Baidu vs. NYC Dissidents: Why This Case Sucks

May 20, 2011

Unfortunately, I still don’t have a copy of the complaint in this case, so I’m kind of flying blind here and going by attorney quotes and comments from the press. Annoying, but I don’t: a) work for a law firm that needs regular access to US federal court cases, or b) work for a news agency.

Anyway, two ways to approach this case. First, there are some legal arguments that are quite interesting, although I think they are extremely difficult for the plaintiffs. Second, even though the plaintiffs aren’t going to win this case, it’s worth looking at the practical implications of a victory.

Okay, there are two main legal issues here that might be fun to look at:

1. Jurisdiction — How is it that a federal district court in New York has jurisdiction over Baidu, a Cayman Islands company with its principal place of business in China? (Note: Baidu has a US subsidiary, but to my knowledge, its commercial presence is minimal. Obviously, the more actual business Baidu does in the US, the more likely it is that a court could assume jurisdiction over it.)

Jurisdiction issues are difficult, technical, and should be left to experts. I’m not one of them, so take my comments here as more of an attempt to raise issues than provide definitive answers. It would be nice to hear from some real litigators who know what they’re talking about.

The plaintiffs have several possible arguments here. First, Baidu is an Internet company with a platform that is accessible in the United States. Whether a court may assert jurisdiction over a Net firm in this manner has been tested in US courts before, and the decision usually comes down to the nature and quality of the commercial activity of the company over the Net in the jurisdiction at issue. It is my understanding that the level of Baidu’s commercial activity in the United States is minimal, so that might be a loser.

If a Net firm enters into agreements with users, that might be sufficient for jurisdictional purposes, but again, I don’t think that’s particularly relevant to this case.

Second, Baidu is a publicly-traded company, listed in New York. Is this sufficient for jurisdiction? Well, courts will generally look at the totality of the circumstances, so I have to be careful here. That being said, I’m not sure what else we have here besides the listing itself. This is not a securities fraud case, no one from the Baidu investor relations office (if they have one in NY) is alleged to have done anything wrong, nor is there any indication of Baidu having used an agent in New York to commit an unlawful act. Again, I don’t know what their US subsidiary does, if anything.

Third, under general tort law, the place where the harm occurred is often appropriate for court action. Perhaps the argument here is that the plaintiff’s right were violated in the US because censored search results were available in the US? Again, I don’t know what’s in the complaint in detail, but this would be another rehash of the Net jurisdiction issue I mentioned above. Just being able to access web content in a given place is generally insufficient for asserting personal jurisdiction over the operator.

At the end of the day, I don’t have a lot of confidence that this case could survive jurisdictional challenges (and there would be several). This is very fact-specific, though, so it ultimately comes down to what Baidu is up to in the US. If nothing else, I bet Baidu’s lawyers could tie this thing up in the motions phase for a long time on jurisdiction issues alone.

2. Public accommodation — because of its special role as a search engine, should Baidu be considered a ‘public accommodation’ under US law?

This is cute, if unpersuasive. The idea of a place of public accommodation is defined in the Americans With Disabilities Act (ADA) and basically says that certain private entities, if open to the public, may not discriminate with respect to certain things, like folks with disabilities.

Why is this being brought up at all? Well, one of the problems with this case is that Baidu is a private company, and yet the complaint asserts constitutional violations. In many instances, private firms and individuals are allowed to engage in discrimination of constitutionally-protected groups, even when the same action would be a clear violation if it was done by a governmental entity.

Under the ADA, this notion of public accommodation is meant to bring private actors within the scope of the law. So if you operate a hotel, you have to follow some of the same anti-discrimination rules as does the government.

Since Baidu is a private company, they will argue that they can violate the First Amendment, with respect to free speech, all they want.

But wait, says the complaint, “”an Internet search engine is a public accommodation, just like a hotel or restaurant.” If a court buys into this, then the plaintiffs would be able to assert that Baidu was obligated to abide by some/all U.S. constitutional protections. That opens up a lot of other legal issues, of course.

This issue of the Net as public accommodation has been tossed around by US lawyers, but the discussion has centered on, for example, the right of folks with disabilities (e.g. the blind) to access the Net, not with anyone’s right to free speech. For example, some have argued that if a retail store’s web site is an extension of its “brick and mortar” store, then the site should also have to abide by the terms of the ADA.

There’s a huge gap between the ADA cases and saying that Baidu, as a search engine, is a public accommodation that must abide by the First Amendment. If this has ever been brought up before, much less taken seriously by a court, please let me know.

A Few General (non-legal) Comments

Okay, so jurisdiction might be iffy depending on Baidu’s US contacts, and the constitutional claims have some problems. What about the big picture?

Taking a step back, the plaintiffs here are arguing that they have the right to have their web content recognized by Baidu and allowed to come up in search results. Think about that.

They are not saying that they haven’t been able to upload content, set up a web site, access the Net, etc. The only claim is that Baidu’s search results do not include links to their content. No claims of fraud, anti-competitive activities, etc. Wow.

Look, if I wanted to start a new site called ‘Nazi Search Pig’ that omitted all blogs written by Jews (like China Hearsay) in search results, I should be able to do that. Whether Baidu is censoring porn or political speech at the behest of the Chinese government is irrelevant — the US constitution simply does not prohibit that kind of activity. However, if Baidu were to be found liable, who’s next and where does it end? What other positive requirements like this are we going to place on our platform operators?

What would be the practical implications? “Baidu, you may have to censor results in China, but this is the U.S., so you must alter your filtering for this jurisdiction.” Could the U.S. do that? Sure, and if Senator Durbin has his way, that’s what would happen.

But is it a good idea? I wonder what our Net companies would tell their helper monkeys in D.C. if we got to the point where each jurisdiction in the world asserted its own filtering rules? I don’t think the lobbyists would be happy at all.

Now I know what you’re thinking. Why is it that China requires censorship, but the U.S. can’t get into the game? Well, a lot of nations censor to some degree or another (China is extremely aggressive of course), and I don’t see that going away anytime soon, particularly for certain types of porn.

Here’s the thing: nations have the right to censor. We may not like it (I don’t), but that’s what they do. But it’s another thing entirely to say that folks have a right to certain kinds of information from private operators.

Seems to me that a government is within its rights telling private companies that they may not provide certain kinds of information to the public, because it might be harmful — this is the basic justification of censorship. However, what is the analogous argument for a government forcing a private company to positively provide certain information to the public? That doesn’t compute at all.

Last Words

Let me get in a quick rant. This case is obviously a publicity stunt. These plaintiffs are not, as I’ve read in the news, in it for the money. If that were the case, the complaint would have been written differently and the damages asked for would have been higher. For a company like Baidu, $2 million per plaintiff seems a bit low.

No, this is all about the politics of censorship. The plaintiffs are looking for free pub, and they’re getting it. Jurisdictional issues aside, I think this case has huge constitutional problems. For what it’s worth, the plaintiff’s attorney looks like a criminal law expert, whose constitutional experience is limited to things like sentencing and habeas corpus as opposed to free speech issues. I don’t think he knows anything about sovereign immunity, either; he was quoted as saying that the Chinese government runs the risk of a default judgment here.

This doesn’t look like a case anyone expects to win on the merits. The plaintiffs have already been successful getting Reuters, the Wall Street Journal, etc. to comment on it.