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.