|
On Sept. 27, 1996 America Online filed this appeal to an injunction preventing the online service from blocking "junk" e-mail from Cyber Promotions to AOL members. America Online alleges that Cyber Promotions began to deluge in late 1995 "AOL and its customers with millions of unsolicited commercial e-mail messages, infuriating AOL members, resulting in member cancellations and imposing increased hardware and software expense on AOL." When AOL took steps to prevent Cyber from continuing this course of conduct, Cyber initiated this litigation, claiming that it had a First Amendment right to conduct its business by means of AOL's proprietary online service.
IN THE
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
96-1811
96-1812
CYBER PROMOTIONS, INC.
v.
AMERICA ONLINE INCORPORATED,
AMERICA ONLINE, INC.,
AMERICA ONLINE, INC.,
Appellant.
v.
CYBER PROMOTIONS, INC.
Appellant.
ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF PENNSYLVANIA
BRIEF OF APPELLANT,
AMERICA ONLINE, INC.
Michael A. Grow
VORYS, SATER,
SEYMOUR & PEASE
1828 L. Street, N.W.
Suite 1111
Washington, DC 20006
202-467-8800
Ronald P. Schiller
Joseph Kernen
David L. Weinreb
Catherine Stuart Magargee
PIPER & MARBURY L.L.P.
3400 Two Logan Square
18th and Arch Streets
Philadelphia, PA 19103
Of Counsel.
215-656-3300
Attorneys for Appellant,
America Online, Inc.
TABLE OF CONTENTS
TABLE OF CASES, STATUTES AND OTHER AUTHORITIES
STATEMENT OF SUBJECT MATTER AND APPELLATE JURISDICTION
STATEMENT OF THE ISSUES PRESENTED FOR REVIEW
STATEMENT OF THE STANDARDS OF REVIEW
STATEMENT OF RELATED CASES
STATEMENT OF THE CASE
STATEMENT OF RELEVANT FACTS
SUMMARY OF ARGUMENT
ARGUMENT
A. The Lower Court's Order Compels AOL to Carry Cyber's Speech in Violation of
AOL's First Amendment Rights
B. Cyber Cannot Meet Its Substantial Burden of Proving Likelihood of Success on the
Merits at Trial
1. The Order Unconstitutionally Infringes AOL's First Amendment Rights
2. Cyber Has No First Amendment or Statutory Right to Send Bulk E-Mail Advertising
to AOL Subscribers Via AOL's E-Mail System
a. Cyber Has No First Amendment Right to Force Its Advertising on AOL Because
AOL's Block Is Not State Action
b. Cyber Has No Statutory Right to Advertise on AOL's System
B. Cyber Failed to Meet Its Burden of Proof of Irreparable Harm Without the Injunction
C. AOL Suffers Tremendous Harm Each Day the Injunction Remains in Force
D. The Public Interest Clearly Favors Lifting the Injunction
E. In Any Event, for Procedural Reasons Alone, the Lower Court's September 5 Order
Should be Immediately Vacated
CONCLUSION
CERTIFICATE OF BAR MEMBERSHIP
ORDER BEING APPEALED FROM
CERTIFICATE OF SERVICE
TABLE OF AUTHORITIES
Cases
ACLU v. Reno, 929 F. Supp. 824 (E.D. Pa. 1996)
Acierno v. New Castle County, 40 F.3d 645 (3d Cir. 1994)
Adderley v. Florida, 385 U.S. 39. 87 S. Ct. 242 (1966)
Armes v. City of Philadelphia, 706 F. Supp. 1156 (E.D. Pa. 1989) aff'd, 897 F.2d 520 (3d
Cir. 1990)
Bateman v. Ford Motor Co., 310 F.2d 805 (3d Cir. 1962)
Black v. Indiana Area Sch. Dist., 985 F.2d 707, 710-11 (3d Cir. 1993)
Blum v. Yaretsky, 457 U.S. 991, 102 S. Ct. 2777 (1982)
Boyle v. Governor's Veterans Outreach & Assistance Ctr., 925 F.2d 71 (3dCir. 1991)
Bradley v. Pittsburgh Bd. of Educ., 910 F.2d 1172 (3d Cir. 1990)
Buckley v. Valeo, 424 U.S. 1, 96 S. Ct. 612 (1976)
Burton v. Wilmington Parking Auth., 365 U.S. 715 (1961)
Cable Investments. Inc. v. Wooley, 867 F.2d 151 (3d Cir. 1989)
Chemlawn Servs. Corp. v. GNC Pumps. Inc., 823 F.2d 515 (Fed. Cir. 1987)
Continental Group, Inc. v. Amoco Chems. Corp., 614 F.2d 351 (3d Cir. 1980)
Deardorff v. Burger, 414 Pa. Super. 45, 606 A.2d 489, alloc, denied, 43 532 Pa. 655, 615
A.2d 1312 (1992)
Elrod v. Burns, 427 U.S. 347, 96 S. Ct. 2673 (1976)
Gibbs v. Buck, 307 U.S. 66, 59 S. Ct. 725 (1939)
Great Rivers Coop. of Southeastern Iowa v. Farmland Indus., Inc., 59 F.3d 766 (8th Cir.
1995)
Greer v. Spock, 424 U.S. 828, 96 S. Ct. 1211 (1976)
Groman v. Township of Manalpan, 47 F.3d 628 (3d Cir. 1995)
Harper & Row Publishers. Inc. v. Nation Enters., 471 U.S. 539, 105 S. Ct. 2218, 85
L.Ed.2d 558 (1985)
Hudgens v. NLRB, 424 U.S. 507 (1976)
Hurley v. Irish-American Gay Group of Boston, 115 S. Ct. 2338 (1995)
Jackson v. Metropolitan Edison Co., 419 U.S. 345 (1974)
Lehman v. City of Shaker Heights, 418 U.S. 298, 94 S. Ct. 2714 (1974)
Lloyd Corp. v. Tanner, 407 U.S. 566, 92 S. Ct. 2219 (1972)
Mark v. Borough of Hatboro, 51 F.3d 1137 (3d Cir. 1995)
McKeesport Hosp. v. Accreditation Council for Graduate Medical Educ., 24 F.3d 519 (3d
Cir. 1994)
Merchant & Evans. Inc. v. Roosevelt Building Prods. Co., 963 F.2d 628, 633 (3d Cir.
1992)
Miami Herald Publishing Co. v. Tornillo, 418 U.S. 241, 94 S. Ct. 2831 (1974)
Midwest Video Corp. v. F.C.C., 571 F.2d 1025 (8th Cir. 1978), aff'd on other grounds,
440 U.S. 689, 99 S. Ct. 1435 (1978)
NCAA v. Tarkanian, 488 U.S. 179 (1988)
Newark Stereotypers' Union No. 18 v. Newark Morning Ledger Co., 353 F.2d 510 (3d
Cir. 1965)
Pacific Gas & Electric Co. v. Public Utils. Comm'n of California, 475 U.S. 1, 106 S. Ct.
903 (1986)
Pittsburgh Press Co. v. Human Relations Comm'n, 413 U.S. 376, 93 S. Ct. 2553 (1973)
Professional Plan Examiners of New Jersey, Inc. v. Lefante, 750 F.2d 282, 289 (3d Cir.
1984)
PruneYard Shopping Ctr. v. Robins, 447 U.S. 74, 100 S. Ct. 2035 (1980)
Rendell-Baker v. Kohn, 457 U.S. 830 (1982)
Robison v. Canterbury Village. Inc., 848 F.2d 424, 428 (3d Cir. 1988)
S&R Corp. v. Jiffy Lube Int'l, Inc., 968 F.2d 371 (3d Cir. 1992)
Samson v. Murray, 415 U.S. 61, 94 S. Ct. 937 (1974)
San Francisco Arts & Athletics v. Olympic Comm., 483 U.S. 522 (1987)
Shea v. Reno, 930 F. Supp. 916 (S.D.N.Y. 1996)
Sims v. Greene, 160 F.2d 512 (3d Cir. 1947)
Sullivan v. Barnett 913 F. Supp. 895 (E.D. Pa. 1996)
United States v. Ingersoll-Rand Co., 320 F.2d 509 (3d Cir. 1963)
United States Postal Serv. v. Council of Greenburgh Civic Ass'ns, 453 U.S. 57, 101 S. Ct.
2676 (1981)
Wooley v. Maynard, 430 U.S. 705, S. Ct. 1428 (1977)
Statutes and Rules
United States Constitution, Amendment I
Telecommunications Act of 1996
Communications Decency Act of 1996
18 U.S.C. Sec. 1725
28 U.S.C. Sec. 1292
28 U.S.C. Sec. 1332
47 U.S.C. Sec. 230
47 C.F.R. Sec. 64.702
Fed. R. Civ. P. 52
Fed R. Civ. P. 65
Fed. R. Civ. P. Local Rule 7.1 (a) (E.D. Pa.)
Other
Georgia Computer Systems Protection Act, Ga. Code Sec. 16-9-93.1 (July 1, 1996)
Charles A. Wright, et al., Federal Practice and Procedure (2d ed. 1995)
STATEMENT OF SUBJECT MATTER AND APPELLATE JURISDICTION
Subject matter jurisdiction for this matter in the United States District Court for the
Eastern District of Pennsylvania is based on diversity of citizenship under 28 U.S.C. Sec.
1332. Appellant, American Online, Inc. ("AOL"), and appellee, Cyber Promotions, Inc.
("Cyber"), are citizens of different states, and the amount in controversy, exclusive of
interest and costs, exceeds $50,000. Jurisdiction in the United States Court of Appeals for
the Third Circuit is based on 28 U.S.C. Sec. 1292(a)(1), which provides that a party may
take an immediate appeal from an interlocutory order granting an injunction. On
September 5, 1996, the lower court entered an Order granting an injunction in favor of
Cyber and against AOL. AOL filed its notice of appeal of the Order on September 12,
1996.
STATEMENT OF THE ISSUES PRESENTED FOR REVIEW
The following issues are raised in this appeal.
1. Whether the district court's order compels AOL to disseminate Cyber's advertisements
in violation of the First Amendment.
2. Whether the district court erred in concluding that Cyber proved that it was entitled to
a preliminary injunction against AOL to last from September 5, 1996 through the trial of
the action.
3. Whether the preliminary injunction should be vacated because the district court did
not: (a) hold a hearing in accordance with Fed. R. Civ. P. 65; (b), issue findings of fact
and conclusions of law in accordance with Fed. R. Civ. P. 52(a); (c), provide AOL with
an opportunity to respond to Cyber's contentions or affidavit before issuing an injunction
of indefinite duration; or (d), require that Cyber post security in a meaningful amount as
required by Fed. R. Civ. P. 65(c).
See the attached order entered on September 5, 1996, by the Honorable Charles R.
Weiner; the docket entries (JA000005-11) reflecting the timing, lack of hearing and
procedural posture of proceedings in the lower court; the declaration of counsel for AOL
noting in part the timing issue, (JA000445-448, Paras. 3-5); the memoranda of Cyber and
AOL filed on August 30, 1996, (JA000354-397 and JA000398-453), on the procedural
posture; and the letter of counsel for AOL to Judge Weiner noting in part the injunction
versus TRO procedural posture, (JA000461-462), before the injunction was entered.
STATEMENT OF THE STANDARDS OF REVIEW
This court reviews the district court's granting of a preliminary injunction for an abuse of
discretion, an obvious error in applying the law or a serious mistake in considering the
proof. Merchant & Evans. Inc. v. Roosevelt Building Prods. Co., 963 F.2d 628, 633 (3d
Cir. 1992). The lower court's underlying factual determinations are reviewed for clear
error and its rulings on questions of law are reviewed de novo. Acierno v. New Castle
Co., 40 F.3d 645, 652 (3d Cir. 1994).
Where a record contains an insufficient basis for determining the legal and factual
grounds for issuing an injunction, the appellate court must vacate the injunction.
Professional Plan Examiners of New Jersey, Inc. v. Lefante, 750 F.2d 282, 289 (3d Cir.
1984).
STATEMENT OF RELATED CASES
There are no related cases of which AOL is aware that are currently pending before or
about to be presented to this Court or any other state or federal court, or that have
previously been before this Court.
STATEMENT OF THE CASE
AOL operates a private online computer service which has more than six million
members. (JA000409, Knowles Decl. Paras. 1-2.) AOL has invested millions of dollars in
its equipment, reputation, software, advertising, and e-mail system. (JA000236,
O'Donnell Decl. Para. 4.) One of the most popular services provided by AOL is the
ability to send and receive e-mail through equipment owned and maintained by AOL.
(JA000237, O'Donnell Decl. Para. 8.) Beginning in late 1995, Cyber began deluging
AOL and its customers with millions of unsolicited commercial e-mail messages,
infuriating AOL members, resulting in member cancellations and imposing increased
hardware and software expense on AOL. (JA000238, 241-242, O'Donnell Decl. Paras.
14, 23, 27-28; JA000410, Knowles Decl. Paras. 4, 6; and JA000414, Ryan Decl. Paras. 4-
5.) AOL has suffered, and continues to suffer, lost customers, substantial damage, cost,
and hardship as a result of Cyber's activities. (JA000242, O'Donnell Decl. Para. 28.)
When AOL took steps to prevent Cyber from continuing this course of conduct, Cyber
initiated this litigation, claiming that it had a First Amendment right to conduct its
business by means of AOL's proprietary online service.
Cyber is a six-employee company, (JA000372, at Para. 13), that charges as little as
$79.00 to add a person's advertisement to its bulk e-mail string messages and repeat its
bulk mailings two to four times each day, seven days a week. (JA000410, Knowles Decl.
Paras. 5-6; JA000441; and JA000447, Schiller Decl. Paras. 12-13.) Some of these bulk e-
mail transmissions include advertisements for adult videos, aphrodisiacs, and get-rich-
quick schemes, and they reach indiscriminately children and their parents -- potentially
anyone with an e-mail box. (JA000238, O'Donnell Decl. Para. 15; and JA000410,
Knowles Decl. Para. 6.) Cyber typically seeds millions of messages containing its
unsolicited advertisements several times a day to more than 900,000 AOL subscribers.
(JA000368, Wallace Decl. Para. 4; and JA000410, Knowles Decl. Para. 5.)
Although the analogy has no basis in fact, law, the nature of the ownership at issue, or the
character of the actors, Cyber itself nonetheless likes to analogize its dissemination of its
bulk commercial e-mail to bulk junk mail sent through the United States postal system.
Even if one ignored arguendo the stark differences of constitutional significance, the
remaining obvious distinctions make all too clear that Cyber's activities would still have
to be considered significantly more pernicious in several critical respects: As a
preliminary matter, the sender of mail through the postal service, whether first class or
otherwise, pays the postage. Cyber does not bear the cost of transmission (or the
"postage"), but the recipients and AOL do; the e-mail boxes rapidly fill up and become
unavailable for real mail as a result of Cyber's bulk e-mail, while postal recipients' mail
boxes generally do not; recipients of Cyber's mail must incur some online charges in
ascertaining what the mail is, while postal recipients do not; and the equipment of AOL
can become damaged by the Cyber junk e-mail, while the postal service generally cannot.
Moreover, all e-mail, regardless of intent or nature, is essentially treated the same by the
Internet and AOL's computers; that is, it is all like first-class mail.1/ For reasons such as
these, AOL and its customers strongly objected to Cyber's unwanted intrusions, cost, and
impact, and AOL accordingly took reasonable steps to protect its proprietary system.
Because AOL receives hundreds of complaints per day from its customers objecting to
Cyber's unsolicited e-mail, threatening to cancel service, and, in some cases, threatening
to sue AOL if the e-mail does not stop, AOL programmed its system to reject e-mail
emanating from Servint, an Internet service provider ("ISP") currently used by Cyber to
send the e-mail. (JA000410, Knowles Decl. Paras. 6, 8.) AOL did not obtain an order
from a court in exercising its right to block Servint.
On August 30, 1996, Cyber made an oral motion with the district court for a temporary
restraining order/preliminary injunction, which asserted Cyber's "right" to conduct its
business on AOL's property -- despite the fact that Cyber has refused to pay for this right.
(JA000354-397.) On four hours' notice, the lower court required simultaneous briefs to be
filed by the parties. Without a hearing, the lower court granted Cyber's motion and on
September 5, entered an order "temporarily restrain[ing]" AOL, "until the time of trial,"
from blocking Cyber's e-mail to AOL members "who wish to receive the mail and from
interfering in any manner with Cyber's business relationships with its Internet Service
Providers." By virtue of the order, AOL was constrained to remove its block of Servint
and Cyber's bulk e-mail, and, even though Cyber had engineered a way to circumvent
AOL's block even before the lower court entered its order, AOL was left essentially
powerless to prevent Cyber or its ISPs from their indiscriminate mass mailings under the
cloak of an official court order. A copy of the lower court's order is attached at the end of
AOL's brief. The lower court did not render any findings of fact or conclusions of law in
connection with the order.
AOL has appealed the lower court's order granting the injunction, and Cyber has agreed
to AOL's request that this Court hear the motion on an expedited basis.
STATEMENT OF RELEVANT FACTS
AOL is a corporation organized and existing under the laws of the State of Delaware. Its
principal place of business is in Vienna, Virginia. (JA000236, O'Donnell Decl. Para. 3.)
At great cost and expense, AOL has developed the world's largest and most successful
proprietary, content-based, computer online service. (JA000236, O'Donnell Decl. Para.
4.) The number of members or customers who have established accounts with AOL has
grown rapidly, and, currently, AOL has more than 6 million customers. (JA000236,
O'Donnell Decl. Para. 5.) Any person having access to a computer, a modem and a
telephone line can subscribe to AOL's service, provided they are willing to adhere to
AOL's "Terms of Service" and "Rules of the Road." (JA000236, O'Donnell Decl. Para.
6.) (Copies of these terms and rules are at JA000244-262.) Additional factual information
on the Internet, the nature and scope of the services provided by online companies, such
as AOL, and the absence of government activity in the area are reviewed in two recent
decisions issued by the United States District Court for the Eastern District of
Pennsylvania (June 11, 1996) and the United States District Court for the Southern
District of New York (July 29, 1996). See ACLU v. Reno, 929 F. Supp. 824 (E.D. Pa.
1996); Shea v. Reno, 930 F. Supp. 916 (S.D.N.Y. 1996).
AOL is just one of many online services providing access to the Internet, though AOL is
the largest in terms of members, investment in assets, and revenue. "National commercial
'on-line services' -- such as America Online, Compu-Serve, Prodigy, and Microsoft
Network -- allow subscribers to gain access to the Internet while providing extensive
content within their own proprietary networks." Shea, 930 F. Supp. at 926. Online
services such as AOL "offer nationwide computer networks (so that subscribers can dial
into a local telephone number), and the services provide extensive and well-organized
content with their own proprietary networks.... The major commercial online services
have almost twelve million individual subscribers across the United States." ACLU, 929
F. Supp. at 833. AOL's online system is comprised of a complex network of computers
and extensive databases. (JA000236, O'Donnell Decl. Para. 7.) For a monthly fee,
customers may obtain access to these databases, which contain textual and graphic
information on such topics as current events, news, personal finance, entertainment,
computing, weather, travel, education and sports. (JA000236, O'Donnell Decl. Para. 7.)
AOL customers also have access to a variety of online periodicals, reference works and
computer software. (JA000236, O'Donnell Decl. Para. 7.) They may participate in online
clubs, which provide information relating to hobbies, and chat rooms which allow
customers to interact with persons having similar interests. (JA000236, O'Donnell Decl.
Para. 7.) Another popular feature of the AOL service is a "KIDS ONLY" area which
contains educational materials, games and other items of interest to children. (JA000236,
O'Donnell Decl. Para. 7.) AOL even offers its subscribers "parental control options free
of charge" for accessing Internet material. Shea, 930 F. Supp. at 932. Customers may also
enter an online marketplace where they may obtain information concerning products of
companies who pay AOL a fee for the right to advertise there. (JA000236, O'Donnell
Decl. Para. 7.) (A copy of the AOL "Main Menu" screen, which identifies many of these
online services, is at JA000263-264.)
Among the valuable services provided to AOL customers is a proprietary e-mail system
which allows them to communicate with each other by means of their personal
computers. (JA000237, O'Donnell Decl. Para. 8.) AOL's e-mail system was created solely
for the benefit of AOL customers, who pay prescribed fees and who agree to adhere to
AOL's Terms of Service. (JA000237, O'Donnell Decl. Para. 8.) The e-mail system is
operated through dedicated computers known as servers, which store and route e-mail
messages for AOL's customers. (JA000237, O'Donnell Decl. Para. 8.) All AOL
customers are given a unique AOL address so that they can send and receive e-mail.
(JA000237, O'Donnell Decl. Para. 8.) These addresses consist of a name selected by the
customer and AOL's service mark and domain designation "aol.com," (e.g.,
"JohnDoe@aol.com"). (JA000237, O'Donnell Decl. Para. 8.) Only AOL customers are
allowed to use the "aol.com" mark and domain name as a part of their address.
(JA000237, O'Donnell Decl. Para. 8.) Any AOL customer who does not wish to abide by
AOL's Terms of Service is free to establish an e-mail address through another service or
an Internet service provider, with the only difference in e-mail address being that such
address will not include "aol.com" and the e-mail will not use AOL's resources.
Because AOL provides access to the Internet, AOL customers may communicate by e-
mail with any other person having an Internet address. (JA000237, O'Donnell Decl. Para.
9.) However, persons using the Internet do not have access to AOL's proprietary online
content unless they first agree to establish an AOL account and abide by AOL's Terms of
Service. (JA000237, O'Donnell Decl. Para. 9.)
The Internet has become one of the most significant technological creations of this
century, occupying a position which is potentially more important than telephones or
televisions among communications media. (JA000237, O'Donnell Decl. Para. 10.) Once
connected to the Internet, users can obtain vast amounts of digitized data from sources
such as the archives of large governmental and academic institutions and the web pages
of the Internet's millions of individual users. (JA000237, O'Donnell Decl. Para. 10.)
Many businesses and educational institutions have invested vast sums of money in
acquiring and running the sophisticated computer and communications equipment
required to make the Internet operational. (JA000237, O'Donnell Decl. Para. 11.) Access
to this equipment is leased by providers to persons who, in most cases, would not have
the means or inclination to acquire their own systems. (JA000237, O'Donnell Decl. Para.
11); ACLU, 929 F. Supp. at 833.
A number of legitimate businesses have established their own web pages on the Internet.
(JA000238, O'Donnell Decl. Para. 12.) These serve as a source of information concerning
such businesses and their products or services. (JA000238, O'Donnell Decl. Para. 12.)
Accordingly, the web has become the chief method on the Internet used by businesses to
advertise their products and services, as it is a mechanism known by Internet users as a
source of information on businesses and does not impose cost on the recipient who does
not wish to see the information. Unfortunately, the Internet has also provided
opportunities for unscrupulous individuals and corporations who use it as a tool to
perpetrate fraud, to misappropriate intellectual property, to engage in unfair competition,
and to invade privacy. (JA000238, O'Donnell Decl. Para. 12.)
Cyber has elected to use AOL's computer equipment for its own purposes by using it
without authorization to send its commercial e-mail messages in bulk to millions of
recipients, with no advance warning or knowledge that the recipient wishes to receive the
information, and at cost solely to others. (JA000238, O'Donnell Decl.Para. 13.) Cyber
holds itself out as being able to disseminate advertisements for a fee to millions of
Internet users.
(JA000238, O'Donnell Decl. Para. 13.) The number of recipients of Cyber's e-mail
messages is increasing daily. (JA000414, Ryan Decl. Para. 4.) Since just the Spring of
this year, the volume of Cyber's commercial e-mail has greatly increased with each
mailing. (JA000410, Knowles Decl. Para. 5.) Cyber charges advertisers a nominal fee and
then includes strings of messages concerning their products and services in indiscriminate
mass mailings sent to the e-mail addresses which Cyber has compiled. (JA000238,
O'Donnell Decl. Paras. 13-14.) One mailing can include 15 to 20 pages of strung-together
advertisements directed to 900,000 AOL mailboxes. (JA000368, Wallace Decl. Para. 4;
and JA000410, Knowles Decl. Para. 5.) Multiply this by four times a day, seven days a
week, and the scope of the problem to AOL becomes self-evident.
The majority of Cyber's mass mailings go to AOL customers. (JA000238, O'Donnell
Decl. Para. 14.) Indeed, Cyber has acquired the e-mail addresses of hundreds of
thousands of AOL customers, perhaps millions by now, and, some months ago, Cyber
began sending large amounts of unsolicited commercial advertisements via e-mail to
them. (A sample of one such advertisement is at JA000265-268.) These advertisements
are voluminous, and they eat up valuable online time for which customers are billed and
AOL resources are expended. (JA000238, O'Donnell Decl. Para. 14.) AOL receives
hundreds of daily complaints from its customers concerning Cyber's conduct. (JA000238,
O'Donnell Decl. Para. 14; and JA000414, Ryan Decl. Para. 5.) The complaints relate to
the volume, nature, content and cost of the bulk mail, as well as the out-and-out
frustration by customers over their inability to remove themselves from Cyber's mailing
lists notwithstanding repeated attempts by phone or e-mail, even after carefully following
the directions Cyber provides purportedly for that very purpose. (JA000414, Ryan Decl.
Para. 5.) (Samples of such complaints are at JA000269-271.)
Some of the advertisements sent to AOL customers by Cyber are marked for adults only
and are of a salacious nature. (JA000238, O'Donnell Decl. Para. 15.) These materials are
offensive to many AOL customers. Such advertisements indiscriminately land in the e-
mail box of 12-year olds as well as their parents and teachers. (Samples of such Cyber
advertisements are at JA000272-274.)
Cyber never requested any authorization from AOL or its customers to engage in this
conduct, nor has it compensated AOL or its customers in any manner for the use of
AOL's equipment to route the millions of unsolicited messages which it has sent or for
the cost, inconvenience, and at times embarrassment to customers caused by the e-mail.
(JA000239, O'Donnell Decl. Para. 16.) AOL would never have granted approval even if
Cyber had requested permission since Cyber's conduct damages AOL and its relations
with its customers with each mailing and violates AOL's Rules of the Road which are
incorporated in the Terms of Service. (JA000239, O'Donnell Decl. Para. 17.) Paragraph C
of these rules contains the following prohibitions concerning online conduct:
C. Online Conduct.
(a) Any conduct by you that in AOL Inc.'s discretion restricts or inhibits any other
Member from using or enjoying AOL will not be permitted . . . You may not post or use
AOL to:
(1) harass, threaten, embarrass or cause distress, unwanted attention or discomfort upon
another Member or user of AOL or other person, or entity,
(2) post or transmit sexually explicit images or other content which is deemed by AOL
Inc. to be offensive . . .
(8) post or transmit any unsolicited advertising, promotional materials, or other forms of
solicitation to other Members, individuals or entities, except in those areas (e.g. the
classified areas) that are designated for such a purpose . . . (viii) Advertising, Solicitation
and Name Harvesting. You may not use AOL to send unsolicited advertising,
promotional material, or other forms of solicitation to other Members except in those
specified areas that are designated for such a purpose (e.g., the classified area) unless you
receive the express permission of the Member. You may not use AOL to collect or
"harvest" screen names of other Members without the express prior permission of the
Member. AOL Inc. reserves the right to block or filter mass e-mail solicitations on or
through AOL.
(JA000239, O'Donnell Decl. Para. 17.)
Cyber has violated each of these rules. (JA000239, O'Donnell Decl. Para. 13.) Upon
discovering these violations, AOL contacted Cyber and demanded that it discontinue its
activities. (A copy of a cease and desist letter dated January 26, 1996, which was sent by
AOL to Cyber, is at JA000275-276.) Cyber knew or should have known of AOL's Terms
of Service, since Cyber's President, Sanford Wallace, is a former AOL customer who
once agreed to abide by them. (JA000240, O'Donnell Decl. Para. 19.) However, his right
to use the AOL system was terminated because of flagrant and intentional violations of
the Terms of Service. (JA000240, O'Donnell Decl. Para. 19.) Notwithstanding its
knowledge of AOL's rules and its receipt of the cease and desist, Cyber has refused to
comply with AOL's demand. (JA000240, O'Donnell Decl. Para. 20.) Indeed, it has
escalated its activities and continues to escalate its use of AOL's equipment to
disseminate unsolicited e-mail advertisements, with an exponential increase in the
volume of bulk e-mail since the beginning of this year. (JA000240, O'Donnell Decl. Para.
20.)
AOL's prohibition against the dissemination of unsolicited commercial e-mail is dictated
by a number of considerations. (JA000240, O'Donnell Decl. Para. 21.) AOL has neither
the means nor the obligation to assist businesses such as Cyber in the dissemination of
huge quantities of unsolicited e-mail. (JA000240, O'Donnell Decl. Para. 21.) AOL owns
the equipment used in its business, and it has the right to charge a fee to those who desire
to gain access to its system. (JA000240, O'Donnell Decl. Para. 21.) If Cyber were
permitted to amass profits by using AOL's system free of charge, others would quickly
follow suit. (JA000240, O'Donnell Decl.Para. 21.) AOL's e-mail system would soon be
overloaded to the point that it would no longer be usable by paying AOL customers.
(JA000240, O'Donnell Decl.Para. 21.) More important, Cyber's solicitations are strongly
disliked by AOL's members who mistakenly believe that AOL is not doing everything
possible to stop Cyber and often cancel or threaten to cancel their AOL subscriptions over
their anger with Cyber's bulk e-mail. (JA000410, Knowles Decl. Para. 6.)
Any e-mail that is sent to an AOL address is received and processed by AOL's mail
server equipment. (JA000240, O'Donnell Decl. Para. 22.) This equipment automatically
attempts to route such e-mail to the AOL subscriber for whom it is intended. (JA000240,
O'Donnell Decl. Para. 22.) If e-mail bears an incorrect AOL address (because no such
addressee ever existed or because the addressee is no longer an AOL subscriber), the mail
is bounced back to the sender's address. (JA000240-241, O'Donnell Decl. Para. 22.) If the
sender's address is not valid, the mail is routed to a server known as the "postmaster
workstation." (JA000241, O'Donnell Decl. Para. 22.) AOL's e-mail equipment has a finite
capacity which is designed to accommodate the demands imposed by AOL's customers.
(JA000241, O'Donnell Decl. Para. 23.) Notwithstanding AOL's substantial and
continuing investment in hardware, software and personnel, AOL remains vulnerable to
disruption by indiscriminate, mass mailings. (JA000241, O'Donnell Decl. Para. 23.) The
volume of mix-addressed or undeliverable e-mail sent from Cyber to or through AOL is
tremendous and results in substantial cost and damage to AOL apart from and beyond
that engendered by the e-mail that actually reaches -- and infuriates -- AOL members.
(JA000241, O'Donnell Decl. Para. 23.) In fact, the volume of mix-addressed junk e-mail
sent by Cyber is so large that on several occasions it has disabled equipment owned by
AOL. (JA000241, O'Donnell Decl. Para. 23.) AOL has had to spend hundreds of
thousands of dollars on new equipment already to accommodate Cyber's mailings while
keeping its system operational for the e-mail its customers do want to receive.
(JA000241, O'Donnell Decl. Para. 23; and JA000410, Knowles Decl. Para. 7.)
It is obvious that Cyber made no effort to determine the validity of the e-mail addresses it
collected before using them. (JA000241, O'Donnell Decl. Para. 24.) Indeed, a substantial
quantity was invalid, since much of the e-mail was addressed to mail boxes that originally
belonged to individuals whose accounts had been terminated or who had changed their
addresses. (JA000241, O'Donnell Decl. Para. 24.) Ordinarily, such mailings would be
returned to the ISP whose system Cyber used to send them. (JA000241, O'Donnell Decl.
Para. 24.) To avoid detection, however, Cyber has used forged return mailing addresses
or domain names on its mailings. (JA000241, O'Donnell Decl. Para. 24.) The use of a
forged or intentionally incorrect "return path" or return address means that undeliverable
mail that is supposed to get returned to Cyber through its ISP instead gets routed to an
incorrect ISP with which Cyber has no dealings, usually an e-mail box of a known
opponent of Cyber's way of doing business. (JA000241, O'Donnell Decl. Para. 24.) By
continually changing its mailing address to avoid detection, Cyber has attempted to evade
AOL's security systems, which are designed to keep communication lines and server
space open for AOL's customers only. (JA000241, O'Donnell Decl. Para. 24.)
Over the last year, Cyber has gained access to the AOL system by using the services of
several ISPs. (JA000241, O'Donnell Decl. Para. 25.) Like AOL, most such providers
have policies which prohibit the mailing of unsolicited commercial advertisements.
(JA000241, O'Donnell Decl. Para. 25.) Notwithstanding these policies, Cyber has
continued sending its junk e-mail in bulk, always overcoming attempts to block it, the
loss of ISPs, criticism in Internet Web pages set up exclusively to complain about Cyber,
and attempts in the courts to stop the damage Cyber causes. (JA000241, O'Donnell Decl.
Para. 24-26.)
AOL has received hundreds of daily complaints from customers who have received
Cyber's mailings. (JA000242, O'Donnell Decl. Para. 27.) While some of Cyber's e-mail
messages contain a provision purportedly allowing recipients to request that their names
be deleted from mailing lists, customers complain that they are still receiving material
from Cyber even after they make such requests, sometimes repeatedly, by e-mail and
phone. (JA000242, O'Donnell Decl. Para. 27.) (Samples of complaints from AOL
customers demonstrating the confusion caused by Cyber are at JA000277-284.)
At times, Cyber has used forged return addresses containing AOL's mark "aol.com."
(JA000242, O'Donnell Decl. Para. 28.) Because these advertisements did not correctly
identify Cyber's ISP, mailings bearing the forged return addresses have been routed in
mass quantities into AOL's postmaster workstation. (JA000242, O'Donnell Decl. Para.
28.) A forged return address is no more than an incorrect return address placed on the e-
mail message to hide the identity of the sender and/or its ISP, prevent the return of
undeliverable messages, make it difficult or impossible for recipients to reply, and/or
prevent the recipient from attempting to retaliate to offensive or objectionable e-mail.
Undeliverable e-mail is trapped in AOL's computers. Cyber's conduct has harmed AOL
and its e-mail system by overloading the workstation and by causing it to become
damaged on multiple occasions for hours at a time. (JA000242, O'Donnell Decl. Para.
28.) This not only has prevented AOL from using its own equipment, but it has caused
continuing hardware and software problems as well. (JA000242, O'Donnell Decl. Para.
28.)
Cyber has implicitly acknowledged the wrongfulness of its conduct by agreeing to the
entry of a preliminary injunction prohibiting it from using a forged aol.com return
address in its e-mail. (JA000242, O'Donnell Decl. Para. 29.) The stipulated injunction
was signed by the lower court on April 11, 1996, and it was entered in the action filed by
Cyber in the United States District Court for the Eastern District of Virginia on April 29,
1996. (JA000242, O'Donnell Decl. Para. 29.) (A copy of the preliminary injunction
entered in the Virginia action is at JA000285-288.) Notwithstanding the entry of the
preliminary injunction, Cyber has continued to use invalid return addresses. (JA000242,
O'Donnell Decl. Para. 30.) (A sample of one such mailing which was sent after entry of
the preliminary injunction is at JA000289-292.)
The use of a forged AOL domain name enables Cyber to avoid having to handle the large
volume of incorrectly addressed mail which would otherwise be returned to Cyber's
server in the normal course and under Internet protocol. (JA000243, O'Donnell Decl.
Para. 31.) In addition, it allows Cyber to avoid the large volume of complaints from
people who do not wish to receive such mail. (JA000243, O'Donnell Decl. Para. 31.) By
contrast, AOL personnel have been obliged to spend valuable time in fielding these
complaints and in repairing the damage to AOL equipment and software caused by
Cyber's activities. (JA000243, O'Donnell Decl. Para. 31.) Upon discovering the correct
return addresses for many of the mix-addressed e-mail advertisements which had clogged
AOL's system, AOL programmed its computers to automatically correct the addresses
and return the e-mail to its source. (JA000243, O'Donnell Decl. Para. 32.) On information
and belief, after learning that the returned e-mail had been sent by Cyber, some of Cyber's
ISPs terminated Cyber's account. (JA000243, O'Donnell Decl. Para. 32.) Any such
termination resulted from the conduct of Cyber in using forged return addresses on its e-
mail. (JA000243, O'Donnell Decl. Para. 33.) By insuring that the mix-addressed e-mail
was returned to the proper source, AOL was merely following established Internet
protocols. (JA000243, O'Donnell Decl. Para. 33.)
By making unauthorized use of AOL's e-mail system, Cyber has caused incalculable
damage to AOL's goodwill and its relationships with paying customers. (JA000410,
Knowles Decl. Para. 6.) AOL customers have to pay for the online time associated with
downloading or viewing Cyber's commercial messages. (JA000410, Knowles Decl. Para.
6.) Moreover, AOL customers find the receipt of junk mail offensive. (JA000410,
Knowles Decl. Para. 6.) Cyber's activities, referred to in Internet parlance as "spamming,"
result in hundreds of complaints per day to AOL. (JA000414, Ryan Decl. Para. 4.) (Just a
small sampling of these complaints is at JA000416-444.)
Against this picture of substantial damage to AOL is the stark fact that Cyber is
judgment-proof. Cyber; its owner, Mr. Wallace; and Cyber's predecessor, Promo
Enterprises, all commingle funds on a daily basis. (JA000446, Schiller Decl. Para. 6.)
Cyber has no audited or reviewed financial statements. (JA000446, Schiller Decl. Para.
6.) Mr. Wallace and his wife take and disburse funds from Cyber at will. (JA000446,
Schiller Decl. Para. 4.) Mr. Wallace pays his personal expenses -- such as wedding
deposits -- from Cyber funds. (JA000446, Schiller Decl. Para. 4.)
Whenever possible, AOL attempts to block users who could damage its system or who
violate its Terms of Service or Internet protocols, such as Cyber, from gaining access to
its system. (JA000411, Knowles Decl. Para. 8.) Cyber has evaded AOL's blocking
attempts in the past by using forged return mail addresses and by switching from one ISP
to another in rapid succession. (JA000411, Knowles Decl. Para. 8.) Recently, AOL
learned through independent sources of information that Cyber was using Servint, Inc., an
ISP in Virginia, to send its e-mail. (JA000411, Knowles Decl. Para. 8.) AOL forwarded
formal objections to Servint and advised it that it was violating Internet protocols and
damaging AOL by allowing Cyber to continue to send millions of e-mail messages a day
to AOL subscribers and through AOL's computers. (JA000410, Knowles Decl. Para. 5.)
However, Servint has continued to allow Cyber to send massive quantities of e-mail in
bulk. (JA000411, Knowles Decl. Para. 8.) Since AOL has no contractual or other
relationship with Servint or Cyber, it has no obligation to accept e-mail sent to it from
Servint or Cyber. (JA000411, Knowles Decl. Para. 8.) Therefore, AOL programmed its
system to reject e-mail emanating from Servint. (JA000411, Knowles Decl. Para. 8.) In
response, Cyber asked the lower court for a temporary restraining order and preliminary
injunction forcing AOL to accept e-mail from Servint. On four hours' notice, the lower
court required simultaneous briefs to be filed. Without a hearing, the lower court granted
Cyber's request and issued an order "temporarily restrain[ing]" AOL, "until the time of
trial," from blocking Cyber's e-mail to AOL members "who wish to receive the mail and
from interfering in any manner with Cyber's business relationships with its Internet
Service Providers."2/ A copy of the lower court's order is attached at the end of AOL's
brief.
SUMMARY OF ARGUMENT
Before granting a motion for preliminary injunction, the district court had to find that
Cyber had proved:
(1) The likelihood that Cyber would prevail on the merits at a final hearing;
(2) That Cyber would be irreparably injured by AOL's decision not to support Cyber's
business;
(3) That the injury to Cyber would outweigh any injury or cost imposed on AOL if the
preliminary injunction were issued; and
(4) The public interest would be served by requiring AOL to distribute Cyber's
unsolicited messages.
S&R Corp. v. Jiffy Lube Int'l., Inc., 968 F.2d 371, 374 (3d Cir. 1992). Further, "[a]ll four
factors should favor preliminary relief before the injunction will issue." Id. The lower
court was also required to comply with the procedural requirements of the Federal Rules
of Civil Procedure.
Cyber has no constitutional, statutory or other legal rights to compel AOL to place its
network or equipment at Cyber's disposal. AOL was clearly exercising its rights when it
took steps to prevent Cyber from flooding AOL's members' home computers with
unwanted commercial advertisements. AOL was and is a proprietary online company that
has invested substantial sums in its own equipment, name, software and reputation. It
does not act with any government assistance, does not function as, with or like a
government, and does not perform a public function. There are, nevertheless, important
First Amendment rights of AOL under attack by virtue of the lower court's order entered
on September 5, 1996. The preliminary injunction not only restrains AOL from
exercising its First Amendment rights, but also rests on the implicit assumption that the
Constitution compels AOL to transmit or distribute Cyber's commercial messages -- free
of charge. Cyber now contends that AOL has forfeited its constitutional rights because it
did not obtain an injunction barring Cyber from engaging in its wrongful conduct earlier.
(Cyber Mem. at 16-17.)3/ This argument misses the point entirely: it is not the mere fact
that Cyber has sent e-mail that constitutes the First Amendment violation, but that there is
now a court order compelling AOL to distribute and support speech with which it does
not agree. And it is this issue that is before this Court on appeal.
In substantial part, the same First Amendment considerations soundly undermine Cyber's
contention that it could establish the first element that must be met before preliminary
injunctive relief can be granted -- the likelihood that Cyber would prevail at a final
hearing on any claim that it had the right to use AOL's property to barrage AOL members
with unsolicited junk e-mail on a repeated, daily basis. Since Cyber had no legal right to
force AOL to disseminate Cyber's unwanted commercial bulk e-mail in derogation of
AOL's First Amendment rights, Cyber's claim on the merits is not likely to prevail. No
other Cyber claim on the merits is supported in any manner by admissible evidence on
the record.
As for the second factor, Cyber's alleged irreparable harm, the only record evidence
addressing the issue suggests that at best, Cyber will lose some money if it cannot
trespass on AOL's computer network for the next few months or until the conclusion of
the trial, apparently whichever comes later. Cyber will continue to earn substantial
revenue selling millions of advertisements and sending them to hundreds of thousands of
recipients who are not part of AOL's network. Indeed, over half of Cyber's revenue for
the first seven months of this year did not even derive from its bulk e-mail advertising.
(JA000447, Schiller Decl. Para. 10.) And Cyber now even admits that it can continue to
overcome AOL's blocking attempts, characterizing its moves as a "cat and mouse game."
(Cyber Mem. at 18.)
The third factor, AOL's tremendous, undisputed irreparable harm to both its First
Amendment rights and its precious good will and reputation, weighs heavily in favor of
lifting the injunction. It is hornbook law that "loss of First Amendment freedoms, for
even minimal periods of time, unquestionably constitutes irreparable injury." Elrod v.
Burns, 427 U.S. 347, 96 S. Ct. 2673, 2690 (1976); Shea 930 F. Supp. at 935; ACLU, 929
F. Supp. at 851. The daily beating to which AOL and its members is being subjected
cannot and will not be remedied by any ultimate award or finding in its favor months
from now, whenever the trial, possibly to be postponed, is completed.
Finally, the public interest is clearly not served by Cyber's daily, unauthorized trampling
of AOL's First Amendment rights and disregard of the interests of AOL's customers.
The lower court has granted Cyber license to utilize AOL's property in order to bombard
AOL members with millions of unsolicited commercial advertisements that cost AOL
members money to review and delete, and that cost AOL incalculable damage in the form
of tarnished good will and reputation and lost First Amendment freedoms. The four
factors that the lower court was required to have reviewed before ordering such a drastic
remedy all weigh strongly against the issuance of the injunction in the first place and
when considered now by this Court, should compel that the order be vacated
immediately.
Finally, the lower court's order granting the injunction is also procedurally fatally
defective in several respects. The order was entered without a hearing; is unsupported by
findings of fact and conclusions of law; followed no notice to AOL that a multi-month
injunction was at issue; was briefed on only four-hours notice, and failed to include even
an opportunity for AOL to respond to Cyber's briefing, let alone cross-examine Cyber's
one witness in a hearing.4/ For these procedural reasons alone, the order should also be
vacated.
ARGUMENT
A. The Lower Court's Order Compels AOL to Carry Cyber's Speech in Violation of
AOL's First Amendment Rights,
The expansive language of the Court's September 5 order, constitutes a serious and
fundamental abridgment of AOL's constitutional rights. The terms of that order compel
AOL not only to sponsor Cyber's unsolicited commercial messages, but also to bear the
cost of distributing those messages. In addition, since many of Cyber's messages contain
explicit adult content, AOL is being forced to engage in conduct that is offensive and
insulting to many of its paid members, many of whom allow their children to use AOL
and to maintain mail boxes on AOL. It has become a daily occurrence for AOL to receive
customer complaints and account cancellations by customers specifically stating that
Cyber's advertisements are the reason for the complaints and cancellations. "Compelled
access like that ordered in this case both penalizes the expression of particular points of
view and forces speakers to alter their speech to conform with an agenda they did not
set." Pacific Gas & Electric Co. v. Public Utils. Comm'n of California, 475 U.S. 1, 106 S.
Ct. 903, 908 (plurality opinion), reh'g denied, 975 U.S. 1133, 106 S. Ct. 1667 (1986).
Under Supreme Court jurisprudence, the district court's order cannot survive
constitutional scrutiny.
At issue in Pacific Gas was an order of the California Public Utilities Commission (PUC)
that a utility, Pacific Gas & Electric Company, allow the consumer group, Toward Utility
Rate Normalization (TURN), to use the "extra space" in the billing envelopes -- deemed
by PUC to be the property of the ratepayers -- which Pacific Gas distributed to its
customers. Id. at 5, 106 S. Ct. at 906. The so-called "extra space" consisted of the space
or weight left in the utility's billing envelopes before additional postage would have been
required. Accordingly, use of that "extra space" or weight would be free in the sense that
it would not impose a postage cost on the utility.5/ TURN had requested that PUC
prohibit Pacific Gas from using its envelopes to disseminate political editorials contained
in its newsletter, and in a compromise effort, PUC ordered that TURN could use the
"extra space" four times a year for two years. Id at 5-6, 106 S. Ct. at 906.
The Supreme Court held that the utility's newsletter was protected under the First
Amendment, id. at 8-9, 106 S. Ct. at 907-08, and although PUC had acknowledged this
protection, it erred in finding no violation of Pacific Gas' constitutional rights, reasoning
(erroneously) that the mere fact that the utility could still deliver its newsletter during
those months in which TURN was not using the envelopes eliminated any constitutional
violation. Id. at 9, 106 S. Ct. at 908. Consequently, the Supreme Court reversed PUC's
order.
The Court noted the penal nature of PUC's actions, holding that " [c]ompelled access like
that ordered in this case both penalizes the expression of particular points of view and
forces speakers to alter their speech to conform with an agenda they do not set." Id. at
909, 106 S. Ct. at 908. The Court reviewed its prior treatment in the area of compelled
access, id (citing, inter alia, Miami Herald Publishing Co. v. Tornillo, 418 U.S. 241, 258,
94 S. Ct. 2831 (1974); Wooley v. Maynard, 430 U.S. 705, S. Ct. 1428 (1977); PruneYard
Shopping Ctr. v. Robins, 447 U.S. 74, 100 S. Ct. 2035 (1980); Pittsburgh Press Co. v.
Human Relations Comm'n, 413 U.S. 376, 93 S. Ct. 2553 (1973) (Stewart, J., dissenting)),
emphasizing that ""'[t]he essential thrust of the First Amendment is to prohibit improper
restraints on the voluntary public expression of ideas .... There is necessarily ... a
concomitant freedom not to speak publicly, one which serves the same ultimate end as
freedom of speech in its affirmative aspect,'"" Pacific Gas, 475 U.S. at 11, 106 S. Ct. at
909 (citing, inter alia, Harper & Row Publishers. Inc. v. Nation Enters., 471 U.S. 539,
559, 105 S. Ct. 2218, 2230, 85 L.Ed.2d 588 (1985)) (emphasis in original). For example,
the Court had previously invalidated the right-of-reply statute in Tornillo for its
interference with the newspaper's "editorial control and judgment" to remain silent when
it wanted to. Tornillo, 418 U.S. at 258, 94 S. Ct. at 2840 (cited in Pacific Gas, 475 U.S. at
10, 106 S. Ct. at 908-09).
PUC's order limited access to those who disagreed with the views expressed by Pacific
Gas in its newsletter and who opposed Pacific Gas in proceedings before PUC. Id., at 13,
106 S. Ct. at 910. The "one-sidedness" of the order, the Court held, "reduc[ed] the free
flow of information and ideas that the First Amendment seeks to promote." Id at 13-14,
106 S. Ct. at 910. While acknowledging that Pacific Gas did not "have the right to be free
from vigorous debate," the Court held that the utility did have the "right to be free from
government restrictions that abridge its own rights in order to 'enhance the relative voice'
of its opponents." Id. at 14, 106 S. Ct. at 910 (citing Buckley v. Valeo, 424 U.S. 1, 49 &
n.55, 96 S. Ct. 612, 639 & n.55 (1976)).
The Court also noted that PUC's order unconstitutionally required Pacific Gas to affiliate
with speech with which it might disagree, thus either giving the appearance that Pacific
Gas agreed with the views of TURN or unfairly compelling Pacific Gas to respond. Id. at
15, 106 S. Ct. at 911. The Court admonished:
That kind of forced response is antithetical to the free discussion that the First
Amendment seeks to foster.... For corporations as for individuals, the choice to speak
includes within it the choice of what not to say. And we have held that speech does not
lose its protection because of the corporate identity of the speaker.
Id. at 16, 106 S. Ct. at 911-12 (citations and footnote omitted). Recalling that in Wooley
v. Maynard the Court had prohibited New Hampshire from requiring its citizens to "'use
their private property [their license plates] as a mobile billboard' for the State's
ideological message," the Court in Pacific Gas censured PUC for its order that Pacific
Gas use its property -- the envelopes, the bills and newsletter -- "as a vehicle for
spreading a message with which it disagrees." 475 U.S. at 17, 106 S. Ct. at 912.
Consequently, the Court vacated PUC's order as an impermissible burden because it
forced Pacific Gas to affiliate with the views of others and selected speakers for their
viewpoints. I.d. at 20, 106 S. Ct. at 914.
Pacific Gas guides this Court's analysis of the First Amendment issues here. In this case,
the First Amendment implications are even more compelling because AOL is not a public
utility, but is instead a proprietary, private online network; and because the speech the
district court's order compels AOL to carry consists of commercial advertisements, and
not the political editorials at issue in Pacific Gas. As the Pacific Gas Court held, AOL has
the constitutional "freedom not to speak publicly," 475 U.S. at 11, 106 S. Ct. at 909, and
the district court's order requiring AOL to allow Cyber access to its network in effect
"reduc[es] the free flow of information and ideas that the First Amendment seeks to
promote," ii at 13-14, 106 S. Ct. at 910. The constitution not only protects AOL's voice
but its "choice of what not to say" on its privately-owned network. This protection is
guaranteed against the type of restraint imposed by the district court, whose order has the
continuing, impermissible effect to "'enhance the relative voice' of its opponent[]," Cyber,
at AOL's expense, see Pacific Gas, 475 U.S. at 14, 106 S. Ct. at 910. "indeed this general
rule, that the speaker has the right to tailor the speech, applies not only to expressions of
value, opinion, or endorsement, but equally to statements of fact the speaker would rather
avoid.... Nor is the rule's benefit restricted to the press, being enjoyed by business
corporations generally and by ordinary people engaged in unsophisticated expression as
well as by professional publishers." See Hurley v. Irish-American Gay. Lesbian and
Bisexual Group of Boston, 115 S. Ct. 2338, 2347-48 (1995) (First Amendment was
violated by state court's interpretation of public accommodation law to require private
organization to admit parade group expressing message with which organizers disagreed).
The reasoning of Hurley and Pacific Gas controls:
Since all speech inherently involves choices of 'what to say and what to leave unsaid,'
Pacific Gas & Electric Co. v. Public Utilities Comm'n of Cal., 475 U.S. I, 11, 106 S. Ct.
903, 909, 89 L. Ed. 2d 1 (1986) (plurality opinion) (emphasis in original), one important
manifestation of the principle of free speech is that one who chooses to speak may also
decide 'what not to say.' Id. at 16, 106 S. Ct. at 912.
Hurley, 115 S. Ct. at 2347 (emphasis in original); see also Great Rivers Coop. of
Southeast Iowa v. Farmland Indus., Inc., 59 F.3d 764, 766 (8th Cir. 1995) ("Requiring
publication of a rebuttal is a form of enforced speech, which is rarely, if ever,
appropriate.").
Indeed, as the Hurley Court noted:
a private speaker does not forfeit constitutional protection simply by combining
multifarious voices, or by failing to edit their themes to isolate an exact message as the
exclusive subject matter of the speech. Nor, under our precedent, does First Amendment
protection require a speaker to generate, as an original matter, each item featured in the
communication.
Hurley, 115 S. Ct. at 2345. The state court's interpretation of the public accommodation
law in Hurley to require the private parade organizers to allow the gay group to march
unfairly compelled the organizers to "alter the message" of the parade by including a
message of which the organizers disapproved. Such a disagreement "does not legitimize
use of the Commonwealth's power" under the First Amendment. Id. at 2351.
In its memorandum dated September 18, 1996, in opposition to AOL's request for a stay
in the district court, Cyber attempts to distinguish Pacific Gas and Hurley on one and
only one ground -- that AOL is not being compelled to place any advertising on its closed
commercial system or put Cyber's bulk e-mail ads on pop-up screens viewed by AOL
customers every time they log on to AOL, but that instead "AOL is merely providing a
conduit . . . to its membership...." (Cyber Mem. at 14.) This is a distinction without a
difference. Cyber is essentially contending that because the lower court's order compels
AOL to disseminate unwanted messages in only one manner, it is in essence less
unconstitutional than if it compelled AOL to disseminate the unwanted advertising in
other manners as well. The order is impermissible even if it could be theoretically
broadened to make it even more unconstitutional. In Pacific Gas, the PUC's order was
struck down even though it was the result of an effort at compromise and even though it
compelled unwanted speech just four times a year, not six or twelve times. Significantly,
Cyber concedes that the order compels AOL to use its resources to disseminate Cyber's
mail by being "a conduit." The envelope at issue in Pacific Gas just four times a year was
also a mere "conduit," but this was more than enough to fail constitutional muster. The
same must be true here.6/
Cyber makes one other contention in opposing AOL's constitutional argument. Cyber
contends that AOL somehow waived its First Amendment rights by not seeking a court
injunction many months ago. This misses the point entirely that the abridgment of AOL's
rights does not result merely from Cyber's attempts to send unwanted bulk e-mail, but
instead from the court order compelling AOL to be Cyber's conduit and to disseminate
against its will Cyber's information. The impermissible state action is, of course, the
order, just as it was the PUC order in Pacific Gas that was at issue in that case.7/
Although AOL operates through a different medium than does the cable television
operator, this court should likewise scrutinize for First Amendment implications the
district court's Order which "affects communication of information and ideas." Cf.
Midwest Video Corp. v. F.C.C., 571 F.2d 1025 (8th Cir. 1978), aff'd on other grounds,
440 U.S. 689, 995 S. Ct. 1435 (1979); ACLU v. Reno, 929 F. Supp. 824, 872 (E.D. Pa.
1996) (Dalzell, J.) ("The Internet is a new medium of mass communication. As such, the
Supreme Court's First Amendment jurisprudence compels us to consider the special
qualities of this new medium in determining whether the [Communications Decency Act
of 1996 at issue] is a constitutional exercise of governmental power.")
The order directly impedes AOL's ability to publish that information and those ideas of
its own selection and improperly makes paramount the interests of Cyber, over those of
AOL, in distributing its speech. Under Pacific Gas and Hurley, this is clearly an error of
constitutional magnitude. The right to speak "does not include every individual's right to
be given the possibility of an audience by government fiat, or to speak in a non-public
forum." Midwest Video, 571 F.2d at 1054. Restrictions on the freedom to speak are even
more limited in a private forum, such as on AOL's network. Yet, the district court failed
to acknowledge this, and by requiring AOL to hold open its doors to allow access to
Cyber and its bulk advertising, the lower court, like the FCC, silenced AOL's First
Amendment rights.
The district court has completely ignored AOL's prerogative, as a private commercial
online service, to select its own members, determine what speech may occur on its
network and retain the option to reject unauthorized junk e-mails distributed en masse.
The "exercise of editorial control and judgment" by AOL in this case deserves no less
protection than that provided to other private communication entities. See, e.g., Miami
Herald Publ. Co. v. Tornillo, 418 U.S. 241, 258, 94 S. Ct. 2831, 2840 (1974) ("It has yet
to be demonstrated how governmental regulation of this crucial process [the exercise of
editorial control and judgment] can be exercised consistent with First Amendment
guarantees of a free press"); cf. Lehman v. City of Shaker Heights, 418 U.S. 298, 303 94
S. Ct. 2714, 2718 (1974) (plurality opinion) (no First Amendment violation where city
refused to allow certain advertising because, "[i]n much the same way that a newspaper
or periodical, or even a radio or television station, need not accept every proffer of
advertising from the general public," the city was free to reject the appellant's
advertisements).
That Cyber's messages constitute commercial speech, and indeed advertisements (some
of which contain adult content) that most of AOL's subscribers find offensive, heightens
even more the urgency of the issue. See, e.g., Pacific Gas, 106 S. Ct. at 908; Hurley, 115
S. Ct. at 2347-48. Such First Amendment freedoms, upheld consistently by the United
States Supreme Court, are clearly violated by the lower court's order. Because AOL is not
a state actor, it cannot be subject to the demands of the First Amendment. Hudgens,
supra. AOL is a privately owned company running a private online e-mail system. AOL
is neither a government agency or entity, nor a company town. It owns no public
property; performs no governmental or municipal services, functions or powers; and
exercises no governmental or municipal powers. (JA000233, Boe Decl. Para. 4.) The
mere fact that users of the Internet are able to send e-mail to AOL's subscribers,
(JA000233, Boe Decl. Para. 5), is completely insufficient under the law to render AOL's
online system a public forum, because "property does [not] lose its private character
merely because the public is generally invited to use it for designated purposes." Lloyd
Corp. v. Tanner, 407 U.S. 551, 569, 92 S. Ct. 2219, 2229 (1972); see also Greer v. Spock,
424 U.S. 828, 836, 96 S. Ct. 1211, 1216 (1976) (even if property is government owned or
operated, a public forum is not created just because "members of the public are permitted
freely to visit" there). Because the AOL online system is private property, involving no
government intervention or entanglement, AOL may properly select those users with
whom it chooses to do business. Under the Constitution, AOL may also refuse
communication access to its private property to uninvited individuals or entities.
Indeed, the Supreme Court has stated that "an uninvited guest may [not] exercise general
rights of free speech on property privately owned." Lloyd Corp., 407 U.S. at 568, 92 S.
Ct. at 2228. A speaker's rights under the First Amendment are the "weakest" where the
property at issue is privately owned. Armes v. City of Philadelphia, 706 F. Supp. 1156,
1164 (E.D. Pa. 1989), aff'd,, 897 F.2d 520 (3d Cir. 1990). The First Amendment
guarantees no absolute right to trespass, and a private property owner has the fundamental
right to exclude others. Id. Even in the context of a government activity/public forum case
where the scrutiny and test are far more stringent than here, the Supreme Court has
analyzed the mailbox issue -- an analogous situation, Cyber would no doubt claim -- in
reasoning that makes clear that Cyber has no First Amendment right at issue here, but
AOL does. See United States Postal Serv. v. Council of Greenburgh Civic Ass'ns, 453
U.S. 57, 101 S. Ct. 2676 (1981). In Council of Greenburgh, the Court rejected a First
Amendment attack of a federal statute, 18 U.S.C. Sec. 1725, which prohibited the deposit
of mail by the sender directly into a letterbox without the payment of postage, even
though the Postal Service was not being used even to deliver the unstamped mail. There,
the plaintiffs sought declaratory and injunctive relief from the Postal Service's threatened
enforcement of the statute following the plaintiffs' continual placement of unstamped
notices and pamphlets in the mailboxes of private homes. 453 U.S. at 116, 101 S. Ct. at
267879. The plaintiffs contended that the First Amendment protected their activity. 14. at
126-27, 101 S. Ct. at 2684.[8/]
In reviewing the constitutionality of the statute, the Court explained that simply because a
letterbox is part of the Postal Service's nationwide system for the delivery and receipt of
mail, it does not metamorphose into a First Amendment-protected "public forum. " Id. at
128, 101 S. Ct. at 2684-85. In using the Postal Service, customers agree to follow the
rules of the Postal Service in exchange for the Postal Service's agreement to deliver and
retrieve the customer's mail. L. The Court then rejected the argument that a First
Amendment right attached to the plaintiffs' deposit of notices and flyers in such a
letterbox because it was "more efficient" to do so, and analogized the letterbox to a
military base, see Greer v. Spock, 424 U.S. 828, 96 S. Ct. 1211 (1976), a jail or prison,
Adderley v. Florida, 385 U.S. 39, 87 S. Ct. 242 (1966), and advertising space in rapid
transit vehicles owned by a city --Lehman, supra -- properties access to which the Court
had previously held was not constitutionally guaranteed simply because they are
government-owned or controlled. Id. Moreover, there was no support in history or the
Constitution to warrant classifying the letterbox as a public forum. Like the private
property owner, the Court held, the government could also exercise its powers to protect
the property it controlled for its legally devoted uses. Id.; 9 see also Adderley, supra,
(same).
B. Cyber Cannot Meet Its Substantial Burden of Proving Likelihood of Success on the
Merits at Trial.
1. The Order Unconstitutionally Infringes AOL's First Amendment Rights.
The same authorities that compel the conclusion that the lower court's order
impermissibly compels AOL to carry Cyber's speech in violation AOL's First
Amendment rights also undermine completely the contention by Cyber that it met or can
meet its substantial burden of proving likelihood of success on the merits at trial. For the
same policies, reasons and principals articulated by the Supreme Court in Pacific Gas and
Hurley, Cyber will not meet its high burden.
Because the Supreme Court precedent clearly permits AOL to refuse Cyber's speech,
Cyber has failed to demonstrate a likelihood of success on the merits, and the preliminary
injunction should be vacated.10/
2. Cyber Has No First Amendment or Statutory Right to Send Bulk E-Mail Advertising
to AOL Subscribers Via AOL's E-Mail System.
As the owner and operator of its proprietary network, AOL has the right and authority to
establish conditions for sending advertisements to its users, and to protect its users and its
own system from unwanted bulk e-mail advertisements. This right to limit advertising on
its network flows from AOL's status as the operator of a private commercial online
service. Indeed, in the absence of a constitutional or statutory requirement that
commercial online services carry advertisements of third parties, AOL, like other
property owners, is free to determine what speech may occur on its property -- in this case
its network. For this reason, AOL may enforce the Terms of Service Agreement its users
have entered into, and may impose similar conditions upon others who choose to use its
network.
a. Cyber Has No First Amendment Right to Force its Advertising on AOL Because
AOL's Block Is Not State Action.
It is hornbook law that "the constitutional guarantee of free speech is a guarantee only
against abridgment by government, federal or state." Hudgens v. NLRB, 424 U.S. 507,
513 ( 1976). Absent state action, "the constitutional guarantee of free expression has no
part to play" where a private property owner limits expression. Id. at 521; Cable
Investments. Inc. v. Wooley, 867 F.2d 151, 161-62 (3d Cir. 1989) (cable company has no
First Amendment right to provide service to tenants in private apartment complex).
Cyber's state action claim presupposes that there is a First Amendment right to be
protected, and this is not true when it comes to Cyber's conduct at issue. There is no basis
for a claim that Cyber is engaging in protected First Amendment activity, or that its bulk
advertisements would justify constitutional protection in any event. In short, no Cyber
First Amendment right is being infringed in the first place. But even if Cyber were
arguendo to be considered to have some First Amendment right at issue, it still could not
enforce such a putative right against AOL.
AOL is plainly not a state actor. AOL is a private company whose stock was publicly
traded on the NASDAQ stock exchange. (JA000232, Boe Decl.Para. 2.)11/ It operates a
private network distinct from the Internet containing unique content, as well as offering
users unusually simple access to the Internet. (JA000232, Boe Decl. Para. 2.) Private
companies compete with AOL in this business, but the government is not even a
competitor, much less the exclusive provider of the service. (JA000232, Boe Decl. Para.
2.) Furthermore, the government has no involvement in the management of AOL, or in
AOL's business decisions, including the establishment of the company's prohibition
against unauthorized e-mail advertising. (JA000232, Boe Decl. Para. 2.)
Cyber's amended complaint offers no support for the notion that AOL or its e-mail
system are somehow state actors. It merely asserts that the Internet "was at one time used
primarily by governmental and academic institutions as a possible means of
communication if conventional communication means were rendered inactive,"
(JA000102, Am. Compl. Para. 14), while explicitly conceding, by stating that no one
owns the Internet, that the government is not the owner. The Complaint alleges no further
facts supporting state action. Cyber's only other contention on AOL's alleged status as a
state actor is that AOL has "jointly participated with the government" by "ultimately
seeking a court order" in the litigation through a trial. (Cyber Mem. at 12-13.) This
misses the critical point that the injunction, and this appeal, have absolutely nothing to do
with AOL's defenses and claims below, but instead relate solely to the court order
obtained by Cyber, not AOL, compelling the dissemination of unwanted speech by AOL.
It is Cyber, not AOL, that obtained the court order (or government participation) central
to both the injunction and the appeal.
In its initial stages, the Internet was an experiment of Advanced Research Project Agency
("ARPA") called ARPANET and linking computers and networks of belonging to the
military, defense contractors and the, labs at universities. ACLU, 929 F. Supp. at 83 1;
Shea 930 F. Supp. at 925-26. Through time, researchers around the world gained direct
access to the "supercomputers" at labs and universities, and ARPANET eventually
became the "Internet," after being linked with networks similar to ARPANET. ACLU,
929 F. Supp at 831-32; see also Shea, 930 F. Supp. at 926. No single entity -- academic,
corporate, governmental, or non-profit -administers the Internet. It exists and functions as
a result of the fact that hundreds of thousands of separate operators of computers and
computer networks independently decided to use common data transfer protocols to
exchange communications and information with other computers (which in turn exchange
communications and information with still other computers). There is no centralized
storage location, control point, or communications channel for the Internet, and it would
not be technically feasible for a single entity to control all of the information conveyed on
the Internet.
"[C]onstitutional standards are invoked only when it can be said that the [government] is
responsible for the specific conduct of which the plaintiff complains." Blum v. Yaretsky,
457 U.S. 991, 1004, 102 S. Ct. 2777, 2786 (1982) (emphasis in original). As the Third
Circuit explained in Groman v. Township of Manalpan:
A private action is not converted into one under color of state law merely by some
tenuous connection to state action. The issue is . . . whether the action taken can be fairly
attributed to the state itself. Jackson v. Metropolitan Edison Co., 419 U.S. 345, 351, 955
S. Ct. 449, 453, 42 L.Ed.2d 477 (1974). As the Supreme Court has stated, "we ask
whether the State provided a mantle of authority that enhanced the power of the harm-
causing individual actor." NCAA v. Tarkanian, 488 U.S. 179, 192, 109 S. Ct. 454, 462,
102 L.Ed.2d 469 (1988).
47 F.3d 628, 638-39 (3d Cir. 1995).
The Third Circuit analyzes state action questions through three discrete tests used in
various Supreme Court state action decisions. These are:
(1) Does the private entity exercise powers that are traditionally the exclusive prerogative
of the state.
(2) Has the private entity acted with the help of or in concert with state officials. [and]
(3) Has the state so far insinuated itself into a position of interdependence with the private
entity that it must be recognized as a joint participant in the challenged activity.
Sullivan v. Barnett, 913 F. Supp. 895, 899 (E.D. Pa. 1996) (summarizing Mark v.
Borough of Hatboro, 51 F.3d 1137, 1142-43 (3d Cir. 1995), cert. denied, 116 S. Ct. 165
(1995)). AOL is clearly not a state actor under any of these standards.
The exclusive government function standard "is limited, reaching only those activities
that have been 'traditionally the exclusive prerogative of the State.'" Groman, 47 F.3d at
640 (quoting Rendell-Baker v. Kohn, 457 U.S. 830, 842 (1982)) (emphasis in original).
As this Court recently noted, "[t]he [Supreme] Court . . . [has] rarely found that plaintiffs
had met that rigorous standard." Mark, 51 F.3d at 1142. Receiving government support or
performing a public function are insufficient to make an entity a state actor. Groman, 47
F.3d at 640. Even heavily regulated utilities with at least partial monopoly statue,12/
private government-funded schools providing special education of maladjusted high
school students,13/ or private contractors providing school bus transportation for public
school students14/ have been held not to be engaged in an "exclusive" government
function. Mark, 51 F.3d at 1142. Proprietary network services, including e-mail, are not
even a government function, and come nowhere near satisfying the exclusive government
function test.
Nor does the amended complaint allege that AOL "'acted with the help of or in concert
with state officials.'" Id. (quoting McKeesport Hosp. v. Accreditation Council for
Graduate Medical Educ., 24 F.3d 519, 524 (3d Cir. 1994)). It is undisputed that AOL's
policy with regard to unauthorized e-mail was its own; not the government's.15/ And
there has been no evidence offered in the lower court to suggest that AOL has received
any government support in its dispute with Cyber, in any way, shape or form. Nor could
there be such evidence. since the only conduct at issue and complained of by Cyber is
AOL's, not the government's, and indeed AOL's attempt to rid itself of Cyber by self-help
has been the frequent subject of Cyber complaints and criticisms. (JA000021, Cyber's
Complaint Para. 38 and JA000107, Amended Complaint Para. 38.) As noted above, the
only government participation in the form of a court order was that obtained by Cyber,
not AOL. In any event, even if Cyber could, arguendo, point to alleged government
assistance, and it cannot, there has never been a credible claim from Cyber that the level
of such government activity would ever rise to the level constitutionally required by this
Court of "coercive power" or "such significant encouragement . . . that the choice must in
law be deemed that of the State." Boyle, 925 F.2d at 76.
Finally, AOL is not a state actor under the joint participation test. The test applies to
"situations in which '[t]he State has so far insinuated itself into a position of
interdependence with . . . [the acting party] that it must be recognized as a joint
participant in the challenged activity.'" Mark, 51 F.3d at 1142 (quoting Burton v.
Wilmington Parking Auth., 365 U.S. 715, 725 (1961)); see also Groman, 47 F.3d at 628
("[T]he interdependence between the state and private actor must be pronounced before
the law will transform the private actor into a state actor."). There are no record facts that
in no way support a theory that the government was a joint participant in AOL's policy
regarding unauthorized e-mail communications or its response to them. Indeed, the
amended complaint fails even to mention the government once amid its lengthy
allegations about the conduct giving rise to its injury. (JA000105-110, Am. Compl. at
Paras. 31-55.) Because Cyber does not allege, and has obviously failed to prove, that the
"Government can or does exert any influence over" AOL's policies with respect to
unauthorized e-mail, this theory too is entirely inapposite. See San Francisco Arts &
Athletics v. U.S. Olympic Comm., 483 U.S. 522, 547 n.29, 107 S. Ct. 2971 n.29 (1987)
(no government action where federal government did not control the allegedly
discriminatory actions of the U.S. Olympic Committee); Groman, 47 F.3d at 642 (finding
that government-funded rescue squad did not act under color of state law because it "did
not have its professional decisions dictated or guided by the State.").16/
For all these reasons, AOL is not a state actor, and Cyber has no First Amendment right
to send unauthorized bulk e-mail advertisements to e-mail addresses on AOL's
network.17/
b. Cyber Has No Statutory Right to Advertise on AOL's System.
Cyber also has no statutory right to send bulk e-mail to and through AOL's system.
Congress has declined to make proprietary network service providers and Internet service
providers common carriers subject to regulation under Title II of the Telecommunications
Act. Indeed, in the Telecommunications Act of 1996, Congress expressly stated that "It is
the policy of the United States . . . to preserve the vibrant and competitive free market
that presently exists for the Internet and other interactive computer services, unfettered by
Federal and State regulation." 47 U.S.C. Sec. 230(b) & (b)(2) (emphasis added).18/ This
statement is consistent with FCC treatment of proprietary network providers and Internet
service providers as enhanced services exempt from common carrier regulation under 47
C.F.R. Sec. 64.702(a). Thus, neither proprietary network service providers. such as AOL,
nor Internet service providers are under a regulatory or statutory obligation to offer
carriage to individuals or entities that wish to send e-mail over their systems.
In fact, far from imposing common carrier obligations on proprietary network and
Internet service providers, Congress gave these providers immunity from civil liability
under state and federal law for restricting access to harassing or objectionable content.
This grant of immunity applies broadly to "any action voluntarily taken in good faith to
restrict access to or availability of material that the provider . . . considers to be . . .
harassing, or otherwise objectionable, whether or not such material is constitutionally
protected." 47 U.S.C. Sec. 230(c)(2)(A).[19/] Plainly, therefore, AOL is under no
statutory obligation to carry Cyber's unauthorized, bulk e-mails.
B. Cyber Failed to Meet its Burden of Proof of Irreparable Harm Without the Injunction.
Before the district court, Cyber did not prove that it would suffer irreparable harm if AOL
refuses to permit it to continue to bombard AOL with e-mail. At most, Cyber alleged that
the injunction was necessary to prevent Cyber from losing money before trial. It is well
settled that " [e]conomic loss does not constitute irreparable harm." Acierno v. New
Castle County, 40 F.3d 645, 653 (3d Cir. 1994). In order to warrant a preliminary
injunction, "the injury created by a failure to issue the requested injunction 'must be of a
peculiar nature, so that compensation in money cannot atone for it.'" Id. (citation
omitted). Moreover, "more than a risk of irreparable harm must be demonstrated. The
requisite for injunctive relief has been characterized as a 'clear showing of immediate
irreparable injury.'" Continental Group, Inc. v. Amoco Chems. Corp., 614 F.2d 351, 358
(3d Cir. 1980) (citation omitted).
Here, even if Cyber could prove that it would be likely to succeed on the merits -- which
it plainly has not and cannot -- its claim for injunctive relief should have been rejected
because Cyber did not (and cannot) show that AOL's conduct will cause it irreparable
harm. As an initial matter, according to a recent profit and loss statement produced by
Cyber, (JA000449-452), more than half of Cyber's revenues this year have been derived
from activities that do not involve the dissemination of junk e-mail. Moreover, according
to Mr. Wallace's testimony at his deposition, Cyber's mailing list includes the addresses
of more that 300,000 people who are not AOL customers. And, according to Mr.
Wallace, this number of non-AOL addresses is increasing daily. Cyber's ability to send its
e-mail to these hundreds of thousands of people is not affected at all by AOL's refusal to
receive Cyber's e-mail. At best, therefore, Cyber might show that its inability to send e-
mail to AOL's customers will cost it some money. It cannot credibly contend that AOL's
conduct will cause it harm that could not be compensated by money damages. Cyber has
never contended that AOL does not have the revenue or resources to pay a judgment if,
arguendo, Cyber could even obtain one against it.
Cyber has recently contended that although it is capable of circumventing AOL's attempts
to block it from sending block commercial e-mail to AOL members, it still has a right to
the injunction so that it is not "forced into a losing cat and mouse game in which AOL
blocks the mail from one site, Cyber must then scramble to find a way to get out its mail
from another site. only to find that AOL will then block the new site." (Cyber Mem. at
18.) Cyber concedes, then, that even AOL's persistent efforts at blocking it at most
prolong what Cyber characterizes as a "game." This is not a game. It has cost, damage,
inconvenience and burden to AOL and its members. But the mere fact that Cyber admits
that it can circumvent the block, even while expending resources to do so, betrays the fact
that AOL's block could not possibly have imposed irreparable harm on Cyber, and its
statements to the court below to the contrary were, to be most generous, premature and
over-stated. Therefore, Cyber cannot prove that AOL's conduct will cause it harm "'of a
peculiar nature, so that compensation in money cannot atone for it ....'" Acierno, 40 F.3d
at 653 (citations omitted).
C. AOL Suffers Tremendous Harm Each Day the Injunction Remains in Force.
As discussed above, AOL's important First Amendment freedoms have been blatantly
undermined as a result of the lower court's order forcing AOL to publish Cyber's get-rich-
quick schemes, miracle diet come-ons, adult videos, and other unsolicited commercial
advertisements. This is per se irreparable harm, which in itself renders erroneous the
lower court's apparent conclusion that the harm to AOL is somehow less compelling than
the alleged harm Cyber claims would result without the injunction. The United States
Supreme Court put it succinctly: "The loss of First Amendment freedoms, for even
minimal periods of time, unquestionably constitutes irreparable injury." Elrod v. Burns,
427 U.S. 347, 96 S. Ct. 2673, 2690 (1976) (emphasis added); see also Shea, 930 F. Supp.
at 935 (same; construing Communications Decency Act section making criminal the
sending or displaying of certain sexual material); ACLU, 929 F. Supp. at 851 (same).
In addition to the continuing abridgment of AOL's constitutional rights, AOL suffers (on
a daily basis, millions of messages at a time) tremendous damage to its good will and
reputation. Good will and reputation are precious commodities whose importance cannot
be overstated and, importantly, damage to which is difficult, if not impossible, to restore.
Moreover, because the facts developed thus far indicate that Cyber may very well be
judgment- proof, any later award of money damages against Cyber would be
meaningless. This problem is further compounded by the lower court's failure to require
Cyber -- a company that admits to substantial revenue, numerous non-AOL customers,
the ability to overcome any AOL block of Cyber's e-mail through its self-described "cat
and mouse games", and even some cash on hand -- to post a meaningful bond. With each
passing day, AOL suffers incalculable damage to its good will and reputation and
ongoing abridgment of its First Amendment freedoms. On the facts and the law, this
criterion for the grant of injunctive relief, the extent to which the party bound by the
proposed injunction will be harmed, clearly weighs heavily in favor of lifting the
injunction.
D. The Public Interest Clearly Favors Lifting the Injunction.
Cyber cannot show that granting its motion for a preliminary injunction would be in the
public interest. Abridging First Amendment rights and forcing AOL and millions of its
customers to be subjected, on a daily basis, to unwanted advertisements for aphrodisiacs,
"Dream Girls" adult videos, and get-rich-quick schemes is hardly in the public
interest.20/
Cyber's very recent attempt to trivialize the public policy impact of the lower court's
order on AOL by characterizing it simply as an "opt on/opt off" issue is overly simplistic
and disingenuous. First, the lower court's order fails to define who bears the burden of
determining the few AOL customers who allegedly "wish" to receive the bulk e-mail, but
given the way the computer hardware and software work, AOL does not have the
technical ability to make the cut for Cyber. Second, even if AOL had the hypothetical
technical capability, no doubt Cyber would interpret the vague order differently than
AOL and further litigation would result. Although the scope of the lower court's order is
imprecise, the implications of AOL's action that could later be adjudicated a mix-step in
violation of the order by the lower court are enormous. Third, not even the "opt off"
procedure Cyber touts actually works. The complaints from the many who repeatedly
attempt to opt out and still get barraged by Cyber are legion. (JA000416-444.) Fourth, not
even the so-called opt off procedure can eliminate or even lessen the tremendous
hardware and software expense and damage occasioned by Cyber's mass of
undeliverables, which use up precious AOL resources regardless of whether they can
ultimately be returned to Cyber.
And finally, as a constitutional matter, Cyber has no First Amendment right to force AOL
by court order to impose an opt out task on its proprietary system's customers. This would
impose a costly and time-consuming burden on both AOL and its customers, with
nonexistent or de minimis probative value in any event. It does not follow that just
because AOL states that its opt out procedure works that it does work. In fact, it does not.
(JA000410, Knowles Decl. Para. 6.) The opt out procedure would necessitate the use of
AOL resources for free to Cyber at least once for each AOL member. The old "one free
bite" rule from dog bite cases, see, e.g., Deardorff v. Burger, 414 Pa. Super. 45, 606 A.2d
489, alloc. denied, 532 Pa. 655, 615 A.2d 1312 (1992), does not apply here. And even if a
member did not affirmatively respond or attempt to respond to the putative opt out offer,
that does not mean that the member actually desires to receive the bulk e-mail,
relentlessly, every day. It is likely to mean that the customer is simply switching to an
AOL competitor rather than fight on his or her own with Cyber. Accordingly, the public
interest factor, too, weighs against granting Cyber a preliminary injunction.
E. In any Event, for Procedural Reasons Alone, the Lower Court's September 5 Order
Should be Immediately Vacated.
As discussed above, the four factors that the lower court was required to consider in
determining whether to enter a preliminary injunction against AOL all weigh strongly in
favor of denying the injunction request. Therefore, the injunction should be immediately
vacated, and the record set straight that AOL's ability to adopt and enforce its owns
policies and procedures for the use of its own proprietary computer network shall remain
unhindered by the lower court pending a full trial on the merits. Just as significantly,
however, because of the manner in which the lower court heard and ruled upon Cyber's
injunction request, the order entering the injunction is procedurally defective, which in
itself compels that the order be promptly set aside.
Except in the most unusual cases, Rule 65 of the Federal Rules of Civil Procedure
requires the Court to conduct a hearing on an application for a preliminary injunction. See
1 lA Charles A. Wright et al., Federal Practice and Procedure Sec. 2947 (2d ed. 1995). A
district court should decline to hold a hearing and decide a motion for a preliminary
injunction on affidavits and documentary evidence only when the facts are undisputed
and the relevant factual issues are resolved. See Bradley v. Pittsburgh Bd. of Educ., 910
F.2d 1172, 1175-76 (3d Cir. 1990). Here, on Friday, August 30, after giving AOL less
than an hour's notice that it intended to seek injunctive relief, Cyber made its motion for a
temporary restraining order and preliminary injunction orally during a telephone
conference with the Court between approximately 10:30 and 11:00 a.m. The Court then
ordered that the parties submit briefs and affidavits on the motion before the end of the
day. Moreover, AOL never had the opportunity to respond to any arguments made by
Cyber or to contest the self-serving, one-sided affidavit of Cyber Promotion's President,
Sanford Wallace, even though Cyber had the burden of proof on all elements for
extraordinary injunctive relief. On approximately four hours' notice, simultaneous briefs
were required to be filed and served. The trial judge announced that he would rule before
the close of the day that very same day. On Tuesday, September 3, when an order had not
yet been received. AOL's counsel called the lower court's chambers and inquired whether
the Court would like to receive additional evidence before deciding the motion. The
Court declined, advised that it would issue an order that day or the next, and instead
granted the preliminary injunction. without a hearing and without live testimony, shortly
thereafter.
"Rule 52(a) requires that in granting or refusing a preliminary injunction the court must
set out the findings of fact and conclusions of law constituting the grounds for its action."
11A Wright, et al., supra Sec. 2949 (emphasis added). As stated by this Court, "[t]he
language of the Rule is mandatory." Bradley, 910 F.2d at 1178 (emphasis added). Where,
as here, the trial court has entered a preliminary injunction without setting forth findings
of facts and conclusions of law, the order entered on the motion should be vacated. Id.;
see also Professional Plan Examiners of New Jersey, Inc., et al. v. Joseph A. Lefante, et
al., 750 F.2d 282, 289 (3d Cir. 1984) (a one-page order stating the four elements that
must be proved for injunctive relief and stating that the plaintiffs met them is "inadequate
to support a preliminary injunction;" therefore, the order entering the injunction was
vacated for failure to set forth adequate findings of fact and conclusions of law); Newark
Stereotypers' Union No. 18 v. Newark Morning Ledger Co., 353 F.2d 510 (3d Cir. 1965)
and Bateman v. Ford Motor Co., 310 F.2d 805 (3d. Cir. 1962).
Although the order contains the words "temporarily restrain," which might otherwise
suggest that it was a temporary restraining order and not a preliminary injunction, the
order clearly is an injunction. It has the effect of an injunction. It lasts for at least two and
one-half months, and possibly substantially longer. The lower court provided no hearing,
and did not set forth findings of fact or conclusions of law as mandated by Rule 52(a). As
stated by this Court in Sims v. Greene, 160 F.2d 512 (3d Cir. 1947):
When a restraining order, purporting to be temporary is continued for a substantial length
of time past the period prescribed by Section 381 of 28 U.S.C.A. without the consent of
the party against which it issued and without the safeguards prescribed by Rule 65(b) it
ceases to be a "temporary restraining order" within the purview of that section and
become a preliminary injunction which cannot be maintained unless the court issuing it
sets out the findings of fact and the conclusions of law which constitute the grounds for
its action as required by Rule 52(a).
Id. at 517; see also Samson v. Murray, 415 U.S. 61, 86, 94 S.C. Ct. 937, 951 (1974) ("a
temporary restraining order continued beyond the time permissible under Rule 65 must
be treated as a preliminary injunction, and must conform to the standards applicable to
preliminary injunctions").
The affidavits and briefs filed in the court below reveal that there are clearly numerous
disputed issues of material fact. Nevertheless, the lower court entered a sweeping
preliminary injunction without conducting a hearing. AOL never had the opportunity to
respond to Cyber's brief or to cross-examine the sole witness relied upon by Cyber in its
request for an injunction. Until the lower court issued its ruling enjoining AOL for
months from protecting its computer network, AOL did not even know that the lower
court had decided to treat the oral motion from Cyber as a preliminary injunction request,
and not a request for a mere 10-day temporary restraining order. Further, the court issued
no findings of fact or conclusions of law in support of its order granting the injunction.
Finally, the notions now raised by Cyber that the lower court can even now cure its
procedural failures and that AOL is required to have sought reconsideration fly in the face
of the applicable rules (Cyber Mem. at 1-2, 7), would have potentially dire ramifications
in practice, and are just plain wrong. Regarding Cyber's claim that belated findings and
conclusions are appropriate, this very issue was addressed by the court in Chemlawn
Servs. Corp. v. GNC Pumps, Inc., 823 F.2d 515 (Fed. Cir. 1987). There, the district court
granted a preliminary injunction without issuing findings of fact and conclusions of law.
Four days later, the party burdened by the injunction filed a notice of appeal. Later, the
district court issued "findings of fact and conclusions of law purportedly supporting its"
prior preliminary injunction. 823 F.2d at 516. The court of appeals held that the district
court's after-the-fact findings and conclusions failed to remedy the procedural defect:
that the District Court eventually and belatedly entered findings of fact and conclusions
of law on February 3, 1987, did not cure the defect of failing to do so at the time the
preliminary injunction first issued and cannot effectively legitimate that injunction.
Id. The court further held that because the case was on appeal, the district court had no
jurisdiction over the matter, and therefore, its belated findings and conclusions had no
effect:
the District Court's delay in entering its finding of fact and conclusions of law is defective
for another reason. By delaying until February 3, 1987, the court attempted to act at a
time when it no longer had jurisdiction over the case because GNC had already filed a
notice of appeal to this court.... In this instance, the District Court clearly lost the
jurisdiction on November 18, 1986 when GNC filed a notice of appeal to this court. It
could not properly issue findings of fact on or after that date and this court cannot
properly consider them.
Id. Accordingly, the Court of Appeals vacated the preliminary injunction.21/ Likewise,
any attempt by the lower court in this case to legitimate the injunction by entering post-
appeal findings and conclusions would be error, and cannot prevent the injunction from
being vacated.
The lower court had no hearing and afforded AOL no opportunity to cross- examine the
author of the sole evidence on the injunction from Cyber. AOL did not even see a form of
proposed order, let alone any findings of fact or conclusions of law after the fact. Each
day that the Cyber motion was pending was the day the parties were told an order would
be issued, but never that it would be an injunction in force until trial. To suggest, as
Cyber has now done, (Cyber Mem. at 7), that the lower court can now file findings and
conclusions makes a mockery of Rule 52 and disregards the substantial efforts undertaken
on the appeal and appellate briefing already. If Federal Rules of Civil Procedure 52(a)
and 65 have any meaning at all, Cyber's contention that they can be ignored and belatedly
paid lip service to must be summarily rejected.
As for Cyber's contention that AOL had to or should have sought "clarification" after the
fact, this too is neither supported by the appellate or civil rules, nor of any significance
given the extremely broad wording of the order. The "clarification" contention is merely
another name for stating that AOL should have sought reconsideration. This is not a
prerequisite to appeal, and in a constitutional infringement case, it would be especially
inappropriate. The second prohibition in the order -- precluding AOL from "interfering in
any manner with Cyber's business relationships with its Internet Service Providers" --
essentially straightjacketed AOL from exercising its business judgment in dealings with
third parties that have the capacity to do substantial, costly damage to AOL. This was
entered against AOL without so much as a single ISP offering on admissible statement
against AOL and in support of Cyber, let alone AOL having the right to cross-examine
the ISP in a hearing of any type.
These are important, fundamental defects relating directly to the extraordinary injunctive
relief at issue, and the lower court's failure to comply with the Federal Rules of Civil
Procedure renders the Order entering the injunction patently defective.
CONCLUSION
For all of the foregoing reasons, America Online, Inc. respectfully requests that this Court
vacate the lower court's injunction entered September 5, 1996.
Respectfully submitted,
/s/
Ronald P. Schiller
Joseph Kernen
David L. Weinreb
Catherine Stuart Magargee
Attorneys for Appellant,
America Online, Inc.
PIPER & MARBURY L.L.P.
3400 Two Logan Square
18th and Arch Streets
Philadelphia, PA 19103
215-656-3300
Michael A. Grow
VORYS, SATER, SEYMOUR & PEASE
1828 L. Street, N.W.
Suite 1111
Washington, DC 20006
202-467-8800
Of Counsel.
September 20, 1996.
CERTIFICATE OF BAR MEMBERSHIP
I certify that I am a member in good standing of this Court.
/s/
Ronald P. Schiller
ENDNOTES
1/ Cyber's activities have also been compared to the conduct of a telemarketer. This
analogy too must fail for many of the same reasons. Furthermore, a more apt analogy
would be to a telemarketer who calls collect while depriving the recipient of the ability to
reject the call or the charges.
2/ Given the oral nature of the request, by telephone, from counsel for Cyber to the court
below, the hurried nature of the briefing, and the lack of even a proposed form of order
below in accordance with Eastern District Local Rule 7.1 (a) or a request from Cyber for
a hearing under Fed. R. Civ. P. 65, it was not at all clear whether Cyber was requesting a
TRO or a preliminary injunction. Moreover, it is not uncommon for a party who wants
immediate injunctive relief to fashion the request as a motion for a TRO "and" a
preliminary injunction. In any event, AOL did not expect the lower court to treat the oral
request, four-hour briefs, and hastily prepared declarations before the holiday weekend as
the equivalent of an injunction hearing, as noted by counsel for AOL in a letter to the
lower court before the order was entered. (JA000461-462.) Indeed, when the lower court
directed the filing of the briefs and declarations, it announced that given the shortness of
time, "ballpark" figures and calculations on damages would be adequate. It also promised
to provide a quick ruling that very same day.
3/ Cyber filed on September 18, 1996 in the district court and in this court a
memorandum opposing AOL's request for a stay of the order in the district court. That
memorandum is referred to in this brief as "Cyber Mem. at _."
4/ Cyber's recent contentions -- again, in its September 18th district court memorandum --
that there was the equivalent of a hearing, that AOL should seek "clarification" or
reconsideration, and that now the trial judge simply should enter findings and conclusions
conveniently just provided by Cyber -- ignore the facts, timing, briefs, and letters that
indisputably show the real sequence of events, would make a mockery of the
requirements of the Federal Rules of Civil Procedure, the Appellate Rules of Civil
Procedure, and the local rules of both the district court and court of appeals, and would
impose procedural obstacles to appeal that simply fail to exist anywhere other than in
Cyber's briefing.
5/ Conversely, in the Cyber/AOL situation, there is no "extra space" because all e-mail
uses computer hardware and software resources of AOL, (JA000237-238, O'Donnell
Decl. Paras. 11 and 14), and AOL subscribers pay for their use, or use up "free time" they
would otherwise use for desired activities by virtue of Cyber's substantial mailings. So,
the cost to AOL and its subscribers with every bulk e-mail transmission is both
pecuniary, as well as constitutional, and hence even stronger than in Pacific Gas.
6/ Cf., Midwest Video Corp. v. F.C.C., 571 F.2d 1025 (8th Cir. 1978), aff'd on other
grounds, 440 U.S. 689, 99 S. Ct. 1435 (1979). There, in the different context of a cable
company, the Eighth Circuit reiterated the basic principle that the First Amendment does
not guarantee every person a right to speak in every situation: "Every individual's right to
speak, precious and paramount as it is, does not include every individual's right to be
given the possibility of an audience by government fiat, or to speak in a non-public
forum, like a newspaper, a magazine, or on the Senate floor." Id. at 1054.
7/ Cyber also seems to argue in passing that AOL's appeal rights were compromised
because AOL waited "eight days" before pursuing the appeal. First, AOL acted well
within its rights in responding to the injunction, initially phrased in terms of a TRO but
obviously intended by the lower court to be in force for several months, after carefully
considering its rights under the Federal Rules of Appellate Procedure and engaging in
discussions at the highest corporate level. Second, the Appellate Rules clearly provide
that an appeal filed a week or so after an injunction is entered is timely. Third, AOL was
not required to seek reconsideration before taking what it considered to be the most direct
route of constitutional redress. And, in any event, the appeal was taken on the morning of
the seventh day after the lower court's order was entered (not the eighth day) and, in view
of the briefing required, the preparation of motions deemed to be appropriate in both
courts, and the importance of the issues, as expeditiously as possible under the
circumstances.
8/ In dicta, the Court recognized that if plaintiffs wanted to use the mails to distribute
their notices, they would have to pay the proper postage, just as all other Postal Service
patrons must do to use the mails. Id at 127, 101 S. Ct. at 2684.
9/ In a footnote, the Court rejected, as lacking support and too "sweeping," a dissenting
justice's proposition that an instrumentality like a mailbox becomes a public forum
because it "'is used for the communication of information and ideas'" and is then subject
to reasonable time, place and manner restrictions. Council of Greenburgh, 101 S. Ct. at
2685 n.6. Indeed, just because the army base cafeteria bulletin board was "'specifically
used for the communication of information and ideas'" did not any more transform the
bulletin board into a public forum than the street corners and parking lots on a military
base held not to be public fora. Id., (citing Greer v. Spock, 424 U.S. 828, 96 S. Ct. 1211
(1976))
10/ Another recent contention of Cyber (Cyber Mem. at 10) -- that success on the merits
is demonstrated by its tortious interference claim -- is not backed by a single reference to
proof on the record. This is not surprising, as any first-hand, admissible evidence of
AOL's alleged impermissible interference with ISP's would have to come from either the
third-party ISP's or AOL itself, if it arguendo existed, and Cyber has not provided a single
affidavit, deposition excerpt, sworn statement or admission in support of these claims, let
alone enough to support an injunction.
11/ Indeed, it is now a matter of public record that as of September 16, 1996, AOL
switched to the Big Board, and is now publicly trading on the New York Stock Exchange.
12/ See Jackson v. Metropolitan Edison Co., 419 U.S. 345, 95 S. Ct. 449 (1975)
(privately owned and operated electric utility holding certificate of public convenience
not state actor).
13/ Rendell-Baker, 457 U.S. at 842.
14/ Black v. Indiana Area Sch. Dist., 985 F.2d 707, 710-11 (3d Cir. 1993).
15/ Before the Mark decision, the Third Circuit on occasion described this test as the
"nexus approach," rather than the "in concert approach" referred to in Mark. See Groman,
47 F.3d at 639; Boyle v. Governor's Veterans Outreach & Assistance Ctr., 925 F.2d 71,
76 (3d Cir. 1991). The result of the "nexus appoach"[sic] is no different, because the test
is satisfied "only when [the State] has exercised coercive power or has provided such
significant encouragement, either overt or covert, that the choice must in law be deemed
that of the State." Boyle, 925 F.2d at 76 (quoting Blum v. Yaretsky, 457 U.S. at 1004).
16/ Here again, even extensive government support and/or regulation and performance of
a public function -- if they existed, which they do not -- would not make AOL a state
actor. Id
17/ Any contention that AOL is a state actor because the Federal Networking Council
"jointly established" the Internet Assigned Numbers Authority ("IANA"), which assigns
Internet addresses and domain names, should be rejected. This argument fails to establish
state action because, even assuming that IANA were a governmental entity (which it is
not), its assigning Internet addresses and domain names to AOL and AOL's customers is
a "wholly neutral and ministerial act" and it is completely unrelated to AOL's policies
regarding unauthorized bulk e-mail advertising. See Robison v. Canterbury Village, Inc.,
848 F.2d 424, 428 (3d Cir. 1988). Cyber has never ever alleged, let alone introduced
evidence in support of, the notion that the assignment of Internet addresses or domain
names to AOL has anything to do with this case or AOL's alleged conduct at issue.
18/ Congress has defined the term "interactive computer service" broadly to encompass
the activities of Internet and proprietary network providers. See 47 U.S.C. Sec. 230(e)(2).
19/ There are also statutes that define as a crime the knowing transmission of data
electronically in a manner that falsely identifies, inter alia the person transmitting such
data. See, e.g., Georgia Computer Systems Protection Act, Ga. Code Sec. 16-9-93.1 (July
I, 1996). Cyber has stipulated to an injunction against itself for just such activity.
(JA000092-94.) Plainly, then, far from being authorized by statute, Cyber's conduct is, at
least in part, arguably criminal.
20/ Cyber's latest, post-hoc contention that its bulk transmissions constitute "newsletters,"
(JA000139), because it now intends to add a line or two of non-advertising to each multi-
page transmission is unsupported by the record evidence, does not change the fact that
AOL still is not a state actor, regardless of the message content, and ignores the fact that
AOL and its customers suffer just as much regardless of whether Cyber adds a line of
self-serving text to its transmissions. Ironically, the timing makes the conclusion
inescapable that this is nothing more than a transparent attempt to cloak pure commercial
speech in alleged non-commercial clothing, sparse and tattered though it may be.
21/ The two cases cited by Cyber in support of its erroneous contention that the lower
court may at this late date issue findings and conclusions in support of the preliminary
injunction are distinguishable. In United States v. Ingersoll-Rand Co., 320 F.2d 509 (3d
Cir. 1963), the Third Circuit upheld a preliminary injunction supported by findings of fact
and conclusions of law issued after the injunction but before the case had been appealed.
Of course, any findings or conclusions by the lower court in this case would be after the
appeal. Regarding Gibbs v. Buck, 307 U.S. 66, 59 S. Ct. 725 (1939), Cyber is correct that
the lower court's findings of fact and conclusions of law were not entered until after the
injunction was issued and before the hearing on the appeal. However, unlike the instant
case, the appellant in that case did not raise an objection to the lack of findings and
conclusions until after the court rendered them: "[N]o assignment of error was made on
account of the fact that the findings were out of time. " L. at 78, 69 S. Ct. at 732. Instead,
appellant waited until after the lower court rendered its findings and conclusions before
first raising an objection.
|
|
LEGAL DOCUMENTS | HOMEPAGE | VERDICTS | FAMOUS CASES | TRIAL TRACKING | PROGRAM GUIDE | CTV STORE | GAMES/CONTEST | LEGAL TERMS | SEARCH | INDEX | HOW TO GET CTV | COMMENTS
|