Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—W.D. Wash.: Web hosting firm denied TRO against “spam” designation by Google, (Dec 23, 2013)

By Edward L. Puzzo, J.D.

A web hosting company was not entitled to a temporary restraining order against Google’s “spam” designation for certain websites it hosts, the federal district court in Seattle has ruled (ICF Technology v. Google, December 20, 2013, Robart, J.).

Plaintiff ICF Technology is a company that hosts websites, primarily for subscription-based sites. ICF alleges that search-engine company Google took action against certain pornographic websites hosted by ICF for violation of Google’s “Webmaster or Quality Guidelines,” resulting in a “spam” designation for these sites. This caused the sites to no longer appear in Google search results.

ICF alleged that Google’s actions restricted consumer access to its clients’ websites, constituting a violation of Washington’s Consumer Protection Act (CPA) and tortious interference with a contractual relationship. It moved for a temporary restraining order (TRO) requiring Google to immediately cease its actions regarding websites hosted by ICF.

TRO requirements. Temporary restraining orders and preliminary injunctions can be issued only when a showing has been made that plaintiff is likely to succeed on the merits; that plaintiff is likely to suffer irreparable harm absent a TRO; that the balance of hardships tips in the plaintiff’s favor, and that the injunction is in the public interest. In the Ninth Circuit, they also can be issued if serious questions going to the merits of plaintiff’s claim exist and the plaintiff has shown a likelihood of irreparable injury and that an injunction would be in the public interest. ICF’s claims do not meet the requirements of either set of requirements, the court stated.

Tortious interference. A claim for tortious interference with contractual relations or a business expectancy requires a plaintiff to show that a valid contractual relationship or business expectancy existed; that defendants had knowledge of that relationship; that there was an intentional interference causing a breach of the relationship or expectancy; that defendants interfered for an improper purpose or used improper means; and that damages resulted, the court explained.

ICF’s claim failed at the fourth step, the court stated. The company was not been able to state what Google’s improper purpose for its actions may have been, and only allege that it is a question of fact. Such speculation that Google had an improper purpose is insufficient to show that its tortious interference claims are likely to succeed or that serious questions exist, and such a showing is required before the imposition of a TRO, the court stated.

CPA violations. Regarding plaintiff’s claim of CPA violations, proof of such a claim requires an unfair or deceptive act or practice; occurring in trade or commerce; with a public interest impact; injury to plaintiff in his business or property; and causation, the court explained. To succeed in this claim, ICF would have to show that Google’s actions were unwarranted or wrongful.

Here Google claimed its “spam” action was legitimate because the sites in question had “thin content,” among other problems. ICF conceded that it shares content, such as live webcams, across multiple sites. ICF did not demonstrate that Google’s justification for its actions was false or deceptive, the court continued. ICF would also have to show that Google’s actions had an adverse impact on the public interest, and would have to overcome Google’s defenses that it is immune from suit under the First Amendment and the Communications Decency Act (CDA).

On balance, the court concluded, and considering the obstacles set forth above, ICF did not meet its burden of demonstrating a likelihood of success on the merits, or even serious questions going to the merits of its claims. Accordingly, ICF was not entitled to a temporary restraining order against Google.

The case is No. C13-2068JLR.

Attorneys: Jackson Schmidt (Pepple Cantu Schmidt PLLC) for ICF Technology, Inc. John Randall Tyler (Perkins Coie) for Google Inc.

Companies: ICF Technology, Inc.; Google Inc.

Cases: ConsumerProtection StateUnfairTradePractices WashingtonNews