Yahoo Inc. was the second largest Internet portal worldwide and the leading Internet portal in France. After Nazi-era memorabilia was posted on one of its English-language auction sites, the company was ordered under a French law to block access to neo-Nazi content. Yahoo filed a countersuit, alleging that compliance would violate free speech, as guaranteed under U.S. and international laws. Angered by the company's response, survivors of the Holocaust charged the chief executive officer with war crimes, for supporting the atrocities of the Nazi regime through its Web site. The borderless nature of the Internet raises many issues for the company: conflicting laws and cultures of other countries, differing views on freedom of speech and suppression of objectionable material, ethical considerations and the impact of extraterritoriality.
Background
Defendants La Ligue Contre Le Racisme Et l'Antisemitisme ("LICRA") and L'Union Des Etudiants Juifs De France, citizens of France, are non-profit organizations dedicated to eliminating anti-Semitism. Plaintiff Yahoo!, Inc. ("Yahoo!") is a corporation organized under the laws of Delaware with its principal place of business in Santa Clara, California. Yahoo! is an Internet service provider that operates various Internet websites and services that any computer user can access at the Uniform Resource Locator. Yahoo! services ending in the suffix, ".com," without an associated country code as a prefix or extension (collectively, "Yahoo's U. S. Services") use the English language and target users who are residents of, utilize servers based in and operate under the laws of the United States. Yahoo! subsidiary corporations operate regional Yahoo! sites and services in twenty other nations, including, for example, Yahoo! France, Yahoo! India, and Yahoo! Spain. Each of these regional web sites contains the host nation's unique two-letter code as either a prefix or a suffix in its URL. Yahoo's regional sites use the local region's primary language, target the local citizenry, and operate under local laws (Henry W. Lane, Martha L. Maznevski, Joseph J. 2006).
Yahoo! provides a variety of means by which people from all over the world can communicate and interact with one another over the Internet. Examples include an Internet search engine, e-mail, an automated auction site, personal web page hostings, shopping services, chat rooms, and a listing of clubs that individuals can create or join. Any computer user with Internet access is able to post materials on many of these Yahoo! sites, which in turn are instantly accessible by anyone who logs on to Yahoo's Internet sites. As relevant here, Yahoo's auction site allows anyone to post an item for sale and solicit bids from any computer user from around the globe. Yahoo! records when a posting is made and after the requisite time period lapses sends an e-mail notification to the highest bidder and seller with their respective contact information. Yahoo! is never a party to a transaction, and the buyer and seller are responsible for arranging privately for payment and shipment of ...