Online Platforms and the Limits of State Regulation

The 2021 enactments of Texas HB 20¹ and Florida SB 7072² opened a new front in the constitutional law of platform regulation. Both statutes, though differing in their operative details, share an animating premise: that large social media platforms exercise something approaching public-utility power over modern discourse, and that their content-moderation decisions are accordingly subject to state regulation notwithstanding the platforms' invocation of the First Amendment. The constitutional question that the statutes pose — whether such regulation can be reconciled with the editorial-discretion line that runs from Miami Herald Publishing Co. v. Tornillo⁶ through the modern compelled-speech doctrine — was the subject of divergent treatment in the Fifth and Eleventh Circuits and remains, after the Supreme Court's intervention in Moody v. NetChoice,⁵ only partially resolved.

The statutory architecture

Texas HB 20 prohibits large platforms from "censoring" users based on viewpoint and creates a private right of action for affected users. Florida SB 7072 imposes a more elaborate regime: it forbids deplatforming of political candidates, restricts moderation of "journalistic enterprise" content, and requires consistent application of moderation policies. Both statutes are accompanied by transparency and notice requirements that, considered independently of the substantive must-carry provisions, raise their own constitutional questions.

The circuit split and the Moody remand

The Fifth Circuit's decision in NetChoice v. Paxton³ upheld HB 20 substantially in full, on a theory that treated platform moderation as conduct rather than speech and analogized large platforms to common carriers. The Eleventh Circuit in NetChoice v. Attorney General, Florida⁴ enjoined the bulk of SB 7072 on First Amendment grounds, treating platform moderation as protected editorial discretion. The Supreme Court in Moody vacated both decisions and remanded for consideration of the facial-challenge breadth question, but in doing so reaffirmed — clearly, if in dicta — that content moderation by a private platform, when it involves the exercise of editorial judgment over what speech to present, is protected First Amendment activity.

The constitutional difficulty is that the platforms perform multiple functions simultaneously, and the same statute may be constitutional as applied to one function and unconstitutional as applied to another.

The function-by-function analysis

The doctrinal framework that Moody commends is one in which the First Amendment analysis proceeds function by function rather than platform by platform. A statute that restricts a platform's ability to make editorial decisions about which user posts to feature in a curated feed implicates the editorial-discretion line directly; a statute that requires the platform to publish notice of its moderation decisions raises more conventional compelled-disclosure questions, subject to the lower-tier scrutiny that ordinarily applies to commercial transparency requirements. The work that remains for the lower courts on remand is to disaggregate the challenged statutes accordingly.

The common-carrier theory and its limits

The Fifth Circuit's invocation of the common-carrier doctrine was, in our view, the weakest element of its analysis. Common-carrier obligations have historically attached to entities — railroads, telegraph companies, telephone networks — whose function is the neutral transport of communications between identified parties. The defining feature of social media platforms is precisely the opposite: they curate, rank, recommend, and prioritize, and they have done so since their inception. To treat them as common carriers is to mistake their function. The argument that they should be regulated as if they were common carriers is a policy argument, not a constitutional one, and the First Amendment is not so easily defeated by the legislative act of recharacterization.

The prospects on remand

Our expectation is that the must-carry provisions of both HB 20 and SB 7072 will not survive the more rigorous facial-breadth review that Moody requires. The statutes' transparency and notice provisions are likely to fare better, though even those will require some judicial pruning to bring them within the doctrinal envelope the Court has marked out. The broader lesson is that state-level platform regulation, if it is to proceed at all, will need to be drafted with substantially more attention to the editorial-discretion line than the first generation of such statutes demonstrated. For related discussion, see our pieces on algorithmic content curation and the First Amendment and on Section 230 in the age of generative AI.