Sued for encouraging user-generated content

by Walter Olson on January 29, 2008

Suits by businesses over their competitors’ advertising are a staple for us, but this one has a somewhat new wrinkle:

Quiznos, the toasted-sandwich chain, [invited] the public to submit homemade commercials in a contest intended to attack a top rival, Subway. The contest rules made it clear that the videos should depict Quiznos sandwiches as “superior” to Subway’s.

Subway promptly sued Quiznos and iFilm, the Web site owned by Viacom that ran the contest, saying that many of the homemade videos made false claims and depicted its brand in a derogatory way. Subway is also objecting to ads that Quiznos itself created, showing people on the street choosing Quiznos over Subway.

The dispute over an ad is fairly standard — companies often sue one another over advertising claims — but the video contest raises a novel legal question: Quiznos did not make the insulting submissions, so should it be held liable for user-generated content created at its behest? …

If Subway wins, advertisers and media companies may find themselves liable for false advertising claims made by consumers who participate in their contests.

(Louise Story, “Can a Sandwich Be Slandered?”, New York Times, Jan. 29).

{ 7 comments }

1 Tom T. 01.29.08 at 4:30 pm

If Quizno’s had simply said, “post your interesting videos on YouTube,” that seems too attenuated for a defamation suit, because then Quizno’s is literally doing nothing more than encouraging other people to create something and disseminate it. In this case, though, Quizno’s is saying, “send us your interesting videos, we’ll review them, and then we’ll post them on a site we created.” That seems to me to be an easier basis on which to allege active involvement in publishing the allegedly defamatory statements.

I’m not sure about the basis for including iFilm as a defendant; offhand, that seems more iffy.

2 Deoxy 01.30.08 at 9:54 am

Tomt T,

Any first year law student could tell you this: include every party (with money) even remotely involved. It costs you nothing, but it costs them money, so they might give you money to go away. No loser-pays system here!

Secondly, a ruling that Quizno’s is liable can far FAR too easily be abused – you could get a “friend” to create actionable content for a competitor, then su the competitor. Lather, rinse, repeat. No more competitor.

3 Tom T. 01.30.08 at 11:13 am

I hear you, but how is what Quizno’s did different from soliciting ads from advertising firms, and then showing those ads on TV? It seems to me that Quizno’s review and approval is what differentiates this case.

And you’re certainly right that iFilm is prsumably just a deep pocket. I just meant that I wasn’t sure what the legal theory would be. I don’t know what iFilm did.

4 J.T. Wenting 01.31.08 at 6:21 am

By setting guidelines that deliberately target Subway, they open themselves to lawsuits by Subway.
That the content is provided by independents and afterwards selected by them is no different from contracting several advertising firms and choosing one in a competition for running a new campaign…

5 David Schwartz 01.31.08 at 9:01 pm

The threshold question is this: did Quizno’s review or endorse the content in some way? If not, there should be no case.

6 Kent 01.31.08 at 9:16 pm

Isn’t truth a defense in a libel suit?

Quizno’s is vastly superior to Subway, at least in my town.

7 SPQR 02.01.08 at 5:33 pm

I think that the CDA provision for immunity for third party content will control – it is very broad.

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