Backpage CEO arrested

Over the past two years I’ve been watching this unfold and can’t say I’m surprised charges came about. Given the number of legislators behind inquiries into Backpage.com business practices it would have been a shock if no charges were the end of this saga. The specific charges for the top three guys at Backpage were a surprise as was California issuing the initial indictments.

Carl Ferrer was held in Texas on a $500,000 bond for a extradition hearing. California issued an arrest warrant for felony charges of pimping a minor, pimping and conspiracy to commit pimping. Money laundering charges were added today by the Texas Attorney General.  After the hearing where he waived extradition his lawyer, Thomas Hilder said Ferrer plans to vigorously fight the charge.

California has also issued arrest warrants for the site’s controlling shareholders, Michael Lacey and James Larking for conspiracy to commit pimping. In California felony pimping is defined as making money off of prostitutes or soliciting customers for prostitution. Both shareholders are on record as Arizona residents, no word if they’ve surrendered or been arrested yet.

They say politics makes for strange bedfellows and this case proves it with Republican Senator Rob Portman from Ohio and Democrat Senator Claire Mc Caskill from Missouri sponsoring a resolution for contempt charges against Backpage when they stonewalled a Congressional subpoena for business records last February.

Some months before the contempt resolution things were looking up for Backpage when the 7th Circuit granted a temporary injunction to thwart Cook County (Chicago) Sheriffs going after their credit card processors. In March a separate court dismissed a civil case by three women who were trafficked underage via ads on the site.

Things went downhill last month when the US Supreme Court upheld a lower court ruling forcing Back page and Ferrer had to comply with the Congressional Subpoena. Their First Amendment assertions failed and the ruling also effectively eliminated constitutional protections under the Communications Decency Act of 1996.

Now that the facts are out of the way the general gist that came my way as this unfolded. Internet site owners have gotten a pass not available to brick & mortar merchants with respect to making shelf space for third party goods. Discount ‘dollar’ stores often purchase items for resale that run afoul of US  standards. Those items are site tested, seized for further testing without government reimbursement or recourse; leaving them at the mercy of whoever sold them the bad goods. This happens all the time with too much lead content in (kids) jewelry,  hair accessories or toys. The same consequences apply if trademark infringing counterfeit goods are found on their shelf.

Yelp’s recent issue with a court order to remove a third party post after the third party didn’t defend a defamation suit and couldn’t be found gives me an inkling these rulings are going to have a big impact on the Internet of Things. In the end this is much bigger than arbitrary age limits for consenting adults to commodity sex as their livelihood.

 

7 Replies to “Backpage CEO arrested”

  1. Karmafan

    If the Republican’s get into the White House you can bet they will go after “sin vices” like porn, escorting, etc…

  2. LurkingReader

    Hmmm…. who went after Jeffrey Hurant as sole shareholder of Rentboy?
    He pleaded guilty on Friday to promoting prostitution aka “the exchange of sexual conduct in return for a fee” in the Brooklyn NY federal court. His sentencing is Feb 2 which is after the inauguration but the sentencing agreement was in place before his plea. He agreed to up to 21 months in federal prison and up to ten million dollar penalty.

    Don’t let political labels fool you. Will have to look but iirc New Orleans city council is also primarily democrat and they voted 7-0 to pass raising the age for dancers. Can’t recall off top of head who was behind yanking the sites escorts used …want to say Redbook San Francisco?

  3. BT

    I wouldn’t bet a lot of money on that. Historically, the Republicans have talked a lot about going after pornography on the campaign trail, but other than the Meese Commission in 1986, during the Reagan administration, they have taken very little action. And, even the Reagan administration did little beyond releasing a report. Yes, the feds went after Seymour Butts, Max Hardcore and Rob Black, but in my view – admittedly speculation – it was the feds way of sending a message to porn that the industry was pushing boundaries that it could no longer ignore. And all three gave them plenty of ammunition, especially Black who dared them to prosecute him.

    As a reporter, I covered pornography and obscenity back in the 90’s – I interviewed Pat Trueman, who used to head up obscenity for the justice department, and Donna Rice Hughes, who was a very vocal opponent of pornography on the Internet. I think their biggest complaints back then were that the feds just weren’t going after porn.

    There have been more prosecutions at the state level than at the federal level, and even those have been few and far between.

    Last, if the Republicans do win the White House, it will be with Trump. I don’t see him going after the entertainment industry, even if the entertainment is hookers and porn.

  4. LurkingReader

    @BT

    You’re spot on about most ‘sin vice’ prosecutions at state level. That’s why the feds going after MyRedbook, Rentboy and Backpage stand out as if they’re part of a larger picture.

    Redbook came on the heels of Silkroad and it seemed IRS was the big stick. Obama put Loretta Lynch in charge of Brooklyn (Eastern District) and she was still there when Rentboy investigation began. That was first site with prostitution charges. When they dropped charges against all the employees it looked like they just wanted the big fish to make an example of. Now it seems the feds have upped the ante by adding pimping minors for Backpage under state law.

    The push for Backspace investigations started with various state senators long before the two year congressional inquiry. This is a case they wanted to cross every t and dot every I on. Which leaves the question of why states issued the first charges instead of congress directing DOJ or FBI to act.

  5. BT

    Pretty simple on the feds. There’s just nothing in it for them. These cases are tricky to win – other than Max and Rob, most have been losers for the feds – they’re expensive to prosecute and in the broader scheme of things there’s no broader national constituency for cracking down on porn. meanwhile, in Alabama, a state politician can look like a winner to a significant portion of his or her conservative constituency for cracking down on the sale of sex toys or dirty magazines. The locals have something to win or lose.

  6. BT

    At the fed level, that remains true unless and until certain standards of decency are passed. Again, I contend that the prosecutions of Seymour, Max and Rob Black were the equivalent of a brush back pitch to an industry that was crowding the plate. I really think the condom legislation is a similar reaction. Had porn continued to police itself with regard to the content it created, rather than one frat boy after another trying to out-extreme the other, they’d probably have been left alone. Same with OSHA – you start daring them, and they’re going to come down on you.

  7. LurkingReader

    Backpage is very different than the obscenity charges against producers. Revisited Redbook stuff and saw they were the first ever federal prosecution for a site promoting prostitution.

    Redbook was charged federally and they quickly got a guilty plea from one defendant looking for leniency and won against the other. Rentboy was also federal charges….Hurant pleaded guilty and forfeited sentencing appeals if he gets less than two years and the penalties are less than ten million.

    On one hand it makes sense for the feds to chase crimes via internet because the way our laws are set up….municipal and state hands are essentially tied with exception of kiddie porn. So I’m curious to understand why after a two year congressional inquiry with senate support, several states backing the effort and knowing Hurant was going to plead once they agreed to terms Backpage charges were initiated at the state level.

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