Criminal Discussion

SERVICE PROVIDER LIABILITY

Criminal: Discussion

● Service provider as victim of computer crime

Service Providers could be the victim of a variety of computer crimes. Hackers gaining unauthorized access to files and private information and damage or outages from viruses present the two most obvious sources of concern. If the criminal activity does not have any adverse effect on victimized Service Providers' subscribers, it is difficult to imagine how Service Providers would have any liability based on a vicarious liability theory.

● Service provider liability due to breach of duty to secure system from viruses and hackers

On the other hand, if a Service Provider has a duty to its subscribers to maintain its systems free from the effects of hackers and/or viruses or at least to exercise certain diligence in preventing service outages due to these activities, and if these criminal activities caused an outage or injury to subscribers where the Service Provider was negligent or reckless in performing its duty, a Service Provider might be exposed to liability. E-Law 3.0.1. This liability would most likely depend upon the terms of the contractual relationships Service Providers have with subscribers. E-Law 3.0.1. A court could, however, find an implied warranty of serviceability as a basis for exposing Service Providers to liability. Nonetheless, Service Provider liability for harm caused by criminal conduct seems likely to turn on the existence of a duty and breach thereof. E-Law 3.0.1. Also, this scenario could expose a Service Provider to liability for the actions of a party that is not a "user" or "subscriber," whereas in most other scenarios, the original offender would most likely be a subscriber (defamation, copyright infringement, obscenity).

● Service provider liability on theory of vicarious liability

Alternatively, Service Providers could face some liability for the criminal conduct of a subscriber if it either knew of the conduct and failed to prevent it or report the conduct to the authorities or if it should have known of the conduct. Again, we know of no instance in which a Service Provider has been held liable under these circumstances but, by analogy, can imagine such a scenario playing itself out. Thus, Service Providers should be conscientious if they notice criminal conduct and should take prudent steps to prevent or report it where known.

Service Provider Liability Pages

Introduction • Table of Contents
Servcie Providers - Overview • Service Providers - Discussion • Liability Analogies - Overview • Liability Analogies - Discussion • Defamation - Overview • Defamation - Discussion • Intellectual Property - Overview • Intellectual Property - Discussion • Obscenity - Overview • Obscenity - Discussion • Criminal - Overview • Criminal Discussion • Privacy - Overview • Privacy - Discussion • Policy Discussion • Conclusion • Pocket Part • Notes & Links

Prepared for Professor Laura Gasaway's Cyberspace Law Seminar (Law - 357C)
UNC School of Law - Spring 1997

By: Ashe Lockhart (Webmaster) & Carol Kozar

Instructor: Laura N. Gasaway, Professor of Law and Director of the Katherine R. Everett Law Library