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The Real Rip-Off Report

Continued from page 3

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Published on January 31, 2007 at 5:43pm

For someone so smart, Magedson is curiously accepting of even the most off-the-wall allegations. He estimates that 98 percent of the site's complaints are true, which seems ridiculous after perusing numerous comments in which people accuse each other of everything from spreading sexually transmitted diseases to grand larceny.

"If you ask Ed the question, 'Ed, do you think there are phony reports?', of course there are going to be," he says. "'Are some of them exaggerated?' Probably so.

"But," he concludes, blithely, "if you're a business being complained about, you probably deserve what you're getting."


For business owners who Google themselves and are startled to discover they're actually scam artists, cheapskates, or even child abusers, the Rip-Off Report can be shocking. After all, if a newspaper printed such unsubstantiated allegations, it would be bankrupted in no time by lawyers with libel claims — some far from frivolous.

The Internet, as Magedson's victims soon learn, is different.

Newspapers are on the hook for libel if they merely publish a damaging untruth without proper vetting. So long as a story is about a private citizen, the standard is mere negligence: If a paper thinks something is true, but doesn't bother to verify, it can be held liable.

A Web site, however, can publish even those claims that writers know to be false: an ex-husband's rant that his saintly wife has herpes, an allegation that a hated city councilman is a pedophile. Forget mere negligence — online reports can be downright malicious.

For that, you can thank Congress, says Eric Goldman, an assistant professor at the Santa Clara University School of Law and director of the High Tech Law Institute. (And, oddly enough, you can thank porn, too.)

Before 1996, Goldman explains, Web sites were treated more like newspapers. If their operators edited or monitored content from their users, they could be considered a publisher. In a few cases, they were held responsible for publishing without verification.

But then came congressional concern about online porn. And Web operators argued that they were caught in a Catch-22: If they removed porn, they'd be on the hook for anything they left up that proved libelous.

So the Communications Decency Act, passed in 1996, attempted to restrict Internet porn — and, at the same time, give Web sites special immunity. Under the act, Goldman says, "you can be aware of bad content, do nothing about it, and still not be liable for it."

Ironically, the Supreme Court struck down the porn part of the law soon after it was passed. But the exemption for Internet publishers stands. The U.S. Supreme Court has shown zero interest in entertaining a challenge to it, Goldman says, much less overturning it.

Goldman believes Congress made a good decision. "It's very hard to put online service providers in the role of judge," he says. "If we asked online service providers to do this, they'd take the path of least resistance. They'd take the content down. And if they did that, we would see a chilling extinction of negative feedback about products and services in the marketplace."

And so Web publishers today have the freedom to publish real, uncensored customer reports — and, while they're at it, to publish false information.

This is not just true of Ed Magedson.

Take, say, America Online. After the Oklahoma City bombings, a guy named Kenneth Zeran was shocked to see that someone smeared him all over AOL message boards, claiming that he was selling tee shirts glorifying the bombings. The messages included his telephone number.

When radio stations picked up on the story, Goldman says, Zeran started receiving a dozen nasty phone calls a day. Hard to blame the guy for suing.

"If you wanted a sympathetic plaintiff, you got him," Goldman says. "This guy got screwed." But the court was emphatic, Goldman says: AOL was not responsible.

"And since then, we've had three dozen cases, all of them saying Zeranwas right," Goldman says. "The person who wrote the words is liable. The online service is not."


There's one good reason the darker corners of the Internet are so nuts: because they can be. And the legal immunity granted to online publishers also explains the continued existence of the Rip-Off Report.

Companies suing Magedson for libel all learn, soon enough, that the law isn't on their side. It may irritate them, or even hurt their businesses and reputations, but they simply can't force him to take down even the nastiest posts.

"It's extremely frustrating for a company to have their number-one search result be a Rip-Off Report," explains Magedson's attorney, Maria Crimi Speth. "And because it's legal, and because the posts are often anonymous, they have no one to take it out on but Ed."

Magedson says he's spent at least $1 million on legal bills. Judging by the volume of suits he's fought — and the size of the case files — he's not exaggerating.

But for Magedson, the blowback he gets is clearly a great part of the fun.

During his interview at Chompie's, he's interrupted when one of his four cell phones starts ringing. (All have numbers ending in 4357, he notes, which spells "HELP.") To his delight, it's a business owner calling to ask him to remove a report on the Web site.

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