoff Report, but so far none of these cases have
ever been resolved against the site. Some previous suits can be reviewed at
Citizen Media Law Project. A partial list of recent cases includes the following:
A lawsuit was filed against Ripoff Report in New York in January 2010
seeking $11 million in damages. The complaint also asserts claims against
Magedson and against Google.[not in citation given]
On February 11, 2010, a lawsuit was filed in Georgia. The entire complaint
appears to have been copied verbatim from another case.
On January 27, 2010, a lawsuit was filed against Ripoff Report in California,
accusing Ripoff Report and Magedson of attempted extortion and RICO Act
violations, among other claims.
On March 12, 2010, a lawsuit was filed against Ripoff Report in New Jersey.
The complaint includes claims for RICO/extortion and seeks damages of
Several people and businesses listed on Ripoff Report have allegedly hired the
Defamation Action League, an organization run by William L. "Bill" Stanley
(possibly a pseudonym), who is listed as one of the world's top 200 spammers,  to
attempt to make Magedson and his business partners remove specific reports. In
return, Magedson filed a lawsuit under RICO. On June 21, 2007 a preliminary
injunction was granted against DefamationAction.com and
ComplaintRemover.com. Stanley and his associates were found liable for
defamation and making death threats. Robert Russo, who claims not to be part of
the Stanley group—but who does own ComplaintRemover.com, filed an answer,
defenses and a counter-suit in the case. The parties reached a settlement on May 15,
Corporate Advocacy Program and Extortion Claims
Some of the harshest criticism is focused on Ripoff Report's "Corporate Advocacy,
Business Remediation & Customer Satisfaction Program". The operation of the
program is described in detail on the Ripoff Report website's Corporate Advocacy
Program page. The program requires companies to pay a fee to Ripoff Report in
exchange for which the site will act as an intermediary between the company and
any unhappy customers who have posted complaints on the Ripoff Report site.
Companies who join the program must agree to meet certain conditions including a
promise to make refunds when requested. In return, while existing reports are not
removed, the Ripoff Report's editor, Ed Magedson, will update the titles of reports
to reflect that the company has joined the program and has made a commitment to
increasing customer satisfaction.
In February 2007 The Phoenix New Times reported that at least 30 companies now
pay Ripoff Report for participation in the Corporate Advocacy Program.  The
current number of participants in the program is not known, however the site
makes no effort to conceal the identity of program members – a search for
“corporate advocacy” conducted on the site returns more than 1,600 results with
titles clearly announcing the name of any company that has joined the program.
Several companies have sued Ripoff Report based on claims that the Corporate
Advocacy Program is unlawful. None of these claims have ever succeeded at trial.
On July 19, 2010, a federal court in Los Angeles, California entered an order
granting partial summary judgment in favor of Ripoff Report in a case which
alleged that the Corporate Advocacy Program was "extortion" and that the
program violated federal racketeering laws. The court's order in Asia Economic
Institute, LLC v. Xcentric Ventures, LLC, Case No. 10-CV-01360 stated that the
Corporate Advocacy Program was not extortion under California law because,
"The offer to help Plaintiffs restore their reputation and facilitate resolution with
the complainants in exchange for a fee does not constitute a threat under California
Penal Code § 519." Based on the determination that the services offered by Ripoff
Report do not constitute extortion, the court granted summary judgment in favor of
Ripoff Report as to the plaintiffs' extortion claim.