Why Uber and Etsy came up so much in the Supreme Court’s social media arguments

During Monday’s Supreme Court arguments in a pair of consequential social media cases, the justices prodded for ways they could rule without giving either side everything they asked for.

The justices seemed largely skeptical of the most sweeping provisions in Florida’s and Texas’ social media laws, which would force certain tech platforms to carry speech even when they don’t want to. But they also looked for the boundaries of tech companies’ First Amendment rights — seeking to understand when they become conduits for the transfer of information, rather than expressive platforms themselves.

The laws at the center of the fight, Florida’s SB 7072 and Texas’ HB 20, were created in the name of countering what conservative legislators have labeled censorship by social media platforms. Florida’s rule directs platforms to moderate content in a consistent manner, while Texas’ prohibits discrimination on the basis of “viewpoint.” NetChoice, an industry group that counts Meta, Google, and TikTok among its members, promptly challenged the laws for violating the First Amendment. NetChoice has argued the laws ignore the rights of platforms to exercise editorial discretion in what they show on their sites.

The laws were aimed at the content moderation practices of major social media platforms like Meta’s Facebook and Instagram and Google’s YouTube. But throughout the arguments in Moody v. NetChoice and NetChoice v. Paxton, the justices repeatedly name-checked companies whose primary functions are not hosting users’ views — like Etsy, Uber, and Venmo.

“I think what you see in the discussion is the justices are thinking, well, not all potentially covered entities are made equal,” said Gautam Hans, associate director of the First Amendment Clinic at Cornell Law School. “And maybe we don’t want to say that there’s no context in which this law could ever be validated. Maybe we want to let this play out a little more.”

The justices repeatedly discussed how NetChoice made a “facial” challenge against the social media laws, meaning it argued they have no possible constitutional application. An “as applied” challenge, on the other hand, would mean that the laws are unconstitutional only as applied to a specific set of companies or circumstances.

While the facial challenges gave NetChoice the chance to preclude similar laws from popping up around the country, it seemed to be a hang-up for some justices, who saw possibly legitimate applications or worried about creating an industry that could not be touched by regulation.

“The Court, I think, realizes that either their deregulatory First Amendment approach has had downsides, or if they took that traditional approach in this case, it would insulate so much of the economy from regulation, which is maybe a bridge too far for this court,” Hans said. “So that, I think, goes to why there was so much discussion of Uber versus Etsy versus Gmail versus Facebook — really trying to figure out what the lines are here.”

The court could develop some sort of standard to say which companies can be subject to laws like Florida’s and Texas’, even while skirting thorny questions like whether social media sites are common carriers akin to delivery trucks or telephone companies. One option would be to explain what makes a company eligible to exercise editorial discretion based on the “expressive nature of their business,” Hans said.

Part of the reason the court struggled with the limits of the law was because the factual record of the cases was not very developed. NetChoice challenged the laws early on and sought preliminary injunctions to stop them from taking effect.

“The challenge for the justices is that the cases came to them in an ‘all or nothing’ procedural posture, and they spent a lot of time trying to figure out whose fault that was and what they should do about it,” James Grimmelmann, digital and information law professor at Cornell Law School, said in an emailed statement. “If I had to guess, I would predict that the court will issue relatively narrow rulings that make it clear that the most restrictive portions of the state laws are unconstitutional, and then let litigation play out to determine whether other provisions of these laws — or of other future laws — are constitutional.”

The justices might choose to remand the cases to the lower courts to get a more developed record, which would allow the cases to reach the top court at a later stage, with more discovery and understanding of how they would apply in different situations.

“That is a potential path that this case could travel,” Lawrence Walters, general counsel at the Woodhull Freedom Foundation, said during a press conference after the arguments. “I think the justices really wanted to explore what all their options were before rendering what could be a historic landmark decision.”

The laws don’t simply ban (allegedly) discriminatory moderation; they also implement requirements that sites disclose aspects of how they moderate. Jameel Jaffer, executive director of the Knight First Amendment Institute at Columbia University, noted in an emailed statement that the justices did not spend much time discussing these transparency requirements. Nonetheless, “how the court addresses those provisions could effectively decide whether even carefully drafted social media transparency laws can be constitutional,” he said.

In bringing the facial challenges, Hans said, NetChoice took a gamble that it could discourage similar laws in other states. It wasn’t a bad bet, he said, but it doesn’t seem to be paying off.

“I think that they were hoping that they could get rid of this and move on to a new issue,” Hans said of NetChoice. “And that’s not going to happen based on what I heard today.”