![Visa knew about Pornhub’s child porn, judge says, and now must face trial [Updated]](https://cdn.arstechnica.net/wp-content/uploads/2022/08/GettyImages-1228596482-800x533.jpg)
Visa claims the court’s decision could affect the entire financial industry.
In December 2020, a New York Times op-ed declared that Pornhub had a child porn problem. Subsequently, Visa temporarily suspended all business with Pornhub and other sites hosted by Pornhub owner MindGeek.
At that time, a MindGeek employee confidentially claimed that this was MindGeek’s worst fear—losing one of its major payment processors—and, therefore, it was unsurprising when MindGeek responded to increased pressure from Visa and other companies by immediately deleting 80 percent of its hosted content, approximately 10 million unverified videos. According to a California court, much of that was likely child porn.
After that, Visa seemed to think that the matter was resolved and continued doing business with MindGeek, claiming it has no control over MindGeek’s content. Now, a lawsuit from a plaintiff named Serena Fleites (a Pornhub child sex-trafficking victim since the age of 13) and 34 other plaintiffs alleges that Visa has become a willing co-conspirator in alleged child sex trafficking on MindGeek sites, and a judge has agreed that they’re not just speculating. It’s a real possibility that Visa could be liable.
This week, US District Judge Cormac Carney of the US District Court of the Central District of California decided that there’s reason to believe that Visa knowingly processed payments that allowed MindGeek to monetize “a substantial amount of child porn.” To decide, the court wants to know much more about Visa’s involvement, calling for more evidence of legal harms caused during a jurisdictional discovery process extended through December 30, 2022.
“The court can comfortably infer that Visa intended to help MindGeek monetize child porn,” Carney wrote, describing Visa’s payment processor as a tool that potentially enabled criminal activity. In his order, Carney granted Visa’s motion to dismiss claims that the company knowingly participated in child sex trafficking but denied its motion to dismiss claims that it conspired with MindGeek to benefit financially from a child sex-trafficking venture.
Visa’s defense hinges on whether it bears direct responsibility, arguing that all blame should go to other parties directly involved in decisions to profit off child porn. In its motion to dismiss, Visa didn’t mention its past suspension of business with MindGeek, likely because that would potentially counter Visa’s argument that “Plaintiff’s claims against Visa are all based on an unsupported assumption that Visa could force MindGeek to operate differently.” Carney says this is unpersuasive because “Visa quite literally did force MindGeek to operate differently, and markedly so, at least for a time.”
A Visa spokesperson shared a statement with Ars, saying that the company believes that Visa is “an improper defendant in this case.”
“Visa condemns sex trafficking, sexual exploitation, and child sexual abuse materials as repugnant to our values and purpose as a company,” the spokesperson says. “This pre-trial ruling is disappointing and mischaracterizes Visa’s role and its policies and practices. Visa will not tolerate the use of our network for illegal activity.”
A MindGeek representative shared a statement with Ars, saying that the company is “confident the plaintiff’s claims will be dismissed for lack of merit.”
“At this point in the case, the court has not yet ruled on the veracity of the allegations, and is required to assume all of the plaintiff’s allegations are true and accurate,” the MindGeek representative says.
However, Lauren Tabaksblat, lead attorney for plaintiffs and a partner at Brown Rudnick, tells Ars that it’s a landmark decision to move forward with Visa as a defendant because “it brings credit card companies into this fight,” where they should be. She says the discovery process will likely yield important new insights into Visa’s and MindGeek’s financial operations. “We have a clear path to take discovery and then ultimately proceed with respect to all the claims against MindGeek and Visa going forward,” Tabaksblat says.
The case against Visa
Nobody suing is saying that Visa participated in child sex trafficking, but Carney says that Visa’s defense pretends that’s the allegation, rather than engaging more directly with the claim that Visa conspired to financially benefit from MindGeek’s policies and practices.
“MindGeek is being sued for knowingly monetizing child porn,” Carney says. Because Visa’s decision to continue to “recognize MindGeek as a merchant is directly linked to MindGeek’s criminal act,” that means Visa could be partly responsible for harms, due to keeping “open the means through which MindGeek completed its criminal act knowing that that criminal act was being committed.”
Carney also says that it’s possible Visa could have prevented harms: “When MindGeek decides to monetize child porn, and Visa decides to continue to allow its payment network to be used for that goal despite knowledge of MindGeek’s monetization of child porn, it is entirely foreseeable that victims of child porn like Plaintiff will suffer the harms that Plaintiff alleges.”
Visa’s defense includes pointing the finger at everyone else and citing various precedents that failed to hold companies liable for larger societal problems that are out of their control, which Carney says don’t apply in this case. “Unlike the cases to which Visa cites,” Carney wrote, courts don’t have to speculate about how Visa’s actions might affect many other “independent actors” that theoretically together bear collective responsibility for a larger societal problem. Unlike past cases, the court has a clear example in the NYT response that shows how Visa could have taken actions that would clearly “affect the way that MindGeek approaches child porn.”
Carney finds invalid Visa’s claims that holding them accountable in this case might pose “an existential threat to the financial industry,” by setting a precedent where courts expect companies to “police” the “billions of individual transactions” they process. Carney disagrees with this logic, saying that the plaintiff doesn’t expect Visa to police every transaction but more narrowly suggests that the company adopt a payment processing policy to “refrain from offering the tool with which a known alleged criminal entity performs its crimes.”
Impact on MindGeek’s defense
On the same day, the court also filed a separate order allowing the plaintiff to amend her complaint and directing MindGeek to also comply with jurisdictional discovery through December 30, 2022. Carney wrote in his Visa order that any point included in his analysis would not apply to MindGeek’s motion to dismiss. However, Carney says that “this order should be a highly relevant signal to the MindGeek Defendants as to how the Court views many of their attacks and challenges to Plaintiff’s complaint.”
This suggests a long road ahead for MindGeek, but the Canadian-based company doesn’t appear fazed much by the lawsuit proceeding. Once the court weighs the facts, a representative says, MindGeek expects the court will agree that “MindGeek has zero tolerance for the posting of illegal content on its platforms and has instituted the most comprehensive safeguards in user-generated platform history.”
Some of those safeguards include banning “uploads from anyone who has not submitted government-issued ID that passes third-party verification,” improving content moderation tools, and instituting “digital fingerprinting of all videos found to be in violation of our Non-Consensual Content and CSAM [child sexual abuse material].”
Lawyers on Fleites’ side see the recent pair of orders in a different light, with another one of her lead attorneys, Michael Bowe of Brown Rudnick, issuing a statement saying that the court’s support for their arguments was a powerful first step toward ending irresponsible business practices for all credit card companies processing payments connected to child sex trafficking. “The court’s holding that our detailed complaint adequately pleads Visa was engaged in a criminal conspiracy to monetize child porn means Visa and other credit card companies are finally going to face the civil and perhaps criminal consequences of this unconscionable and illegal activity,” Bowe said.
Tabaksblat says that though four months for discovery is “very short,” the firm expected a “long, drawn-out battle” and is “obviously prepared to move forward expeditiously to “pursue this discovery aggressively.” (Update: Tabaksblat clarified that there are four months for the first phase of discovery. Then there will be an order for broader discovery from all parties.)
Previously, Brown Rudnick described MindGeek as “a classic criminal enterprise,” saying in their initial complaint that everybody who gets involved with MindGeek knows that it runs “just like the Sopranos.”