Houlihan Smith & Company, Inc., et al v. Julia Forte, et al

Liability of Web Site Operators – Houlihan Smith & Company, an investment bank based in Chicago, filed suit against Julia Forte over two message boards – 800Notes.com and whocallsme.com – where members of the public had posted statements criticizing Houlihan’s telemarketing practices as well as other aspects of Houlihan’s business. On less than 90 minutes notice to Forte, a North Carolina resident, Houlihan went to state court in Illinois and got a temporary restraining order compelling Forte to remove “all statements of a factual nature” about Houlihan and to prevent future postings by those who had posted such statements. Representing Forte, Public Citizen removed the case to federal court and opposes continuation of the TRO. We argue that the TRO is an impermissible prior restraint, especially in Illinois which does not allow injunctions against libel, and that in any event Forte, as the host of a message board, is immune from liability under 47 U.S.C. § 230. Although Houlihan has tried to evade section 230 immunity by relabeling its defamation claims under the trademark laws as well as the right of publicity, such relabeling does not defeat Forte’s statutory immunity. Forte moved for an award of attorney fees. In response to the motion, Houlihan Smith claimed that it had been driven out of business by their failure to obtain a preliminary injunction, that the plaintiffs were no longer operating companies, and that they lacked assets to pay any fee award. The fee motion was settled for a payment of $35,000 in attorney fees.