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Service Provider Liability to Third Parties

Service Provider Liability to Third Parties

• By Ashe Lockhart
• April 30, 1997

>> In 1997, I co-authored a paper (click here) on the subject of internet service provider (ISP) liability for a seminar in Cyberspace Law at UNC School of Law.  After reviewing it recently, I believe it continues to be relevant on the issue of third-party liability for ISPs.  If nothing else, it provides a good overview of the contours of the third-party liability arising out of the internet.

At this point, some 15 years after web browsers were first widely distributed, the world wide web has permeated just about every aspect of modern life.  One of the consequences of the widespread use of the web is that parties who might never have been aware of each other in earlier times are now routinely in disputes with one another over a number of issues, such as defamation, copyright infringement and violations of privacy.  And it will be quite some time before the law catches up to the seemingly infinite variety of problems and conflicts that can arise out of the internet.

If you’re a little befuddled by what I’m talking about, here’s what I’m getting at.  Under certain circumstances, ISPs may be exposed to legal liability to third parties for the actions of the ISPs’ customers.  The circumstances that could lead to liability will vary from one ISP to another.  For example, a web hosting service may face liability under different circumstances than an internet access provider.  Similarly, some internet services companies – such as web developers or graphic designers – may also be exposed to legal liability to third parties for the actions of their customers. Employers could face third-party liability for their employees’ actions on the internet when using company internet systems.  Even a blogger could be viewed as an ISP and be on the wrong end of a dispute because of improper comments to the blog. Each liability issue will have to be evaluated on the basis of the specific facts in question.

The cost of defending a legal action is generally much higher than the cost of avoiding it.  The good news is that ISP liability to third parties can often be avoided or greatly reduced if you know what to look for and plan accordingly.

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