The complaint in Jonathan Tasini’s class-action lawsuit against the Huffington Post, owner AOL, and founder Arianna Huffington has been posted online.
I’ve gone through it. If you don’t feel like reading the whole thing, here are excerpts I’ve transcribed that I think capture the essence of the complaint. (Italicized portions are my own paraphrasing. Otherwise, it’s quoted material.) As you’ll see, I’ve interspersed my own thoughts.
JUDGE GRIESA 11 CV 2472
IN THE UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
Jonathan Tasini, individually and on behalf of all others similarly situated, Plaintiffs, v. AOL Inc., TheHuffingtonPost.Com, Inc., Arianna Huffington and Kenneth Lerer, Defendants.
This action seeks to vindicate the fundamental principle that creators of value deserve to be compensated and, in particular, addresses the important issues of (a) whether in the digital age, profitable digital media sites should be required to compensate the creators of valuable content from which such sites derive substantial revenues and (b) if so, how the creators of content should be compensated.
Of the $315 million paid by AOL to purchase HuffPo, at least $105 million was due to the contribution of content by the unpaid bloggers.
… TheHuffingtonPost.com’s continued assertion that it, alone, should be enriched by the valuable content provided by Plaintiff and the Classes has the broad detrimental effect of setting an artificially low price for the valuable digital content created by Plaintiff and the Classes, depressing the market for such content and, over the long term, having a serious depressing effect on the value of intellectual content being created by Plaintiff and the Classes and on the ability of Plaintiff and the Classes to support themselves as creators of high quality, engaging, digital content. According to Article 1, Section 8 of the United States Constitution, the purpose of copyright is “to promote the Progress of Science and the useful Arts” by allowing creators to be appropriately compensated for their contributions. Yet, despite our founders’ intent, TheHuffingtonPost.com continues to assert that it, alone, should be enriched by the valuable content provided by Plaintiff and the Classes.
This leads me to one of the problems with this lawsuit. Should Tasini be successful with is unjust enrichment argument, which I don’t think he will be, he is vulnerable to a copyright pre-emption argument. That is, AOL and Arianna can argue that Congress’s legislation in this vein cuts off common-law causes of action that might otherwise exist. In fact, I think it was a bad choice for Tasini and his attorneys to put this reference to copyright and the Constitution in here; it just wraps up the pre-emption argument with a bow.
¶¶11, et seq.:
Bio of Tasini: Union leader, social activist, writer on work/labor issues, successful U.S. Supreme Court litigant.
Arianna, can there be any surprise that this guy ended up suing you with a résumé like his?
There are approximately 9,000 unpaid content providers at TheHuffingtonPost.com
That makes it ripe for a class action, provided other elements are met …
Jurisdiction and venue. Allegations to create subject-matter jurisdiction under the Class Action Fairness Act of 2005 and establish the appropriateness of filing the litigation in federal court in New York.
… Defendant Arianna Huffington’s statements indicate her own belief that the creators of content should be fairly compensated for the value provided.
For example, in her book “Third World America” (Crown 2010), Ms. Huffington … states: “… The middle class, by and large, plays by the rules, then watches as its jobs disappear. The corporate class games the system – making sure its license to break the rules is built into the rules themselves.”
Towards the conclusion of “Third World America,” Ms. Huffington writes that to avoid a “Third World America,” she believes the nation needs to make certain it is “a place where economic opportunity is once again real for everyone, not just the economic elite” and “a place where greed and selfishness are no longer rewarded and the ‘least among us’ are given a helping hand, rather than the back of it.” (page 237).
That’s pretty funny. She’s something like the opposite of a “victim of her own success.” That is, Arianna is basically a “beneficiary of her own failure.” Well, okay, you can accuse limousine liberals of being hypocrites. You can wave at them through the tinted windows. But they are just going to drive off to the next black-tie fundraiser you’re not invited to.
HuffPo is unlike other media outlets in that HuffPo selects its content providers and does not allow content from non-vetted providers.
Plaintiff and the Classes were not officious contributors to the TheHuffingtonPost.com and, rather, were carefully selected, and in some cases recruited, by TheHuffingtonPost.com to perform services for it.
One of the purposes of those allegations, I suppose, would be to defeat sky-is-falling type arguments that HuffPo might make, such as, “Your Honor, if you award compensation to Tasini and the HuffPo unpaid bloggers, you’ll open it up for people to employ themselves by stuffing sites with unsolicited content and then sending the site owners a bill.”
… the vast majority of the Classes’ members, like Plaintiff, are quasi-professional writers, meaning that they occasionally earn fees for their writing, but it was not their principal occupation. …
Executives of AOL noted that $20 million in “cost savings” would be recognized by AOL due to TheHuffingtonPost.com’s history of not compensating Plaintiff and the Classes for high quality content. …
Allegations about “The AOL Way” document discussing how each post is tracked and evaluated in terms of the cost required to produce it and the revenue gained from it.
Upon information and belief, AOL only offers to pay amounts for content which are less than the revenue potentially earned from that content. …
That sounds suspiciously like capitalism to me.
In sum, by eliminating all costs associated with content production and placing those costs with Plaintiff and the Classes, Defendants are being unjustly enriched.
Despite the value provided, Plaintiff and the Class were only offered “exposure.”
Because of the system set up by TheHuffingtonPost.com, Plaintiff and the Classes gave the Defendants more exposure than vice-versa, namely, Plaintiff and the Classes typically shared the link to the content provided with their social networks, sharing via electronic mail, Facebook, Twitter and the like (as so encouraged and directed by TheHuffingtonPost.com) – driving internet traffic to the HuffingtonPost.com and creating value for the Defendants.
… Arianna Huffington, at a meeting in Beverly Hills, California, February 8, 2011 stated: “People have not fully adjusted to the fact that self-expression is, for many people, a new source of fulfillment and entertainment … We have 9,000 bloggers with a password and literally get hundreds of submissions that our editors have to process. People are dying to blog for us … ”
¶¶92, et seq.:
Complaints that HuffPo doesn’t give contributors information about how much exposure they are getting, such as how many page views they get.
Finally, TheHuffingtonPost.com’s assertion that “writers write for free” serves to bring an ages-old falsity into the digital age, one this Court should reject. Indeed, writers, like all creators, deserve a share of the value they create and allowing such value to rest solely with Defendants is against equity and good conscience.
¶¶100, et seq.:
FIRST CAUSE OF ACTION
DECEPTIVE BUSINESS PRACTICE
(N.Y. Gen. Oblig. Law §349 et ff. as per the Terms and Conditions)
PLAINTIFF AND THE CLASSES v. DEFENDANTS
It is deceptive to promise exposure (visibility, promotion and distribution) in lieu of monies to Plaintiff and the Classes, but then not provide a real and accurate measure of exposure and it is deceptive to solicit content on the promise of providing a free forum for ideas when, in fact, a product with tremendous value is being created by the solicited and uncompensated services provided.
Sorry to say it, but this doesn’t sound deceptive to me. Tasini and unpaid bloggers got exposure. Tasini wants more than that, but I don’t see how he was deceived into thinking he would get it.
¶¶106, et seq.:
SECOND CAUSE OF ACTION
PLAINTIFF AND THE CLASSES v. DEFENDANTS
Plaintiff and the Classes provided valuable services to Defendants, services that were encouraged and accepted by Defendants.
This, I think, is the essential problem with the unjust enrichment claim: The defendants were actively encouraging the labor. The prototypical unjust enrichment claim is when an unconscious person arrives at the emergency room and receives life-saving treatment. The patient never agreed to receive the care, so does the patient owe the hospital and doctors compensation? The courts say yes, under a theory of unjust enrichment. It would unjustly enrich the patient to allow him or her to retain the benefits of the medical treatment without paying for it. Part of what makes it unfair is that there was no chance for the parties to make a contract, since the patient was unconscious. Now, imagine a patient came into a clinic and asked – even actively encouraged – being treated for free. If the clinic provides treatment for free, you can’t say the patient was unjustly enriched. There’s nothing unfair – nothing unjust – about the patient retaining the benefits of the treatment in this case, because the patient went looking for free treatment and got it.
Ironically, Tasini’s case for unjust enrichment would be stronger if HuffPo had somehow ended up with the content despite not having sought it out. I don’t know how that would hypothetically happen, but if it somehow did, then unjust enrichment might seem to fit the bill. Unjust enrichment is a flexible doctrine, and it’s not limited to the ER hypothetical or highly similar cases. But under the circumstances in this case, I just don’t see it.