YouTube / Wozniak and others
Apple co-founder Steve Wozniak sued YouTube over the proliferation of “bitcoin draw” scam videos on the YouTube platform. The videos falsely use the names of Wozniak and other celebrities, including Elon Musk, Bill Gates, and Ethereum founder Vitalik Buterin, to legitimize the scams.
Scammers hijack popular YouTube accounts and change their names to appear to be the official accounts of celebrities like Wozniak or companies like Apple. They then broadcast a “live” video showing old images of the celebrity discussing cryptocurrencies or related topics. Along with the footage is a text that says if someone sends bitcoin to a particular address, the celebrity will return double the amount.
Along with Wozniak, the plaintiffs include more than a dozen people who were tricked by the scam, losing bitcoins worth a few dollars to more than $ 40,000. Altogether, cryptocurrency scams like this have cost victims millions of dollars.
“We take abuse of our platform seriously and take prompt action when we detect violations of our policies, such as scams or impersonation,” a YouTube spokesperson told Ars by email. YouTube says that in the first quarter of 2020, the company removed 2.2 million videos and disabled 1.7 million accounts for “spam, scams, deceptive practices.”
But the plaintiffs argue that YouTube is not doing enough to eliminate these cryptocurrency scams. Wozniak’s wife Janet says she has contacted YouTube numerous times since May about the scams. The plaintiffs point out that YouTube has sophisticated tools to identify objectionable activities. However, they don’t seem to be taking obvious steps, like leaking videos that use terms like “bitcoin giveaway.”
The lawsuit also points to the example of Twitter, which had been plagued by such scams in the past, but has taken steps to eliminate them in recent years. The plaintiffs argue that the Twitter crackdown pushed scammers to YouTube, where they have thrived for the past few years.
YouTube has a powerful defense
Ultimately, it may not matter how much YouTube has done to remove these videos. This is because Section 230 of the Communications Decency Act gives online platforms broad immunity for content submitted by users. Sites have immunity even if they do little or nothing to combat objectionable content posted by users.
In anticipation of this defense, the plaintiffs attempt to distinguish their claim from current Section 230 cases. But it is not obvious that those arguments will succeed. For example, Woz’s lawyers argue that the scam videos are “blatant criminal behavior that is not even arguably protected by the First Amendment. “That may be true, but it is not likely to save the lawsuit. After all, the courts have upheld Section 230 immunity even in cases where users distribute child pornography.
The plaintiffs argue that YouTube did more than passively host the videos. YouTube’s recommendation algorithms promoted the videos to cryptocurrency enthusiasts and sold ads against the videos, directly benefiting from the scams. But that could also be difficult to sell; Courts have repeatedly held that sites enjoy Section 230 protections even when they deliberately promote problematic third-party content.
But while Woz’s lawsuit is legally unstable, it could still be important in the court of public opinion. Being sued by one of Silicon Valley’s most beloved figures could pressure YouTube to take the crypto scam problem more seriously.
