A judge for the U.S. District Court for the Southern District of New York recently threw cold water on the claims of unpaid bloggers for the TheHuffingtonPost.com when he threw out their lawsuit, with prejudice, in which they claimed that the company concealed information regarding the money the website earned from their posts. The bloggers had sought $105 million in damages from Huffington and her parent company, AOL. The judge maintained that the bloggers were not duped by Arianna Huffington and that she did not mislead them with promises of exposure for their work. The plaintiffs were sophisticated people who knew exactly what they were getting themselves into when they agreed to blog for her site. They never had any expectations of monetary compensation and the only “compensation” they were going to get, and knew that they were going to get, was exposure for their work. In fact, the bloggers admitted that they did not expect compensation. The court pointed out that no one forced them to give their articles to the The Huffington Post; they did it of their own volition.
AOL purchased The Huffington Post a year ago for over $300 million. The bloggers had maintained in their lawsuit that Huffington was able to attract such a lucrative offer from AOL because the site got high quality content from the plaintiffs for free. The plaintiffs, who numbered around 9,000, sought $105 million from Huffington and AOL, claiming that this was their share of the $300 million plus that AOL paid Huffington. They based their lawsuit on violations of New York General Business Law Section 349, i.e. deceptive and misleading conduct. They also alleged that an implied contract or “quasi-contract” existed, requiring compensation. Otherwise, AOL would be unjustly enriched for receiving something of value and not paying for it.
The writers contended that millions of readers visited the site because of their writing and that this brought substantial advertising revenue to the site which helped to develop a “digital media brand”. The Huffington Post promised the writers wide exposure and encouraged them to publicize their content on the site, and they were not paid for any of this.
Their content was superior, the plaintiffs contended, because it was original content and search engines like Google’s, give original content priority in search results, thereby giving The Huffington Post a higher ranking and making it more likely to attract views. This all lead to the site being more valuable than other websites in the same arena.
The writers’ attorneys claimed that the case was one of first impression. According to the, the question it poses is: “Does the equitable principle of unjust enrichment require restitution when solicited content and promotional efforts provided by unpaid writers create a valuable internet property?”
The plaintiffs’ lawyers quoted Huffington herself in support of their position. She had admitted that her website’s ability to “produce high-quality content in cost effective ways” was something it did “well.”
The defendants’ attorneys claimed that the written contract between the parties barred any claims of “quasi-contract”. Furthermore, according to defendants, Section 349 of N.Y. General Obligations Law was inapplicable because plaintiffs had not alleged that defendants engaged in deceptive or misleading acts.
The court gave short shrift to plaintiffs’ claims. It found that the writers got exactly what they bargained for-exposure in The Huffington Post. Also, New York law requires a plaintiff to allege that he expected to be paid and that this expectation was denied in order to make out an equitable claim of restitution. The court also rejected plaintiffs’ claims under Section 349 of New York General Obligations Law because the statute applies to consumers, and it requires that consumers be harmed by the defendants’ alleged misconduct. The plaintiffs here did not show that any consumer was harmed.
Plaintiffs are currently weighing their options including whether to appeal or not.