Wins Injunction Over Credit Card 'Pressure Tactics'

Dec 1, 2015 11:39 AM PST

CHICAGO — A federal appeals court ruled yesterday that Cook County’s sheriff violated the First Amendment rights of by pressuring Visa and Mastercard to stop processing ad sales on the site.

The 7th U.S. Circuit Court of Appeals, in its decision to grant an injunction, said that Sheriff Thomas Dart’s claims that Backpage’s adult section is promoting illegal sex-related products or services didn’t justify his “pressure tactics” designed to shut it down.

Dart’s letters to the credit card companies alleged Backpage “promote[s] prostitution and facilitate online sex trafficking,” but he didn’t explicitly threaten legal action against them.

But just two days after the letters were received, both Visa and MasterCard announced they would no longer process transactions for Backpage customers.

“Visa and MasterCard bowed to pressure from Sheriff Dart and others by refusing to process transactions in which their credit cards are used to purchase any ads on Backpage, even those that advertise indisputably legal activities,” the 7th Circuit said.

In Monday’s ruling that reversed a district judge’s earlier ruling, the 7th Circuit ordered Dart to “take no actions … to coerce or threaten credit card companies, processors, financial institutions, or other third parties with sanctions intended to ban credit card or other financial services from being provided to”

The 7th Circuit’s ruling extended a preliminary injunction against the sheriff granted two weeks ago by the same court.

Industry attorney Robert Corn-Revere, who represented Backpage, welcomed Monday’s decision.

“The 7th Circuit ruling reaffirms the bedrock First Amendment principle that the government cannot simply presume speech it dislikes is illegal; nor can it take unilateral action to restrict speech whether it uses formal or informal means,” Corn-Revere told XBIZ. “It means no matter how sanctimonious Sheriff Dart may get, he is not immune from the rule of law.”

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