PHILADELPHIA – “Good Day Philadelphia” anchor Karen Hepp has settled claims with social media sites like Facebook and Reddit for featuring an image taken without her knowledge on several commercial websites, including one on an ad for erectile dysfunction, for an undisclosed amount.
Hepp first filed her complaint in the U.S. District Court for the Eastern District of Pennsylvania on Sept. 4, 2019, suing Facebook, Imgur, Reddit, Giphy, WGCZ S.R.O. and the owners of various websites and media outlets, named in the lawsuit as Does 1-10, for alleged violation of the state’s Right of Publicity statute.
Hepp alleged that her co-workers informed her that a security camera caught a snapshot of her in a New York City convenience store. That photo is said to have been used in online ads for erectile dysfunction as well as dating websites and other avenues, according to the lawsuit.
The picture was also included in a Facebook ad that implored users to “meet and chat with single women,” based on the complaint. Imgur allegedly posted the photo with the word “milf,” an inappropriate term related to attractive women with kids.
Reddit allegedly featured the photo in a subgroup called r/obsf.
Hepp also alleged, “The photo was modified and featured on Giphy wherein a video appears in the background of a man – who is hiding behind a glass commercial freezer door and masturbating – to what would appear, from his perspective, to the backside of the plaintiff.”
Lastly, the picture also made its rounds on XNXX in the “milf” gallery.
Hepp asked the court to bar the defendants and their related entities from publishing the photo, and to make them remove the ones that are currently present on their sites. She also wanted the defendants to have to show how much money they made from using her image.
U.S. District Court for the Eastern District of Pennsylvania John M. Younge granted motions for dismissal for several of the named companies, based upon Section 230 of the Communications Decency Act – which notes that third-party Internet content providers cannot be sued.
Hepp and her counsel appealed to the Third Circuit in August 2020 and participated in arguments before panel judges Thomas M. Hardiman, Peter J. Phipps and Robert E. Cowen on June 2, 2021.
Hepp’s counsel argued that Younge’s dismissal ruling from the District Court was in error, and that Hepp used creative and intellectual powers to create her public image via her professional persona on the air.
This point was the crux of plaintiff counsel Samuel Fineman’s argument that Hepp’s position was based in state law intellectual property rights – which would also serve as an exception to Section 230 of the Communications Decency Act, and allow her case to move forward.
Fineman compared Hepp to a professional athlete whose image has monetary value, a point of view which Hardiman did not share. Hardiman felt such matter could be considered property, but not of the intellectual variety.
Fineman disagreed, contending that professional sports leagues who earn revenue from the images of professional athletes would feel differently.
Meanwhile, attorneys for the defendant companies countered that the Third Circuit had no jurisdiction in the matter and that Hepp’s claims did not sound in intellectual property law.
Rather, the defense argued that Hepp’s claims originate from a right to privacy and that Pennsylvania has never recognized a right to publicity apart from privacy rights in its law.
On Sept. 23, 2021, Third Circuit judges Hardiman, Phipps and Cowen reinstated Hepp’s action, finding that while Section 230 of the CDA precludes many claims against Internet content providers, it has no such defense against cases centering on the matter of state intellectual property rights.
“In our view, Facebook’s interpretation strays too far from the natural reading of Section 230(e)(2). We disagree that ‘any law pertaining to intellectual property’ should be read to mean ‘any federal law pertaining to intellectual property,” Hardiman said.
“For her part, Hepp contends the right to publicity is an intellectual property right. And she argues that she ‘has dedicated considerable time, effort and money into building her brand.’ Her amicus adds that state courts have long recognized individuals have property interests in their personas.”
Meanwhile, Cowen concurred in part with the Court’s majority ruling, but also dissented in part.
Cowen added that while the parties dispute whether the protections of Section 230 are still necessary and whether the negative consequences of immunity in this context (continue to) outweigh its positive effects, that these were matters for Congress, and not the courts, to address.
But Hardiman countered that the Third Circuit’s ruling in this matter is narrow and does not threaten to limit or curtail free speech.
“[This ruling] does not threaten free speech…Second, our holding does not open the floodgates. Pennsylvania’s statute is limited. For instance, it provides a right of publicity cause of action only for those whose valuable interest in their likeness ‘is developed through the investment of time, effort, and money,” Hardiman said.
Subsequent to the Third Circuit’s ruling in September, Facebook filed a petition for rehearing en banc on Oct. 28, 2021, which was then denied by the Third Circuit three weeks later. As a result, the case was remanded to its point of origin in the District Court.
After Hepp filed a second amended complaint against Facebook in February, the company filed another dismissal motion on March 4, 2022 – where the social media giant argued that it had no actual knowledge of the photo, that it personally did not use the photo for advertising, only that the photo belonged to another company whose ad appeared on service – and that, for Hepp’s claim to prevail, she would have to show proof that Facebook used the photo for a commercial purpose.
In a March 18, 2022 response, Hepp’s counsel countered that Facebook did in fact use the image in question for commercial purposes, and asked that their dismissal motion be denied.
“Despite Meta’s repeated attempts to conflate tort theory, and specifically, right-of-privacy theory with intellectual property law (i.e., right-of-publicity theory), it ignores the Third Circuit’s ruling in this case, which holds that ‘Hepp’s statutory claim against Facebook arises out of a law pertaining to intellectual property.’ Therefore, Meta’s continued shoehorning of the ‘incidental use’ or ‘incidental publication’ doctrine to these facts is particularly inapposite,” according to the response motion.
“Here, the Third Circuit has observed that ‘Facebook is one of the world’s largest social media companies.’ It is common knowledge that Meta’s Facebook is a non-subscription-based social media service, and it derives most of its revenue from advertising. In that vein, based on Meta’s economic model for Facebook, all advertising is material because it goes to Meta’s bottom line.”
In an April 22, 2022 judicial order, Younge ruled that Facebook’s dismissal motion be denied, that the company would be compelled to answer the complaint within 20 days and referred to the company’s argument focus as “premature.”
“The Court finds that these arguments are premature as they are more appropriately reserved for the summary judgment stage in this ligation. Without discovery and the opportunity to develop evidence, the issue of whether defendant had ‘actual knowledge’ or used plaintiff’s image for ‘commercial purposes’ is an open question. From the pleadings, the Court can draw the inference that a photograph of plaintiff was used in an advertisement that was featured on defendant’s social media platform. The advertisement…clearly displays Facebook’s name and identity,” Younge stated.
“In addition, it would appear that defendant’s advertising platform was used to disseminate the advertisement at issue. Therefore, the Court will not make a definitive determination as to defendant’s involvement in the advertisement or whether it used the advertisement for a commercial purpose, when a plain reading of the advertisement suggests that its origin, and the service it promotes are open to interpretation. The parties provide no evidence to establish whether revenue or goodwill was generated from the advertisement. Therefore, defendant’s argument that it did not create, edit or generate revenue from the advertisement is simply defendant’s argument, and questions remain as to whether discovery will reveal evidence tending to show otherwise.”
Per Younge’s judicial order, Facebook filed its answer along with affirmative defenses to Hepp’s second amended complaint on May 12, 2022 – which denied Hepp’s claims in their entirety, before listing the company’s defenses.
“Plaintiff’s complaint fails to state a claim upon which relief may be granted. Plaintiff’s claim for violation of her statutory right of publicity is barred under 42 Pa. Cons. Stat. Section 8316(d) because defendant had no actual knowledge that plaintiff’s image was used without her consent. Plaintiff’s claim for violation of her statutory right of publicity is barred because defendant did not use her image for a commercial or advertising purpose as required by 42 Pa. Cons. Stat. Section 8316(a),” per Facebook’s defenses.
“Plaintiff’s common law claim is barred because the Pennsylvania common-law right of publicity has been abrogated by 42 Pa. Cons. Stat. Section 8316. Plaintiff’s common-law right of publicity claim is barred because defendant’s use of her image was, at most, passive and not for its own commercial advantage. Plaintiff’s claims are barred, in whole or in part, because of a failure to mitigate damages if such damages exist. Defendant reserves the right to allege additional defenses in the event that discovery or other analysis indicates that additional affirmative or other defenses are appropriate.”
UPDATE
On May 23, plaintiff counsel filed a stipulation of dismissal settling the action. Terms of the settlement were not revealed.
“Pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(ii), the parties hereby stipulate to the voluntary dismissal with prejudice of all claims in this action. Each party shall bear its own costs and fees,” the stipulation stated.
Prior to settlement, Facebook had sought that judgment be entered in its favor and in full, that the Court dismiss each of Hepp’s claims with prejudice, that it be awarded attorney’s fees and costs, and for such other and further relief as this Court deems just and proper.
Meanwhile, Hepp had initially sought damages in excess of $10 million.
U.S. District Court for the Eastern District of Pennsylvania case 2:19-cv-04034
U.S. Court of Appeals for the Third Circuit case 20-2885
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com