PRODIGY WILL APPEAL a state court decision holding the company liable for the content of its subscribers' electronic messages.
New York Supreme Court Judge Stuart L. Ain, in Mineola, ruled that Prodigy acted substantially as a publisher in allowing a bulletin board message that accused the investment banking firm Stratton Oakmont Inc. of criminal conduct.
The decision clears the way for a $200 million libel suit filed by Stratton Oakmont against Prodigy.
However, according to Brian Ek, director of communication at Prodigy, the lawsuit is "incidental" to the more fundamental issue of who is responsible legally for material posted on computer bulletin boards.
Prodigy, seeking guidelines under which the company can operate without threat of lawsuit, is looking for a higher-level decision than the state court to act as a precedent, Ek said.
Ain agreed with the operating principle of most online bulletin board and chat groups, which exercise little or no control over the content of subscribers' messages.
"Computer bulletin boards should generally be regarded in the same context as bookstores, libraries and network affiliates," he wrote. That is, they generally cannot be held liable for what they disseminate.
But the judge differentiated Prodigy from services such as CompuServe, which won a precedent-setting 1991 decision that limited the right to sue for online defamation.
He said Prodigy's decision to bar messages that contain obscenity, slurs and personal attacks constituted editorial control. Prodigy's software automatically returns messages that contain obscenities, and an alert button lets users call a system operator to look over other messages that might be offensive.
"Prodigy's conscious choice, to gain the benefits of editorial control, has opened it up to a greater liability than CompuServe and other computer networks that make no such choice," wrote Ain.
Is any form of editorial control too much?
"We believe very strongly that we were penalized for acting responsibly," said Ek. "Newspapers are facing the same thing if they offer bulletin boards or chat, which most of them do."
Other online services screen for obscenities but have not publicized their policy as much as Prodigy has.
Ain cited Prodigy's 1990 marketing copy: "We make no apology for pursuing a value system that reflects the culture of the millions of American families we aspire to serve. Certainly no responsible newspaper does less."
In fact, Prodigy does less, according to Ek, because the service takes no responsibility for factual content and never claimed such responsibility.
Prodigy now says it has abandoned those early claims that compared it to a newspaper.
Despite the judge's argument to the contrary, the decision potentially impacts every online service, including Prodigy's competitors, CompuServe and America Online.
"They are alarmed by it, they are in full support of our appeal, and you will see them issue a press release very soon to that effect," Ek said. …