Facebook, Twitter and other tech firms could benefit from a U.S. Supreme Court ruling Monday that redefines when private companies can be treated like government entities under the First Amendment.

Ruling in Manhattan Community Access Corp. v. Halleck, the high court decided that in most instances, private companies cannot be regarded as “state actors” that can be penalized for violating free speech rights.

Justice Brett Kavanaugh, joined by four other conservatives on the court, wrote the majority opinion. He stressed that “the Free Speech Clause prohibits only governmental abridgment of speech. The Free Speech Clause does not prohibit private abridgment of speech.”

He added that “when a private entity provides a forum for speech, the private entity is not ordinarily constrained by the First Amendment because the private entity is not a state actor.”

Kavanaugh said that the way to determine whether a private company takes on the attributes of a “state actor” is to what extent it uses “powers traditionally exclusively reserved to the State.” That narrow definition may let tech companies off the hook when it comes to restraints on how they handle free speech issues. Kavanaugh did not mention any companies by name in the decision.

The organization at issue in the case was the Manhattan Neighborhood Network, designated by New York City to operate public access channels on Time Warner's cable system in Manhattan. A dispute over allowing or not allowing a film to be shown on the network led to First Amendment litigation.

At the district court level, the case was dismissed on grounds that the network was not a state actor. But the U.S. Court of Appeals for the Second Circuit ruled that it was a state actor because of the city government's involvement. The Supreme Court reversed the Second Circuit on that issue.

Justice Sonia Sotomayor, joined by Justices Ruth Bader Ginsburg, Stephen Breyer and Elena Kagan, dissented. They asserted that because of its relationship with New York government, the network “stepped into the city's shoes and thus qualifies as a state actor, subject to the First Amendment like any other.”

Sonia Sotomayor Sonia Sotomayor testifies in 2009 at her confirmation hearing. Photo: Diego M. Radzinschi/National Law Journal

Fordham University School of Law professor Abner Greene, a First Amendment expert, said Monday, “If you are Facebook, you are going to say this decision is good.” Practically speaking, Greene said Facebook “can have carte blanche to allow hate speech or delete hate speech” because of its status as a private actor. Facebook in March announced a ban on “praise, support and representation of white nationalism” on its pages and on Instagram, the photo-sharing site.

Greene noted that critics of Facebook and other platforms have suggested that they be considered public forums akin to government entities and therefore subject to First Amendment rules that forbid discrimination based on content. Facebook and other tech companies may still be subject to other kinds of regulation such as antitrust, he added.

The Internet Association, whose members include Facebook, Twitter and Google, filed a brief in the case urging a narrow definition of a state actor. “On its face, that issue has little to do with Internet Association or its members,” the brief stated.

But the brief, authored by Munger, Tolles & Olson partner Chad Golder, added that if the court endorsed a wider definition of state actor, “litigants and lower courts will misread such a decision as a general loosening of the exacting restrictions this court has historically applied when considering whether a private space, operated by a private company, is subject to constitutional scrutiny.”

It wasn't immediately clear how the Supreme Court's ruling might affect a pending First Amendment case in the Second Circuit, where the U.S. Justice Department is defending President Donald Trump's power to “block” people from following him on Twitter and reading what he says on that platform.

The Knight First Amendment Institute at Columbia University, which brought the challenge against Trump in that case, had urged the Supreme Court in the Manhattan public television dispute to uphold the Second Circuit.

“Today, government actors are increasingly harnessing the power of the Internet and social media to establish new expressive spaces that function as digital analogs to traditional town halls and public squares,” the Knight Institute said in its brief. “These government-controlled digital forums are critical to public discourse, but they reside or rely on communications networks that are, as a general matter, privately owned.”

The court's ruling in Manhattan Community Access Corp. v. Halleck is posted below: