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Court dismisses Yahoo's free-speech lawsuit

Appeals court ducks question of whether a French court can require a U.S. company to censor a U.S.-based Web site.

A divided federal appeals court on Thursday ducked the question of whether a French court order censoring Nazi-related materials can apply to Yahoo's U.S.-based Web site.

In a case that pits European restrictions on "hate speech" against the values of free expression enshrined by the United States' First Amendment, a slender 6-5 majority of the 9th U.S. Circuit Court of Appeals dismissed Yahoo's case involving the online display of Nazi-related books, posts and memorabilia.

Excerpt from the French court order:

"We order the Company Yahoo! Inc. to take all necessary measures to dissuade and render impossible any access via to the Nazi artifact auction service and to any other site or service that may be construed as constituting an apology for Nazism or a contesting of Nazi crimes."

"Unless and until Yahoo changes its policy again, and thereby more clearly violates the French court's orders, it is unclear how much is now actually in dispute," one group of judges wrote (click for PDF). Also, those judges said, it's "extremely unlikely" that any penalty could be assessed against Yahoo's U.S. operations.

In an unusual twist, the 11-judge panel fractured into multiple factions, some of which said the case should be dismissed on technicalities or because it was too preliminary, and others who said it was an easy call because the French court order is clearly unenforceable under the U.S. Constitution.

Yahoo filed the suit in December 2000 in an effort to clear up whether a U.S. company was required to rework its Web site to comply with a French court order. In April of that year, the Paris-based International League against Racism and Anti-Semitism (LICRA) took the Web portal to court to stop sales of Nazi paraphernalia to French citizens on its auction site. French law prohibits the sale or exhibition of objects associated with racism.

A French court agreed with LICRA. It required Yahoo to make it "impossible" for French citizens to connect to a Yahoo Web site with messages relating to Nazi objects, or ones that displayed excerpts from Adolf Hitler's "Mein Kampf" and "The Protocols of the Elders of Zion," or messages that contested Nazi crimes.

But Yahoo won its initial court battle in the U.S. A federal district judge ruled in November 2001 that "although France has the sovereign right to regulate what speech is permissible in France, this court may not enforce a foreign order that violates the protections of the United States Constitution."

In a dissent on Thursday, a minority of 9th Circuit judges echoed that argument. "Censoring speech we find repugnant does not comport with our cherished First Amendment," the dissent said. "We should not allow a foreign court order to be used as leverage to quash constitutionally protected speech by denying the United States-based target an adjudication of its constitutional rights in federal court."

Joel Reidenberg, a professor of law at Fordham University who wrote a law review article on the topic, said he was alarmed that a majority of the 9th Circuit found sufficient jurisdictional grounds existed to consider the case.

"This is a radical and troubling expansion of U.S. jurisdiction that may put U.S. companies at risk abroad," Reidenberg said in e-mail. "In essence, the majority would allow any U.S. company that loses a lawsuit abroad to bring the suit back to the U.S. for a second bite at the apple." Now, he said, foreign companies that lose in the U.S. might take their dispute back to a more friendly court at home.

The U.S. case does not involve Yahoo's French subsidiary, which has complied with French law.