Case Summary and Outcome

The European Court of Human Rights (ECtHR) ruled that Hungary failed to adequately balance the right to reputation and the right to freedom of expression when it awarded damages to a real-estate website for injuries to its business reputation. The Hungarian courts imposed objective liability for unlawful comments made by readers on a website, and the ECtHR held such reasoning unduly placed “excessive and impracticable forethought capable of undermining freedom of the right to impart information on the Internet.”

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Facts

The applicants share and sometimes create content and allow users to comment on it. The websites contained disclaimers stating that the comments did not reflect the views of the websites’ operators. The websites also had a “notice and take down” system, allowing users to flag comments for deletion. Furthermore, Index.hu partially moderated and sometimes deleted comments. Additionally, the websites had publicly accessible code of ethics that explicitly forbade comments infringing on the rights of others.

On February 5, 2010, MTE published an opinion piece titled, “Another Unethical Commercial Conduct on the Net” about two real estate management websites. The opinion piece explained that the sites offered a 30-day free trial for their services, after which they automatically charged a subscription fee. The piece also stated that the only way to remove personal data from the website was by paying overdue subscription fees.

The piece generated comments and the Court highlighted two of them:

“They have talked about these two rubbish real estate websites a thousand times already.”

“Is this not that Benkő-Sándor-sort-of sly, rubbish, mug company again? I ran into it two years ago, since then they have kept sending me emails about my overdue debts and this and that. I am above 100,000 [Hungarian forints] now. I have not paid and I am not going to. That’s it.”

On February 8, 2010, the opinion piece was reproduced verbatim on www.vg.hu but with a different title, “Another Mug Scandal.” Similarly, some users left comments, one of which read “People like this should go and shit a hedgehog and spend all their money on their mothers’ tombs until they drop dead.”

On February 17, 2010, the company criticized in the opinion piece brought a civil action against MTE and Zrt. The action alleged that the piece was false and offensive, while the comments violated the right to good reputation and therefore violated Articles 75 and 78 of Hungary’s Civil Code (“HCC”). Upon receiving notice of the suit, MTE and Zrt removed the comments in question.

HCC Article 75 states: “(1) Personality rights shall be respected by everyone. Personality rights are protected under this Act. (2) The rules governing the protection of personality rights are also applicable to legal personalities, except the cases where such protection can, due to its character, only apply to private individuals. (3) Personality rights will not be violated by conducts to which the holder of rights has given consent, unless such consent violates or endangers an interest of society. In any other case a contract or unilateral declaration restricting personality rights shall be null and void.”

HCC Article 78 states: “(1) The protection of personality rights shall also include the protection of reputation. (2) In particular, the statement or dissemination of an injurious and untrue fact concerning another person, or the presentation with untrue implications of a true fact relating to another person, shall constitute defamation.”

The court of first instance ruled that the comments violated the realtor websites’ right to good reputation because they were offensive, insulting and humiliating, and went beyond the scope of freedom of expression. The court also held that the comments constituted edited content and equated them to readers’ letters.

The appellate court upheld the decision, but disagreed that the comments were edited content. Particularly, the court held that, pursuant to Articles 75 and 78 of the Civil Code which protect personality rights, “the comments were injurious for the plaintiff [and] the applicants bore objective liability for their publication, irrespectively of the subsequent removal, which was only relevant for the assessment of any compensation.” [para 20]

Hungary’s Supreme Court upheld the judgments of the lower courts. “It stressed that the applicants, by enabling readers to make comments on their websites, had assumed objective liability for any injurious or unlawful comments made by those readers. It rejected the applicants’ argument that they were only intermediary providers which allowed them to escape any liability for the contents of comments, other than removing them if injurious to a third party.” [para 22]

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Decision Overview

First, the ECtHR assessed the issues of intermediary liability and found that domestic courts did not thoroughly analyze the issues. However, the Court reiterated that “persons carrying on a professional activity, who are used to having to proceed with a high degree of caution when pursuing their occupation, can on this account be expected to take special care in assessing the risks that such activity entails.” The Court then held that it was satisfied on the facts of the case that Hungary’s Civil Code “made it foreseeable for a media publisher running a large Internet news portal for an economic purpose and for a self-regulatory body of Internet content providers, that they could, in principle, be held liable under domestic law for unlawful comments of third-parties.” [para 51]

Then, the ECtHR laid out the general guiding principles relevant to this case. Specifically, that freedom of expression is necessary in a democratic society and that the press plays an essential function in a democratic society. The court noted that the Internet plays an important role in enhancing access to information. The Court also noted that the impact of the medium is an important factor to consider when assessing the duties and responsibilities of a journalist. The Court further reiterated that the right to freedom of expression and the right to private and family life deserve equal treatment.

To determine the applicable standards to the case, the Court reviewed “the nature of the applicants’ rights of expression in view of their role in the process of communication and the specific interest protected by the interference, namely – as was implied by the domestic courts – the rights of others.” [para 60]

The Court then agreed with the national courts in that the case needed to be reviewed through the prism of freedom of the press.

The Court cited Delfi to establish that internet news portals must assume duties and responsibilities for comments and third party content published on their platforms. However, the Court differentiated the case at hand from Delfi in that the latter dealt with clearly unlawful speech amounting to hate speech and incitement to violence, while the current case dealt with offensive and vulgar speech.

The Court then reiterated that commercial entities do not enjoy the same protections as persons under the right to reputation. However, in this case, the Court agreed with the domestic courts’ reasoning that the comments in question reached natural persons behind the company and that indirectly the domestic judgments aimed to protect them. [para 67]

The Court proceeded by listing the criteria to be assessed in balancing the protection of freedom of expression and the right to reputation in this case: “contribution to a debate of public interest, the subject of the report, the prior conduct of the person concerned, the content, form and consequences of the publication, and the gravity of the penalty imposed on the journalists or publishers.” [para 68]

The ECtHR held that the criteria established in Delfi to assess the liability of large internet portals for failing to remove comments that amounted hate speech were useful to determine the balance between freedom of expression and the right to reputation. Specifically, the criteria were: “the context of the comments, the measures applied by the applicant company in order to prevent or remove defamatory comments, the liability of the actual authors of the comments as an alternative to the intermediary’s liability, and the consequences of the domestic proceedings for the applicant company.” [para 69] The ECtHR then reviewed the facts of the case against these criteria.

First, the court reviewed the context and content of the comments. It held that the opinion piece discussed large real estate websites, which allegedly misled users. Moreover, the websites’ practices already resulted in complaints to Hungary’s consumer protection agencies. Thus, the court held that the comments pertained to an issue in the public interest. Reviewing the content of the comments, the Court held, as per the domestic courts’ ruling, that they were value judgments about a commercial activity, some even influenced by personal issues with the real estate websites. Furthermore, the Court agreed that some of the comments were offensive and vulgar, but reiterated that vulgarity itself is not unlawful and that “style constitutes part of the communication as the form of expression and is as such protected together with the content of the expression.” [para 76] Moreover, the ECtHR found that vulgar and offensive speech is a common attribute of online comments and that such commonality reduces their impact. [para 77]

The ECtHR then reviewed the liability of the authors of the comments. It held that the domestic courts limited the discussion to the liability of the websites, rather than the persons who made the comments. Following this trajectory, the Court held that providing a space for comments is a particular journalistic activity, but that even so EU case law protects journalists from disseminating statements made by others for doing otherwise has significant repercussions on the press’s ability to engage in discussions concerning the public interest.

The Court then reviewed the measures MTE and Index took to prevent unlawful comments on their website. Nonetheless, the domestic courts imposed objective liability for unlawful comments made by readers by establishing that allowing even some unfiltered comments made it foreseeable that those comments could be unlawful. The ECtHR held that such reasoning unduly placed “excessive and impracticable forethought capable of undermining freedom of the right to impart information on the Internet.” [para 82]

Looking at the consequences of the comments for the real estate websites, the Court reasoned that the comments had little impact on the public opinion of the websites because their business conduct had previously been called into question. [para 85]

Looking at the consequences for Index and MTE, the Court held “the decisive question when assessing the consequence for the applicants is not the absence of damages payable, but the manner in which Internet portals such as theirs can be held liable for third-party comments.” [para 86] For the Court, such liability had a direct and indirect chilling effect on the freedom of expression on the internet.

Considering all of the above, the ECtHR ruled that the Hungarian courts failed to adequately balance the right to reputation and the right to freedom of expression, reiterating the Delfi ruling, that the notice-and-take-down system that MTE and Index used offered an effective protection mechanism for the reputation of others.

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