Calm Down Porn People: Calif. Supreme Court’s Ruling Doesn’t Say What You Think

SAN FRANCISCO – On Twitter today, there’s a conversation about a holding from the California Supreme Court in the case White v. Square – a lawsuit in which bankruptcy attorney Robert White sued Square, Inc., alleging that Square’s seller agreement discriminated against bankruptcy attorneys in violation of the Unruh Civil Rights Act.

So, why are some folks in the adult industry so excited about this case? Because non-attorneys think the court’s ruling means payment processors can’t discriminate against potential clients on the basis of their occupation.

If this were what the California Supreme Court’s holding meant, it would indeed be a significant development for the adult industry. Unfortunately, that reading of the court’s ruling is wrong.

The court’s ruling is narrowly focused on White’s standing to bring a suit against Square. It says nothing at all about the merits of his claim – and the court literally said so in its ruling.

If you read nothing else from the court’s decision, please read these lines:

“Our standing analysis is limited to the pleadings, in which White unequivocally alleges his intention to use Square’s services,” the court wrote. “Nor do we express any view on whether a defendant violates the Act by discriminating on the basis of occupation or on White’s adequacy as a representative for a class of bankruptcy attorneys excluded from Square’s services.”

All the court’s ruling means, really, is that White’s case should not have been dismissed for lack of standing to sue. That’s it.

The ruling has no impact on whether the trial court should consider bankruptcy attorneys a protected class under the Unruh Civil Rights Act, or whether White is even an appropriate representative of such a class for the purposes of a class action, even if the court were to find bankruptcy attorneys a protected class. And it certainly doesn’t mean that adult companies or adult performers should be lining up to sue companies like Square for denying them service.

Since I’m not an attorney, you shouldn’t take my word on this either, of course. Happily, Larry Walters is an attorney – and he agrees the court’s ruling is not what some people are making it out to be.

“The court specifically did not rule on whether discrimination based on occupation can constitute a violation of California law,” Walters said. “The decision also never addressed whether the case is a proper class action. The ruling is extremely narrow and holds that legal standing can be shown by intent to do business with a website, as opposed to forming an actual contract with the site.”

Does that sound like something adult businesses and performers should get excited about? If not, that’s because it isn’t. This is not to say the case has zero potential to produce good news for the adult industry – just that it hasn’t yet reached a stage where it CAN produce such good news.

“Future decisions in the case may impact the ability of adult businesses or performers to claim discrimination by online service providers, but the case has not reached that stage yet,” Walters said.

Moreover, the decision is food for thought for adult site operators (well, all site operators, really) for what it says about the thought that should go into composing the terms of the agreements they publish on their own sites.

“The ruling is interesting from a website operator’s perspective, however, since it underscores the importance of a user agreement, and how specific user terms can potentially trigger discrimination claims before any customer even accepts the agreement,” Walters said. “Adult website operators should ensure that their terms have been evaluated to mitigate the risks of potential discrimination claims under state law.”

In other words, if the California Supreme Court’s holding here is at all significant for the adult industry, it’s significant for a very different reason than the conversation on Twitter suggests. Depending on the final outcome of White’s lawsuit, that fact may change – but for now, at least, any celebration by the adult industry is very premature.