Lawsuit accusing Pornhub parent Mindgeek of monetizing child pornography can move forward, judge rules
Visa argued that its payment services on MindGeek's porn websites did not have a substantial influence over the company's operations
A California district judge is allowing a lawsuit against Visa and Pornhub parent company MindGeek to proceed after Visa filed a motion to dismiss.
The complaint alleges that the financial services company played a role in monetizing child pornography distributed on MindGeek's websites, such as Pornhub. It also alleges that both companies violated trafficking laws.
"Visa lent to MindGeek a much-needed tool—its payment network—with the alleged knowledge that there was a wealth of monetized child porn on MindGeek’s websites," Judge Cormac Carney wrote. "If Visa was aware that there was a substantial amount of child porn on MindGeek’s sites, which the Court must accept as true at this stage of the proceedings, then it was aware that it was processing the monetization of child porn, moving money from advertisers to MindGeek for advertisements playing alongside child porn like Plaintiff’s videos."
Attorney Michael Bowe, who filed the complaint, told Fox News Digital that Carney's decision has been accurately described as "seismic" for "both Visa and the credit card industry."
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"The court held that the facts we alleged from our year-long investigation would establish that Visa criminally conspired with MinGreek/Pornhub to traffic in child pornography. That criminal conspiracy continues today, and the responsibility for that now rests squarely with the CEO and board," he said. The court was required to assume that 100% of the plaintiff's allegations are true in order to make the ruling.
A California lawsuit alleges that Visa played a role in monetizing child pornography distributed on MindGeek's websites, such as Pornhub. (Nikolas Kokovlis/NurPhoto via Getty Images / Getty Images)
Visa alleged in its motion to dismiss that it did not have any substantial influence over MindGeek's operations on its porn websites, but Carney wrote that "Visa quite literally did force MindGeek to operate differently, and markedly so, at least for a time" when it temporarily suspended payments for MindGeek after The New York Times' Nicholas Kristof published a disturbing Dec. 4, 2020, report detailing the abuse of minors and female victims on Pornhub including "child rapes, revenge pornography, spycam videos."
The financial services company also stated that it could not be expected to police "the billions of individual transactions it processes each year." But Carter says it is not being asked to do so. "It is simply being asked to refrain from offering the tool with which a known alleged criminal entity performs its crimes. That is not a tall order and does not spell out an existential threat to the financial industry," the judge wrote.
Carter concluded: "Visa is being kept in this case because it is alleged to have continued to recognize as a merchant an immense, well known, and highly visible business that it knew used its websites to host and monetize child porn."
A Visa spokesperson told Fox News Digital in a statement that the company "condemns sex trafficking, sexual exploitation, and child sexual abuse materials as repugnant to our values and purpose as a company."
"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. We continue to believe that Visa is an improper defendant in this case," the spokesperson continued.
Soon after Kristoff's article was published, Visa and Mastercard temporarily suspended payment operations on MindGeek's websites, forcing the porn site owner to remove millions of illegal videos, but they allegedly reimplemented those operations weeks later.
"The financial and reputational damage here for Visa, as well as for Mastercard, if they continue enabling and benefiting from MindGeek’s illegal conduct will be massive," Laila Mickelwait, CEO of the Justice Defense Fund and founder of the Traffickinghub Movement, told Fox News Digital in a statement. "The judge’s recent decision against Visa has opened the floodgates, creating a pathway by which hundreds, if not thousands of victims can now sue Visa and Mastercard for conspiring with MindGeek in the crime of sex trafficking."
Plaintiff Serena Fleites alleges in the lawsuit that when she was 13 years old in 2014, her then-boyfriend pressured her into making an explicit video and then uploaded it to MindGeek's most popular free porn website, Pornhub.com, which reportedly gets more annual website visits than Netflix.
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The video apparently garnered 400,000 views by the time Fleites discovered it and continued to be viewed in the weeks it allegedly took for Pornhub to remove it. The complaint further alleges that the video was also downloaded and re-uploaded to the site several times.
"Plaintiff’s life spiraled out of control," the lawsuit states. Fleites alleges that she dropped out of school, distanced herself from family and friends, attempted suicide multiple times, and met an older man who introduced her to heroin, while she was still minor.
"To fund her heroin addiction, Plaintiff—still a minor at this point—created sexually explicit videos at the older man’s behest, who in turn sold the videos on Craigslist. Some of the videos were uploaded to Pornhub and were still available on the website as recently as June 2020," the complaint states, describing the ordeal of removing content as a"whack-a-mole situation" for victims.
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The complaint notes that at the time, "MindGeek employed a barebones team of ‘as few as [six] but never more than about 30 untrained, minimum wage contractors’ to monitor the millions of daily uploads. This team was clearly understaffed, but also perversely incentivized: they were offered pay bonuses that depended on the number of videos they approved for upload. Such an incentive structure suggests that content moderation was not the goal."
MindGeek is "confident" that the plaintiff's "claims will be dismissed for lack of merit" once Carney is able to "consider the facts" in the case, a company spokesperson told Fox News Digital in a statement.
MindGeek is "confident" that the plaintiff's "claims will be dismissed for lack of merit" once Carney is able to "consider the facts" in the case, a company spokesperson told Fox News Digital in a statement. (iStock / iStock)
"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. … Any insinuation that MindGeek does not take the elimination of illegal material seriously is categorically false," the spokesperson said.
The spokesperson further stated that MindGeek has banned anyone who has not submitted a government-issued ID from uploading content to its websites, "eliminated the ability to download free content," integrated new content moderation tools and practices and "instituted digital fingerprinting of all videos found to be in violation" of its "Non-Consensual Content and CSAM Policies to help protect against removed videos being reposted."
Billionaire investor Bill Ackman weighed in on Carney's order in a July 30 tweet.
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"Visa’s conduct here is inexcusable, likely to cause the company incalculable financial and reputational damage and create serious Caremark personal liability and potential criminal liability for the board," he wrote.