Section 230 Doesn’t Apply to Generative AI Enhancements to Ad Copy (But the Plaintiffs Lose Anyway)–Bouck and Suddeth v. Meta

The blog post covers two cases involving scammy ads on Facebook that were part of a pump-and-dump for Chinese penny stocks. The first two rulings came in March. In the Bouck case, the court rejected Facebook’s Section 230 defense because Facebook’s generative AI allegedly contributed to the ad copy. In the Suddeth case, the court accepted Facebook’s Section 230 defense because the plaintiffs focused on algorithmic amplification. Although the Bouck case initially overcame Section 230, in an under-the-radar ruling this week, the court nevertheless dismissed it as preempted by federal securities law. So the Bouck plaintiffs got a first-hand taste of the infamous Ninth Circuit switcheroo, which occurs when the plaintiffs get false hope that they might actually win because they got around Section 230, only to slam into other brick walls in their prima facie case. The March Bouck Ruling Section 230 Meta’s Section 230 defense turns on whether it was a co-creator of the ads sufficient to…