An Ontario judged has denied an injunction request from a U.S. client of Shopify Inc. to reinstate its web store, after the Ottawa e-commerce company shut it down last week for violating its policy prohibiting content that promotes hate or terrorist organizations.
Cleveland-based RageOn Inc. failed to prove that it hadn’t crossed the line in violating Shopify’s Acceptable Use Policy around hate, violence and terrorism, wrote Justice Peter J. Cavanagh of the Ontario Superior Court of Justice on Friday. “Shopify reserves the right to suspend or terminate the account of a merchant who engages in activities that violate the letter or spirit of the [policy],” he said.
RageOn allows users to upload their own designs that it prints on items ranging from shirts to yoga mats in full colour. It says it has nearly one million users who have uploaded close to 100 million designs to sell on its Shopify-powered store.
In a filing with the Ontario Superior Court of Justice earlier this week, RageOn said that Shopify unfairly shut its store down on Feb. 17 over user-uploaded designs depicting imagery that referenced terrorist group the Proud Boys, the QAnon conspiracy movement and an allegedly “satirical” shirt depicting a “Nazi fire rainbow unicorn.”
Shopify had warned RageOn several times to remove similar material, which RageOn complied with, the filing states – in addition to taking “all reasonable measures” to remove offending material and screen for new uploads. But RageOn alleged that Shopify did not give it a clear list of material that would violate its Acceptable Use Policy that governs hate speech on its platform, and argued that the material flagged on Feb. 17 predated Shopify’s prohibition of such imagery.
Instead, Toronto-based Justice Cavanagh said that Shopify had made it clear to RageOn as early as October 2020 that such content should not appear on its store at all, and that it should have sought to remove all such offending content following the warning.
RageOn had also argued that Shopify had added new terms to the policy in recent months that it did not disclose, but Justice Cavanagh said that the material Shopify asked RageOn to remove “fits within the prohibitions” of Shopify’s publicly available policy, last updated in April 2020.
RageOn’s injunction request required it to show that the shutdown would have caused it “irreparable” harm. The company said that without its Shopify store, it would lose nearly $12,750 a day and have its reputation damaged, potentially forcing it to declare bankruptcy and cease operations.
But the judge pointed to a statement posted to RageOn’s Facebook last Tuesday welcoming customers to use its Apple mobile app, asking them to wait for “some super big and exciting announcements where RageOn will be live again.” The company’s statements about bankruptcy and shutdowns “are little more than bald, declaratory, and conclusory assertions,” Justice Cavanagh wrote.
Neither Shopify nor RageOn immediately responded to requests for comment midday Friday.
The injunction request comes as Shopify’s Acceptable Use Policy comes under greater scrutiny, following years of accusations that the company applies the policy inconsistently. In January, for instance, it shut down former U.S. president Donald Trump’s official web stores after he helped incite the Jan. 6 Capitol riot, despite leaving stores up from his supporters offering similar merchandise.
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