Insights into Texas’ Content Moderation Law

On May 31, the US Supreme Court reinstated an injunction first implemented in December 2021 regarding HB 20, the Texas law prohibiting social media companies from certain content moderation based on viewpoints. Its decision comes just over a week after the 11^th Circuit upheld an injunction barring enforcement of Florida’s law that banned social media platforms from removing political candidates.

The Supreme Court’s 5-4 decision stemmed from NetChoice LLC and the Computer and Communications Industry Association’s appeal of the Fifth Circuit decision staying the original injunction issued by the District Court. Their argument was that rather than promoting free speech, Texas’ law is requiring social media platforms to promote speech they don’t agree with. Justice Alito in his dissent discussed social media’s transformative impact on communication and stated that while he does not have “a definitive view on the novel legal questions that arise from Texas’ decision to address the ‘changing social and economic’ conditions it perceives,” he believes the District Court’s original injunction was a “significant intrusion on state sovereignty”.

So, for now Texas cannot enforce this statute. Will they if the injunction is lifted? The Texas Attorney General is empowered to bring an action to enjoin a violation and collect attorneys’ fees and investigative costs. We know that office is particularly focused on Big Tech issues, having sued multiple targets on issues ranging from antitrust, to privacy, to deceptive advertising. The reinstatement of the injunction presents an opportunity to pause and take a closer look at HB 20 and what future enforcement could look like in Texas and other states.

Social Media Platforms General Provisions

The new statutes include more than just the controversial censorship chapter. A social media platform is defined as “an Internet website or application that is open to the public, allows a user to create an account, and enables users to communicate with other users for the primary purpose of posting information, comments, messages or images.” The exclusions from the definition includes ISPs, email services, and direct news sources with comment features. Further the applicability of these statutes applies only to those who have more than 50 million active users in the United States in a month, indicating a focus on “Big Tech” only.

These platforms are required to disclose on a public website accurate information about how it curates, targets, places, moderates, and promotes content including its own; how it uses algorithms to determine results on the platform; and how it provides users’ performance data.

Further, the law requires the platform to publish an easily accessible acceptable use policy which informs users about the content allowed, explains compliance with the policy, and the means to notify the platform of violations. The platform must make a good faith effort to evaluate complaints of illegal activity within 48 hours with reasonable exceptions.

They also must report every 6 months on the total number of instances of policy violations by users, employees, or automated tools they were alerted to and how many times the platform took action including content removal, demonetization, deprioritization, or assessment; and account suspension, removal, or other action consistent with their acceptable use policy.

When a platform takes an action under their policy they must notify the user who provided the content and explain the reason, allow an appeal, and provide written notice of the outcome of the appeal. The exception to this is if they are unable to contact the user after reasonable steps or know that the content is part of an ongoing law enforcement investigation.

Discourse on Social Media Platforms

Censorship under this statute includes any action to alter or remove or deny access to or otherwise discriminate against expression. Expression includes any perceivable communication. Social media platforms are prohibited from censoring a user or their expression or ability to receive an expression based on viewpoint or geographic location, regardless of the medium the viewpoint is expressed. This applies to users who reside in Texas, do business in Texas, or share or receive expressions in this state.

They are allowed to censor anything specifically authorized by federal law, at the request of an organization to protect exploitation, that directly incites criminal activity or has specific threats of violence, or is unlawful. Additionally, users can censor expression on their own page. Users may also seek injunctive relief and the statute specifically notes that users may bring action regardless of whether a court has enjoined the AG or has declared the chapter unconstitutional. The court can hold the platform in contempt if they fail to comply with court order and can use “all lawful measures” to secure compliance including “daily penalties sufficient to secure immediate compliance.” Platforms cannot enforce a waiver of the protections of this statute by contract.

Bottom Line?

Carefully examine what you tell users about your moderation practices, and how they are applied to users. While the constitutionality of HB 20 and similar laws is a decision for another day, the increased scrutiny of platforms’ (both large and small) content moderation practices is already forcing platforms to make clearer acceptable use policies and publicly clarify their practices. Such representations may ultimately become the focus of UDAP investigations in states, something we’ve already seen in Texas and Indiana. Just like any other public facing policy – establishing clear and neutral rules of the road and following those standards will help minimize AG attention to your practices. And even if HB 20 doesn’t impact your business – following this and similar cases will help to shed light on how far future legislatures can go to regulate the practices of platforms going forward.

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State Attorneys General play an increasingly important and powerful role in enforcing consumer protection laws and establishing public health standards impacting broad swaths of business. Please join us for State Attorneys General 101, a webinar covering the basics of State AG consumer protection powers, what to expect if you find yourself a target of attorneys general investigation, how to look to state attorneys general to stop improper actions of competitors, and more. Register here.