People walk past a billboard advertisement for YouTube on September 27, 2019 in Berlin, Germany.
Sean Gallup | Getty Images
The Department of Justice warned the Supreme Court against an overly broad interpretation of a law shielding social media companies from liability for what users post on their platforms, a position that undermines Google’s defense in a case that could reshape the role of content moderation on digital platforms.
In a brief filed Wednesday led by DOJ Acting Solicitor General Brian Fletcher, the agency said the Supreme Court should vacate an appeals court ruling that found Section 230 of the Communications Decency Act protected Google from being liable under U.S. antiterrorism law.
Section 230 allows for online platforms to engage in good-faith content moderation while shielding them from being held responsible for their users’ posts. Tech platforms argue it’s a critical protection, especially for smaller platforms that could otherwise face costly legal battles since the nature of social media platforms makes it difficult to quickly catch every harmful post.
But the law has been a hot-button issue in Congress as lawmakers on both sides of the aisle argue the liability shield should be drastically limited. But while many Republicans believe the content moderation allowances of the law should be trimmed down to reduce what they allege is censorship of conservative voices, many Democrats instead take issue with how the law can protect platforms that host misinformation and hate speech.
The Supreme Court case known as Gonzalez v. Google was brought by family members of American citizen Nohemi Gonzalez, who was killed in a 2015 terrorist attack for which ISIS claimed responsibility. The suit alleges Google’s YouTube did not adequately stop ISIS from distributing content on the video-sharing site to aid its propaganda and recruitment efforts.
The plaintiffs pursued charges against Google under the Antiterrorism Act of 1990, which allows U.S. nationals injured by terrorism to seek damages. The law was updated in 2016 to add secondary civil liability to “any person who aids and abets, by knowingly providing substantial assistance” to “an act of international terrorism.”
Gonzalez’s family claims YouTube did not do enough to prevent ISIS from using its platform to spread its message. They allege that even though YouTube has policies against terrorist content, it failed to adequately monitor the platform or block ISIS from using it.
Both the district and appeals courts agreed that Section 230 protects Google from liability for hosting the content.
Though it did not take a position on whether Google should ultimately be found liable, the DOJ recommended the appeals court ruling be vacated and returned to the lower court for further review. The agency argued that while Section 230 would bar the plaintiffs’ claims based on YouTube’s alleged failure to block ISIS videos from its site, “the statute does not bar claims based on YouTube’s alleged targeted recommendations of ISIS content.”
The DOJ argued the appeals court was correct to find Section 230 shielded YouTube from liability for allowing ISIS-affiliated users to post videos since it did not act as a publisher by editing or creating the videos. But, it said, the claims about “YouTube’s use of algorithms and related features to recommend ISIS content require a different analysis.” The DOJ said the appeals court did not adequately consider whether the plaintiffs’ claims could merit liability under that theory and as a result, the Supreme Court should return the case to the appeals court so it can do so.
“Through the years, YouTube has invested in technology, teams, and policies to identify and remove extremist content,” Google spokesperson José Castañeda said in a statement. “We regularly work with law enforcement, other platforms, and civil society to share intelligence and best practices. Undercutting Section 230 would make it harder, not easier, to combat harmful content — making the internet less safe and less helpful for all of us.”
Chamber of Progress, an industry group that counts Google as one of its corporate partners, warned the DOJ’s brief invites a dangerous precedent.
“The Solicitor General’s stance would hinder platforms’ ability to recommend facts over lies, help over harm, and empathy over hate,” Chamber of Progress CEO Adam Kovacevich said in a statement. “If the Supreme Court rules for Gonzalez, platforms wouldn’t be able to recommend help for those considering self-harm, reproductive health information for women considering abortions, and accurate election information for people who want to vote. This would unleash a flood of lawsuits from trolls and haters unhappy about the platforms’ efforts to create safe, healthy online communities.”
Representation of Ethereum, with its native cryptocurrency ether.
Dado Ruvic | Reuters
Ether fell as much as 9% on Monday, slipping below its critical $3,600 support level, shortly after a multimillion dollar hack affected a protocol on the token’s native network.
The cryptocurrency, which is issued on Ethereum, was last down 6.6% at around $3,600, CoinMetrics data shows. That’s roughly 25% off its high of $4,885 hit on August 22.
The coin’s tumble came after Ethereum-based decentralized finance protocol Balancer on Monday lost possibly more than $100 million in a hack. The exploit marks the latest in a series of bearish events that have put digital assets investors on tenterhooks over the past few weeks.
In mid-October, U.S. President Donald Trump announced “massive” tariffs on China over its restriction of rare earth exports, kicking off investors’ flight from crypto to risk-off assets such as gold. And although the president later walked back that threat, his comments sparked a sell-off that triggered cascading liquidations of highly leveraged digital asset positions.
“These events have put investors on uneasy footing as we roll into November,” Juan Leon, senior investment strategist at Bitwise, told CNBC. “Macro volatility notwithstanding, this October’s drawdown appears to have been a healthy, albeit sharp, de-leveraging event that flushed speculative excess from the market.”
Some stocks linked to digital assets are also coming under pressure. Coinbase shares were down nearly 4%, while Bitcoin treasury firm Strategy edged down more than 1%.
Nvidia was once again on the move after the world’s three biggest cloud companies, along with Meta Platforms , guided spending higher last week to keep pace in the artificial intelligence arms race. Some, if not much, of that spend should continue to fill the coffers of the Jensen Huang-run AI chip king. Club stock Nvidia on Monday soared another 4% to another all-time high — around $5.12 trillion in market value. In the run-up to next week’s earnings, we would expect to see more analysts raise their quarterly estimates and price targets on Nvidia. The stock closed above $5 trillion for the first time last Wednesday. Three trading days later, it added nearly $100 billion in market cap. In a Monday note to clients , Loop Capital raised its Nvidia price target to $350 per share from $250. The analysts acknowledged that the 70% upside from Friday’s close built into their PT over the next four to five quarters sounds crazy. But they believe their “work suggests NVDA is about to begin a ramp of GPU that will essentially double its unit shipments in the next 12-15 months, while seeing the benefit of [average selling price] expansion and networking.” Loop’s note came out ahead of two major Nvidia developments before Monday’s opening bell. First, Microsoft said it secured export licenses to ship Nvidia chips to the United Arab Emirates. Second, Amazon got a $38 billion commitment from OpenAI to use AWS, the largest cloud, for more compute, tapping hundreds of thousands of Nvidia graphics processing units (GPUs). Microsoft’s Azure and Google Cloud at the second and third biggest, respectively. On Friday, we learned the South Korean government, along with key South Korean industrial companies including Samsung, Hyundai, and others, is working with Nvidia “to expand the nation’s AI infrastructure with over a quarter-million Nvidia GPUs across its sovereign clouds and AI factories.” The idea is for various South Korean entities, some government-funded, others private, to source Nvidia chips and build out various data centers with the infrastructure forming a “foundation for AI-enabled economic growth and innovation across Korea’s industries, including automotive, manufacturing, and telecommunications.” Remember, Nvidia made its own OpenAI deal in September, announcing a $100 billion investment into OpenAI to help the latter build out 10 gigawatts of artificial intelligence data center capacity. NVDA 5Y mountain Nvidia performance over 5 years All these updates come as it is becoming increasingly clear that access to AI infrastructure is not only important for businesses looking to compete against one another, but also fast becoming a national security issue. Governments must be proactive in securing supplies of the cutting-edge accelerated computing platforms – at this point, the latest products from Nvidia are so far beyond simply being chips – if they are to compete in a world in which data is gold and cyberattacks can cause billions of dollars worth of economic damage. Though there is no denying that the gains tied to the AI trade have already been nothing short of incredible, there is still so much more room to run. That doesn’t, however, mean those gains will be made in a straight line. We must consider that while AI is real and the demand is certainly there, many companies being bid up still do not generate earnings, and in some cases may not even be generating sales yet. We wouldn’t advise playing in that part of the speculative arena. While we have to consider that bubble-like froth in one part of the market can seep into other parts or that a popping of those micro bubbles in the nuclear and quantum can cause collateral damage in less speculative names, the most recent updates support the idea that investors need to maintain exposure to the highest quality AI players, and that for all the millionaires it has already minted , Nvidia’s best days still lie ahead. (Jim Cramer’s Charitable Trust is long NVDA, MSFT, AMZN, META. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
In this photo illustration, a person is holding a smartphone with the logo of US GPU hardware company Lambda Inc. (Lambda Labs) on screen in front of website.
Timon Schneider | SOPA Images | AP
Cloud computing startup Lambda announced on Monday a multibillion-dollar deal with Microsoft for artificial intelligence infrastructure powered by tens of thousands of Nvidia chips.
The agreement comes as Lambda benefits from surging consumer demand for AI-powered services, including AI chatbots and assistants, CEO Stephen Balaban told CNBC’s “Money Movers” on Monday.
“We’re in the middle of probably the largest technology buildout that we’ve ever seen,” Balaban said. “The industry is going really well right now, and there’s just a lot of people who are using ChatGPT and Claude and the different AI services that are out there.”
Balaban said the partnership will continue the two companies’ long-term relationship, which goes back to 2018.
A specific dollar amount was not disclosed in the deal announcement.
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Founded in 2012, Lambda provides cloud services and software for training and deploying AI models, servicing over 200 thousand developers, and also rents out servers powered by Nvidia’s graphics processing units.
The new infrastructure with Microsoft will include the NVIDIA GB300 NVL72 systems, which are also deployed by hyperscalerCoreWeave, according to a release.
“We love Nvidia’s product,” Balaban said. “They have the best accelerator product on the market.”
The company has dozens of data centers and is planning to continue not only leasing data centers but also constructing its own infrastructure as well, Balaban said.
Earlier in October, Lambda announced plans to open an AI factory in Kansas City in 2026. The site is expected to launch with 24 megawatts of capacity with the potential to scale up to over 100 MW.