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J Bus Ethics (2012) 106:353–365DOI 10.1007/s10551-011-1001-zFreedom of Expression, Internet Responsibility, and BusinessEthics: The Yahoo! Saga and Its ImplicationsRaphael Cohen-AlmagorReceived: 12 March 2010 / Accepted: 9 August 2011 / Published online: 31 August 2011 Springer Science+Business Media B.V. 2011 Abstract In the late 1990s, the Internet seemed a perfect medium for business: a facilitator of unlimited economical propositions to people without any regulatory limitations. Cases such as that of Yahoo! mark the beginning of the end of that illusion. They demonstrate that Internet service providers (ISPs) have to respect domestic state legislation in order to avoid legal risks. Yahoo! was wrong to ignore French national laws and the plea to remove Nazi memo- rabilia from its auction site. Its legal struggle proved futile and may have harmed its business. This essay argues for the adoption of standards of corporate social responsibility (CSR). CSR considerations may trump some forms of antisocial, highly offensive expression.Keywords Internet Yahoo! Nazi memorabilia Corporate social responsibility (CSR) Business ethicsIntroductionIn his cyber law scholarship, Lessig (1999, pp. 43–44) distinguishes between two claims. One is that, given its architecture, it is difficult for governments to regulate behavior on the Internet. The other is that it is difficult for governments to regulate the architecture of the Internet. The first claim is true; the second is not. It is not hard for governments to take steps to alter Internet architecture and, in so doing, facilitate regulation of Internet behavior.R. Cohen-Almagor (&)Department of Politics and International Studies,University of Hull, Cottingham Road, Hull HU6 7RX, UKe-mail: R.Cohen-Almagor@hull.ac.ukURL: http://www.hull.ac.uk/rca; http://hcc.haifa.ac.il/*rca/ In the late 1990s, the Internet seemed a perfect medium for business: supranational, diffusive, with wide distribu- tion and little regulation, offering enormous opportunities to investors. In his famous ‘‘declaration of the indepen- dence of cyberspace,’’ the Internet theorist John Perry Barlow wrote,Governments of the Industrial World, you weary giants of flesh and steel…. You have no sovereignty where we gather. You have no moral right to rule us nor do you possess any methods of enforcement we have true reason to fear. Cyberspace does not lie within your borders.1Cases such as that of Yahoo! mark the beginning of the end of the no-sovereignty illusion. They demonstrate that Internet service providers (ISPs) have to respect domestic state legislation in order to avoid legal risks. An ISP is a company or other organization that provides a gateway to the Internet, enabling users to establish contact with the public network. Many ISPs also provide e-mail service, storage capacity, proprietary chat rooms, and information regarding news, weather, finance, social and political events, travel, and vacations. Some offer games to their subscribers and provide opportunities for shopping. Yahoo! is one of the most popular search engines and websites in the world. The company also provides multiple other web services, including a directory (Yahoo! Directory), email, news, maps, advertising, an auction site, and video sharing (Yahoo! Video).2The Yahoo! controversy juxtaposes two contrasting views: Yahoo!’s Internet-separatist view that it can engage in commerce as it chooses notwithstanding national laws1 ‘‘The Internet’s new borders’’ (2001); Shea (2006, p. K4).2 http://everything.yahoo.com/; http://uk.yahoo.com/?p=us. and morals, versus the view that countries have the right and ability to assert their sovereignty on the Internet. This essay argues for the adoption of standards of corporate social responsibility (CSR), under which limits are placed upon free expression in the interest of furthering goals of social responsibility. CSR on the Internet, especially when it concerns ISPs, may require limiting some information deemed by sovereigns to be antisocial and offensive (for further discussion, see Levmore and Nussbaum 2010).In his seminal work, Bowen (1953, p. 6) defined CSR as the obligations of business people to make decisions, to pursue policies, or ‘‘to follow those lines of action which are desirable in terms of the objectives and values of our society.’’ The Internet is international in character, but it is susceptible to the constraints of national laws. There is not one law for the Internet and another for all other forms of communication.This essay comprises four parts: First (I), the Yahoo! saga as it unfolded in France and the USA is described in detail. Next (II), a comparative legal dimension is pro- vided, explaining how different countries address the challenge of hate and racist speech. Part III considers the business dimension of the Yahoo! affair. Finally, part IV discusses responsible terms of service that Internet com- panies can employ that prohibit antisocial, violent content on their servers.The Yahoo! SagaSales of Nazi merchandise are against the law in France, which strictly prohibits the selling or displaying of any- thing that incites racism. The French Criminal Code pro- hibits the display of Nazi symbols.3 The Yahoo! saga started in February 2000 when Marc Knobel, director of the International League against Racism and Anti-Semitism (Ligue Internationale Contre le Racisme et l’Antise´mit- isme, LICRA) and a member of the Observatory of Anti- semitism, went to the Yahoo! auction site and saw pages of Nazi-related paraphernalia. The site featured swastika arm- bands, SS daggers, concentration camp photos, striped uniforms once worn by Nazi camp prisoners, and replicas of Zyklon B gas canisters (Crumm and Capeloto 2000, p. A1; Reuters 2002, p. C4). Sales of Nazi merchandise are against French law. Knobel acknowledged that the auctions might be legal in the USA, but believed them to be abso- lutely illegal within the borders of France.4In April 2000, LICRA together with two other organi- zations, Union des Etudiants Juifs de France (UEJF) and3 Section R645-1 of French Criminal Code.4 ‘‘Yahoo! sued for Nazi-item auctions,’’ http://www.usatoday.com/life/cyber/tech/cth715.htm. Mouvement contre le Racisme, l’Antise´mitisme et pour la Paix (MRAP), asked Yahoo! to either remove the Nazi memorabilia from its American websites or make all such auctions inaccessible to web surfers in France and its ter- ritories such as Martinique and French Guyana in accor- dance with its own terms of service agreement, which prohibited netusers from posting content that was ‘‘hateful, or racially, ethnically or otherwise objectionable.’’5 If it did not, the organizations asked that the California-based company be fined US $96,000 for each day of noncom- pliance. Ronald Katz, a lawyer representing the French groups, asserted: ‘‘There is this na¨ıve idea that the Internet changes everything. It doesn’t change everything. It doesn’t change the laws in France.’’6Yahoo! did not respond to the demands, and legal action commenced. At the first hearing in the Tribunal de Grande Instance de Paris on May 15, 2000 defending counsel Christophe Pecard noted that Yahoo! maintained a French- language website (Yahoo!.fr) that complied with French law. He argued that ‘‘Internet users who go to Yahoo.com undertake a virtual voyage to the US.,’’ so no offense could be said to take place in France (Le Menestrel et al. 2002, pp. 135–144). In any case, he said, it would be technically impossible for Yahoo! to block all access to its sites from France. Yahoo! claimed that it had no power to identify the national origins of its customers and thus no control over where in the world its digital products went. Were Yahoo! forced to comply with French law, it would need to remove the Nazi items from all its servers, thereby depriving Yahoo! users everywhere from buying them, and making French law the effective rule for the world (Goldsmith and Wu 2006, p. 5). In response, the plaintiffs’ lawyer, Ste´phane Lilti, asserted that France had the sovereign right to prohibit the sale of Nazi merchandise within its borders, and argued that Yahoo! should not be exempt from French law (Le Menestrel et al. 2002).The Court OrdersOn May 22, 2000 Judge Jean-Jacques Gomez ruled that Yahoo!’s sales were ‘‘an offense to the collective memory of a nation profoundly wounded by the atrocities com- mitted in the name of the Nazi criminal enterprise.’’7 He rejected all of Yahoo! Inc.’s jurisdiction-related arguments, holding that, though the Yahoo!.com site was located on a server in California, and perhaps intended for an American5 http://uk.docs.yahoo.com/info/terms.html/.6 Guernsey (2001), http://query.nytimes.com/gst/fullpage.html?res=9B01E7D71F3AF936A25750C0A9679C8B63.7 LICRA v. Yahoo! Inc. and Yahoo! France (Tribunal de Grande Instance de Paris, 2000), affirmed in LICRA and UEJF v. Yahoo! Inc. and Yahoo! France (Tribunal de Grande Instance de Paris, 2000), www.foruminternet.org/actualities/lire.phtml?id=273. audience, harm was suffered in French territory, and Yahoo! auctions were not protected in France by the USA’s First Amendment. Judge Gomez ordered Yahoo! Inc. ‘‘to take all measures such as would dissuade and render impossible all consultations on yahoo.com of the service of auctioning of Nazi objects as well as any other site or service which constitute an apology of nazism or which contest the nazi crimes.’’8 In other words, the French Court said that there can be no apology for Nazi crime, and that it is impossible to contest or downplay the horrific magnitude of evil-doing that had happened. Nazi crimes should be condemned without any reservation. Yahoo! Inc. was ordered to prevent access from Frenc
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